Your view on banks and APA

Hi Paul,

Thanks for the positive feedback, always appreciated.

A question of two distinct halves but areas we have been watching of late:

Banks: We see the “Big Four” largely moving as one and while they are trading on unprecedented valuations selling the sector has detracted from portfolio performance throughout 2024. We would not consider increasing our banking exposure but considering the “crowd” has been calling them lower since April/May when the pullback does unfold we can see buyers emerge sooner than many would expect.

• We don’t particularly believe “dividend traps” is an apt term for the banks, they’ve rallied strongly in 2024 while paying solid dividends, the phrase is usually reserved for stocks that fall by more than their touted dividends – obviously this is a matter of semantics around timeframes.

However, we do concur that CBA is the one to buy when CBA does correct – in 2024 its already experienced pullbacks ~10%, the next one could well be deeper considering the momentum buying which has driven many stocks higher this year.

APA Group: as we all know it’s been a tough couple of years for APA but we like the stock ~$7.40. On a yield above 8% underpinned by a regulated asset base we continue to think APA is a highly attractive income stock which is poised for capital appreciation/growth after Michele Bullocks more dovish rhetoric this week – it’s now held across two of our portfolios.

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APA Group (APA)

LAST UPDATED 11/12/2024 14:29

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APA Group (APA)

LAST UPDATED 11/12/2024 14:29