Author: Craig Shepherd

Steadfast in its approach

The Markets This week: ASX v Wall Street FYTD: ASX v Wall Street Steadfast Group Limited is an Australian insurance broking network that provides insurance broking services to businesses and individuals across Australia and New Zealand. The company was founded in 1991 and has become one of Australia’s largest insurance networks, with over 3,500 brokers […]

Growing – in two very different ways

In recent weeks, we heard the mildly alarming statistics that the ASX had fallen to a low in October 2023 of 6703.2, lower than the levels seen in the broad market index at the close of October in 2007 (6770).

Inghams: laying golden eggs

Inghams is the dominant supplier of chicken products in Australia. It is also amongst the largest positions in client portfolios. In the past week, it delivered an update on progress within the business across the first half of the fiscal year.

Company Profit Reporting Season continues

In an effort to provide a more complete picture, we will continue to provide some updates on the prospects of our portfolio companies as gleaned from our coverage of the ASX Reporting Season.

Company Profit Reporting Season – Closing Week

As the curtain closes on the end of August, ASX reporting season also comes to a conclusion. We provide some of the more relevant company-result takeaways:
• Perpetual
• Home Consortium (HMC)
• ARN Media (A1N)
• MRM

Company Profit ‘Reporting Season’ preview

It’s an intense time of year for equity market professionals. But one that is welcomed because of the opportunity to review financial data, hear about company strategy, assess management and operational performance, and to review one’s own stock selection and analytical prowess.

Lull before company profit reporting season

Late July is when there is a lull in company news, as industrial companies are in communication lockdown before company profit reporting in August. Mining companies are busy releasing production reports and not much else, also ahead of profit reporting.

Out with the old, in with the new

There has been a significant period of de-equitisation in the Australian equity markets in the past couple of years. Our portfolios, and performance, have been the beneficiaries of this phenomenon.  Several stocks we own are subject to takeover bids:

Selectivity and Productivity

This week we discuss two major topics. Japan and why we are more heavily invested than global benchmarks and Productivity: why is this a problem for Australia and how does it impact returns?

Going, Going, Gone – the de-equitization of the Australian Equities Market

Two of our investments, Costa Group and United Malt, received confirmation relating to takeover bids this week.

Both takeovers provided support for our investment strategy. This strategy concentrates on finding opportunities where the market fails to price either the long-run asset or the franchise-based value of a company, and instead focuses on short-term earnings fluctuations. In such cases it is often an external party, via a takeover, that unlocks the value.

EOFY, Inflation and Small Caps

The curtain is about to fall on another financial year. FY-23 has been a year of very good investment performance across First Samuel various portfolio strategies.

Clients should expect their Flash Performance reports within 10 days, always noting that all portfolios are individually managed, with different asset mixes and security selections.

Some interesting introductions

We’re always looking for new ideas to introduce into the investment portfolios. A spate of recent takeovers within the portfolio (think Newcrest, Origin, United Malt, Pushpay, Eildon Capital) has accelerated the need for fresh ideas to replenish building cash positions.

Banks and Budgets

A busy week in financial markets given the conclusion of the Australian Bank 1H23 profit reporting cycle and the announcement of the Federal Budget. Our discussion will focus on each in turn.

Conferencing

This week the Australian investment world was dominated by one event – the Macquarie Equites Conference in Sydney. We will provide a quick run through of major themes and highlights from companies to which our clients have exposure.

Sayonara

This week in Investment Matters, we have three sections that provide important updates on clients positions in Eildon Capital, Reliance Worldwide and Mineral Resources.

Over the course of the later part of this week and next many companies will provide updates to the market, including mining companies, smaller companies and those presenting at upcoming investor conferences. We will cover as many as possible of these updates in coming weeks.
O the economic front we discuss the impacts of the review into the RBA that goes beyond the changes mentioned in the headlines.

Battery Powered Portfolios

This week in Investment Matters, we have two news items relevant for client portfolios and a piece designed to assist with understanding how an investment in the portfolio has been restructured

Gold and price of money

This week in Investment Matters we have two items relevant for client portfolios. The first is the revised takeover conditions for Newcrest Mining and the 2nd is the pause in rate hikes announced by the Reserve Bank last week. Again, this week we have the much-needed assistance of Patrick Cooks’ cartoons.

Cheers

This week in Investment Matters we have highlighted three news items relevant for client portfolios. Similar to the previous week, is the enhancement of these stories with the sensational Patrick Cook cartoons.

A little more for the collection

This week in Investment Matters we have highlighted three news items relevant for client portfolios. The highlight of the week however is the enhancement of rather plain text with the sensational Patrick Cook cartoons.

The end of company profit reporting season

The final week of reporting season is traditionally occupied by some of the smaller companies with less well-developed internal reporting structures and possibly some news they are reticent to share!

The week also saw the much-awaited update from EarlyPay which is discussed.

Busy week of company news

The third week of company profit reporting season is traditionally the busiest with a range of large companies presenting updates to the market. We have provided some detail on those results important to client portfolios in today’s Company News section.

Another takeover bid

Client portfolios benefited this week from another takeover bid this time for Newcrest Mining. A non-binding indicative offer came from another giant global gold miner, Newmont Mining, based in Denver USA.

Synthesis from the state of Black Swans and Kangaroo Paws

Following a commitment made last week, I have returned to pen the second in a series on my recent visit to Perth. Most importantly, after almost a decade of stagnation, Australia is once again seeing explosive growth in mining investment.

How the sausage is made

In this week’s Investment Matters, CIO Craig Shepherd provides some insight into the way in which the investment community organises in-person meetings and company access, and how First Samuel makes use of its scale to access the best of such opportunities.

<strong>“Value” on offer?</strong>

A key point during the CIO dinners this month was that long-term value is emerging in the Australian share market (at last). With the aid of a simple chart, we discuss the reasoning behind this and how our clients are positioned to benefit.

Misstep or side-step? 

The Reserve Bank of Australia (RBA) is currently an impasse. Will it continue to hike interest rates in lockstep with the US Federal Reserve? Or will it choose to take a divergent path? And what might the consequences (of either approach) be?

Are there sovereign risks to wealth for Victorians?

The irony is that Victoria needs to invest even more to provide amenity to the expected increased population growth.

Should Victoria fail to invest, higher public transport and health care costs will be the most significant risks to the cost and quality of living of families and individuals in the middle of the income wealth scale.