“Keep in your portfolio high-quality securities that have proven themselves in the past”, Chat

Rémi Le Bailly: Hello everyone. Thank you for your loyalty and your many questions. I’ll start by answering a question that wasn’t asked of me, but since the topic has generated a lot of comments from you in recent weeks, I’ll start with it.

This is Albioma. The result of the takeover bid was announced after the opening last week. KKR, this time, crossed the bar of 90% of capital and voting rights. It is therefore able to implement a squeeze-out procedure, at 50 euros per share. At this time the shareholder has no choice whether or not to give his shares to the offer, he is obliged to do so. He is expropriated.

Note that we feel the price is not high enough and that we advise keeping the titles. There are very few investors in our opinion. For title holders, the operation is neutral. It is the same as if they gave their securities in the offer. After this first “false” question, let’s get to the real thing…

Theo: Hello Mr. Le Bailly. After following your advice to sell when Cac was at its peak, I stayed invested at 30%. Also, my question: should we sell it or when should we replace it (inflation, crash risk, etc.)? Helpful.

Rémi Le Bailly: Thanks twice Theo. First of all because you congratulate me, which is always a pleasure, and then because your question is perfectly in line with the questions of the present time.

In fact, the environment is not good. The clouds gathered and the market bounced back strongly last week. Despite this, as you have no doubt read the investment leads published this week, the market generally falls more strongly when the economy falls into recession, which is the scenario of many financial institutions and the bottom point was reached after the recession started.

So this means that if this scenario happens, we will have to wait for a few quarters before hitting the bottom point. But these are only averages observed in the past (since the early 1970s). Every situation is unique. For one reason or another (more efficient central banks, end of the war in Ukraine …), the economy may return, avoiding this dark scenario.

This means that being 100% liquid is a risky bet. If the market turns around you you forget the start of the rise… You are invested at 30%, that for me is a good compromise. Hold high quality stocks that have proven their value in the past.

Regarding your question “when to reinvest”, ie when to reinvest, you will understand that I think it is better to wait until the economy enters a recession (if the most likely scenario happen), or that it starts again to avoid recession. .

Didier: In your opinion, given the current situation (war in Ukraine), what threshold will Cac 40 reach on December 31, 2022? Thanks in advance for your reply.

Rémi Le Bailly: I think it will be below 6,000 points or even 5,500 if the prospect of a recession is no longer in doubt.

Victor70: Hello Mr Le Bailly. I follow the recommendation to buy Chargeurs shares, especially since the announced yield is high. Should we keep these titles waiting for the rise? In addition, the Investir site does not include an error in dividends: you announce a dividend of 1.24 euros… But elsewhere you document 0.76 euros. Thank you for your accuracy.

Rémi Le Bailly: We are dedicating an article to the Chargeurs every week this week. We have moved from “buying” to “speculative buying” because it is clear that there is a certain distrust in the company, whose results remain generally satisfactory.

In addition, regarding the dividend, the company paid a dividend of 1.24 euros for the 2021 financial year in two installments. A deposit of 0.48 euros at the end of last year and a supplement, called the balance, in April. Most companies distribute the dividend in one go, but some do it in two or even four installments, such as TotalEnergies.

For the 2022 financial year, the Chargeurs have decided to pay a deposit of 0.22 euros to be paid on October 6. We expect a total dividend of 0.50 euros for the whole year.

Minouchat: Hello Mr. Le Bailly. I made a low average in Orpea at 25 euros, do you think we should do the same at 14/15 €? The value of the housing stock alone, I think, is higher than the current value of the stock market, but by how much? Given the price massacre but still full of EPHADs, could a takeover bid emerge? Helpful.

Rémi Le Bailly: Many of you have asked me about Orpea. To begin with, I remind you that I am suspicious about falling averages. This is often a way for the investor not to recognize that he is wrong.

The title will likely be worth more than it is now in 5 years. As for 2, I’m not sure. We advise you to stay as the sale is late.

Mmaxx: Hello, is there a clerical error in your section “Managers selling short” in your last edition, where the paragraph dedicated to Alstom and Vinci refers to a railway specialist and a computer science group ? Thanks for your chat and, in advance, for your explanations.

Rémi Le Bailly: Good to see. You should have read it and not Vinci. Sorry for this error.

Kontrarian: What is your new opinion on the M6 ​​side after leaving the TF1 integration project?

Rémi Le Bailly: When you join this chat, you can also read our advice on the site. At the beginning of the afternoon, we published an article in which we recommend the sale of M6, which is the company, a priori, the most favored by the TF1-M6 marriage. We remain buy on TF1 which benefits (like M6 in addition) from a generous dividend and has greater potential for improving its profitability.

Gim: Hello Mr. Le Bailly, how many GTT shares does Engie still hold? Thank you for your reply.

Rémi Le Bailly: Engie lightened its position again at the end of last week, by selling 6% of the capital. It weighed in on the title on Friday. Engie still has about 5% of the capital and is trying to keep it for at least one year. In addition, Engie issued, in May 2021, zero coupon bonds with a maturity of 3 years, redeemable with GTT shares. This represents approximately 10% of the capital.

Your implied question is about the risk of “reversal of paper”. So it seems to be excluded for 1 year. Then there is the potential to reach 5% of the market in 1 year, then 10% in two years. But in the latter case, bond subscribers can decide to keep all or part of their securities.

I remind you that we bought GTT, a company that benefited from the “boom” in liquefied natural gas, which is a way of reducing Europe’s dependence on Russian gas.

Maseti: Hello, I am trying to get a clearer picture of property companies. After reading La Cote on Saturday, I don’t know who to choose between Icade, Argan, Gecina and Nexity (depending on their debt, ability to rebound, yield, etc.). Thanks for enlightening me. Helpful.

Rémi Le Bailly: We bought these 4 property companies, but their profiles are very different. Gecina, which is in residential real estate, is the safest. Argan is the most dynamic value because it changes in the dynamic logistics market, but its yield is not very attractive. Nexity and Icade have a riskier profile, especially Nexity being a promoter, but these last two securities are highly discounted…

Pierre: Hello Mr. Le Bailly. What is your opinion on ABC Arbitrage? In fact, due to the current high volatility of the markets, I thought that this value would be interesting, especially since the yield is good and it was, a few months ago, in your Top 10 Yield. However, I know it can be frustrating for many months, with a price that just goes down… Thanks for your opinion.

Rémi Le Bailly: Very disappointed because it is a bit harsh. The action decreased about 5% since the beginning of the year and over a year, when the Cac 40 reached, him, 15% since the beginning of the year and over a year. The company pays a dividend of 40 cents (in four installments) for the 2021 fiscal year, which means its reinvested dividend performance is more or less stable over the year.

We will know more tomorrow about the impact of volatility on the accounts, as the company will publish its results for the first half.

Nicolas: Hello Rémi, I own 130 shares of UMG Group at an average of 22 euros. The title has been underperforming for a long time, should we sell and consolidate Vivendi? Or should we move on and do you think music will rise again? Thanks for all the chats and replies.

Rémi Le Bailly: I want to keep the UMG titles. The action was introduced as very expensive but the music sector was quite defensive. Which is pretty good in the current environment.

Ron: Hello, with rising rates is there still time to invest in credit SCPIs?

Rémi Le Bailly: Of course, it is less interesting than before, but the rate of credits is still lower than what SCPIs have done. This also makes it possible to streamline the investment effort over time. You just need to negotiate your credit rate well in an environment that is not the easiest…

Thank you all for your questions. I can’t process them all, there are so many.

Feel free to try your luck next week. You will see on this occasion the friend Denis. Have a great week everyone and see you soon.


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