Bye Bye Apple, Hello Pandora

appleWe have been a long time investor in Apple, but after the release of the iPhone 7, we decided it was time to close our positions and take profit. We closed our positions around 112,5 USD per share, and have decided to follow the stock from the sideline for a while. We still believe Apple is one of the best companies to invest in – based on almost any fundamental analysis except growth for the time being. But even though Apple has some of the strongest fundamentals in terms of earnings, gross margin and cash/balance sheet, these fundamentals does not seem to work or impress the market for the time being. Everyone has their eyes on the “next big thing”, and despite really good sales signals from the new iPhone 7, we believe its best to wait for the next product launch before we will consider investing in the company again.

Manivest has primarily focus on the US market, but sometimes we scan globally for good companies using the Manivest criteria. Recently our screeners identified the danish company Pandora. With very strong fundamentals and promising growth outlook, we decided to invest and make it one of our larger holdings. The stock traded down more than 20% from this years high and it has a consensus target of 1109 DKK per share. We entered around 800 DKK per share, giving a P/E of 16,4. ROE is estimated at a staggering 93,2% for the ongoing year! EBITDA margin was 37,1% last year and Pre-tax profit was 31,7%. With estimated revenue growth of 22% this year and Pre-tax profit growth of 36,7% we believe there is a significant potential in this company. We have set a one year target of DKK 1150 per share.