Smithson Investment Share Discussion Threads

[battyliveson] 06/7/2022 15:17

Thank you LE4R, hopefully discount will narrow a little now!

B

[le4r] 06/7/2022 09:03

In case anyone hasn't yet seen it, the s166 review has been completed. All good - various recommendations made to the firm to bolster governance, controls / risk management etc, but no instruction to take any further action. Portfolio Adviser reported yesterday and I was emailed an extract by Fundsmith.

[zho] 17/6/2022 19:29

>>I'm guessing the above is one of Lennon's lines, a bit dark for Paul>>

First half written by JL, second half (from "Woke up, got out of bed .." written by PM, I think.

[epo001] 17/6/2022 19:21

Never occurred to me before but that is a (then, shocking) scene from The Ipcress File, a 1965 film which Lennon could well have seen while writing A Day in the Life.

[essentialinvestor] 16/6/2022 16:44

haha!!


I'm guessing the above is one of Lennon's lines, a bit dark for Paul.

[spectoacc] 16/6/2022 16:42

Like Terry Smith, The Beatles also went offshore for tax reasons :)

[essentialinvestor] 16/6/2022 16:36

There's a great line from The Beetles "A Day in the Life" which goes..


"he didn't notice that the lights had changed..."

[spectoacc] 16/6/2022 16:01

Terry, is that you? ;)

[essentialinvestor] 16/6/2022 14:08

Have to question some of the stock selections here ?.

[steve3sandal] 07/6/2022 11:24

My understanding is that the Fevertree has a long way to grow. Mind you I do tend to be an optimistic pragmatist and have surrounded myself with like minded fund managers. Do you also have a ticket?

[porsche1945] 07/6/2022 11:11

Wonder if this is a buy again, back to June 2019 prices, just wonder if there is any catalyst at the moment, in fact most of the indexes are back to 2019 or worse valuations. Just wonder really whether the likes of Fevertree have had their day.

[beltd] 27/5/2022 14:19

Nice little director buy..... should help close the nav discount

[spectoacc] 16/5/2022 11:10

But is it big enough..

Ongoing charge 1%.

No divi.

Up 10% over 3 years.

Major holdings (HL) - Sabre Corp, RMV, Temenos, Recordati, Fortinet, FEVR, Verisk, Ansys, Cognex, Tech One.

Can't say it's jumping at me, tho 10% the highest discount it's had.

The FCA enquiry still out there too.


"he Investment Manager focuses on investing in those companies it believes can compound in value over many
years. It seeks to achieve this by selecting companies that have an established track record of success, such as
having already established a dominant market share in their niche product or service or having brands or patents
which others would find difficult, if not impossible, to replicate. "


Not sure the performance shows they're finding them.

Edit - perhaps unfair, the performance may reflect overpaying. Isn't necessarily anything wrong with the picks ex the price they paid for them.

[beltd] 16/5/2022 10:42

Well that's quite a big discount to NAV for a portfolio of allegedly quality companies and a poster child fund management team....

[marksp2011] 10/5/2022 17:30

My guess it that FCA will be looking at customer record keeping. It is quite easy to open an account and they didn't do the regular checks on tax status, NI numbers etc that others do.

It is also relatively easy to buy a shed load, change your bank details and then sell the units to transfer assets from one place to another.

Could be lots of things

[hectorscrackhouse] 09/5/2022 10:46

This performance is despite a foreign exchange tailwind of circa 10% from US stocks

[le4r] 09/5/2022 09:33

Presume he's not allowed to put anything out in the public sphere. Or their PR advisers just advised to lay low on it. I'm not sure, but am taking comfort from what I have heard from staff, and they have significant amounts invested.

[hectorscrackhouse] 09/5/2022 08:53

Thanks LE4R.

Usually we would expect a bolshie announcement from Smith about the FCA matter.

But nothing

[hectorscrackhouse] 09/5/2022 08:51

This announcement from the website dated today

""Fundsmith LLP (‘Fundsmith217;), the fund management company founded by Terry Smith, announces the appointment of eight new Partners from across its portfolio management, research, operations and sales teams.

The new Partners are:

Paul Mainwaring Chief Financial Officer
Simon Barnard Portfolio Manager - Smithson Investment Trust
Will Morgan Assistant Portfolio Manager - Smithson Investment Trust
Jonathan Imlah Research
Thomas Boles Research
Hugo Cardale Sales - Asia, Scandinavia & Family Offices
Peter Jackson Sales - UK, Ireland & Middle East
Amar Patel Head of IT and Chief Information Security Officer

Terry Smith, Founder and Chief Executive of Fundsmith, said:

“I am delighted to welcome many long-standing and integral members of the team, from across the breadth of our operations, as new Partners. By further aligning their interests with the success of the firm we will ensure the business continues to develop and strengthen as we seek to deliver a world class service to investors.”

Fundsmith Equity Fund

The Fundsmith Equity Fund offers investors a high quality, concentrated portfolio of 20-30 resilient global growth companies which are held for the long term. Since inception to the end of April 2022, the fund’s AUM has grown to £25.5bn and it has delivered a total return of 496.4% or 16.8% annualised, net of fees.""

[le4r] 09/5/2022 08:47

I know someone personally at Fsmith and I called last week after the announcement. Clearly they can't disclose specific details but I was greatly reassured by the thrust of the remarks. From what I could infer, this is probably related to the retirement of Simon Godwin last year and the sub division of his prior role as CFO and CCO (now CFO, COO and a Head of Back Office) and new resource below them. Sounds like an oversight check on operations as opposed to anything more sinister. Remember that Fsmith was one of a number of firms to receive the S166 review, so it's not a unique outlier.

[spectoacc] 09/5/2022 08:34

Just catching up, the s.166 is very odd indeed - FCA hardly known for being proactive.

"Section 166 reviews are requested by the FCA in order to provide 'an independent view of aspects of a firm's activities that cause us concern or if we need further analysis'...".


I see SSON's top UK holding is RMV - down 5% today on CEO leaving. Have to wonder how T Smith can be so brilliant (at least until recently) with Fundsmith, and so relatively naff with everything else - FEET, SSON.

Why doesn't it translate? Why has he grown a beard?

[essentialinvestor] 06/5/2022 14:08

AS long as this does not turn out to be another FEET.

[hectorscrackhouse] 06/5/2022 08:59

According to the 2021 Annual Letter the average FCF Yield at the end of 2021 was 2.0%, so who knows what the bottom is for this collection of companies. It is already down about 35% from the beginning of the year, implying perhaps a FCF yield of circa 2.7% now, all things being equal. Perhaps anything over 3% might be worth a dabble, so around the £12 mark??

""The second part of the strategy, of not overpaying for these great companies, can be assessed by looking at the average free cash flow yield (the free cash flow divided by the market capitalisation) of the portfolio. At the end of 2021 this was 2.0%, down from 2.9% a year earlier, and compares to the Index at 2.5%. The decline was a combination of share price appreciation and portfolio changes but also note that the figure is based on the last reported full financial year results for the companies,
many of which might be representing the more difficult 2020 rather than 2021.""

Of course, if it represented the 2020 year then the companies may have grown by 20% since so now the figure may be 2.7 x 1.2 = 3.24% so it may theoretically have crossed the 3% figure already.

[essentialinvestor] 05/5/2022 16:45

Getting whacked, any thoughts on what they hold?.