The Best Share I Never Bought

Published in Investing on 11 April 2012

Which share do you really regret missing out on?

The thing about being a writer for the Fool is that you tend to do a lot of research about shares, and you do come up with quite a few share tips.

But, of course, the amount of spare money you have is finite, so you can't realistically buy into every single company you fancy. You actually only invest in a fraction of the share ideas you produce.

What is then particularly galling is when the share tips you write about but don't invest in do incredibly well, often better than the shares you did invest in! That's what has been happening to me recently.

The value that outed

For example, take Barratt Developments (LSE: BDEV). In December of last year I tipped the company as a deep value play. The firm was doing surprisingly well in a tough property market, having bought a large amount of land at knock-down prices, and with much of its business in the relatively buoyant South East.

At the time of writing, the share price stood at 89.5p, which was just 42% of the company's net asset value. The shares had hit 1,200p just a few years ago.

As soon as I had written the article, Barratt's shares started appreciating, and by March they had nearly doubled in value, touching 150p. Looking back, investing in this business was a no-brainer. Did I buy in? I'm afraid not.

The growth prospect that just kept growing

Then there was Petrofac (LSE: PFC). In September 2011, I touted this as 'the £5 billion oil opportunity you've probably never heard of'. I could see when I wrote the article that this was a great growth play.

After all, the company had already expanded in ten years from a firm of 900 employees to one with 14,600 workers. And it had ambitious plans for future growth, planning to more than double its 2010 earnings by 2015. Yet at the time I wrote the article, the company's share price of 1385p put it on a P/E ratio of just 15.

I seriously considered buying into Petrofac, but instead of going with my instincts I hesitated. As I did so the share price rocketed, and the chance was gone.

Since then the shares have had an amazing run, increasing in value by a third. And I was left kicking myself again.

A play on European recovery

Finally, in December I tipped luxury car maker BMW. For me this was a global brand at a knock-down price. After all, in a world where wealthy consumers in emerging markets such as China and India were devouring luxury brands, BMW's forward P/E ratio of 8 looked too cheap.

My tip turned out to be prescient, as things improved in the eurozone and European stock markets recovered dramatically.

BMW really was the bargain I thought it was, and promptly increased in value by a third in the space of a few months. If only I had followed the courage of my convictions! I had missed out again.

You win some, you lose some

Now, to be fair, I didn't miss out on all my picks -- not by a long chalk. Notably, I have done very well with companies like Admiral (LSE: ADM) and BP (LSE: BP). Overall, after a torrid 2011, my portfolio is doing very nicely, thank you, in 2012.

Of course, I would be doing even better if I had followed the courage of my convictions in some of my picks. But, as the saying goes, you win some and you lose some.

Perhaps the lesson I can draw is that I should go with my gut instinct more often. If something looks cheap then it probably really is cheap. You really can be too cautious.

So, over to you. Have you also been seriously interested in a business, but never went through with the purchase, only to see the share price rocket? What was the best share you never bought? Please sound off in the box below.

> Get the latest on investing and the markets, direct from the desk of David Kuo. You'll also receive a special free report on '10 Steps To Making A Million' if you join The Motley Fool Collective today.

> Prabhat owns shares in Admiral and BP.

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Comments

The opinions expressed here are those of the individual writers and are not representative of The Motley Fool. If you spot any comments that are unsuitable hit the flag to alert our moderators.

theRealGrinch 11 Apr 2012 , 12:39pm

We have all missed out along the way and also dodged companies like HMV, GAME and Aero Inventory. Recently, Ive missed out on Admiral. In 2009 I looked at Petrofac but didnt act. In May 2009, I acted on Lamprell, Hallin, Rangold et al. I sold PVCS at 63p before it crashed. I think the important thing is not to worry about what you missed out on but to apportion to lower risk and avoid those companies with red flags.

tux222 11 Apr 2012 , 1:18pm

Opportunities are like buses. Miss one, and there will be another along soon enough. Chase one, and you may hurt yourself.

dpeddlar 11 Apr 2012 , 3:24pm

I brought shares on the back of your advise in BMW and Petrofac - Thanks

ANuvver 12 Apr 2012 , 9:37am

I occasionally indulge in fantasy side portfolios built from things on my watchlist. It's an educational and humbling exercise, and has skewed my attitude firmly towards safer propositions.

I mildly regret not swooping on BRK.B when it was flirting with $70 last year, just before Buffett announced that level as his buyback threshold. Canny old bird - I bet he hasn't spent a dime on his own stock since!

GTX1000000 12 Apr 2012 , 11:36am

missed out on Lloyds, nearly bought at 22p in Oct 11 and then went up to 37.5p in March, a 70% increase !!! now down to 31p, The question is would I have sold at the higher price, probaby not. hoo hum.

sdi2 13 Apr 2012 , 12:55pm

For me it was weir.
They were tipped at around £2.70, when I looked they went up to around £3.00, so I did not bother.
They finally got to £21.00.
I do regret that decision.

XMFSonia 13 Apr 2012 , 1:07pm

I'm still kicking myself about Mulberry - really should have gone with my instinct and bought in 2010.

Blewyn 13 Apr 2012 , 1:32pm

In 2003 I told both my parents (separated) to put £10k in Apple. They both recoiled in horror at the thought of buying shares rather than having money in the bank. I was skint at the time......and have consistently failed to buy Apple shares with my own savings ever since......sheeeeesh..

Investa69 13 Apr 2012 , 1:51pm

In 2009 I almost bought barclays for 52p, I was one click away from doing so and then decided to buy Aviva instead. Barclays then went up to £3.75 at one point in 2009 which would have been a 621% profit in about 6 months! Luckily I still made about 150% on Aviva, but it's not quite in the same league! :(

yeready 13 Apr 2012 , 3:56pm

Swings 'n things.

Many regrets about buying late,and selling early, but never dwell too much on missed opportunities.

Just for the record, though:

Bought Polly Peck (on a broker recommendation) the day before they went belly-up. Cost me 'plenty'.

Held ARM @ 80p(ish) for many months; then began to doubt my judgement, and sold. Where are they now?

abecol 13 Apr 2012 , 4:10pm

I do know exactly what you are saying. WEST CHINA CEMENT !!!! Need I say more?

Abecol

1800k 13 Apr 2012 , 4:23pm

Tullow Oil way back when they were about 60p is my biggest regret, I bought M&S instead. DOH!
Oh, and Mulberry, three years ago when my son started working for them. Double DOH!

heatingman 13 Apr 2012 , 4:56pm

Is it a mug's game researching for a profit - can be? In 2003 I found the Aim quoted business Lo-Q (LOQ) involved in making booking system digital hardware for the visitors to entertainment parks to book rides without needless and wearying queueing. Bought 59,880 shares @ 8.35p Total £5065. In 2005 when not much had happened
sold at a loss of £2083. If I had held those shares until now they would be worth £168,000!! The lesson was only the end of year /end of visitor year mattered mattered to the result

heatingman 13 Apr 2012 , 5:07pm

My post slipped out prematurely!! The interims meant nothing as the punters were only in full holiday swing - the end year was what matters so where am I now? With 6965 shares and a profit of £5000
but I think there is much to play for yet

retire1asap 13 Apr 2012 , 5:21pm

My most annoying miss was Next at 1900p. I'd seen it given an A+ dividend report card and it was at a 12 month low. I was so close to buying but decided that I had enough retail exposure with Marks. Still have Marks but their recovery is frustratingly slow compared to Next.

I bought BDEV for 70p in 2010 but missed selling in May 2011 at 120p - I literally had my finger on my mouse button at 119.8 waiting for it to hit 120, which it just didn't manage. I didn't buy more at the 2011 70p point. Had to wait 10 months for it to get back to 120. Then I sold at 120 and it went on to 150!!!

harold9 13 Apr 2012 , 5:29pm

From the annals of history but true nevertheless. Polly Peck tipped as a 'shell' at 6p. The next few days they were up to 18p so I presumed I'd missed the boat. They finished at £35. ie buying 10k at 6p would have turned £600 into [if you had had the nerve to stay on for the full ride] to £350k. Not bad today but a small fortune in those days.

Sandecker 13 Apr 2012 , 8:22pm

I received a spam email some time ago from an american hot news tipster. I didn't buy any of his recommended tips, although, in all fairness, some of them made moderate gains. However, his last recommendation was to put as much as one could afford in Apple, as he stressed this was the only share one needed and he was personally investing a major sum. Apple was about $100. What a miss!

FACMAN18 13 Apr 2012 , 8:28pm

I bought 3500 Shares in AMEC in 2006 @ £2.18 as part of a Share Option Scheme .I Sold in March 2007 ,on early Retirement ,@ £4.20.
One of the guys in office ,who was more savvy than myself , stated that they would 'go all the way to £7'. I laughed,,,,they went to £12 last year !!!!!
Conversely I put £7500 onto AMERINDO around 2001 and still hold the Final Div Cheque £9.87 ,,,uncashed ,FRAMED facing me at this very moment ,,,,

suse9 13 Apr 2012 , 8:32pm

it's reassuring to know that I'm not the only one who missed out - Fresnillo - I sold and made a marginal profit but it goes on and on and on!

Tony2204 13 Apr 2012 , 9:12pm

I should have put all the cash I spent on Greene King IPA in the 70's into Greene King shares. And the £6k spent on a 10 year old 944S2 in 2002 would have done much better invested in Porsche stock

Had a lot of fun with both products though...

ian3marshall 14 Apr 2012 , 10:43am

Well where to start? There was Next at 11p early 90's on verge of bankruptcy, Tullow oil, hot tip from my boss at 8p, of course I poo poo'ed it what did he know? Petrofac also at 650p, more recently Mulberry sitting in my portfolio still as a "potentail" and verging on a 10 bagger.There were many more but regrets? bit like frank there were some but too few to mention. The bigger one is the one you bought as a great idea that later fell back to become worthless and you sat and watched it unbelievably. This was 10 years ago and I have wiped the name from my mind, £30k waiting to be took on click of a mouse and down the drain in 7 days.
Sticking with big divi ftse companies these days so know my place.

SwaziGold 15 Apr 2012 , 9:22pm

Last December was not sure whether to buy shares in Rio Tinto when they were a mere 30.00 per share. Just 6 weeks later they had soared to a shade under 40.00/share, making me feel a bit gutted. But since Feb they have eased down to a bout 34.00 per share making me feel a bit better.
Swazi Gold

SwaziGold 15 Apr 2012 , 9:22pm

Last December was not sure whether to buy shares in Rio Tinto when they were a mere 30.00 per share. Just 6 weeks later they had soared to a shade under 40.00/share, making me feel a bit gutted. But since Feb they have eased down to a bout 34.00 per share making me feel a bit better.
Swazi Gold

dukindiva 16 Apr 2012 , 11:07am

I regret not buying Burberry when they were at about 800p and buying MAN Group at 206p.

some you win they say!!

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