Select Harvest returns... and a soggy tea bag

Punter sells, then buys back into Select Harvests


Opinion
The Punter sold off his shares in Select Harvest, then bought back in, it's not so much macadamia nuts (pictured above) he's got his eye on, but rather almonds. He's also watching Australian Dairy Farms.

The Punter sold off his shares in Select Harvest, then bought back in, it's not so much macadamia nuts (pictured above) he's got his eye on, but rather almonds. He's also watching Australian Dairy Farms.

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Is the Punter going nuts?

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Early last month the Punter finally sold the last of his shares in Select Harvests (ASX code SHV) at $5.44 each, for a modest profit. 

He'd have made more if he had sold them earlier, of course, but he is not complaining.   

He sold them ex-dividend, so he still received a $70 dividend on October 5.

The shares continued to slide and late last week were down to $5.14. 

At that level they are down 30 per cent since July. 

They are still selling for 20 times earnings per share, which looks pretty high, but the Punter, having carefully studied his soggy teabag, has decided they probably won't go much lower.

The company did make an impressive turnaround last year, cutting costs, more than doubling its net profit after tax and cutting debt.

The result mainly reflected both higher volumes and higher prices for its almonds, which more than offset a setback in sales of some of it branded products in the face of tough competition from supermarket own-label brands.

It is still early days, but the 2019 harvest outlook is looking good and Select expects its almond crop to be up around 8 per cent. 

Hoping he isn't going nuts, Punter has bought 600 SHV at $5.16 for a total of $3116.

He has also set aside $2500 to buy 19,231 more shares in Australian Dairy Farms (AHF) at 13c under the share purchase plan, which closes on Wednesday. He won't actually transfer the money until the last minute, but, at the time of writing, the offer is a modest bargain, with the shares costing 14.5c to buy on the stock market.

The Punter's star of the week was the South Australian graphite miner Archer Exploration (AXE) which jumped 40 per cent on news it has secured a binding material transfer agreement with a German biotech company to supply the graphene for the development of an electrochemical biosensor to detect diseases.

It's all still at the research stage, but it does indicate that there is serious interest in Archer's graphene-based biosensor development work with the University of Adelaide.

  •  The Punter has no financial qualifications and no links to the financial services industry.  He owns shares in a number of companies featured in this column.
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