MM went long JHX in October targeting a recovery-style rally back up towards $40 in line with our view that the buildings products company offered deep value around $30 with investors becoming ultra-bearish towards construction-facing stocks. However, after reaching our target the risk/reward is no longer that appealing and while we remain fans of the business, around $40 the next 10-15% feels like a coin toss hence yesterday saw us lock in a healthy profit of ~30%.
- We have transitioned from one recovery stock to another i.e. JHX into WDS. Very different businesses but both are aligned to an economic recovery.
MM is now neutral toward JHX
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