What is your Coca Cola company for the next 30 years?
Buffet's 50% yield
One of Buffett's most famous long-term holdings is his 8.9% stake in The Coca-Cola Company (NYSE: KO). The $15bn shareholding is Buffett's company Berkshire Hathaway's largest holding and most of it dates back to 1988, when Berkshire spent $1bn to acquire a 6.2% stake at an approximate cost, adjusted for splits and dividends, of $3.75 per share.
Back in 1988, Coke shares offered a yield of 4% -- decent, but not amazing. Since then, the company has maintained its 50-year unbroken record of annual dividend increases. The result is that in 2011, the dividend payout was $1.88, providing Buffett with a massive 50% yield on his original investment.
Company May 2002
share price2002 yield
on cost2011 yield
on costBritish American Tobacco (LSE: BATS) 793p 1.4% 15% SSE (LSE: SSE) 679p 4.8% 11% Vodafone (LSE: VOD) 118p 1.3% 7.5% Tesco (LSE: TSCO) 246p 2.5% 6.0% Unilever (LSE: ULVR) 1,396p 1.5% 5.6% BAE Systems (LSE: BAE) * 371p 2.5% 5.1% Diageo (LSE: DGE) 856p 2.8% 4.7% GlaxoSmithKline (LSE: GSK) * 1,477p 2.7% 4.7% HSBC (LSE: HSBA) * 830p 4.0% 3.1% Average yield: - 2.61% 6.97%
It would be interesting to hear what companies fellow investors would choose to Invest in for the next 30 years.
If there was one company you could choose to Invest in over a 30 year period which would it be and why?
This is not an easy question to answer, it requires a lot of thought and it is very difficult to try and work out what will happen in the next few weeks let alone the next 30 years!
I recognise that none of us our Buffett & we probably should'nt invest like him given the advantages we have as private investors.
I personally prefer to just Buy and Hold, it is more cost effective as you don't constantly pay stamp duty and broker fees. Also I think the less decisions one has to make more often then not the better of they are & I am a strong believer that doing nothing MOST of the times is the right course of action.
Looking back over the last month what was the fuss all about with Soco going to around £2.50ish....
The reality is markets will always move, stocks will always go up and down. The trick is are you smart enough to asses the value of a share as well as a reasonable foresight to see where the future lies for a company and then have the patience to see out the value?
Disclaimer
This is not financial advice. Our content is intended to be used and must be used for information and education purposes only. Please read our disclaimer and terms and conditions to understand our obligations.
47 comments
Publishing Technology PLC is my next Coca Cola.
The stock has now gained a cool 200% from my fist post . At £25M it is in stockmarket terms a minnow.
High end investors who buy and hold any AIM quoted stock for two years do not have to pay any inheritance tax on death.
That is a huge tax break for the rich and super rich.
If one can also pick a super growth share that can in years to come pay a divi then you are on to a real winner.
PTO itself has a huge tax loss to use up,so earnings can grow 20% faster than other companies for the next few years..
Harryr - we are closing this thread. Frankly, we should have done this a long time ago. Please post under Publishing Technology rather than this misleading title.
PTO my next Coca Cola has had an outstanding week being the third highest riser 39%.
Three items set the stock moving upwards over the last five days.
Results on Monday showed the first half loss being turned into a full year profit.
Tue saw the house broker issue a buy note and new higher valuation price.
On Wed a well known research house also posted up another a very bullish outlook and buy note on the company.
We ended the week with a company valuation of £25M in stockmarket terms a pin prick
The first sings of profit growth can now be seen by all.It is this growth that new investors are looking for in any stock they buy.They want to invest on the basis of big profits over the years ahead
The next event is the AGM in around 4 weeks time where we may or may not get an update on trading..
.
Shares magazine this morning is highlighting Past masters Asos @ 4.5p now £27.00.
It goes on to winners in the last 12 months 513% for Mobile Streams.[Mos]
"Canny investors who piled into another marvellous minnow Oxfordshire based Publishing Technology [PTO]have enjoyed a 329% one year gain.
Publishing Technology PLC is my next Coca Cola.
Publishing Technology plc.
Broker report out this morning.
http://www.westhousesecuritiesresearch.com/Research/iid/73722648328/p
Publishing Technology 2012 results can be found under "investor"
Trend spotters should look at these broker valuations as Publishing Technology has turned a loss into a profit.
http://www.publishingtechnology.com/
05 Mar 2013 Westhouse Securities Buy 230.00 260.00 Retains
04 Jan 2013 Westhouse Securities Buy 200.00 230.00 Retains
17 Dec 2012 Westhouse Securities Buy 150.00 200.00 Retains
05 Dec 2012 Westhouse Securities Buy 120.00 150.00 Retains
15 Aug 2012 Westhouse Securities 120.00 120.00 Strong buy
Results from my next Coca Cola company,Publishing Technology PLC have just been published within 64 days of the year end.
The results were in line turning a first half loss into a full year profit.
The full accounts can be seen on the companies home investor page.
If ever one is looking at a super growth share this must be it.
The report is in digital form.
China is just about at b/e point after 9 months of trading.
Sales from the older vista products are way ahead of where the company thought they would be 3 years ago.
Sales of the new products have grown year on year at 60%
Broker Westhouse has lifted his valuation today.
In the next few days i will post a full update of events.
Todays Financial Times page 16, lists the risers and fallers over the last 12 months.
My next Coca Cola stock Publishing Technology Plc is listed in third place with a 328.6% gain.
The London stockmarket has over 2,000 shares listed so,third place makes this share a Star
This is the forecast growth rates .
2011 - 2012 800%.
2012 - 2013 99%
2013 - 2014 38%
The 2011 - 2012 growh rate starts at around zero so do not take much notice of that.
The results for last year are due any day now.
Publishing Technology Plc has had a good run but in no way does it yet reflect the growh due over the next few years from this company.
PTO is my next Coca Cola share.
I first posted it here in November 2012 at one pound a share.
It has now gone over two pounds a share .
The market cap is still under £20M.
Results are due in 3 weeks time,
The growth has startedI will update on results day.
Company 5...- is helping the world's leading publishers bring their content into the digital age. Years of R&D activity is beginning to pay off as the firm's products are rolled out as far afield as China...
http://uk-analyst.com/shop/page-advice/action-advertorial.show/id-130020720
Highly likely I'll get the thumbs down for posting this.
Never mind eh!!
Publishing Technology PLC: The next Coca Cola
I understand Westhouse has this morning lifted its price target yet again to £2.00.
It last raised its target under 3 weeks ago.
They have produced some numbers to support this
Their target has now gone from £1.20 up to £2.00.
My target puts those numbers in the dustbin, it is way higher
The broker has to move up in stages often on news. I do not..
I agree with harryr. The right business at the right time.
PTO last week signed a new lease in Boston doubling their office space there...'Publishing Technology, a provider of information technology, has signed a 6,665-square-foot office lease relocation and expansion at 38 Chauncy St. in Boston.
The UK-based company, which previously occupied 3,300 square feet in Cambridge, moved its office and doubled its space to accommodate growth....'
That's the word we all like to hear....GROWTH.
Can't add to harryr's comments as he has covered just about everything.
I hold.
Publishing Technology plc [PTO] last year put out a trading update on the 19th of December.It went on to say that profits for 2011 would fall short but the outlook for 2012 was very upbeat.
In the last two months the shares have come to life, this in part must be down to the purchase of stock by the director.
In the next few days the company may issue a trading statement as their year ends on 31/12/12.
Profits are forecast to be IRO half a million pounds after a first half loss.
Full year results are due in March 2013.
Well well, At last the broker has got out of bed on this cold morning.
This and the director buy 6 weeks ago means the company is at last out of the traps in the eyes of the city
.RESEARCH ALERT-Publishing Technology: Westhouse Securities
Finance & Stock Market News
RESEARCH ALERT-Publishing Technology: Westhouse Securities raises target price
Wed, 5th Dec 2012 09:04
Dec 5 (Reuters) - Publishing Technology PLC:
* Westhouse Securities raises target price
o 150p from 120p; rating buy
Publishing Technology PLC is my next Coca Cola. Market Cap £10M
China needs the digital software that Publishing Technology has, it is new and world class.
Can you see the link?
The Chinese want to get their libraries on line fast. It is a short cut to growth.
Publishing Technology has also done a deal with China All. [not the deal listed below] A publisher with huge market share, one of the very few if any , who pay a fee to the author.
The chinese will be able to keep a strict eye on content as well.
LONDON | Tue Apr 17, 2012 5:15pm BST
LONDON (Reuters) - China is actively looking at buying into European publishing companies as part of its strategy to raise the country's cultural profile, a senior official said on Tuesday.
Tan Yue, president of China Publishing Group Corp (CGPC), said his company wanted to expand its editing, printing and distribution interests either by buying such businesses directly, purchasing capital stakes in the companies that ran them or forming joint ventures.
In an interview with Reuters at the London Book Fair, Tan said CGPC, which reports directly to the Ministry of Propaganda, was already looking at possible targets.
"As a matter of fact, we've already had some initial negotiations with those partners," he said. Tan gave no names.
One of the companies under CGPC's umbrella, China National Publications Import and Export Corp, signed separate strategic partnerships on Tuesday with Dutch publisher Wolters Kluwer (WLSNc.AS) and with Britain's Publishing Technology Plc (PTO.L), a provider of software and services to the sector.
Publishing Technology has developed a digital portal, to be managed by CNPIEC, to link international publishers to more than 10,000 Chinese public and academic member libraries. The two partners hope that more than a million different content sources will be accessible on the site in the next two years.
CNPIEC handles more than 60 percent of the publications imported into China and more than 30 percent of those exported.
Underscoring Beijing's strategy of "going forth" in fields other than the economy, more than 180 Chinese publishers attended the book fair, which this year had a special market focus on China.
(Reporting by Alan Wheatley; Editing by Helen Massy-Beresford)
This is from ten years ago when my next "Coca Cola share" share Publishing Technology PLC was known by its old name Ingenta.
It is a broker report from Old Mutual Securities.
SALES PROFIT
2002E £24.7M £3.5M
2003E £45.8M £15.9M
The forecast was a million miles out.
However, note the huge projected jump in profits of £24M from 2002 to 2003.
Todays Shares Magazine describes software companies as having little need for fixed assets or production equipment and should generate dollops of cash.
Publishing Technology plc has after 12 years arrived at this tipping point.
If one takes time to read the accounts you will see turnover has only just started to move upwards in the last 6 months, after being flat for the last 5 years.
I see HP has just slashed $8.5BN off the UK FTSE 100 company it bought around a year ago for $10BN.
Just like the Banks, Blue chips often turn to brown chips.
The name of the game with investing is to start low with a tiny company.
My next Coca Cola is Publishing Technology PLC .
Check this out : Google search:
Publishing Technology Launches in China youtube.
The clip above has been seen just 140 times [5 times by me.!]
PTO is valued at £10M
The broker to the company has £660,000 profit for the year ending Dec12.
The FD has just bought a large lump of stock.
.
Harry, Your missive on the Soco BB has been marked 'Reported for Disruptive Behaviou' !!!
Bit strong don't you think?
Slough based consumer goods giant Reckitt Benckiser has launched a 1.4bn-dollar (882m-pound) counterbid for US nutrition specialist Schiff Nutrition International, with the tender offer beginning today.
At $44 per share that constitutes 27% more than German conglomerate Bayer's own £693m ($1.1bn) offer announced last month and a 24% premium over the closing price of Schiff's shares last night
Yet one more reason I would not like to be a shareholder in RB.
I understand RB have pulled off a few smart deals in the past, however paying way over to get rid of others is plain daft.
For super growth your company needs an edge, it also wants to be valued as if it has no edge when you buy.
Thus you buy at the right price, not on a pe of 40 a few years later.
Publishing Technology has developed a digital portal, to be managed by CNPIEC, to link international publishers to more than 10,000 Chinese public and academic member libraries. The two partners hope that more than a million different content sources will be accessible on the site in the next two years.
CNPIEC handles more than 60 percent of the publications imported into China and more than 30 percent of those exported.
Publishing Technology plc is valued by the market at £10M pounds it has eight offices around the world and is market leader in the software it sells.
For the life of me I do not understand why it takes the city an age to see what is infront of their eyes.
Coca Cola here we come.
Ah Harry, I'm sure we would all have hated to hold RB. Or BAT. over the past 12 years...
Having said that, i wouldn't disagree with the notion that the telltale determines are now looking somewhat stretched.
Dettol, brasso,calgon can no doubt be found in Gran mothers house but not mine.
I see this week the LSE has published a list of the most shorted shares on the LSE.
A very large number of those companies are the High St names
This is the very market RB is selling its goods to.[not a good sign].
I have also noted the 3 year RB chart, if it does the same for the next 3 years expect the pe to be a lot lower than today.
Overall it sums up the very poor returns from FTSE 100 companies with that index still lower now that 12 years ago.
Gentlemen, you are missing something about Coke. It was a household name when Buffett first purchased it. It wasn't a tinpot Aim stock but has a competitive advantage that Buffett thought would be hard to better. So instead of looking at the bottom end of the Mcaps we should be looking for a Bluechip contender, Something that you could purchase in Fund Manager size that still fills the criteria. My choice would be Reckitt Benckiser (RB.). Its products are all household names including Calgon, Vanish, Airwick, Dettol. Cillit Bang, Clearasil, Nurofen, Durex, Brasso, Cherry Blossom, Harpic ............ Its inflation proof and with all the money printing going on thats an important issue.
On fundmentals it offers over 3% dividend which has increased every year for the last 11 years. Same for Sales, Profits and EPS, each of then increase every year for the past 11 years. On the growth side the s/p has risen almost 400% in the past 11 years yet trades a a discount to its ten year average PER of 15.
Hard to better imo.
For those looking for for the next coca cola a few tips on what i have picked up over the years.
Timing
Buy stocks others can understand.
Buy tiny companies just about to turn in profits.
Buy off the share price lows. You are then often the only buyer
Buy stocks that have lost most of their value over a very, very long time as traders are not in the market and you have it for yourself
I have found a small amount of debt is good as it can get growth moving faster
Understand what profits can do for stocks, re rating on higher year on year profits does wonders for a share price.
Also of note, if a stock has drifted for years and years the Market Makers are more than happy to sell you stock in lumps that they do not have on the books.
They do this knowing full well when a seller shows up they buy it back in for a song.
That is fine, but in rare cases they get caught out with a bid or constant buying.
Investing has risks, the real trick is for your shares to go up hard and fast soon after buying , then just wait for the value /growth to come.In the meantime if the market takes a hit you have got some protection from any falls.
Me? I would go back to the drawing board harryr. You could start with the kiss principle, because coke did, and still does.
http://en.wikipedia.org/wiki/KISS_principle
To find a company that could generate Coca-Cola type returns over the next 30 years, you need two things: 1) To be able to identify a company with strengthening and sustainable competitive advantages and 2) a dose of luck.
In hindsight, it's easy to see that Coca-Cola's brand translated well to global audiences and that it was able to build a highly-efficient and scaleable distribution network, but that could have gone wrong at some point. While management unquestionably deserves some of the credit there, there's no question that some luck was also involved in the company's longer-term success.
One of the things that Coca-Cola did have going for it was multiple sources of competitive advantage -- the combination of brand and distribution network became progressively difficult for competitors to overcome.
The best thing you can do today, then, is to seek companies with at least one source of sustainable competitive advantage, buy them at a good price, and hold them for the longer-term. With some luck, perhaps one or two of your companies could turn out to be the next Coca-Cola.
A few reasons why I think Publishing Technology plc is the next Coca Cola.
Martyn Rose chairman / 30% shareholder has a rather good track record, selling his share of Macaw soft drinks ltd for £30M plus profit.
That proves to me he and the board know what they are at.
The city tends to fall in love with companies that have a stream of recurring revenue.
Publishing Technology PLC has just that at 65%. I Ithink with the new contract wins it could hit over 70%
.
How many Aim stocks do you own where the company gets out the half year results within 31 days.?
Publishing Technology plc does. Again it points to them being "on the ball"
With a market cap of under £10M pounds today it can grow at the rate of knots, just what an investor requires to beat the market hands down..
About US
Publishing Technology plc is the world-leading provider of content solutions that transform business. We cover the publishing process from end to end with content systems, audience development and content delivery software and services.
The above is from the companies home web page.
Find me another £10 million pound AIM stock that is world leading at that price .
Now we all know about spin, however take a look at who Publishing Technology plc have contracts with, inc 8 out of ten of the largest publishers in the world the world bank, bbc, oecd and many more..
Those contracts are topped by the Joint venture in China.This is with the state controlled publisher that has over 60% of the book import maket .The chinese need new digital technology from the west for their five year plan.
Within 3 years China will be the biggest publisher in the world. .
Think how many cans of cola are sold, then change the product to books.
Then note who will be the winners in the new digital age, it will be the companies that can sell books and the only way is by getting book buyers to your web page.
Publishing Technology has the newest software for publishers and others to do just that.
Over the next few weeks, months, and years the city will wake up to this astonishing company .
I would buy Coca Cola (why get second best when you can buy the worlds best franchise) at the right price, somewhere south of $32.
If we are talking UK only then I would buy Tesco, at up to £3.20 , although I am already in so wouldn't buy more now.
Publishing Technology PLC has just 15,000 options and £8.5M shares.
Take a look at the stocks you own.
How many options are diluting your companies earnings.? Now work out as a % of shares in issue.
Publishing Technology PLC has just 0.2% of the shares put by for options, thus profits in the form of EPS go to you as a shareholder not the directors.
When looking for super fast growth stocks you want.
Few if any options.
Tax losses , thus for the first few years company pays no tax. EPS can grow 26% faster year on year.
Publishing Technology PLC.
Number of Shares Grant Date Exercise Price Expiry Date
65 17 April 2002 £150.00 17 April 2012
7,100 21 January 2003 £5.25 21 January 2013
500 30 June 2003 £11.75 30 June 2013
4,254 21 January 2004 £9.50 21 January 2014
100 2 August 2004 £6.00 2 August 2014
100 22 November 2004 £3.25 22 November 2014
2,500 4 October 2005 £1.95 4 October 2015
1,000 30 March 2006 £2.16 30 March 2016
Total 15,619
The company I have been buying for months is Publishing Technology PLC
It has fallen 98% since the dot com boom in the year 2000.
At the time it was called Ingenta.
It is the worlds number one in digital software for publishers.
It is valued at just £9M pounds
It has done a massive deal in China its partner has 60% of the book import market
Broker has.£660,000 profit down for this year.[Dec12]
It has spent the last 5 years producing brand new software for the digital age now finished.
That has cost £2.5 M a year that has been written off as they go along.
It has a tax loss to use up of over £16M
This week the FD bought £50,000 of stock at the high for the year.
Sales that have been flat for 5 years are on the move, most costs are fixed and it only takes a 25% jump in turnover for profits to Zoom.
I have put my money where my mouth is, this week the FD followed me.
Rofl, highly amusing.
Seriously why do you bother even posting if you aren't going to share your ideas - this is what the bulletin boards are all about.
Sorry only found one share. Would like another ten.
The stock i have found i am buying week in week out and to name it here will not make it easy for me to keep buying.
When i have enough shares in the company i will post.
So what are the "actual names" of those companies Harryr that fit your criteria( I see Isaac has asked you twice for specifics) yet you continue your evasive commentary. I'm sure everyone is interested so they can go away and look more closely at the companies you think fit the bill.
WEIR need to do 30% from now on, it gets harder to do.
Very easy to grow from 100k profit pa at 30% pa for the first few years. plus its fun being invested on a low pe as when things go wrong on a pe of 20 they tend to fall to a pe of 5 overnight.[with a 75% loss]
Weri are fine but not for me.
NICL are now on a pe of 20 [falling on next results]
I want to be investing in stocks on a pe of 4 that can get re rated to 20.[and then pay a divi]
What i am saying is this stock is valued about right so long as it keeps growing.
I also want a product where i have what others want, and i can price the product not the market.
Err.... can I be the first to pick out the obvious? Nichols (LON:NICL).
EPS 5yr CAGR = 17.1%
DPS 5yr CAGR = 9.3%
Asagi
no position Nichols (LON:NICL)
One needs profits growing 30% P/A .Can Weir do that?
harryr
If you want to make life changing amounts of money it is not necessarily by buying something that have come down 98% plus from their highs
If Soco were to drop 98% from it's highs it would more liklely then not that they have had their Vietnamese assets confiscated or they have a major Oil spill or some other kind of environment disaster making them liable for millions etc etc - That does'nt sound like a company I would want to Invest in for a life changing amount of money.
I personally think if you want to make A LOT of money then the way to do that is to find 4-5 decent value plays that have the potential to multi bag over a certain period of time. One of the few sectors that offer such an opportunity is E+P IMO.
At the moment I can think of a number of stocks that has the potential to multibag over the next few years and make people life changing sums of money.
If you want to make the big cash in a short period of time it involves taking a large but sensible amount of Risk in say 4-5 stocks with massive upside potential.
I've talked a lot about the HYP and Dividends, but this is a strrategy that will make a reasonable amount of money over a very very long period, not necessarily life changing.
I have recently bought a decent amount of stock in TPL - Tethy's Petroleum - The stock has recently declined a fair amount due to the decline in Oil produce, they produced in q1 around 5000 boepd, this is expected to ramp up to around 10-12,000 boepd by December. The Oil is very high quality at 46 API and a $35 netback, but the more exciting part of the company is Tajikstan with unrisked mean resources of 1,146 MMBOE - a block the size of Switzerland. The netback in Tajikstan is around $60/bbl. Not only that the PSC terms sare very favourable with 70% cost recovery and 70% profit net of all taxes. TPL own 85% of the licence and own 5 rigs, they will use one of their own rigs to drill in Tajikstan late 2012/early 2013.
Dr Dave Robson is CEO/Chairman and has extensive experience in the area, he is one of the founders of JKX.
I think if TPL takens on reserved based lending or the Oil price stabalises then the share price can re-rate quite swiftly imo. There are plenty of funding options including farming down.
If this works then it can make life changing sums of money IMO as the potential is huge compared to the downside.
Pope Asset Management are large holders in the stock....
Did Coca Cola grow profits by 30% p.a.? [as it happens Weir's 5year profit CAGR HAS been 30% p.a.]
How much would you pay for a company if it was the No1 in its field, in the world.?
Judges Scientific (LON:JDG) has paid no more than 3-5x EBIT for several such companies. The whole ethos of Buffett & Graham's philosophy is not to overpay (a philosophy which Judge's rather astute CEO and I share). They buy good companies, with sound track records, at reasonable prices.
ISTM that current market fears are offering a number of largecaps, that are likely to do well over a long time period at very reasonable prices. Perhaps my favourite right now, fitting that category, is Weir (LON:WEIR) . It is leader in an area that is likely to be in demand for the foreseeable future and it has grown strongly with further growth forecast, yet the market is currently putting it on a lowly CY P/E of < 10.
Most smallcap investments cannot in any way be considered comparable to the likes of Coca-Cola. They offer an entirely different risk profile (that doesn't mean I don't like them, just that they're an entirely different type of investment ;0)).
Start looking at firms that could grow that fast.
I love stocks that have come down 98% plus from their highs but have been building the profit making blocks as they go along.The long term shareholders give up over 5 to 10 years as does the city.These stocks still need to have the edge new directors, contracts, or products timing, and so on.I go fishing for under £5M pound companies.
Yes, I have understood all of that. But exactly which companies are you referring to is what I am asking.
And which stocks are they harryr?
One will need to start with a very low cap growth company that is not paying a divi today.
That company needs to grow profits around ten times and start paying a divi of just 10%.
Bingo.
Get a few stocks like that when you are young and no need to work past 30.!
Of the companies in your list I'd say Tesco on the assumption that they can keep up international expansion.
Isaac, you might want to take a look at some of our Warren Buffett-esque stock screens.
http://www.stockopedia.com/screens/guru/warren-buffett-1/
We have modelled them based on a couple of books - Buffettology and the Warren Buffett Way. Sure they are quantitative, but they have a tendency to highlight consistently profitable, high return companies that exhibit the financial signs of a durable competitive advantage.
In creating a qualitative framework for assessing individual stocks it's important to understand how to identify an economic moat - http://j.mp/wAc57q
Personally I've always been impressed by Abcam (LON:ABC) - though it's always been (and still is) too expensive for me to warrant buying. It's got a phenomenal network effect in its niche, distributing antibodies to research analysts via the web and has impressive economics spitting off a great deal of free cashflow. The trouble with high quality companies is that they are generally recognised by the market and don't come cheap and price is all I'm afraid - as Buffett would say always buy with a margin of safety. I am though completely unsurprised to find that it shows up consistently on our Buffettology screens.