Portfolio 2024

Short introduction of all my positions in my portfolio

Disclaimer: The following is no investment advice. The author may own, buy and sell securities mentioned in this post. Please always do your own due diligence! Some companies are micro-caps. Keep in mind that even a small investment from your side can move the share price due to the low liquidity of shares. It's not easy to liquidate if you want to get out.

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Welcome,

This is the first post in my new “Portfolio” section of Under-Followed-Stocks. I use this first post to give you a short introduction of all the companies I currently own. I sorted it by the first stock I purchased and will end with the most recent purchase.

At the end of each month, I will give you an update on my portfolio and will try to explain to you why I bought a new stock or sold one. So these posts will probably be more personal than you might know from my other write-ups. I will also share the size of each position in my portfolio.

In addition, I will also try to summarize all the events (earnings, calls, other news) that happened during the month at the companies I own.

This section will be reserved for the people who decided to voluntarily pay for my substack. I want to give something back to these people with a section where I can write something up more frequently. All the other content I publish on this blog will of course stay free.

I hope you enjoy it :)

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Secunet Security Networks AG:

Ticker: $YSN.DE

Market Cap: € 869 million (USD 987 million)

First buy: June 2016

Secunet Security Networks is a cybersecurity company based in Germany. It operates in eHealth, Homeland Security, Industry, Public Authorities and Defense & Space. Customers include federal ministries, more than 20 DAX-listed corporations and many international authorities and organizations such as the EU Commission or NATO. Secunet is the IT security partner of the Federal Republic of Germany. Therefore a big part of its revenues are generated by German authorities. Secunets main product is called SINA (Secure Inter-Network Architecture) which was developed in cooperation with the Federal Republic of Germany. It is used worldwide by governments, critical infrastructure & industry, and has over 170.000 installed systems. The huge installed base especially in the German government represents a huge moat.

The big moat, combined with the secular growth trends in cybersecurity is the reason why the valuation of secunet is often quite high. In 2021 the stock price reached its top of nearly 600 € which means over 20x since 2016. Unfortunately, I wasn’t able to sell at this top and now the price has come back to a more decent level of 135 €. The reason for this collapse was on the one hand of course the sky-high valuation, but also on the operating side, secunet is currently a bit struggling. While in the previous years secunet was able to increase revenues and profits with high CAGR’s, the profit decreased this year as a result of higher investments. Secunet is currently switching its product portfolio from hardware-centric solutions to more software and cloud solutions. If this transformation is successful, I think it is highly possible that secunet can return to its growth path. But such a transformation when your main customers are governments, especially the German one, is not easy. 2024 will be another year of high investments, but if secunet is successful, they have products with a large moat and recurring revenues, which the stock market typically appreciates.