Viewpoint: Bullish
CBA +0.63%: Australia’s biggest bank was out with their 3rd quarter update today which was largely as expected, but did enough to support the stock on a weak day for the broader market. NPAT was flat vs the quarterly average in the 1H at $2.4b while income fell 1% as volume growth failed to offset margin pressure. Credit quality remains strong with the bank seeing $48m in reserve releases…
The “Big Australian” was another point of discussion yesterday and specifically our 6% exposure in the Flagship Growth Portfolio to BHP which is currently significantly underweight the ~11% index weight. We like BHP for a bounce to at least $52-53 but in terms of going back to index weight, a move under $40 now feels a strong possibility due to Chinas COVID stance and the market’s aggressive overweight commodities position.
CSR +0.53%: Reported FY earnings this morning that were inline with expectations. NPAT of $192.6m was as expected and a +20% increase on the prior year while the final dividend of 18c was a slight beat. They talked to a strong pipeline of detached housing projects which is expected to continue in the year ahead as completion times lengthen with supply chain and trade…
This is an ASX listed bond that can be purchased and held on Chess the same way a stock can be held. This is a low-risk security guaranteed by the Australian Government yielding ~3%
The environmental solutions company has been a standout performer in the portfolio in recent months but took a hit in the last week. Shares fell despite positive news regarding its work in antimicrobial resistance. The company signed on with the Australian Government to be a part of their Solving Antimicrobial Resistance in Agribusiness, Food and Environments (SAAFE) research push. While a small…
PDL +8.11%: a strong first half result for the investment management firm ensured the share price was well supported against a weaker backdrop. Base fee revenue was up 35% to $317.7m and performance fees up 8% meant revenue beat estimates by at least 5%. Costs were up 20% but still came in better than expected which meant UPAT at $131m was a ~25% beat to market. Performance of FUM…
The world and asset prices have enjoyed declining interest rates for around 40-years but this downtrend has clearly been broken this year which has led to standout weakness in high valuation growth names. At MM we are not panicking around rising bond yields but portfolios need to be constructed with this in mind e.g. for us to buy interest rate sensitive names the entry price will need to represent standout value.
WBC +3.23%: A strong 1H22 result this morning from Westpac beating consensus expectations by ~6%.Cash NPAT of $3.1bn was ahead of the $2.9bn expected while the interim dividend of 61c was a tick above the 60c pencilled in by the market. Cost management was a key driver and they did a good job here, cutting underlying costs by 10% plus they also guided for 2H22 costs to be 0-2% lower than the…
TPG +2.33%: Announced the sale of their entire mobile tower and rooftop infrastructure network today for ~$950m to a Canadian pension fund, using the proceeds to pay down about 20% of their current debt. Both Telstra & Singtel have made similar moves in recent times cashing in on the current appetite for infrastructure assets. Reducing the overall amount of debt TPG carries will reduce…
