Freetrade diary – Buy, Buy, Sell, Sell

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Not a HUGE amount of activity this past month, but certainly a lot more than probably the last 10+ months.

Off the back of selling a number of shares within my Freetrade account in order to start consolidating the amount of companies I’m invested in, I sold yet another in the form of Visa.

As I mentioned in my last update, I think this is a great stock to hold for the long-term; if I wasn’t primarily a fund investor I’d probably have this as one of my core holdings, but I wanted to free up the funds to use somewhere else so it had to go.

I actually topped my account for the first time in a long while too to buy into the dropping price of Unilever. I almost doubled my position in the stock after it had dropped as low as £37 a share from YTD highs of £44.

I didn’t really time this very well though – and I don’t mean because I missed out on buying right at the bottom – but because I missed the ex. div. date of the 25th Feb. I’ll just have to wait for next quarter for those new dividends to be realised.

So why did Unilever’s price drop this month?

It looked like the most of the drop came from a reaction to their 2020 annual results.

Sales fell 2.4% over the year with operating profit also dropping 4.6%.

This is no tremendous surprise really given the what the world has gone through over the last 12 months, and all things considered I don’t have much concern at all given Unilever is still a highly profitable company with the backing of some hugely popular brands.

However, more of a concern would be competition from cheaper own brands. With many people feeling the effects of the pandemic in their wallet, many (I’m including myself in this) could seek cheaper, and let’s be honest, for the most part, just as good own brand products.

This is certainly a concern, but one thing Unilever has is a huge float to go and acquire brands to plug those gaps that could be swallowed up by cheaper brands.

There’s also the growing developing countries markets. Huge opportunities in Asia are still open for growth.

Has the Cloud lost its Flare?

No. Quite frankly.

Cloudflare exceeded expectations when announcing successful end of year results. Although its price drop seems to be a result of a wider tech sector drop rather than any concerns with the company itself.

Cloudflare’s strengths lie in both its ease of use and its 3.5mil strong customer base. The majority of these aren’t actually paying customers, but they saw a 32% increase in new customers from the previous year which offers numerous opportunities for up-selling and scaling those free users into paying customers.

This is by no means guaranteed obviously, but the company is trusted and revered by many in the IT and Security industry and prides itself on its in-house innovation of new products and features that are considered some of the best in options available.

Having partly worked in the industry I’m confident of the future of Cloud technology, whether as a standalone product or as part of a unified solution.

But only time will tell. Nearly $30 has been shaved off its share price since the start of the year, so I’ll probably be grabbing some more after writing this post.

This isn’t advice, these are just my opinions. Please do your own research before investing in anything.

2 thoughts on “Freetrade diary – Buy, Buy, Sell, Sell

  1. I think it’s surprising to see Unilever shares drop – but like you said the COVID19 pandemic would have caused disruption on this.

    I’ve been following Carnival Cruises quite closely (really enjoy cruising). Their share price has tumbled recently but with vaccinations rolling out and the climb back up to their original levels, this could be an interesting one to follow.

    Liked by 1 person

    1. Yeah I just don’t see the slight dip in profits as being a reason for the considerable drop in share price, so happy to buy more in that case.

      Yeah they had a bit of a run off the back of lockdown lifting last time. It’ll certainly be interesting to see what the travel and entertainment stocks do with the increased vaccine rollout. The travel sector doesn’t overly interest me greatly but I did consider Rightmove at one point to get on the back of the recovery, but after looking into them a little more decided against it. Kinda glad I did as they’ve moved sideways since June.

      Liked by 1 person

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