Each year I make the resolution to read all the Annual Reports issued by Belgian listed companies.
While I don’t believe Belgium is especially fertile ground to grow great global companies, there is some anecdotal proof we are a good breading pen for “hidden champions” or “mittelstand” as coined by author Hermann Simon.
What can be more delicious then an overview
of all Belgian Lised Companies ?
The good news is: there are only 122 Belgian originated listed companies, according to the FSMA.be (the Belgian SEC). So, instead of climbing a mountain, I only have to climb a hill to complete this roundup.
A little disclosure : I am biased towards value investing. The reason for this roundup is to create a watch list of stocks to research more extensively – to put on a Watch List, so to speak. My first aim is to find the top notch quality companies on the Brussels stock markets.
Whether or not there are some bargains to be made at the time of writing, remains to be seen.
Since I find it inspiring, methodical & valuable how UK Value Investor Maynard Patton approaches his watch list, I will steal and adapt his questionnaire to determine if there are any red flags in the companies.
These are the questions to guide my thought process:
How do they make money?
X-ray. What do the key figures look like?
Does the business boast a respectable track record?
Has the business grown with adequate returns on invested capital?
Has the business funded its growth in a smart way?
Does the business possess a healthy balance sheet?
Does the business convert revenue into value?
Does the business enjoy some sort of hard to copy advantage?
Does the business produce a respectable return on equity?
How is the quality of the shareholders ?
Does the business employ capable executives?
Does the business employ good-value-for money executives?
Does the business employ owner-orientated executives?
Does the business enjoy reasonable growth prospects?
Is it worth watching?
What share price stands a good chance of becoming a bargain?
Inspired by the upcoming Olympic Games – I will promote a stock to the “hot seat” going foreward – meaning I will nominate a the stock I like best among all the stocks I have looked at thus far. Maybe I will do a top 3: gold, silver and bronze.
Who deserves a place on My Watch List? Who will take the first “Hot Seat”? Let’s find out.