Evil Knievil: A profitable playground for pricks

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Evil Knievil: A profitable playground for pricks

Investment is originated in all sorts of different ways. For instance, my chum Robert B was on his crystal wireless set listening fifty years ago to the BBC World Service in the middle of the night as he lay in bed in Lusaka. Reception was not good (it never was) but he picked up the name of a company, Queensland Mines (QM). In the morning he sent a telegram to his bank in London instructing them to acquire a healthy whack of QM. A few days later he received a contract note by post as he followed the persistent rise in the share price of QM. He doubled his money and sent another telegram instructing his bank to get him out.

The result was a brand-new Peugeot with big wheels which of course are ideal for negotiating Central African roads since they tend to clear potholes more readily. This Peugeot served him very well and, as far as I can recall, it carried him and his wife up to Kenya a few years later when they emigrated.

Nowadays this inspired grasping of the Australian mining boom would not be allowed since the FCA can possibly deal with words beginning with the letter Q even though it is quite far along the alphabet. Definitely, the cut-off point here is the letter P – and this is relevant to the stock selection which I adumbrate below.

Robert is still alive, aged 86, and his wife, Jenny, a godmother to my elder daughter, is also motoring. Her father, a white man, was Zambian Minister for Native Affairs in the interim government that emerged with Zambia’s independence. 

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Yesterday evening, my pal, Lord Monson, dropped by for whisky and an opportunity for me to stop watching the hopeless performance of my selections in Champions League. (All was well later when Hamilton Academicals drew with Aberdeen – I tend to support academics.)

Anyway, Lord M drew my attention to the latest hot stock in America, Palantir (NYSE:PLTR) which he had acquired yesterday afternoon at $25. An hour or two later, as we contemplated the single malt, it had advanced to $28. Apparently, the target price is $200. Do not ask me why since I have not the faintest idea as to what is going on. Comfortingly, as far as I am aware, nobody else has either. But it is an ideal stock for those locked up during lockdown.

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The editor has asked me to comment on gold. Really, I have nothing to add to my sense of disappointment though I think it most unlikely that the US government’s debt is more likely to be controlled under Biden than it has been under Trump. Therefore, it is surely right to stay long of gold. The flight from USD will surely occur.

*****

Over here, the governor of the BoE, Andrew Bailey, has opined that failure to “do a deal” by the end of the year over Brexit will be more damaging to Britain than Covid. Here he is committing the same blunder as his predecessor Carney who also supposed that he knew what the Continentals would get up to. However, we modest chaps of Chelsea decline to opine since we simply do not know. And nor as it happens does Bailey.

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It is noticeable that Beximco Pharma (LON:BXP) is now ex dividend and a ten per cent scrip issue yet stands at 90p. What a beauty. BXP’s deal with the Serum Institute of India to handle AstraZeneca’s Covid vaccine is also a whizzer since others require their vaccine to be kept below minus 70 degrees centigrade – not easily done on the Indian sub-continent. A-Z’s offering can be carried around at minus twenty. An altogether more practical affair. Bangladesh has 160m citizens and offers a profitable playground for pricks.

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Meanwhile REA (LON:RE.) keeps producing palm oil in Indonesia where the cash price is now a startling $920. I am of course well aware that the price of palm oil can decline but, right now, that does not seem likely. So I have moved my target price for RE. ordinaries up to at least 200p. Given their current price of 55p, it is clearly time to fill yer boots. RE. is of course beyond the FCA’s comprehension cut off point at the letter P. Investors should therefore be safe from being checked by the FCA’s madmen.

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Comments (1)

  • philip baker says:

    Re. have re-confirmed the passing of the preference dividend for December. Statement on 17.11.20 i believe. So if you include next years dividend the preference could yield 27p for the year, if they are brought up to date. A yield potential of 35%. Can Re. produce 27p of cash per preference share at $900 or maybe $800 for crude palm oil?
    I do not know where the companies break even price is, no mention of it in the annual statement.
    I would imagine if a rival appeared now with a bid of 100p per share and 100p per preference share and dividends brought up to date they would get approval and a potential bargain if crude palm oil stays high.
    If any rival sits on the side lines the price could reasonably reach your targets over time.
    I am a holder of the preference. The temptation of the ordinaries is still out weighed by my thought of dividends from the preference.

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