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Even in the summer lull (if one can so describe this month in the stock market, given that the FTSE 100 index hit a new all-time high), I have been looking for shares to buy in the past month.
So, how did I do?
An old favourite
I already had a sizeable holding in JD Sports Fashion (LSE: JD).
I sold some JD Sports shares earlier this year, to take profits off the table. At the moment, though, I continue to feel the share looks like good value. Earlier this month, I bought some more.
Last week, the FTSE 100 announced declining like-for-like sales in the first half. But the overall sales picture showed growth, thanks in part to an aggressive shop-opening programme over the past several years. JD Sports’ opening of its biggest store globally this summer at Greater Manchester’s Trafford Centre showed the scale of the company’s ambition.
I see a risk that weak consumer spending could hurt demand for expensive trainers and athleisure wear. But the company last week maintained its full-year profit outlook, to my relief.
One that can wait
I decided against putting more money into another one I already own: Diageo (LSE: DGE).
The share rallied last month after a new boss took over abruptly and generally the share performed well in August.
Was this the start of a turnaround, I wondered?
It could be – but I reckon it is too early to tell. New management could help address some already known risks, such as weak demand in Latin America.
But bigger challenges remain, from what a weak economy means for premium spirits demand to how Diageo can engage with changing attitudes towards drinking, especially among consumers in their twenties and thirties.
I decided to wait to see how the business performs before deciding whether to buy any more.
An age-old conundrum
JD Sports is not the only share where I have taken profits off the table in recent months. I did the same with Journeo (LSE: JNEO).
But I hung onto a significant part of my stake and, as the share moved around in August, weighed whether to buy more.
This is hardly a new investing conundrum: take profits and bank them, or buy more of a rising share at an even higher price than before.
The thing is, I reckon Journeo’s best days are ahead of it. Its price-to-earnings ratio of 15 does not look like obvious value for a medium-sized company (its market capitalisation is £66m) that most people have probably never heard of.
But I think its earnings could grow strongly. This month saw it announce approximately £1m of purchase orders from a local authority for bus information display services.
One risk is a decline to revenue caused by the recent end of the first phase of a contract with the New York subway.
But Journeo’s proven specialist capabilities could help it win a lot more contracts, I reckon, not only with the New York subway but more widely.
Should I buy more shares at a much higher price than I originally paid? For now, I have decided not to, but if the price falls back down enough in September, Journeo is on my list of shares to buy!
