Portfolio Update: 1 sale, 1 buy 📈

Selling a Ford to purchase a Ferrari 🧠

Hi there partner!

Tomorrow we will make two moves in the Quality Growth Portfolio

We are selling a Ford, to purchase a Ferrari 📈

One of our holdings will be sold, and we will initiate a new position with some of the proceeds from the investment.

The company we are selling has performed well in stock price terms, but poorly in its fundamentals. We expected this company to be more versatile, but in recent times it has shown that it is more cyclical than expected. It is also trading at a premium price to earnings multiple. We might visit this business in the future if it sells off, but right now, we want to exit to make capital for better businesses.

The share price has increased by 50% since our purchase at the start of 2022, a fine result for a poor (fundamentally) performing asset.

Our new position is an interesting business with superb fundamentals. The historical growth is fantastic, the fundamentals are industry-leading, they operate in a profitable niche where they have a sustained competitive advantage, and the business is run by its founder with skin in the game.

This company checks all of our boxes, and it is available at a fair price.

Let’s break it down 👇