Ann: Half Yearly Report and Accounts, page-21

"I notice you have this as not held. What's holding you back from buying a share of this company?"

In a word, valuation.

I did own the stock at stages over the course of 2023, but it hasn't been a high conviction position. As a result, it has been a "trade" for me which, while profitable, is not in keeping with my investing DNA which is more aligned with being a long-term holder of rapid-growth compounders. Or, when opportunity presents, a buyer of cyclical businesses trading at very steep discounts to intrinsic valuation.

I don't think SHL is either of these.

But there are times when it does succumb to the market schitzophrenia from being overly loved to being overly hated. Which is why I maintain a watch on the business, but it's never represented elegant investing in my mind, because the times I have made sh0rt-term money out of it, I feel it involved too much luck for my liking.

Don't get me wrong; it isn't a cruddy company. It's a resilient business model, with granular customer base and stable recurring earnings [*], and is more than ably stewarded by its directors.

It's just that it isn't a nimble ski-boat that is capable of rapid acceleration (instead, it's more like a slow-moving oil tanker... slower than the ski boat, maybe, but a lot harder to sink); nor is it ever priced at bargain basement levels that permits having a big, red-hot conviction go at it.

[*] In this same pathology space, I did spend a few hours the other week looking at a minnow in the industry [https://hotcopper.com.au/posts/72281791/single], which looks a lot cheaper than SHL, but the trade-off is that it lacks the long track record of SHL,

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