The 3 stinkers in my SIPP have sunk again this week – what on earth am I supposed to do?
My Self-Invested Personal Pension (SIPP) has produced some cracking winners since I started building it three years ago. Costain, Rolls-Royceagain Lloyds all around 200% on my watch.
But investing isn’t all champagne and steaks, there’s definitely the odd dollop of little gruel too. Personally that comes in three stubborn lumps. Coincidentally, the three worst performing stocks in my SIPP all published their full year results either yesterday (25 February) or today, and they all stink. So am I finally pulling the plug?
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Aston Martin shares car crash
The maker of James Bond cars Aston Martin Lagonda (LSE: AML) is the worst of the lot. If this FTSE 250 Stock was a movie franchise, it would be an absolute horror show. Shares are down another 12.5% today and down 93% in five years. I’m taking care of about a 70% loss, which almost feels like a win in comparison. Thankfully, I only invested a small amount.
Yesterday’s numbers were bad. Revenue fell by 21% to £1.3bn and net debt rose to £1.4bn, due to weaker demand and less tax. The administration is cutting more jobs while blaming the country’s turmoil and major pressures.
One danger with scare stocks like these is that they always look on the edge of a comeback, only to keep floating. My stake is now so small that it is no longer worth selling. I will hold it for a number of new things and as a lesson learned. I wouldn’t recommend it to anyone considering buying it.
Ocado is stinky cheese
Ocado (LSE: OCDO) is almost as big as a car accident. It’s down 90% in five years and I’m sitting on a 47% loss.
The FTSE 250 stock fell 10% in this morning’s results before recovering slightly, after it unveiled plans to cut around 1,000 jobs in a bid to save £150m. The rollout of its automated customer fulfillment center (CFC) has come under fire, with key US partner Kroger and Canada’s Sobeys both pulling out.
There was a glimmer of hope here. Underlying earnings jumped to £178m and management thinks Ocado will have full-year cash flow in 2026/27. That would be a milestone for a business that has been cash-strapped for years.
It still needs a lot of CFC to convince the market and again, I would not buy more or urge anyone to consider stockpiling. I may be crazy but I’ve been through a lot, I’ll stick with it.
Diageo must fight back soon
FTSE 100 headwinds Diageo (LSE: DGE) is my best hope for recovery. This is the one I went to town with. And again it disappointed me.
Shares fell 12.7% yesterday after new CEO Dave Lewis cut dividends and downgraded indices following tough US trading. They are down again today and down 45% in five years.
I am concerned about the effect of weight loss drugs and changing drinking habits. But Diageo still has a smart portfolio of global brands and makes a lot of money. If consumers feel rich, I suspect they will dry up again. I will not sell. I’ve even been tempted to buy more, but discounting Diageo is a habit I have to break.
So I will hold all three. I’m more confident about Diageo, though, but the other two are absolute punts. Investors hunting for top FTSE stocks probably shouldn’t start here.
