Viewpoint: Bullish
LLC has struggled through 2021 under the weight of a re-emerging virus and fixed price contracts being pressured by rising input prices.
CBA has at times has been the backbone of this MM portfolio since we backed the Banking Sector at the height of the royal commission. Taking into account our medium term reflation / higher bond yield view the banks should continue to enjoy a macro tailwind into Christmas, and beyond.
The financial press have been full of ALU of late since the takeover bid from US based software company Autodesk (ADSK US). The initial $38.50 bid was rejected but apparently discussions around $40 were also met with little enthusiasm by the Australian software business.
Probably the most common question we receive at MM is something along the lines of “what’s your favourite stocks (s) in the MM portfolio (s)” hence today I’ve cast risk aside and named my favourite 3 holdings in our Growth Portfolio, importantly considering the stocks at today’s levels.
WFC reported well on Tuesday night sending the San Francisco based bank up to fresh 3-week highs however we believe its got at least another 10% upside before MM is likely to reconsider the holding in our International Portfolio :
Overnight saw another solid session for US stocks with most major indices rallying around +0.8% as corporate earnings more than satisfied investors, suddenly after a horror start to the week the S&P is quickly back within less than 1% of its all-time high, another example of why it rarely proves successful to fight strong trends.
After looking at REA I quickly cast my eye to our holding in CAR which clearly has some similarities although it trades on a significantly lower valuation.
Property listing business REA has enjoyed a solid 2021 following the strategic acquisition of Mortgage Choice (MOC) plus having taken a 34% stake in mortgage software business Simpology.
The ASX200 enjoyed a solid Wednesday with the index closing up +0.8%, the banks and resources led the gains as the “reflation trade” enjoyed a day back in the sun.
KGN -1.45%: shares in the online retailer slowly gave back a strong start to close lower today following what looked like a decent full year pre-announcement. Sales are expected to be up over 50% for the full year, and earnings up around 60% which puts it right in the middle of previous guidance, and a little ahead of where the market was positioned.
