Like many companies exposed to China, the share prices Macau casinos like Sands China, MGM China and Wynn Resorts have been volatile. Kevin Bertoli, Portfolio Manager, Asian Strategies, recently travelled to Hong Kong and Macau and reports that the industry structure is improving and valuations look attractive for long term... Show More
After recent market volatility, Portfolio Manager Uday Cheruvu writes on some ways to get to the bottom of a tech company's true value. Show More
We don't really break up between ‘growth’ and ‘value’. To us these constructs don’t really matter. Show More
Uday Cheruvu, Portfolio Manager (Australian Equities), reports on the sectors in the Australian market that are looking more attractive - including commodities - and how he is positioning the Australian Companies Fund's portfolio. Show More
Historically, our view has been that there is a supply and demand imbalance in the aged care sector, with the lack of supply and rising demand only going to be exaggerated over the next few years as the bulge bracket of the Australian population moves deeper into retirement. The proportion... Show More
Emerging markets have been affected by a combination of factors, most obviously rising US interest rates and the subsequent appreciation of the US Dollar. However, what has not come out as clearly is the effect of rising commodity prices on economic growth. Show More
Although we are a long term investor, there are some trends to be found in the latest Australian earnings season. My key takeaway is that the main attraction for investors now is growth potential. Show More
The arguments for using Listed Investment Companies (LICs) are numerous and the burgeoning LIC offering on the ASX means investors now have more choice than ever. One of the biggest frustrations for many investors is the fact that LICs will often trade at a discount to their Net Tangible Assets... Show More
With the Brent crude oil price tipping over US$80 a barrel, continuing its rebound since 2016, attention has inevitably again turned to the current valuations of resource stocks. Portfolio Manager Uday Cheruvu looks at what the rise in energy prices may mean for long term investors. Show More
KKR & Co has been a US-based alternative asset manager since 1976. Now, it's changing. PM Capital Portfolio Manager, John Whelan, explains why KKR & Co. is going through major corporate change and why it may be positive for the company. Show More
Online automotive advertising portals, Autohome – featured in a Livewire piece in February 2017 – are a part of a broader investment thematic at PM Capital which has focused on online classified advertising businesses across the Asia region. With Autohome more than doubling since then we wrote about it, Livewire... Show More
As we’ve reached the end of the first quarter calls in the US, we can take a snapshot of the tech sector and see what it may tell us about the future. Earnings reported by technology companies across a range of subsectors have been good. In the internet space, both... Show More
Over the years during Kevin Bertoli’s time travelling to South Korea, often at times when relations were considerably strained, people have always seemed to take the North Korean issue very much in stride. Show More
NAB, CBA and Westpac, among others, report in early May. In those results we expect credit growth to be stronger than what the market expects. However, we expect relatively poor topline growth for the banks as their net interest margins remain under pressure. Given that the banks have already said... Show More
To illustrate how the PM Capital team searches for investment anomalies around the world, Jarod Dawson uses UK pub company Spirit, which generated the opportunity for a 25% return from a credit security. Show More
Some US market sectors that would be major beneficiaries from tax reform haven't seen marked investor interest. What about if tax reform actually occurred? Show More
As investors, we can get caught up with the new and snazzy. The world is definitely moving on at speed, but it’s generally technology that gets most of the attention. However, it’s not just the hardware that’s moving on. It’s also the belief systems of human beings that have to... Show More
Brewers and banks have historically played a significant role in PM Capital’s Global Companies Fund and Asian Companies Fund, and more recently the listed Global Opportunities Fund and Asian Opportunities Fund. Show More
In this 6 minute video CIO Paul Moore discusses how to navigate the changing global interest rate environment. Show More
This Australian earnings season gives us an insider’s view of the health of the different sectors in which our portfolio holdings operate. This is even more important this time around, given macroeconomic statistics are giving contradictory indications. Business confidence indicators are at their highest levels in three to five years.... Show More
Uday Cheruvu from PM Capital here, replying to Oliver Minchin's question on Altium. The reasons for decreasing piracy are not price-related but the fact that updates to systems have become more important to users. Updates allow designers access to newer features for designing electronic boards which reduces design time. This strategy of frequent updates which improve functionality is assisting to drive down piracy. Secondly, Chinese companies are exporting their designs overseas. This also forces them to buy licences in order to send authenticated designs to customers.
Hi Ada, Yes you are correct, increased regulation will drive drown profitability and put weaker players out of business, adding further add to the demand – supply imbalance. Our original thesis when we invested Japara was that the government would see this reality and either increase funding or deregulate the industry (from a pricing perspective) and charge consumers more. However, the actions by government have gone in the other direction – ie increased regulation and lower funding – so every player in the industry is being hurt. We do not see this changing in the medium term. Regis has investments in retirement villages. Japara has also flagged that they will expand into this area and invest more capital in retirement villages. Estia’s capacity to grow is constrained due to its historic acquisition-led strategy that impinges on its capital generation. So the actions by the listed players suggest they too believe that diversifying out of aged care makes economic sense. As a result, our thesis is that there is more downside to go with these companies before earnings find a sustainable base. This, in addition to the royal commission and the potential curve balls it can throw up, limit our interest in these companies for the time being - Uday.
Ben, Thanks for your comments and you are correct that Las Vegas, particularly in the 1990’s overstepped the mark in the transition to a ‘family destination’. However, to clarify, in regards to ‘family friendly’, we are referring to the opening of the market to a new percentage of the population that visit these gaming centres for reasons other than gambling; mass market focused, non-gaming entertainment and retail experiences. On visiting both Macau and Las Vegas, it’s clear that these two gaming centres are at different points of the continuum in their evolution. In regards to the gaming element, there is also a palpable transition towards mass-market gaming from the dominance of “high-rollers” in Macau. In our view this is a natural and secular transition of the middle-class in Asia in addition to the improvement in access/infrastructure and may likely continue for decades to come. We hope this clarifies our position and thanks again for the discussion point, regards PM CAPITAL.
Absolutely James - we are hosting a roadshow from 12-2pm today at the Intercontinental if you would like to come along. Arranger and lead manager will be Ord Minnett and the other JLM's are CBA Equities, Morgans and Taylor Collison.