3Wk·

Evolution AB Opportunity Cost

Even though I am generally very positive about Evolution, the opportunity cost is getting higher and higher, especially now that many other shares are also on sale. I am currently -25% down (with costs). Unfortunately, I don't see the share making up for this any time soon and waiting for the dividend is a zero calculation given the lack of momentum. All the good news, such as strong demand in the Brazilian market, US expansion, share buybacks and good prospects for powerful compensation are not at all reflected in the share price.

I mean Buffet once said that an excellent company is not necessarily an excellent share. And that seems to be the case, at least for the moment, with Evolution. How do you see that?

I also want to consolidate my portfolio somewhat.

11 Comments

Ruben Schoff@Sand

2Wk

The good thing is that when it picks up, it does so in a relatively short time. Divi is coming soon I estimate that we will at least be back above 90 euros. Kenneth dart has increased his stake significantly in recent months and a lot is priced in. CR is good and patience pays off

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Puki@Puki

3Wk

is not a good stock... The company is, but not a good share... unfortunately.

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Stevo@Money-Man

3Wk

My total loss is around 13%. I have recently asked myself again about further purchases.
- Despite the negative overall environment, the share remains stable at around €71
- All negative news is heavily priced in, positive news is almost non-existent (as you have already described)
- I could well imagine that even minor good news in the figures will lead to stronger upside
Overall, I still see an asymmetrical risk/reward ratio on a current basis.

Nevertheless, the question of opportunity costs must always be asked. Do you have any specific stocks in mind? I still don't see many that are priced as attractively as $EVO

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TaxesAreTheft@TaxesAreTheft

3Wk

@Money-Man $BATS is still very cheap and in my opinion has a lot of long-term potential through multiple expansion (from 9 towards 20-25 like $PM ) and as soon as the debt is reduced, >1 bn per year can be invested in share buybacks. $BN is also very cheap on a DE basis at around 17 PE and is a historic compounder. $BRK.B has also fallen again nicely and is more or less the best hedge you can put in your portfolio. $FNOX had delivered extremely good figures, is not cheap, but could improve my entry price. With a minus of 13% you can still do it, but that's a different situation.

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Stevo@Money-Man

3Wk

@TaxesAreTheft Thanks for sharing the shares. All solid stocks. Fundamentally, however, $EVO (apart from $BRK.B) is clearly superior to all of them in my view. Significantly stronger growth, lower capital requirements...
I currently see Evo's shares more as an investment in the company and the share price is still of secondary importance.
But on the other hand, you shouldn't fall in love with a stock... but the 4% dividend always makes me happy 😭

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TaxesAreTheft@TaxesAreTheft

3Wk

@Money-Man that also made my eyes glaze over, I'm only in love with my BAT 😍 that's where my heart lies. For example, it's the perfect counterpart to EVO, the market doesn't like BAT, probably the least popular tobacco stock, not to mention ESG, yet the fundamentals are so good that the share performs. EVO is a Ferrari on black ice spinning its tires.

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Stevo@Money-Man

3Wk

@TaxesAreTheft Great metaphor 😄 Have you ever made a post where you introduced your great love? Makes me curious.
At the time, I opted for $PM, which I thought was "best in class".
I'm actually less of a fan of dividend tankers, it's the combination with growth that makes my heart beat faster 😄♥️

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TaxesAreTheft@TaxesAreTheft

3Wk

@Money-Man have made countless posts on BAT, I think if you scroll through some of mine should thaw. I also have a review of the FY2024 report.
I see it exactly the same way, I love shareholder value, FCF growth and then off into dividends and share buybacks. $BAM is also very interesting 15% profit growth and 90% of the profits (distributable earnings) are distributed, plus the whole thing is still growing very strongly.

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TaxesAreTheft@TaxesAreTheft

3Wk

@Money-Man https://getqu.in/5HQbnS/ https://getqu.in/5HQbnS/ my first big post, but my opinions and views have changed somewhat since then.

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Stevo@Money-Man

2Wk

@TaxesAreTheft merci! 🙏🏻

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LDP@LDP

3Wk

18% down, my biggest stock. Altough it is tempting, I will not buy any more shares for the time being.

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