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Renishaw - Great Company, High Price

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spiderbill
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Re: Renishaw - Great Company, High Price

#82063

Postby spiderbill » September 19th, 2017, 3:28 pm

ADrunkenMarcus wrote:The lesson here is 'Don't sell Renishaw!' I suppose the rise was just awkward timing with the tax year. I tend to give an instruction to Bed & ISA, then normally it's done the same day and you have a reasonable match between the sell and buy price, except you have fewer shares bought back after fees: so I use cash to top up the holdings back to their prior quantity and/or make any adjustments needed.


Indeed!
Unfortunately it was in my old HSBC account and I needed to move it to my current ISA with TDDirect, so I couldn't do a simple Bed & Isa. (HSBC are crap at them anyway even if I could have used them.)

ADrunkenMarcus wrote:I know someone else who sold Unilever because it was looking 'toppy' or 'expensive' (how did they phrase it?) back in February. A day or so later and it started a rise which has taken it up 40% in a few months.


Ouch!
Must admit I was thinking of buying some more Unilever around that time myself but there were too many alternatives at the time and a lump sum hadn't arrived by then. Would have been way better than some I've bought since!

cheers
Spiderbill

ADrunkenMarcus
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Re: Renishaw - Great Company, High Price

#96339

Postby ADrunkenMarcus » November 16th, 2017, 9:28 pm

I noted on another forum that one investor had recently offloaded some Renishaw at £53. I've also seen people 'top slice' at anything from £40. Nonetheless, it seems every time the price gets frothy then it just rises further - hitting £54.15 today.

Best wishes


Mark.

doug2500
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Re: Renishaw - Great Company, High Price

#96344

Postby doug2500 » November 16th, 2017, 9:51 pm

ADrunkenMarcus wrote:
Renishaw was 2% of the capital value of my portfolio in April 2016 but it's now 3.9%, which comes despite the portfolio's capital value growing substantially.

I know someone else who sold Unilever because it was looking 'toppy' or 'expensive' (how did they phrase it?) back in February. A day or so later and it started a rise which has taken it up 40% in a few months.

Best wishes

Mark.


This is why I hate selling stuff. You just don't know what the next thing to take off will be, and you just don't know how far something already fairly priced will go. I've seen plenty of stuff go nowhere for a couple of years and then take off. And I did buy them thinking they looked good value, but while some had a trigger to rise some just did with nothing obvious triggering it.

And, of course, it works the other way too :lol:

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Re: Renishaw - Great Company, High Price

#96378

Postby Bouleversee » November 16th, 2017, 11:37 pm

VCP is a case in point. How much longer can its stratospheric rise continue or will there be a sharp correction?

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Re: Renishaw - Great Company, High Price

#96379

Postby Lootman » November 16th, 2017, 11:48 pm

Bouleversee wrote:VCP is a case in point. How much longer can its stratospheric rise continue or will there be a sharp correction?

Why can't they carry on going up? Look at Apple, Google, Amazon and FaceBook and their market caps. These are companies that quite simply reinvented the landscape and increase their earnings by 10% to 30% a year. Apple is set to become the world's first trillion dollar company. And anyone who avoided them because they were stratospheric has under-performed.

Or of course you could bet that Tesco and Carillion will become tomorrows winners. Bottom fish if you want, but why not buy growth?

Bouleversee
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Re: Renishaw - Great Company, High Price

#96430

Postby Bouleversee » November 17th, 2017, 9:24 am

Lootman wrote:
Bouleversee wrote:VCP is a case in point. How much longer can its stratospheric rise continue or will there be a sharp correction?

Why can't they carry on going up? Look at Apple, Google, Amazon and FaceBook and their market caps. These are companies that quite simply reinvented the landscape and increase their earnings by 10% to 30% a year. Apple is set to become the world's first trillion dollar company. And anyone who avoided them because they were stratospheric has under-performed.

Or of course you could bet that Tesco and Carillion will become tomorrows winners. Bottom fish if you want, but why not buy growth?


I hope they (VCP) do, Lootman. I am sitting on over £60k worth which cost me nothing as my £3k purchase costs were more than covered by the special dividend paid shortly after Wilding took over the management. I don't want to sell for cgt reasons (had to take them out of my ISA when they went on AIM and wasn't able to put them back when the law changed) and also because of IHT benefit. However, RPC suffered after multiple takeovers brought in the shorters and my Anglo Irish Bank shares went from £3k to over £80k and then to nothing, so I am slightly nervous. Whenever I have bought something that has shot up, it has immediately gone the other way. Regrettably, I don't hold any of the 4 giants you mentioned. Buying on a drop has sometimes worked well (e.g. Greggs, Fenner) but in other cases has compounded the loss (IRV, CLLN etc.) The net result is not very impressive so far as I am concerned as I have no idea which will be which. Running to stand still.

ADrunkenMarcus
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Re: Renishaw - Great Company, High Price

#96439

Postby ADrunkenMarcus » November 17th, 2017, 9:54 am

I'm certainly happy to keep holding Renishaw although, if it's not a contradiction, I wouldn't top up at these prices! The company's recent announcement had growth north of 20%. It hit 5465p today which means the dividend yield (for last year) is now under 1%, whereas the dividend yield was 4.5% or more when I bought (enough for a HYP selection, surely). I think that's more indicative of how highly its rated than the PE, because earnings forecasts for this company seem to be all over the place and indeed last year's earnings significantly exceeded the 'consensus'.

What frustrates me is that I didn't put more money into it in 2011 although, of course, that's hindsight bias. I did put a reasonable amount in and the capital has now more than quintupled. My Total Return CAGR since purchase is 37%. As of this morning, it's risen from 2% of my portfolio at April 2016 to 2.7% as of April 2017 and 4.3% today. That's with no new money being added and my portfolio's accumulation units rising 46 or 47% since April 2016 (dividend yield is modest so most of that - 93% - is capital growth).

I will resist the urge to tinker or cut back my winners and hope that earnings turn out to be far higher than estimated, making today's price look more reasonable!

Best wishes


Mark.

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Re: Renishaw - Great Company, High Price

#96441

Postby ADrunkenMarcus » November 17th, 2017, 9:58 am

Bouleversee wrote: my Anglo Irish Bank shares went from £3k to over £80k and then to nothing, so I am slightly nervous. Whenever I have bought something that has shot up, it has immediately gone the other way.


I had a big chunk of Lloyds and Barclays going into the financial crisis, so I can sympathise. At one point in 2009 the Barclays share price went down to 1985 levels.

One poster on Seeking Alpha (USA!) *never* sells his holdings and yet he's been investing since 1970. His argument was that by selling you give up on a potential huge future return, whereas you can only lose what you have invested. I realise that's scant comfort in this case, but maybe it works as a wider argument for investing in collectives or index trackers!

Best wishes

Mark.

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Re: Renishaw - Great Company, High Price

#96460

Postby ADrunkenMarcus » November 17th, 2017, 11:27 am

doug2500 wrote:And I did buy them thinking they looked good value, but while some had a trigger to rise some just did with nothing obvious triggering it.

And, of course, it works the other way too :lol:


Very true Doug!

Best wishes

Mark.

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Re: Renishaw - Great Company, High Price

#96537

Postby Bouleversee » November 17th, 2017, 4:36 pm

Bouleversee wrote:
Lootman wrote:
Bouleversee wrote:VCP is a case in point. How much longer can its stratospheric rise continue or will there be a sharp correction?

Why can't they carry on going up? Look at Apple, Google, Amazon and FaceBook and their market caps. These are companies that quite simply reinvented the landscape and increase their earnings by 10% to 30% a year. Apple is set to become the world's first trillion dollar company. And anyone who avoided them because they were stratospheric has under-performed.

Or of course you could bet that Tesco and Carillion will become tomorrows winners. Bottom fish if you want, but why not buy growth?


I hope they (VCP) do, Lootman. I am sitting on over £60k worth which cost me nothing as my £3k purchase costs were more than covered by the special dividend paid shortly after Wilding took over the management. I don't want to sell for cgt reasons (had to take them out of my ISA when they went on AIM and wasn't able to put them back when the law changed) and also because of IHT benefit. However, RPC suffered after multiple takeovers brought in the shorters and my Anglo Irish Bank shares went from £3k to over £80k and then to nothing, so I am slightly nervous. Whenever I have bought something that has shot up, it has immediately gone the other way. Regrettably, I don't hold any of the 4 giants you mentioned. Buying on a drop has sometimes worked well (e.g. Greggs, Fenner) but in other cases has compounded the loss (IRV, CLLN etc.) The net result is not very impressive so far as I am concerned as I have no idea which will be which. Running to stand still.


I see that Invesco have just increased their holding in VCP to 8.15% which is presumably a good sign. That's probably what sent the s.p. up a lot yesterday; down a bit today.

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Re: Renishaw - Great Company, High Price

#96543

Postby ADrunkenMarcus » November 17th, 2017, 4:57 pm

I should stop bleating about the increasing share price, given it keeps hitting new highs - 5580p today. And 4.4% of my portfolio instead of the 4.3% it was this morning...

Best wishes

Mark.

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Re: Renishaw - Great Company, High Price

#108166

Postby Spet0789 » January 5th, 2018, 3:54 pm

Sold 1k shares at £53 earlier today. Although this is a fantastic company and I may regret it, I see more downside than upside over a 1-3yr view.

Given RSW compete on quality not price I think worsening terms of trade post Brexit are not fully priced in.

I can’t bring myself to sell out in full as they’re a company I have so much admiration for so continue to hold half of my original position. But now own those shares for less than nothing.

Next stop £60?

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Re: Renishaw - Great Company, High Price

#108201

Postby ADrunkenMarcus » January 5th, 2018, 5:18 pm

Spet0789 wrote:Although this is a fantastic company and I may regret it, I see more downside than upside over a 1-3yr view.


I tend to agree with that.  On the other hand, some were worrying it was overpriced when it headed above £32 less than a year ago and they missed out on a remarkable rise.

Qualitatively, Renishaw seems to be a company doing all the right things. Its long term record is good. I have resisted the urge to sell any of my holding (I'm annoyed I didn't invest much more at under 900p in 2011!) but I do also think that when the next downturn inevitably comes then Renishaw will suffer. It was really pummelled back in 2008-09. If that happens again, I'll take the opportunity to pile in. ;)

Best wishes


Mark.

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Re: Renishaw - Great Company, High Price

#108208

Postby Spet0789 » January 5th, 2018, 5:48 pm

ADrunkenMarcus wrote:
Spet0789 wrote:Although this is a fantastic company and I may regret it, I see more downside than upside over a 1-3yr view.


I tend to agree with that.  On the other hand, some were worrying it was overpriced when it headed above £32 less than a year ago and they missed out on a remarkable rise.

Qualitatively, Renishaw seems to be a company doing all the right things. Its long term record is good. I have resisted the urge to sell any of my holding (I'm annoyed I didn't invest much more at under 900p in 2011!) but I do also think that when the next downturn inevitably comes then Renishaw will suffer. It was really pummelled back in 2008-09. If that happens again, I'll take the opportunity to pile in. ;)

Best wishes


Mark.


Thanks Mark. I bought at £16 so not quite as good an entry as yours!

At £32 and a PE of 20 ish I think they looked solidly priced but no reason to sell. At a forward PE of over 35 I struggle to see the shares as anything other than rich.

But I may be wrong so I am not selling out!

ADrunkenMarcus
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Re: Renishaw - Great Company, High Price

#108244

Postby ADrunkenMarcus » January 5th, 2018, 9:36 pm

Spet0789 wrote:At a forward PE of over 35 I struggle to see the shares as anything other than rich.

But I may be wrong so I am not selling out!


If only we knew the future, eh? :)

The difficulty for me is that estimates for Renishaw seem to be out so often and by a large margin. If I recall, the last year's EPS estimate was 120p and it came in at 132p - a considerable difference - so my perception of the PE was out. The estimates for the upcoming year show EPS up almost 20% so we get a PE around 33. On the other hand, if estimates were out the other way the PE may even be 36 or above.

Best wishes


Mark.

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Re: Renishaw - Great Company, High Price

#113188

Postby ADrunkenMarcus » January 25th, 2018, 8:02 am

Renishaw raised their forthcoming dividend payment by 12%. Revenue growth is 20% at constant exchange rates, so there has actually been a currency headwind holding Renishaw back.

Best wishes

Mark.

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Re: Renishaw - Great Company, High Price

#113209

Postby PrincessB » January 25th, 2018, 9:10 am

Best wishes

Mark.


Down 480 as I type this, or rather, back to where we were a few weeks ago.

Like you I bought at around the £9 mark and like some other posters it is a main account rather than ISA. My inclination is to wait for the next tax year to start in a few weeks and then sell enough fund a new position in my HYP ISA.

Time will tell, I'd much rather sell at £60 than £40 and by waving a finger in the air I can guess that we could see either price, or perhaps one in between, unless it is higher or lower by a smaller or greater margin :)

Regards,

B.

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Re: Renishaw - Great Company, High Price

#113211

Postby Spet0789 » January 25th, 2018, 9:13 am

Stock off 9%, new CEO with the founder moving upstairs. Still a great company but glad I trimmed.

ADrunkenMarcus
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Re: Renishaw - Great Company, High Price

#113309

Postby ADrunkenMarcus » January 25th, 2018, 1:47 pm

PrincessB wrote:Time will tell, I'd much rather sell at £60 than £40 and by waving a finger in the air I can guess that we could see either price, or perhaps one in between, unless it is higher or lower by a smaller or greater margin :)


I should be hoping for the share price to collapse, because that would open up a chance to invest more and grab a bargain. :) That opportunity may arise next time we have a downturn. I thought the 2011 price was a bargain, but I wish I'd got in during 2009!

That's not to say I would be unhappy if it did hit £60 as that feels good...

Best wishes

Mark.

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Re: Renishaw - Great Company, High Price

#113311

Postby ADrunkenMarcus » January 25th, 2018, 1:49 pm

Spet0789 wrote:Stock off 9%, new CEO with the founder moving upstairs. Still a great company but glad I trimmed.


That's nothing - I remember back in 2011, I think October, when it released a results statement and was down 17% or so!

Best wishes

Mark.


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