Year-to-date, the performance between these two names has been fairly similar, with ORA up +6.2% and ALU +4.8%, but over the last 5 months, it’s been a very different story with ALU adding ~40% while ORA has dropped by over -30% following its capital raise to buy Saverglass in 2023. This is clearly not a like-for-like switch, but such a move fits our desired portfolio characteristic positioning moving forward.
- Altium (ALU) has taken some positive lead from US tech and is trading close to its all-time high; we believe that after a stellar run, the high-valuation tech names are set to underperform in 2024. Hence, we are looking to take profit on our ALU position but we reiterate this is a valuation decision towards ALU as opposed to not liking the company’s direction over the coming year (s).
- Orora (ORA) fits nicely into this portfolio moving forward, offering some defensive exposure into 2024 through earnings that can grow at low double digits in the coming years while delivering a yield of ~6% (unfranked) – note we already own ORA in our Active Income Portfolio.
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MM is looking to switch from ALU to ORA
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