Loved name within the sector, but actually only achieved 1% growth ex FX in H1, and that benefit will likely have been fully achieved by the end of 2015 given hedging strategies. That leaves tough comps and a difficult operating environment, with headwinds in China, the US and less tourism in Europe thanks to the…
Themes to start 2016: Some of the themes we liked for end of 2015 start of 2016 have played out in Q4, but we stick with them for the start of the year. On the long side we stick with our TELCO theme. None of this is ground breaking, but sometimes the best trades are the…
Over the last two days RIO has rallied over 9%. Still our preferred miner but for now we step aside as global IP continues to struggle and the commodity complex stays under pressure going into 2016. We take this opportunity to close RIO FOR -10.24%. At the same time we take this opportunity to close…
European car sales where very good this morning. Rates are going up so cyclicals due a period of outperformance. China car sales have been great helped by the tax cut as we continue to see them feeding through. Plastic Omnium Agrees to Buy Faurecia Fender Unit for EU665M. Peugeot own ~50% of Faurecia which is…
Following our short call in SANDVIK yesterday as Global Industrial production slows we close our Long in SKF. Sandvik is the way to get exposure to Industrials on the short side as it trades a premium to history on 13x EBITDA and 16.5x earnings and the normally very tight correlation with commodity prices and the…
The arrival of the new CEO brought hopes of portfolio optimisation. Since then Sandvik has rallied more than 30% off the lows. With global data tepid at best and bond yields doing what they are doing, we want to get exposure to industrials on the short side. Sandvik is one of these. Structural pressures in…
We are closing Orange this morning. Two bits of news in last two days that lead us to close the trade. Firstly, yesterday a Bloomberg article stating that Orange to explore tie up with Telecom Italia as well as other M&A options. Although that may be an accretive deal LT it will lead to ST…
Had a great run recently. Attractive exposure to the European consumer and especially the Germans has been a key driver. Has been helped more recently by talk of dropping of sanctions by the west on Russia as the 2 sides seems to be working together to battle ISIS. We use the recent bounce to close…
HK -38.5%, USA -12.2%, Japan flat, China -5.1%, Italy -4.1% , Germany -4.7% USA poor again as has been an area of support for them. Nothing has changed for us as worrying mix development continues and inventory will continue to require elevated marketing spend to shift. Warning from peers in the US and struggling weak…
We originally bought SKF in mid July which proved to be a disaster timing wise. We doubled up on 21st October as we felt the bad news was out there and in the price. The new CEO has a lot of levers he can pull, in particular in the auto division, where any signs of…