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good eye fellow investors how to find stocks that will increase seven times in seven years while researching the paper sector I research today mostly upm I have put a link to my written report of twenty pages that you can read just click on the link below it's free so no no time to do a video of such a long video but I have found a very interesting smaller company it's called ultra SGPS it's a portuguese eucalyptus pout producer and they make other things from that and the stock actually increased seven times over the last seven years and there are two things that we can learn from that one you have to look there were others don't and secondly you don't have to buy crazy growth stocks to reach amazing returns and thirdly you must not trust the market in telling you whether something is good or bad so those are three extremely important things we can learn from this so the company just boring stock producing powd from eucalyptus trees in portugal processing them into paper pulp dissolving pub and bo mas nothing special very very boring but the stock price went from below one euro in june 2012 to above seven euros even eight euros just a while ago so now it's above seven the current dividend yield is four percent the price earnings ratio is still around seven so you might still think it as a bargain even if it is seven times up the first interesting thing is that nothing special happened over the last seven years the company just executed on what their initial plans were and pal prices went up a bit the management didn't do crazy buybacks they just paid down debt and paid dividends over the last seven years the company lowered its debt a bit but most importantly it increased its dividend from zero to 0.25 per share and the profits did even increase that much they just allocated capital differently as earnings per share went from zero 25 to zero 50 so the zero 14 yeah just last year 2 0 73 number of shares remained stable the book value increased significantly but what is very interesting to see is that revenues increased just 50% pal prices even declined if we compare them to 2012 an operating income also increased just 50% so nothing special nothing spectacular nothing we're going to take over the world growth or something like that just one of those typical Peter Lynch company's boring under trader in a country like Portugal that no one wanted to look into in 2012 and the result is staggering so the key point is that you don't have to find stellar growth stocks to achieve amazing returns you can find boring profitable stocks to do the same 7 years ago it was a 200 million market capitalisation company it was highly leveraged but they were already working on paying down the debt the profits were there already so it was already there everything that is there now was already there in 2012 and then going to the market how the market saw the company let's imagine that you bought the stock on the same story that developed later in 2010 you would have paid 2.5 euros per share and over the next three years you would have lost 70% of your investment because the stock went from 2.5 to below 1 even if you bought in 2007 it went below 1 twice over the next few years but still from 2.4 to 7 it's still a good investment in 2010 so don't let market tell you what is a good investment really research what's going on and the market might be selling for completely other reasons which makes it pretty pretty irrational so to conclude take advantage of the market don't let the market tell you anything about business to find great investments you don't need to look at stellar growth stocks you just need to look at those talks that will improve a little bit constantly over seven years pay out dividends and get into onto the markets raider so sometimes boring is much better than very very exciting looking forward to comments please share in the comments if you have some other stocks that have done similarly over the last seven years that we can learn from thank you and I'll speak to you in the next episode
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