Tag: stocks

Wry & Dry #21 FY-24. Heaven: a busy week. Dubai: COP that. US: Haley’s comet.

It’s been a busy week at the Members’ Entrance to the pearly gates to heaven.

On Tuesday Charlie Munger arrived in a limmo longer than a bus. Charlie was Warren Buffett’s conservative investment alter ego. He arrived and immediately began arguing with St Peter about heaven’s recent investments (remembering that time doesn’t matter in heaven): “That St Peter’s Basilica property development in Rome was a waste of money.”

Profit Reporting Season – Stockland, Mirvac, Garda and Lendlease

laptop with the words property on it with small colourful illustrated houses

we’ve maintained higher weights in cash holdings within property sub-portfolios with an expectation that a significant rises in interest rates would necessitate an increase in cap rates (implied returns on property values), a resultant reduction in property book valuations and trigger a resultant slew of equity capital raises at discounted share prices in order to restore balance sheets to within bank funding covenants.

While the dull shine of copper comes in focus, we shed little light on BHP. Similarly, our focus this week on financial services dives deeper than the four major banks.

Profit Reporting Season – Sandfire, Perpetual and Judo Bank

This week’s Investment Matters will continue to focus on the recent reporting season.

While the dull shine of copper comes in focus, we shed little light on BHP. Similarly, our focus this week on financial services dives deeper than the four major banks.

Profit Reporting Season – Cleanaway, Emeco, ParagonCare and Worley

This week’s Investment Matters will concentrate on key company results as the reporting season winds down. On balance, market strategists have noted that earnings revisions have been neutral across the board, which is better than historical outcomes of net negative earnings revisions by optimistic investment banking equity analysts. 

Profit Reporting Season – Ventia, Johns Lyng, Earlypay and Nanosonics

Read key company results as the reporting season winds down. On balance, market strategists have noted that earnings revisions have been neutral across the board, which is a better than historic outcomes of net negative earnings revisions by optimistic investment banking equity analysts.

Early profit reporting season and news update

In last week’s Investment Matters we concentrated on the confession season, the period in which companies make early announcements to the market surrounding material changes to upcoming earnings.

This week’s Investment Matters will also concentrate on news flow and early reporting season results.

Confessions of a corporate earnings season

Most ASX-listed companies in Australia have a June fiscal/financial year-end. Accordingly, those with June and December balance days will tend to present their (half-year/annual) financial results to the market in each of the months of February and August.

Perpetual – finding a way to unlock value

In the past year, we have often commented that we’ll exhibit due patience as part of our investment approach. This is required as we often seek to invest in businesses that are significantly unloved and misunderstood and where assets may, therefore be mispriced.

Premier Investments – A deep dive into a new opportunity

In recent weeks, clients will have seen the addition of Premier Investments to their Australian equity sub-portfolios. Famously partly owned and operated (whether formally or informally) by Solomon Lew, Premier Investments is amongst the most successful discretionary retailers in Australian history.

Steadfast in its approach

© 2024 First Samuel Limited 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 […]

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’ 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.

The Health of Australia’s Employment Market

This week’s Investment Matters strikes out on a different path to usual. We will present a range of background information on the changing nature of the labour force following a decade of rapid aging and massive inbound migration.

Jittery consumer meets unrepentant RBA

This week’s Investment Matters continues our examination of the RBA’s tightening cycle and the increasing fragility amongst cohorts of Australian consumers. Have the screws been tightened too far already?

What Alternative assets do investors have?

This week we spend some time discussing a small but important component of most clients’ portfolios, Alternative Assets. We’re in the process of making new venture capital-style investments in health and financial services.

We also discuss another new Australian Equity portfolio holding called Impedimed (IPD ASX).

Did Aussies just stop spending?

In addition to the usual market updates, this week’s Investment Matters provides updates on two companies in client portfolios: Costa Group and Aristocrat.

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.

Debanking Some Fears in Global Markets

This week Investment Matters covers off on the collapse of the Silicon Valley Bank (SVB) in the US. 
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We used equity market weakness, associated with fears of contagion in the financial system given the collapse of Silicon Valley Bank (SVB) (and to a lesser extent smaller crypto-focused Signature Bank) in the US, to add to positions in the Australian Bank sector this week.

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.

Wearing golden shoes

Good decision, good outcome? Not necessarily. We take a look at the poker world for some insights into decision-making.

<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.

Understanding the rise in mergers and acquisitions

Two people shaking hands with a light blue background

When the share-market does not see value or investment merit in a particular stock the stock’s share price will recede. This could be because the company’s earnings (i.e. profit) outlook is poor (e.g. Bega Cheese Ltd) or perhaps the industry in the which the company operates is struggling (e.g. ARN Media Limited).
But often someone or a company will see value where the share-market does not. The logical outcome of this is one of the more interesting aspects of investment: the merger or the acquisition. Or, in jargon: M&A.