Sunday, July 24, 2005
Chaucer slumps as Amlin walk away
Amlin have announced they are not interested in buying Chaucer. As expected, Chaucer fell back sharply on the news and on Friday stood at 60p to sell. A few weeks ago they were as high as 69p, buoyed by the bid speculation.
This has dealt a real blow to my returns. Prior to the news, Chaucer made up 21% of my portfolio.
Though the takeover was aborted, dashing any hopes of a deal at 70p+, cofirmation that Amlin was interested forced market observers to get their calculators out again and price up Chaucer. And it seems they have decided Chaucer deserves a higher price than was assumed throughout 2004. For much of last year Chaucer malingered at around 48p, dipping to 40p during the Atlantic hurricane season. With hurricanes beginning to strike again, I'm worried Chaucer could slump again - further delaying any advance to my calculated fair value of 66p.
One positive to emerge recently has been from SVB, my portfolio's smallest constituent. The insurers shares have advanced handsomely, leaping a huge 9% in trading on Friday. The shares now stand 16% above my April buy price of 24.12p. I expect more soon as the interim results approach.
Interims are also expected soon from the housebuilder Ben Bailey. Builders have been complaining recently of a much tougher market, with both house prices and completions falling. At 437p Ben Bailey remains way too cheap, with strong interims and decreasing interest rates expected, will the company finally get the recognition it deserves?
The Artful Dodger
This has dealt a real blow to my returns. Prior to the news, Chaucer made up 21% of my portfolio.
Though the takeover was aborted, dashing any hopes of a deal at 70p+, cofirmation that Amlin was interested forced market observers to get their calculators out again and price up Chaucer. And it seems they have decided Chaucer deserves a higher price than was assumed throughout 2004. For much of last year Chaucer malingered at around 48p, dipping to 40p during the Atlantic hurricane season. With hurricanes beginning to strike again, I'm worried Chaucer could slump again - further delaying any advance to my calculated fair value of 66p.
One positive to emerge recently has been from SVB, my portfolio's smallest constituent. The insurers shares have advanced handsomely, leaping a huge 9% in trading on Friday. The shares now stand 16% above my April buy price of 24.12p. I expect more soon as the interim results approach.
Interims are also expected soon from the housebuilder Ben Bailey. Builders have been complaining recently of a much tougher market, with both house prices and completions falling. At 437p Ben Bailey remains way too cheap, with strong interims and decreasing interest rates expected, will the company finally get the recognition it deserves?
The Artful Dodger
Comments:
Post a Comment
