Portfolio
Double hazard
Nephew Wilde
The task of selecting a share is made doubly difficult this week. Firstly, the Middle East war has given the stock market the jitters. Secondly, as a result of an unfortunate accident 1 can barely see. Wotherspool foolishly decided to bring his two huge greyhounds with him when we played golf last week. The beasts became frantic when Wotherspool pulled up his two-seater sports car outside the golf club and one knocked off my glasses and the other sat on them!
In my myopic state I have left the choice open to Wotherspool to select a share. Obviously, he was at first rather sceptical of doing this in view of the state of the market, but after some consideration he decided that it was silly of me to be so liquid and subsequently persuaded me to make more than one plunge. His basic theme of choice largely reflected fears that the Middle East crisis would continue for some time.
Thus, on Wotherspool's advice, I am buying two shares. The first is Dowty Group for the basic reason that it is a direct beneficiary of the National Coal Board's capital spending programme. If the ptesent crisis does influence much more rapid exploitation of our own coal reserves. then Dowty is well placed, making roof supports, control systems and conveyors. Other countries could well be thinking on the same lines as ourselves in regard to coal and here Dowty should benefit from its large export business. In other fields, too, Dowty should be in for a good year. The aviation component division, for instance, which could account for as much as half of trading profits should do well, judging by the heavy aircraft programme. Another interest is in hydraulic seats and here again export demand is strong. Dowty is selling at only about ten times earnings and yields nearly 6 per cent„ The other investment I am making is Alexander Russell whose activities are in quarrying. coal recovery and distribution of fuel. It also distributes building materials in Scotland. Admittedly this is only a small company. capitalised at just over £1 million but the shares are lowly rated and Russell should be in a favourable position in what could well prove to be a winter of discontent for many.
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