Thoughts on GMG at new highs
Hi James and Team Market Matters love the stock but sold out of Goodman Group entirely on 1/8/24 for better opportunities in the immediate term. It reached a new high yesterday. What is your view now? regards Deb
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Answer
Hi Deb,
You’re right, we do love GMG, it was our best position last FY! Our view has not changed since we sold our position, specifically:
We think GMG is a great business, and applaud their move into Data-Centres which looks like another master stroke by CEO Greg Goodman, however, our concern in the short term centres on the dislocation between a great strategy, and the timing around the actual earnings that strategy will generate i.e. there is a lot of optimism built in, yet some patience will be needed to see tangible financial benefits – much like the concern about AI being a huge theme, but not yet generating returns.
In hindsight we were too pedantic into weakness in August with our targeted buy area ~$30. Its been the story on a few stocks in recent months but we do expect to own GMG at some stage in the future.
