AGL Energy (AGL)

04/05/2022 09:33

AGL Energy (AGL) $8.35

We bought AGL at $5.35 when the news flow was a one-way street, a company with massive headwinds as the ESG dynamic built steam. There has now been one take-over tilt at a high of $8.25 while Mike Cannon-Brookes of Atlassian fame has just acquired (via derivatives) an ~11% stake apparently around $8.50. Brookfield, who is a very savvy global investor was party to the original bid but is now not involved in the second...

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04/05/2022 09:32

Active Income Portfolio

The portfolio added  +0.61% for the week with cash at 2%.  There were some strong moves at the stock level over the 5 trading sessions with Magellan (MFG) up +12.20% and Service Stream (SSM) put on +7.51%. We often get questions about SSM and our view on the stock, ultimately we like it and if we didn’t own it we’d be buying it. We’ve considered up weighting and that could be relevant for some however for the more conservative mandate of this portfolio, we’ll sit on our hands and hold what we have.

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03/05/2022 14:23

Income Portfolio – Amendments

We are switching from AGL into WES, in the Income Portfolio.

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20/04/2022 09:28

Active Income Portfolio

The portfolio added +0.48% for the week while cash sits at 3%.  AGL Energy (AGL) continues to perform adding a further +4.64% supported by Metcash (MTS) which added +3.03%. The biggest drag was Bank of QLD (BOQ) down -5.92% while G8 Education (GEM) fell by -1.84%. We made a number of changes to the portfolio during the week taking profits on National Storage REIT (NSR)

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13/04/2022 08:48

Active Income Portfolio

The portfolio added +0.68% for the week while cash remains at ~5%.  Strength in AGL Energy (AGL) continued with the position now up nearly 60% since purchase, while Metcash (MTS) also traded to levels not seen in over a decade. G8 Education (GEM) fell -7.83% to be the weakest link following a quarterly trading update that we discuss below.  

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06/04/2022 09:42

Active Income Portfolio

The portfolio added 0.37% for the week while cash remains at ~5%.  Magellan (MFG) had a rare period of strength adding 9.59%, the fund manager trading ex-option issuance today, while AGL Energy (AGL) rallied +7.99% to $8.24, taking it back to the price of the Brookfield–Cannon Brookes offer – we are now considering selling the position. On the flipside, Service Stream (SSM) fell -7.48% and Bank of QLD (BOQ) lost -3.49% following their 1H22 results.

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07/03/2022 17:00

AGL Energy (AGL) $7.30

AGL -1.75%: Over the weekend, the Cannon-Brookes / Brookfield consortium increased their bid for AGL from $7.50 to $8.25 before the AGL board formally rejected the offer, saying it still undervalued the group. A few whispers circulating (not sure of accuracy) that they sounded out AGL at $9.00 and not even that was going to get the job down. Cannon-Brookes said the consortium have put their ‘pens down’ implying...

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24/02/2022 09:30

AGL Energy Ltd (AGL) $7.65

AGL has enjoyed a great few months rallying well over 50% when much of the market slipped away under inflation and Ukraine fears. Short-term we can see a pullback in line with our view on the sector level but we like this ‘turnaround play’ into any weakness - its already delivering strong paper profits for the MM Active Income Portfolio and may also have a place in our Growth Portfolio.

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23/02/2022 09:28

Active Income Portfolio

The Income Portfolio was up +1.36% in a tough week for equities while cash sits at ~4%. Magellan (MFG) bounced back +14.98% while Smart Group (SIQ) +10.54% rallied on a good result. AGL Energy (AGL) +9.64% is capturing it’s fair share of the press thanks to a Brookfield backed takeover tilt that was swiftly rejected by the board. They clearly have a similar...

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21/02/2022 17:32

AGL Energy (AGL) $7.92

AGL +10.61% Rallied strongly today following a takeover tilt from a Brookfield / Mike Cannon-Brookes consortium that proposed buying AGL for $7.50, a miniscule ~5% premium to the last close and completely unrealistic for a change of control transaction, however we do support their rationale for winding up coal powered generation and using AGL’s footprint to expediate the transition to renewables. We think they’ll be more to play out with this.

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