Dividends. What’s all the fuss?

Roger Montgomery

In the last few days Opposition Labor Leader Bill Shorten has proposed a radical transformation of dividend imputation. Putting aside his mistaken belief that his voters are “Aussie Battlers”- when in fact they are hard-working small business owners and contractors, many of whom receive franked dividends from their business endeavors... Show More

Real growth in real estate

Roger Montgomery

We have long been supporters of the REA Group (ASX: REA) story with the company a longer term holding in both our domestic and global funds. Initially we were attracted to the very high rates of return on equity and little or no debt – a function of the company’s... Show More

It is true that the best businesses are those that have a competitive advantage and the most valuable competitive advantage is the ability to charge a higher price and cause people to still cross the road to buy that product. Consumer brands are often used as examples of this and A2 milk has achieved the ability selling what is basically milk. The question has always been about the price of the stock and the barriers to entry. If you believe that the company can continue to grow in the future, as fast as it has in the past, then the price might in fact be cheap. If however you believe that normal market and competitive forces will produce more modest earnings growth than the price is implying, the stock is expensive. By definition (we don’t own the stock), we believe the latter.

On Make market corrections your ally -

Thank you for sharing your view. Different views are precisely what makes a market, and indeed, we could be wrong.  You are quite right when you point out that if your scenario transpires, the P/E would not be 40 times. Thank you again for providing the counter view.

On CSL: What the market missed -

Hi Carlo, you make a very good point. I too have been seeing flyers most weeks at a lower price. Price wars aren't great either (for the customer yes!)

On Hold the phone... How are the Telcos? -

Hi Glenn, we wrote our thoughts on our site about VTG. Even though the weighting of VTG in our funds was relatively minor, we are nevertheless enormously disappointed.

On Hold the phone... How are the Telcos? -