My Portfolio

This BUD’s for me

March 1, 2005

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I am buying Anheuser-Busch (NYSE: BUD) for my retirement account. The main thesis for investment is valuation: at a recent price of $47.50, A-B is trading at an estimated 2005 P/E of 16, which is at the low-end of its historical valuation. Over the past ten years, A-B has consistently increased its sales, earnings and dividends per share, and also reduced its number of shares outstanding. I think the stock is depressed because the market is worried about increased competition due to the popularity of wine and spirits. However, I believe the company’s new marketing initiatives (like its recent launch of Budweiser Select and B-to-the-E beverages) and its significant exposure to China will drive long-term growth.

2004 Portfolio Review

January 1, 2005

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Our portfolio (stocks and cash, no bonds) returned 7.21% in 2004. The portfolio is currently divided into 50% Canada, 40% US, 8% International and 2% cash.
The returns for various asset classes in 2004 (in C$) is as follows:
TSX Composite: +12.48%
SCM Bond: +7.15%
C$/USD: +7.52%
S&P 500: +1.37%
DJIA: -4.1%
NASDAQ: +1%
Gold: -2%
Crude Oil: +24.6%
US equity returns were adversely affected by the strengthening C$. Bonds displayed surprising strength, when the consensus was for bond yields to rise (showing that market timing rarely pays off). The main portfolio goal for 2005 is to initiate a bond exposure, through the new bond index fund.