Following up on last week’s post on annual results, and my post at the beginning of the year, I thought I’d provide an update on what my current top holdings are.
1. Reading Intl (RDI)- Coming in at about 13% of my portfolio, Reading International is my largest holding. I’ve mentioned it plenty of times, but I continue to be attracted to Reading’s combination of underappreciated real estate and catalysts through either asset sales or activist presence. You can find an excellent recent write up by a bit of value over on seeking alpha.
2. To be announced- My second largest holding, just barely smaller than Reading, is a very illiquid unlisted stock that I’m still attempting to accumulate and haven’t posted a write up on yet. I’ve got a write up completed, just waiting to get more shares!
3- Gramercy (GKK) – Coming in right behind the other two, at almost 12% of my portfolio, is Gramercy (through a mix of ~2/3 preferreds, 1/3 equity). I’m excited to see their new portfolio direction, though I do worry that an equity raise to fund asset growth is on the horizon despite no pressing need for funds. Regardless, I continue to think the preferreds will go current on their dividend before year end, and think the common trades too far below NAV to ignore.
4- Addvantage Tech (AEY)-Coming in the fourth spot, at ~8% of my portfolio (though this could go up soon- I have several buy orders in the low 2 / high 1.90 range that keep almost but not quite getting hit), is long time holding ADDvantage (AEY). The thesis is honestly pretty simple- the company is (at this point) basically debt free, has NCAV of almost $2.65 per share, tangible book of $3.46 per share, and a history of excellent ROIC. While their ROIC the past few years has been low, new management and eventual recovery in the housing market should turn that around.
5- Universal Securities (UUU)- This is more a result of me continuing to buy on the way down than real conviction in the business. I think Universal would makes a fantastic part of a net-net basket, but I’m not really comfy with it taking up this much of my portfolio. Basically, the business has started generating net losses, but that fact is overwhelmed by pure asset protection. Tangible book comes in at almost $11.20 per share (versus today’s share price below $5.00) and consists almost entirely of NCAV (once factoring in the NCAV from the Hong Kong JV).
6- Jewett Cameron (JCTCF)- I know, I know: this is a discussion of my top 5 positions, so what am I doing discussing my sixth largest? I felt I owed you one since number two was a “hidden” holding. I mentioned JCTCF yesterday, but I’m impressed by a combination of their low valuation (trading for under 3x EBIT once excluding their money losing division) and great capital allocation (buying back shares hand over fist)
Just missing the cut is Asta (ASFI), which I should have an updated post on in the near future.
Disclosure- Long all of the stocks (RDI, GKK, ASFI, JCTCF, AEY) mentioned in this article.
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