Treasury Wine (TWE), Lynas (LYC) and Hybrids

Hi Don,

Treasury Wine (TWE): We looked at TWE in another question today. The company stated the levy is unlikely to have a material impact, as only about $35 million of its U.S. business comes from Australian or New Zealand-produced wine, largely in bulk form. The 10% is slightly better than the 15% on European wine. However, TWE’s U.S. operations face headwinds from deamand weakness and distribution challenges. The stock looks good value ~$7.70 but it appears in need of an operational catalyst to reverse its underperformance – much lower and it will be on people’s M&A radar.

Lynas (LYC): Lynas, like most rare earth stocks, looks great. If we were long we could consider trimming our position but not exiting.

Hybrids:

• Trading Margin = The current margin (or yield) that the hybrid security is paying right now in the market.

• Fair Margin = The theoretical or “fair value” margin that the hybrid should be paying based on credit risk, market conditions, and other factors.

A higher positive “trading margin versus fair margin” score (like 0.52%) means the hybrid offers a yield above its fair value, indicating potentially better income but possibly higher risk. Conversely, a lower or negative score suggests the hybrid is priced closer to or below fair value, implying lower yield but possibly safer. All else equal, a higher positive score generally signals more attractive value for income-focused investors.

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Lynas Rare Earths (LYC)

LAST UPDATED 08/08/2025 16:16

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Lynas Rare Earths (LYC)

LAST UPDATED 08/08/2025 16:16