MM’s thoughts on National tyres (NTD) & Resimac (RMC)
Would appreciate your advice on the above-mentioned stocks which I was advised to be very good value.
Many thanks, Sidney
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Answer
Hi Sidney,
National Tyre & Wheel Ltd (NTD) is a $114m QLD business which wholesales automobile products locally and in NZ / South Africa. While I haven’t looked at this company before, we believe the stock looks bullish while it can hold above 90c.
Resimac (RMC) is a great mortgage business that has benefited from 1. solid loan growth and 2. their ability to tap bond markets with their Residential Mortgage Backed Securities (RMBS) affording them funding to grow. However, the risk now becomes a regulatory one. It is easy to comprehend that the regulators will apply lending caps to manage the huge rise in domestic house prices and that is a risk for RMC. For that reason, we are neutral at best here.
