Forum Archive Index - January 2000
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Re: [sharechat] local performance
Les
You asked me to give my picks for the year 2000. The best performers in
percentage terms will no doubt be some of the small cap tech related shares
which have popped up in the last few months although I can almost guarantee that
the worst performers will also come form the same group.
There has been a lot of hype about ITC. The Investment Club to which I
belong and which is devoted purely to punting bought in at 20c and sold 75% of
its holding last week at 84c. However although it is totally “blue
sky” ITC probably is the best bet in this sector as the intention is that
it will hold a portfolio of investments and therefore will have a chance of
picking at least one winner. SKY and ADV are the other two tech stocks that
could be worth consideration. Having said that I believe that some of the
technology focused US Mutual Funds or UK Investment Trusts are the best entry
point into this sector.
Back to the point. My picks for 2000 are FLB, FEG, WHS,
OZY. Boring, boring, boring I know but I am looking from an
investor’s point of view rather than a speculator’s.
FLB is in my opinion very much undervalued. The
uncertainty over the FCL letter stock structure has impacted severely on the
share price which is being driven down by overseas institutional selling
(Franklin Resources in particular) The trading results for the half year to
December will be spectacular and I expect that there will be an announcement
regarding the future of FLP in the near future which will allow the
restructuring of the rest of the Group to proceed. FLB is a pure play on
the strength of the NZ economy and as long it remains reasonably strong I will
be surprised if the shares aren’t at least $4 by the end of the
year.
I don’t know as much about FEG but they are under
the same cloud as the other Fletcher companies. This is a well managed company
which is undervalued compared to its peers overseas. When it is spun off from
the rest of the Group I would expect its shares to appreciate substantially,
subject of course to the vagaries of the world oil market.
WHS Just keeps rolling along. The best form of research on
this company is to visit the stores. The company will continue to benefit from
the upturn in the economy and its continuing expansion into the top brands via
parallel importing. The question is how will WHS go when, due to the saturation
of the NZ market, it makes its inevitable foray across the Tasman? There
is huge upside potential but also considerable risk in this move but on balance
I believe that the company has the management to pull it off.
OZY is cheating a bit but it does give a good $NZ exposure
to the Australian market and no sensible investor is going to have all his or
her investments in the local market; I personally have reduced the percentage of
my portfolio in NZ companies from 80% to 45% in the last two years (and I
suspect that many other individuals and institutions have done the same with the
consequent depression of prices) and will continue to reduce it. OZY were
floated in March 1997 at $1.48 and are currently $2.40 , a
gain of 62% compared with a loss of 7.5% for the NZSE40.
I expect the Australian market to out perform NZ again in 2000 but not by as
much.
There you have it
Mike H
>Mike, my selection of AQL, ITC, SFH, (RVS
watch closely) were in reply
>to Phil Williams request of list members to
name stocks they believe
>will be strong first half
performers.
>Perhaps you could share with us your top 3
selections.
>A performer for me would be a stock that shows the greatest %
return.
>Have a great day regards
Les.
>
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