Stock of the month - March 2020

Hello everyone

Here is the monthly thread. Before we get down to money and wealth (or the depletion of it) I just want to pay tribute to those on the front line and those who have lost loved ones.

I’m sure I’m not the only one to have suffered in other ways. I was let go by my firm in March and yesterday I lost someone to Covid-19. He was a man with a large family with his youngest just 7 years old. I realise that losing a job is really actually nothing compared to losing your closest and dearest. I had a happy childhood and my parents are still living, I’ll get another job and it will be all part of my CV. In fact I will take the opportunity to take time out and study. However, for this family the whole of the rest of their life will now revolve around losing their dad so young with the impact it has. Perhaps there are others here with similar stories or maybe you will have a similar story by the time the next stock of the month appears. Life seems so fragile and uncertain. I hope you all stay safe and well.

It was a relatively good month for grocers, Sainsburys and Ocado, Tesco and pretty much any food store. Gold miners too held pretty firm. Online service-based retailers are probably on for a bumper year and their stocks maybe unfairly depressed. I am particularly impressed at Amazon’s continued resilience. As everyone moves off the high street to online it could be the final nail for the high street. I really think high street will become the thing of the past with its high rent and rates and employee intensive nature can be sustained. I wonder how much stock is lost due to theft on the high street or damage from being shop spoilt? Might not be much but in an era of fractions of % it is just another edge online stores have. What about theatres and cinemas? With Disney launching its own channel are we spending our working from home with home entertainment?

Sales for travel agency or airline firm are near zero. It’s quite difficult to see with a terrible recession looming how anyone will be booking too many fancy holidays. Cruises? The holiday of choice for many retirees, but will this be the end of Carnival? Their stock was lauded by a certain investment advice website a few months back and now it is cap in hand to its shareholders. It is difficult to see an early recovery here with the enormous overheads cruise ships have. I think this stock will fall a bit more. However, if you fancy a cruise holiday, I suspect there will be some cheap packages floating around what travel companies are left in the near future.

I suspect quite a few of us screaming for a slice of the UK and American airline industry are now actually quite relieved we all dodged a bullet. Or maybe a hail of bullets. Meanwhile the side effects for those concerned with a green agenda probably couldn’t have seen a more effective weapon. There will be plenty of people enjoying watching the oil firms suffer. Shell must really be considering the unthinkable; stopping its dividend.

Have we now changed as a country? Travel to work or abroad a thing of the past? Could the high streets be turned into flats? Could this be the defining year of the 21st century? Will we as a nation rather become more self-reliant even if it costs a bit more?

What about Brexit? What’s Brexit? You mean for 3 years we spoke of nothing else and now it is all just irrelevant? Is the EU even still there? With nation states looking after their own and the borders locked down it’s a very strange world.

So to invest in “bargains” or hold fire and conserve ammunition? Recession on the way? Sure. Is that built in to the stock market; well partly. Nobody knows the true scale and there will a good few firms which will be going pop over the next 12 months. One thing I will be doing before investing is to check the debt on the balance sheet. Strap yourselves in folks for there are plenty of swings in this playground.

Stay safe everyone.


As per Freetrade’s policy always remember to do your own research.

Remember that past performance is no guarantee of future performance.

This is a discussion only thread and is not advice to invest in any particular stock.

February 2020 stock of the month thread

January 2020 stock of the month thread

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