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No impact on Byggmax from lower tax breaks

Carnegie Småbolagsfond rose 2.5 percent in March, a month that saw gains for cyclicals in general and commodity companies in particular.

This made an impression on automotive sub-supplier Haldex, which rose 13 percent, but the company’s share price has performed poorly this year. We note storm clouds in the short term, driven by supply problems in North America, but we also discern substantial valuation potential for the long-term investor.

The Byggmax share performed weakly early this year, but experienced a big recovery, rising 12 percent. There are concerns over how reduced tax breaks on home improvements could impact sales, but we believe this concern is exaggerated. The company’s low-price strategy is long established, and we regard it as an economic buffer. Data in March for February’s building materials trade sales indicated an increase of 16 percent. Thus, no negative impact in February.

Intrum Justitia has long been one of our favourite stocks. There was plenty of uncertainty when CEO Lars Wollung was discharged in early November 2015, and there was scant praise when his successor Mikael Ericson was appointed. Ericson’s previous experience had received mixed reviews, but he made a good impression when we met him. We believe Intrum is continuing its successful journey in debt management, and we do not anticipate any loss of tempo from the change in management. The stock rose 9 percent in March.

Loomis was this month’s disappointment. There was a significant reaction in its share price when, in the middle of the winter holiday, the stock market learnt that main shareholders Melker Schörling and Gustav Douglas wanted to sell their shares in the cash handling company. We were surprised by the sale itself, and also by the way the sale was made. We regard the company as very well managed, and the stock has performed strongly since we have held it, but we have now reduced our holding. The stock fell 17 percent in March.

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