mardi 23 février 2021

Why I sold my Couche-Tard shares

Today, I finally sold all my Couche-Tard shares.

It took me many weeks to sell because I've loved Couche-Tard for years. I still think that it's a good company. Probably not great anymore, but still good.

Sadly, Couche-Tard had changed: Fuel selling wasn't as trendy as before. Buying other convenience stores wasn't even that appaling for Couche-Tard. They thought about diversification through Dollar Stores instead. Which was a big source of ?????  for me.

Why should I stay with Couche-Tard if that company thinks that Dollar Stores is the place to be? Why shouldn't I sell my Couche-Tard shares to buy Dollarama or Dollar General instead? And what about the future of fuel? What about electric stations? Couche-Tard would maybe adapt it's model, but maybe not. A changing industry is not the easiest place to be. You may believe in the company, but the fog is thicker than before. And I don't like fog. I prefer to pay more for less fog (whatever Buffett says about overpaying for a cloudless sky. Yeah, that’s probably why he didn’t buy anything in March 2020).

That's mostly why I sold Couche-Tard. 

Some years ago, I wrote a post about my "permanent holdings". 

Couche-Tard was among that list. Yeah, "permanent" my ass. Most of the stocks listed on that post have been sold. 

9 commentaires:

  1. Interesting that you linked that post about permanent holdings from 5 years ago.

    Of all the stocks that I listed, I only sold UNP. It was more that I wanted some cash to buy another position and UNP was one of my smallest position.

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  2. Tricky name, lots to like here but structural headwinds are unlikely to abate. That being said, I wouldn't underestimate the operational and capital allocations skills of this management team. If you give great managers ~$2.5B in annual FCF, a clean balance sheet, and fragmented industry conditions, good things tend to happen over the long-term. Even if FCF levels remain constant (very conservative assumption) this company will be able to generate its entire market cap (~US$32B) in FCF (cumulatively) within the next decade so one shouldn't overlook the earnings power here.

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  3. What did you buy with the proceeds?

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  4. You will probably be told to leave Quebec due to your unpatriotic portfolio choices.

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    Réponses
    1. I’m currently more exposed to Ontario’s economy than Quebec. I should live there. We can smoke marijuana on the streets there (not here).

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  5. I wonder why paying at the pump didn't kill Sleep Late?

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  6. Gas and cigarettes...yay. Well, they do have some kind of deal with the cannabis retailer, Fire & Flower.

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  7. Keeping the faith for now! I even increased my position bolow $38 even if it was my top 2 stock...

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  8. Maybe I purchased some of you shares? 😉

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