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Simon Thompson's Bargain Portfolio

The idea behind our annual Bargain Shares Portfolio is very simple. It’s to invest in companies where the true worth of the assets is not reflected in the share price, usually for some temporary reason, but where we can reasonably expect that it will be in due course.

Our portfolios are based on the investment ideas of Benjamin Graham (see box ‘Rules of Engagement’) and they have beaten the FTSE All-Share index in 13 out of the 16 years in which we have run them. During that time, they’ve generated an average return of 22.7 per cent in the first 12-month holding period compared with an average increase of 4 per cent for the FTSE All-Share.

Latest Updates

  1. Take time out to consider Oakley

    Take time out to consider Oakley

    By Simon Thompson | 25 April 2016

    Shares in the cash-rich private equity group are priced on a thumping discount to book value, and unjustifiably so

    Having taken a close look at the latest annual results, the valuation is completely out of sync with a company that produced a 33 per cent return on its investment portfolio, driven by strong increases in the cash profitability of the constituent investee companies.

  2. Scaling up for profitability

    Scaling up for profitability

    By Simon Thompson | 20 April 2016

    Shares in a specialist asset manager are heavily asset backed and its experienced management team is worth backing too.

    The bottom line is that the company has rock solid asset backing through property assets worth almost £11m including the cash due from the Royal Mail sorting office in Edinburgh; deferred consideration from Persimmon of £5.9m which is in effect being released through the Kleinwort banking facility; listed shares worth £5.9m; and investments in cemeteries worth £620,000. It also had net funds of £890,000 at the end of 2015.

  3. Top end performance

    Top end performance

    By Simon Thompson | 20 April 2016

    A small cap manufacturer and distributor of industrial fastenings hits the top-end of earnings estimates.

    Another point worth noting is that I reckon the company should have ended the financial year with net debt just above £17m, implying balance sheet gearing of 23 per cent, so has substantial firepower to make further earnings enhancing bolt-on acquisitions as and when the right ones are identified.

  4. New highs beckon

    New highs beckon

    By Simon Thompson | 19 April 2016

    Shares in an Eastern European property fund manager look poised to make further ground in the months ahead.

    Recurring profit earned from the debt funded earnings accretive Eastern European commercial property acquisitions covers earnings forecasts for the financial year to end March 2017. On that basis, the shares are rated on 11 times earnings estimates and offer a prospective dividend yield of 3 per cent.

  5. Bargain shares updates: 15 April 2016

    Bargain shares updates: 15 April 2016

    By Simon Thompson | 12 April 2016

    Our stockpicking expert assesses news from five of the companies on his watchlist.

    Once these settlements are made, cash and receivables will more than treble to 63p (before accounting for tax and other reserves) meaning that almost 80 per cent of the last reported net asset value will be in cash. Moreover, the board will be distributing funds back to shareholders in the most appropriate way.

Our portfolios

Mr Bearbull's Global Fund Portfolio

A portfolio of instruments designed to capture the rise of emerging markets

Mr Bearbull's Income Fund Portfolio

A collection of high-yielding shares that's beaten the market since 1998

Chris Dillow's Benchmark Portfolio

Simple portfolios picked using simple rules that often beat the market

John Baron's Investment Trust Portfolios

A portfolio of investment trusts designed to generate growth and income

David Stevenson's SIPP Portfolio

Our columnist describes how he manages his pension fund and what he puts in it

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