October 6, 2017

Securitas for a secure portfolio



Obermatt's personal top 10 stock lists only contain large stocks. In addition, they filter out all stocks that are hard to understand because of financial facts, such as shareholdings and biotech.

What’s left are stocks in industries that we can understand, like service providers, product manufacturers and companies from the industrial sector. We already evaluated some companies of this kind for Northern Europe this week, with a focus on companies with sound management incentives.

These are companies in countries with reasonable wages and thus little incentive to do stupid things. This is important to me these days because high wages are a reliable indicator for a bad return of a stock.

Dr. Stern's personal top 10 starts with Atlas Copco, which he has had in my portfolio for almost two years. On place three, there was Investor, an investment vehicle of the Wallenberg family. They also have reasonable wages for the managers. However, he decided against Investor in the end because he can simply buy the stocks from Investor’s portfolio himself and thereby save the costs for the management company – which has almost 100 highly qualified experts on their payroll.

In the end, he decided to buy security service provider Securitas, which is on place 7 of his personal top 10. Security is a business that is unlikely to lose importance, and our analyses revealed good stock rankings for Securitas across the board. The financial facts, therefore, indicate that investing in the company is a good idea.

Dr. Stern buys 300 shares of Securitas (SECU-B, SE0000163594) at market, so everything is good.



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