MGF extended its 3-month decline this week to over 44% illustrating how fund managers with high fees need to perform even if they’re led by talisman Hamish Douglass. We’ve been monitoring the stock having taken a small position in the Income Portfolio recently at $33.85 – a forecasted 6.5% yield is certainly some useful cream on the cake. The companies important global fund has struggled for being too conservative holding too much cash in a rising market plus it was caught out by the crackdown by China on the likes of TenCent (7000 HK) and Alibaba (BABA US), we were also guilty of holding these two.
We continue to believe Mr Douglass is an excellent and highly intelligent fund manager and pricing MFG on an EST P/E for 2022 of 13.8x feels on the conservative side especially as it may yet prove to be an ideal time to adopt a more cautious stance towards risk assets.
MM is bullish MFG initially looking for a 20% rally
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