BOWLING

Welcome to this month’s “Bowls” update.

INTRODUCTION

I am now flagging this introduction as for “new readers” only, those who have read previous articles or are familiar with my view on “Bowls” can now skip this section.

I have been looking for and often investing in “Bowls” for over 3 years or so now.

They’re a concept I picked up from Richard Crow who, as I continue developing, still discuss Bowls with on a weekly basis – Richard runs his own Substack here.

For me a Bowl is a basic charting pattern which often occurs when a stock has fallen and could be bottoming. It usually has 3 main characteristics I look for…

• The rate the stock was declining slowed, indicating “Sellers almost done?”

• The stock put in no lower lows, indicating “More Buyers than Sellers?”

• The stock starts gradually rising, indicating “Buyers paying up?”

Hard to explain, even with a diagram, but here’s one anyway…

Bowls are a charting pattern and like most charting patterns, are often in the Eye of the Beholder - As can be seen by comparing my list with Richard’s recent post above.

Bowls are often “recovery” plays so to accompany any good looking Bowl I also like to see at least one of the following, preferably both…

• Management changes, a new CEO in the last year or two, it takes them a while to get going!  Not so significant but also worth checking for a new COO and/or CFO too.

• Management buying, decent sized purchases within the past 12 months by, preferably, two or three Board members, certainly no selling except partials to cover option taxation.

Bowls (recovery play opportunities) seem to be best reflected in 3 year line charts.  This kind of makes sense, most companies don’t decline overnight and likewise, most of them take a year or two, sometimes longer, to recover, or show signs of recovery.

For these reasons, a Bowl can be spotted over a period of a few months or over a period of 18 months or even more.

Anyway, I usually use 3 year line charts when scrolling through “Companies In My Universe” to look for Bowls as I’ve found over time, it’s what works best for me.

COMPANIES IN MY UNIVERSE

I don’t look at all UK companies for Bowls, I limit my criteria to those with a Market Cap >£50m and <£1bn.  I also avoid those in the “Residential & Commercial REITs”, “Collective Instruments” or “Holding Companies” Industry groups.

Just my personal choice, and this leaves me with around 500 “Companies In My Universe”.

THIS MONTHS BOWLS

In StockRank (from Stockopedia) Order…

Longer Term Bowls

VP. – 650p would confirm

CSN - 275p would confirm

IPO - 56p would confirm

KIST - 145p would confirm

OBI - 14p would confirm

AGL - 18p would confirm

Medium Term Bowls

SQZ - 160p would confirm

ATG - 660p would confirm

WJG - 37p would confirm

INSE - 70p would confirm

KNOS - 930p would confirm

CBG - 340p would confirm

FEVR - 830p would confirm

PANR - 52p would confirm

Shorter Term Bowls (where a more recent sell-off may be over)

RNO - 58p would confirm

PETS - 230p would confirm

SLP - 48p would confirm

BYIT - 480p would confirm

VCP - 155p would confirm

XAR - 85p would confirm

CVSG - 1050p would confirm

IQE - 17p would confirm

SUMMARY

As always, all bowls on this list may be worth a further look as all have potential for a decent run up in an improved economy and Bull market. This is especially true of those with a StockRank (from Stockopedia) of 80 and above, SQZ, RNO, PETS and ATG.

Remember I may hold all, some, or none, of the stocks mentioned in this article.

No investment advice intended, for information only, Do Your Own Research - Look out for that change in management and management buying of shares!

Until next time!

Jon