Recent Buy – SWRAY

swray

In keeping with my current strategy of utilizing a strong US dollar to my benefit, today Swire Pacific was added to my portfolio.  Swire Pacific is 49% owned by privately held, London based  John Swire & Son with the remaining 51% traded on the Hong Kong exchange under the ticker 0019 (a second class trades as 0087).  The ADR corresponding to 0019 trades in the US as SWRAY.  They are also one of Coca-Cola’s (KO) anchor bottlers under the 21st Century Beverage Partnership Model of KO’s that is expected to complete in 2017 with territory covering Hong Kong, the Chinese mainland, Taiwan and the western United States.

But Swire is much more than a Coca-Cola bottler.  Last year they celebrated their 200th anniversary and are a conglomerate in a style similar to Warren Buffet.  They own 45% of Cathay Pacific, have significant real estate holdings and refrigerated warehouse operations among their holdings.  The Coca-Cola Bottler’s Association did a great article on their success.

Swire Pacific pays a dividend twice per year on an interim/final schedule.    At today’s purchase price ($10.338), the dividend yield translates to roughly 4.77%.  There is a risk of currency fluctuation as dividends are declared in HK$.

As an aside, I wonder how this company fits into Pres. Trump’s world view as a Chinese (HK) company that employs several thousand US workers – many on production lines?

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2 thoughts on “Recent Buy – SWRAY

  1. The only thing that gives me concern is their real estate holdings. Unlike the US, the value is marked to market – which could be a double edged sword. Otherwise the diversity of their holdings should provide balance to the inevitable gyrations – with thousands of US jobs being the icing on the cake in this environment. Thanks for the comment.

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