A change in leadership on the ASX

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As reporting season ramps up, there’s a change in leadership underway in mining services says Simon Shields, Principal at Monash Investors Limited. Recently, mining services companies with exposure to the capex cycle have performed very strongly. However, he believes as the mining cycle matures, it’s the production-focused companies that are best placed to benefit.

“Companies providing OpEx services to the miners, they’ve got a lot more of a tailwind behind them, like Seven Group, which supplies Caterpillar heavy equipment, and Emeco Holdings, which supplies  Yellow Gear Rental.” 

Watch the full video to find out which bricks and mortar retailer is getting strong results despite the challenges of e-commerce. 

 

Key points:

  • Strong global GDP growth has driven a recovery in resources and mining services companies
  • Mining services companies exposed to the CapEx cycle have already been rerated and are now fighting over the remaining contracts
  • Australian retailers have been “reliably disappointing” for some time, but companies like Kogan and Afterpay have benefitted from the switch to online 

Further insights

Monash Investors aims to achieve their objectives by investing in a small number of compelling stocks that offer considerable upside, and by shorting expensive stocks that are at risk of falling. Find out more here.


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