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MM’s thoughts on Block Inc (SQ2) and AGL Energy (AGL) please

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MM’s thoughts on Block Inc (SQ2) and AGL Energy (AGL) please

Hi MM team, Keen to get your thoughts on two stocks please: SQ2 - the last note from May suggested that the stock will be reliant on a healthy economy. Given concerns around a general downturn in the general economy, both here and the US, which direction do you see this stock heading towards in the next 6-12 months? AGL - unfortunately missed the boat on this one at lower prices! Understand that MM view this as long and bullish but what would you consider to be an ideal entry price range given the improved earnings guidance for FY23 and FY24? Keep up the good work! Cheers, Anthony


Hi Anthony,

Block  (SQ2) and other payment related companies look neutral, the next move in their share price looks a very 50/50 scenario, hence why we do not own them. You are right in terms of an improving economy drives payments volumes and helps with the bad debt side, however  the opposite is also true.  If we do have a deeper recession than we think is likely, payment stocks are certainly not the place to hide. Too hard for us at this stage.

AGL fell 0.09% on Thursday when the market was off -1.63% showing it’s defensive qualities. Ideally into 5% pullbacks however intimately we are happy to own it, so by default, happy to buy it here. For those new subscribers, stocks marked with an ‘Active’ tag  in the portfolio, we are happy to buy here.

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