OT: Nestle

Jim, may I point your attention to a mutual “holding forever” which never is cheap? Also now Nestlé is not really cheap but a Charlie or Warren might say “reasonably priced” (unfortunately I am too cheap to use this opportunity - but another 10% down and I can’t resist).

Jim, may I point your attention to a mutual “holding forever” which never is cheap?

Definitely.
I have wanted a position for years, but could never convince myself the price I was paying represented a margin of safety, so I’ve never owned it.
After a while, I stopped looking so often.

Jim

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L’Oreal is another European business I would like to understand better. Without knowing much about it other than half the population seem to enjoy the products…like everything else it gets cheaper daily and therefore more interesting.

I haven’t heard Buffett talk about beauty products. Maybe they are always too expensive for his taste, or maybe they are not as durable as other consumer products he likes.

Haven’t looked at the numbers but imagine it is high margin with pricing power type business. Probably a nice company to hold for a few decades, if the price was right.

Likewise Unilever trading at 18 x earnings and 5 year lows…

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How about biotech? I’ve seen a suggestion that a lot of constituents of the Nasdaq Biotech index are trading for less than cash - just buy the basket via SBIO.L or IBB?

Vanguards’s Developed Europe etf is one way to buy a basket of these stocks:
https://www.vanguardinvestor.co.uk/investments/vanguard-ftse…

612 stocks:
p/e 14
p/b 1.9
div yield 2.75%

SA

my financial advisor got me in Nestle once, all good except the swiss govt takes a bigger chunk(35%) of Dividends than most other Govts unless you fight the swiss bureaucracy to get it to the 15% they’re entitled to(or whatever your tax treaty is). The ETF’s and funds will fight, you and me , maybe, maybe not --------------- my financial advisor was in the NOT camp

on a side note, the UK dividend withholding was 0% at the time. austerity for the masses but international shareholders are special so I sat on CUK instead of CCL for a bit if U K is still at 0% BP and GSK are lookin good at 4% div

Mondo

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Am uncomfortable with trusting Nestle as one trusts Berkshire.

If you want a truly long position, it is more like a marriage.

One must be able to trust.

I have negative trust in Nestle.

Am uncomfortable with trusting Nestle as one trusts Berkshire.
If you want a truly long position, it is more like a marriage.
One must be able to trust.
I have negative trust in Nestle.

It makes sense to eliminate a stock from consideration on that basis.
There are companies I won’t buy into, and I won’t buy into any index that holds them.

But of course opinions can differ.
For example, they are ranked the 59th most respected big firm worldwide by Reptrak with a score of 73.5. The highest score was 79.0.

As it happens, I trust Nestle a fair bit more than most firms.
They have been the victim of some very strong negative PR campaigns, some of which were seemingly well justified, some much less so.
They are extremely popular as a target, without a doubt. But popularity as a target is not proportional to wrongdoing or negative externalities.
It has very much more to do with incentives for those doing the attacking.
As mentioned, I’m not arguing that none was deserved, nor that you should change your opinion.
But one should always be aware of the power of a narrative: Firms vary in terms of how easy a target they are and how fashionable it is to go after them quite independently of their actual negative influence.

Jim

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It makes sense to think about these things, but mostly I don’t worry about investing in “bad” companies. Most of them are “bad” in some way or other and it’s hard to know which ones are worse. But mostly I think of it as being Robin Hood - why leave the spoils for the bad guys? I prefer to take the money from the bad guys and give it to the good, that’s me obviously :slight_smile: and those that I buy from and donate to.

SA

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Nestle is made for days like this. The only stock in my portfolio which is up today.

Someone mentioned L’Oreal. Nestle owns 20% of L’Oreal. They are gradually reducing their ownership by selling lots every couple of years. They have a long term deal with the founding Betancourt family.

L’Oreal always seems to trade at very high PE in the high 20s or 30s, regardless of the economy or stock markets.

Hi Steady,

The bad guys can cheat you before you get money from them…

That is unless you just try quick trading?

I hate trading, but am glad that we raised a little more cash this year, even though cash is depreciating too much…

No worries, nothing is ever perfect👍🏼

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Yes, a huge negative for all Swiss-based companies who pay out big dividends.