Tuesday, February 22, 2011

StockChallenge entry

StockChallenge is a monthly share competition, for which I have just submitted my first entry. Wish me luck! You can enter five candidates, and either long or short them. Here are my entries for March:
Long BARC (Barclays) - bank on low PBV
Long CYS (Chrysalis) - VCT on big NAV discount with director purchases. VCT/private equity trusts are trading at big discounts at the moment
Short RCG (RCG Holdings) - company with a lot of director intrigue, puzzling acquisitions, and shareholder dilution. Recently announced a proposition to delist from AIM.
Short YELL (Yell) - Yellow Pages struggling under debt, with no turnaround in operating activities. It's well-liked by Sanjeev Shah of Fidelity Special Situations, though. He's receiving a lot of flak for that pick.
Short PUB (Punch Taverns) - over-endebted pub chain trying to scrape through in an overcrowded market.

The last three companies have very disconcerting share price graphs, and look like messes. Maybe they'll

Damn, I wish I had added HMV as a short now. It, too, is struggling with debt, in structural decline, and will be facing covenant tests in April, which are reckoned to be "tight".

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