Thanks for comments D Dawg, Klog and PetepanI have on occasions...

Thanks for comments D Dawg, Klog and Petepan

I have on occasions considered Breville, but I cannot recall why I never bought. I buy shares one at a time, so if I had to choose one from a short list of four, the remaining three get left out, in spite of their merits. Very often in these situations, I would end up buying more TGA shares, particularly in my own-name portfolio (the non-SMSF one), which now only has TGA in it. I'll look at Breville again.

When I started my SMSF and first got into equities in 2007 or 2006, I invested in managed funds and I bought many shares indiscriminately, including TGA. To my surprise, the managed funds made larger percentage losses during the GFC than I did, in spite of my promiscuous share buying methodology. Over time I have pared the managed funds to one, and lost a lot of money. I also have reduced ASX-listed stocks from a portfolio of 31 to 15 – on average making more losses than gains. My most recent stock exits have been based on my perception that the shares were either overvalued, or they had low dividend-payout ratios, and hence did not suit the pension-paying SMSF – exiting these was at a capital profit. Stocks most recently sold are WOW, CSL, and SGH. In dollar terms, the major recent exit has been from a few Platinum managed funds (at a loss, but not as bad as the earlier exits from other managed funds). TGA on its own has compensated all these losses, because I have continued to invest in TGA, and I have a large paper profit there, plus I have received dividends over the years.

Ignoring two scrappy relics wherein I have minuscule holdings in dollar terms, I now hold ANZ, ARG, BHP, BOL, DOW, FFI, KSC, MLT, NWH, QBE, TGA, UGL and WBC – the total value is just under $1,600K, of which TGA is worth about $1,040K. I could easily cull a few more of the stocks that I hold in my SMSF portfolio, but then I must find a home for the funds realised. ARG and MLT are listed invested companies, which I would not be in if I had other investment objects of high conviction on par with that which TGA enjoys, because they are somewhat like investing in an ASX large-cap index, which makes no sense for an active investor. The banks and a few other holdings are probably fully or over valued, etc, etc.

Anyhow, back to TGA's SP, and Petepan's well placed optimism. I would not be surprised to see the SP at $3.00 in the current profitability setting, and much higher when the new initiatives, like TEF, Cashfirst, Rent-Drive-Buy, network expansion/enhancement, direct importation and the improvements to NCML, reach optimal traction. The SP will bounce around, which I'll substantially ignore because I do not want to buy any more, being so heavily invested in TGA, and I am inclined to hold what I have. For others though, I would advocate accumulating on the dips.

When I was buying in May 2012 at about $1.40, I did not have to be pedantic about my fair-value price, because it was easy to hold that below $2.00 was a no-brainer, and a variation of Okham's Razor (Pioupiou's Razor) is that a simple and sufficient reason does not call for garnishing. When the SP gets to $2.20 (soon I think), then I am sure I'll have no problem pushing back the goalposts, and thereafter repeating the justification process as the SP trends upward in coming years. In YE 30/3/2017 or 30/3/2018, the EPS should be roughly 30 cents, the dividend 15 cents and the trajectory pointing skyward, and then the SP should incline to $4.00+, which is why I am likely to hold what I have. My four offspring will be very happy if I then exit this life, and leave them 500,000 TGA shares to liquidate and squander. I am under strict instructions to stay alive for a few more years and increase the value of my estate.

I wish I could share a similar high level of conviction for a few additional ASX-listed stocks. There are quality alternatives for sure, but one needs to be able to buy them at a good price, which is the problem. At half its current SP, I may put Invocare in the same boat as TGA after examining it again, but at its current SP, it does not merit scrutiny. WOW for instance, has a lower coiled-spring quality than TGA, but sells at nearly twice the P/E ratio. In these times of straitened bargain-buying choices, TGA stands out like a beacon of value in a dark void.

Petepan, your "coiled spring" has now entered into the argot of the investment cognoscenti.