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StingyInvestor.com |
Current Stats
Average Capital Gain
33.5%
Average Holding Period
2.4 Yrs
03/31/2001 to 12/31/2009
33.5%
Average Holding Period
2.4 Yrs
03/31/2001 to 12/31/2009
Eight Years in Review (Q1 2009)
(The stats below cover the 03/31/2001 to 03/31/2009 period.)
This is the eighth anniversary of the Rothery Report and, even after suffering from the biggest bear market since 1929, I remain pleased with our long-term track record. Over the last eight years we've uncovered some very profitable situations. So, I hope you'll excuse a little walk down memory lane.
Our best performer, so far, was our first Books-A-Million venture which provided capital gains of 606%. Add in dividends and the total return came to 626% by the time we sold the firm in the summer of 2006. As it happens, the stock subsequently declined and we're on to round two with the company. Our second best gainer was Service Corp which generated a capital gain of 462% by the time it was sold at the end of 2007. Add in dividends and Service provided total returns of 474%. Third place goes to Algoma Central which was sold in late 2006 for an average capital gain of 263% and an average total return of 279%. Following behind, Lone Star picked up a capital gain of 221% and Apple Computer netted us returns of 213%. Alas, we would have fared even better on Apple if we had held on for a while longer.
| Top Rothery Report Capital Gainers | |||
| Company | Capital Gain | Years Held | Annualized Gain |
| Books-A-Million | 606% | 3.5 | 76% |
| Service | 462% | 5.4 | 37% |
| Algoma Central | 263% | 4.3 | 35% |
| Lone Star Tech | 221% | 3.3 | 43% |
| Apple Computer | 213% | 2.2 | 67% |
| Indigo | 159% | 6.5 | 16% |
| Toys 'R' Us | 158% | 1.7 | 76% |
| John B Sanfilippo | 149% | 0.8 | 210% |
| Circuit City | 148% | 2.7 | 41% |
| MDC | 123% | 2.1 | 45% |
| Altria | 107% | 6.8 | 11% |
Below the 200% level, Indigo Books & Music returned 159% and remains a current holding. We expect even more from the firm in the next few years. The next four winners were sold some time ago but enjoyed healthy profits. Toys 'R' Us climbed 158%, John B. Sanfilippo & Sons gained 149%, Circuit City returned 148%, and M.D.C. moved 123% higher. Altria rounds out our 100% plus list with a 107% gain and that includes the Kraft spinoff but not its hefty dividend yield which exceeded 8% at times.
Greatest hits are one thing, but how do we stack up overall? The average Rothery Report stock has provided capital gains of 24.6% since first being suggested and we've held our stocks for 2.36 years on average. Based on these two numbers, our annualized average capital gain comes in at 9.7%. But this figure does not include dividends which would boost our total returns by several percentage points. Indeed, the average dividend yield on our current portfolio is 3.7%.
By way of comparison, over the last eight years the S&P500 (as represented by the SPY exchange traded fund) lost an average of 3.0% annually and the S&P/TSX Composite (as represented by the XIC exchange traded fund) gained only 3.1% on average annually. Coincidentally, the average dividend yield of 3.7% on our current portfolio exceeds the average annual return of both the S&P500 and the S&P/TSX Composite including reinvested dividends.
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