Annual Review 2023
2023 has been a notably eventful year for me as an investor. Despite the ups and downs, my portfolio managed to return approximately 16%. The chart below will be used as a guide to some of the key events during the year.
Stuff outside of investing: Sections A, B, and C
The first quarter of the year, before section A, was quite similar to the end of 2022 for me personally. As a full time student at the time, there was a good amount of time left over to research new cases.
In Section A I started writing my thesis, and finished my second degree. This took a huge portion of time and energy, and I did not do much in terms of deep research.
Luckily, I managed to land a really cool job during the summer, fresh out of school, as a developer at Quartr. I learned a lot, probably more than during the entire B.Sc. degree i just finished. This also took a lot of time and energy, but it was incredibly rewarding!
Summer came, and summer went… Time passed incredibly fast, and between B and C, I involuntarily became a full time investor (unemployed), before landing a great job as a full-stack developer, at a place where I also can utilize both my interest for investing and my finance degree. This, however, was in Stockholm, whereas I was living in Helsinki at the time. So I had to move back to my home country, from living abroad for 5 years. Again, this took incredible amounts of time and energy.
So, to summarize, I feel that the only time I had a good amount of spare time and energy was during Q1, after which I had to do so much other than focusing on looking for new cases. With that in mind, I am very happy with this years performance, and look forward to settling in so that I can go back to putting in the effort I want into my portfolio.
Stocks: sections 1 - 5
During the year I created or updated 76 different sheets, of which 33 are up to date as of today. This means I looked at, and found 76 different cases interesting enough to at least want one quarter of data in my spreadsheet model.
During the year made 88 transactions in 26 different stocks. Some of the more significant stocks during the year has been: G5 Entertainment, Brdr. Hartmann, Mag Interactive, New Wave, Odfjell Technology, Reka Industrial, Rovio, TIGO, Tura, VBG, Bergman & Beving, Nordic Paper, ScandBook, and Svedbergs.
MAG Interactive
Section one in the image is the drawdown caused by holding MAG Interactive over the Q4 2022 report. I bought most shares at the end of 2022 at about 24 sek, increased the hodling in january 2023 at 20 sek. I sold all shares at 17 to 18 sek in both early and late march, and have since then proceeded to pretend that the company simply does not exist.
Brdr. Hartmann
Section two relates to the tumultous case of Brdr. Hartmann. An egg-carton producer from denmark, which looked cheap in relation to their earnings power. I initiated buying in january at about 300 dkk per share, and tripeled the position at about 340-360 dkk, after the company on february 28th issued preliminary figures pointing to better than expected results for the full year 2022. About a week later, on march 7th, the company issues guidance for 2023 pointing to a severe decrease in margins.
This low guidance made no sense to me or the other very knowledgeable and trustworthy investors I had spoken to. Based on what we saw in input and output prices, energy prices, and more, this guidance either signaled that management knows something we don’t… Or they have no idea what they are talking about! I didn’t have the guts to say that I know better than management, and was afraid that there was somehing i was missing or didn’t understand, so a day later i sold all my shares at about 300 dkk.
About 6 months later, the majority shareholder, Thornico, calls to an extraordinary general meeting to propose the delisting of Hartmann shares, together with an offer to purchase all shares at 300 dkk. They got about 10% of shares and increased the bid to 360 dkk about a month later.
VBG Group
VBG has three divisions: Truck & Trailer Equipment, Mobile Thermal Solutions, and Ringfeder Power Transmission. It is an above average quality company that was trading at a below average multiple on what I believed to be normalized earnigns power. I bought shares in march and late april-early may, at between 160 and 177 sek. I sold some of the shares i nmay at 180 sek, and sold the rest in three waves, august, september, and november at prices between 190 and 230 sek per share. I was very happy with my investing, the performance of the business, and my return on the stock… On the 1st of june 2024, the shares reached their peak price of 484 sek per share.
Pricer
Pricer is a seller of ESL’s, electronic shelf labels, both the physical hardware and a software service. Pricer had a very troubeled 2022, but me and the same guys that were in Hartmann together thought the fundamentals of the business had bottomed out and that the margins were set to improve during 2023. I bought shares in june, july, and september of 2023, and in january of 2024, at prices between 6,7 and 7,2 sek per share. I know that im breaching the bounds of the year 2023, but I sold my shares in pricer between march and june of 2024 at prices between 9 and 12,6 sek per share, making fantastic returns on a sizeable portion of the portfolio.
New Wave
New Wave divides their business into three segments, Corporate (promotional products), Sports & Leisure, and Gifts & Home Furnishings. In my eyes the company is often mistreaded by the market for carrying unusally much inventory, and for communicating in an uncommonly honest manner. The founder is still the CEO, and the company was trading at very low multiples compared to what I thought normalized margins to be. Before 2020/2021, the company had operational margins between 5% and 9%, but after 2020 the company managed to pull off operating margins between 15% and 17%!
The market did not believe these margins to be sustainable, but I thought the company had made lasting changes to their cost structure in 2020, which would make the margins sustainable. I bought shares in may and august at prices between 75 and 100 sek per share (split adjusted), and sold a small amount of my shares in october to november, and the last stake in february of 2024, at prices between 86 and 123 sek per share.
Other stocks contributing to 2023
Closing thoughts
The trend of concentrating my portfolio continued, and I keep getting more and more sure of my own personal strategy and style as an investor. Finding something that makes me want to do the hard work, and dig deep is still one of the best feelings for me as an investor. And I hope that never goes away.
The first pieces of this annual review was written early 2024, then another section after the summer, and now I am finally coming around to finishing it with less than three weeks remainging on 2024(!)… Lets see how long it takes me to write the 2024 annual review. Hope your 2023 was great, and see you soon, or whenever I get around to summarizing 2024.
Over and out.
ValueTeddy