The takeover of Altium (ALU) has been done and Slack Investor had some cash at his disposal. At the end of April 2024, I went through the Slack Process of deciding which stocks to buy with the money that Altium was about to provide. In the spirit of this great company, I concentrated mostly on growth stocks and presented the list below.
Topping up existing stocks
Some of the stocks that I own are like old friends. I am always looking to add to ‘tried and true’ stocks with a good track record of growth and good management. All of the above were considered. However, as REA was already a large holding (7.9%), Slack Investor passed on REA. He did buy some TLX and also added to his holdings of TNE, SNL, NDQ, CAR and PME.
New Holdings
Profitability and Growth are two things that really impress Slack Investor has been looking for smaller companies that have some potential. The newer stocks usually come from the financial press, newsletters and email subscriptions.
One thing I insist on however, is that they have a pleasing income chart that shows both historical growth (Black bars) and projected growth (Grey bars) – From Marketscreener.
As well as increasing income, I like my stocks to be profitable – a projected ROE (in 2026) to be more than 15%. I also want them to be not too expensive – a projected P/E ratio (in 2026) of less than 40-50. Of course, I also screen for growth, using the 3-yr CAGR – and hope that it is also above 15%.
I am not sure how any of these stocks will fare – but if you get the numbers right, good things will happen on most occasions. The 3-yr CAGR for Nick Scali is low at 8%, but past results were affected by COVID 19. I have invested in NCK as they have just expanded into the UK and, if anyone can make this work, it will be the crack management team at Nick Scali.
| Company | Ticker | ROE 2026 | P/E 2026 | CAGR 3-yr | Buy Price | Price 9/10 |
|---|---|---|---|---|---|---|
| Megaport | MP1 | 25 | 37 | 35 | $9.03 | $7.39 |
| Nick Scali | NCK | 36 | 13 | 8 | $13.73 | $16.13 |
| XRF Scientific | XRF | 18 | 20 | 24 | $1.55 | $1.70 |
| Betashares Diversified Growth | DHHF | – | – | – | $34.01 | $34.78 |
| Botanix Pharma | BOT | 27 | 18 | – | $0.37 | $0.37 |
| Betashares NextGen NASDAQ | JNDQ | – | – | – | $15.47 | $15.80 |
| Webjet | WEB/WJL | 16 | 22 | 16 | $9.03 | $7.89 |
| RPM Holdings | RUL | 15 (?) | 39 | 18 | $2.57 | $2.86 |
These newer stocks are in the Slack Investor ‘nursery’ for now. Sometimes a company looks good on paper – but fails to keep growing for a number of reasons (often these reasons are opaque to Slack Investor!). While in the nursery, I keep a weekly watch and if they fall below my buying price by around 15%, I will usually cut my losses and sell.
This happened to Megaport (MP1). I sold my holding a few weeks ago for around $7.90. Webjet (WEB) has just gone through a stock split into WEB and WJL – and is on a close watch.
Slack Investor is off on holiday to Thailand tomorrow … and has pushed this post out early (before his usual mid-month burst of activity).
Hi Slack Investor,
Love your posts and returns. I decided not to wait for the takeover to complete and I sold my Altium for $65.20 a few month ago with limited upside available. I bought into Newmont at $54 (now $75+) and a very interesting LIC called NGE for $0.99 (now $1.10). You might enjoy reading NGE’s past few years investment reports and results for some light holiday reading. They are high conviction, don’t stay on the normal track, and have done well over 7+ years.
Hi Pete. Impressive results with Newmont Corporation. Some people are good with mining stocks – I have had no real luck. But NEM seems the real deal. I will take your advice and look into NEG during my holiday. All the best, Slack Investor