Collins St nailed the gold call 3 years ago. Here's 10 stocks it likes right now

Michael Goldberg of the Collins St Value Fund has never been a “set and forget” value investor. When we last spoke, he was already leaning into one of the most prospective trades in markets – gold – and doing it in size. Three years on, that call has been emphatically vindicated, and he still sees upside from here - although he is slightly more cautious. 

As he told me;

“I'm not sure that gold is properly represented in most people's portfolios. I think there's a lot of excitement now and people are tinkering with it, but you don't see gold forming a material part of people's portfolio. I think there's probably upside. How much upside? I don't know.”

That blend of conviction and humility runs through everything Goldberg and the Collins St team are doing right now. They were early on gold, but they express the view through deeply researched equities, not bullion. 

They have been following rare earths and mineral sands for more than a decade, long before geopolitics turned them into front-page news. And they see AI not as a magic investment theme, but as a tool every management team must wield intelligently to survive.

In this interview, Goldberg walks through how he is sizing and trimming a once-in-a-generation gold cycle, why scarce non-Chinese rare earths have become strategically priceless, how AI can be as transformative as oil without ever becoming “truly intelligent,” and why “slow is smooth, smooth is fast” is more than a slogan when cheap stocks stay cheap for years.

Above all, he comes back to first principles: understand what you own, know what it is worth, and refuse to be bullied by the latest market fad.

Why Collins St backed gold so early

Goldberg traces Collins St’s gold journey back about three years, when the spot price was around US$1,600–1,800 and almost nobody was talking about record highs. The team saw powerful tailwinds: heavy central bank buying, inflation translating into a weaker US dollar, and a shortage of new mining projects due to financing constraints and ESG spillover from fossil fuels.

They didn’t want to speculate on bullion. Instead, they went hunting for mispriced gold equities. 

“What we tried to find and what we uncovered was a host of companies… where not only were the companies' costs cheap based on prevailing gold prices, but they were predicting much lower gold prices, and we thought that that was unreasonable.”

Even with gold now around US$4,000, Goldberg argues the market still undervalues many producers because broker models assume long-term gold prices well below spot. His “danger zone” is when share prices start baking in unrealistic upside: “At the point that we start predicting a $6,000 gold price, when the actual spot price is $4000-4500. That's going to be a signal for me that I need to start getting a little bit concerned.”

Managing a monster gold win without breaking the portfolio

Collins St’s conviction in gold grew so large that the flagship fund at times held close to 30–35% in the theme, a level Goldberg acknowledges was too concentrated for a diversified vehicle. To avoid distorting the core strategy, they launched a dedicated gold fund. It is up roughly 150% since inception and nearly 100% in the last year.

Recently, they returned capital to investors. “Our launch price was $1. We handed back about 78 cents, and our investors retain about $1.70 of exposure.” Presented with the option, around half of the fund's investors took the money, whilst the other half reinvested immediately, underscoring how strongly clients still believe in the theme.

The flagship fund has trimmed gold from 30% to about 25%, which Goldberg emphasises is still a high-conviction position. He remains constructive on supply–demand imbalances but wary of euphoria: “When the market gets excited about a commodity, it makes me a bit nervous.”

Rare earths, mineral sands and geopolitics

Collins St's rare earths and mineral sands exposure stems from a long-standing interest in Astron (ASX: ATR) (discussed below) and its Donald Project near Horsham in country Victoria. 

Initially, the attraction was mineral sands, a critical input for tiles, sinks and bathtubs with no easy substitutes. But the rare earths byproduct is now strategically significant as China dominates global supply.

“If the Western world doesn’t want to be blocked out by Chinese interests, they need to find a way, and quickly, to shore up some of this material,” Goldberg says. 

With US and Australian government support flowing into non-Chinese projects, Astron and its peers have surged 150–200% over the past year.

AI as a tool, not an investment thesis

Goldberg rejects the idea that AI is “intelligent” in the human sense. 

“It is just the first time in history that we've had a tool that was capable of digesting mountains of data and then recognising patterns.” 

AI excels at patterns and best practice, not breakthrough creativity. “If you asked AI how to improve your horse-drawn carriage business... it would not suggest that you invent the internal combustion engine.”

In the portfolio, Collins St wants companies using AI pragmatically. Seven West Media uses it to precision-target advertising. SkyCity uses it to meet regulatory obligations by identifying patterns of problem gambling. Mining and logistics businesses use AI to anticipate maintenance needs. 

Stocks Collins St likes right now

Drawing on the fund’s June 2025 quarterly report, here are the key holdings and why Collins St continues to back them:

#1 - Astron (ASX: ATR)
Backed for its enormous Donald mineral sands and rare earths project in Victoria. Collins St believes the asset’s multi-billion-dollar NPV isn’t reflected in the share price, even after US strategic backing.

#2 - Boom Logistics (ASX: BOL)
A crane and lifting business trading on low single-digit earnings multiples despite NTA far exceeding the share price. Collins St expects consolidation, asset sales and dividends to unlock value.

#3 - Carnarvon Energy (ASX: CVN)
Effectively priced for just its cash, with the market assigning no value to its major Bedout Basin oil and gas interests. A new development partner or corporate action could materially rerate the stock.

#4 - Gold equities basket, including Black Cat Syndicate (ASX: BC8)
Still the fund’s largest exposure. Many producers are priced as if gold were US$2,500, creating significant valuation upside should equities “catch up” to the metal.

#5 - Humm Group (ASX: HUM)
A turnaround financial business where Collins St sees value in its growing business lending arm. The current takeover offer is viewed as opportunistic relative to their 90c–$1 valuation.

#6 - Litigation Capital Management (LON: LIT)
Market sentiment is extremely negative following a run of adverse outcomes, but Collins St believes the NTA, historic performance and pipeline remain underappreciated.

#7 - Retail Food Group (ASX: RFG)
A cleaned-up franchising group now back in growth mode. United Petroleum has quietly accumulated a 21% stake, creating clear takeover optionality.

#8 - Select Harvests (ASX: SHV)
A leveraged play on rising almond prices after an eight-year slump. SHV retains a cost advantage over Californian producers and is well-positioned for margin expansion.

#9 - SkyCity Entertainment (ASX: SKC)
A heavily discounted casino operator with monopoly assets in Adelaide and Auckland. Potential asset sales and the return of dividends support the investment thesis.

#10 - Seven West Media (ASX: SWM)
An undervalued media group trading around 4x earnings, with strong ratings, valuable sports rights and growing digital profits. Collins St sees scope for rerating or corporate interest.

Slow is smooth in a noisy macro world

Collins St's mantra - “slow is smooth, smooth is fast” - has been tested in a market dominated by AI hype, mega-caps and momentum, while many small and mid-caps have remained stubbornly cheap. Historically, Collins St held stocks for under two years; lately, value has taken longer to be recognised.

Once again, Goldberg returns to first principles. 

“We want to buy a dollar's worth of earnings for 50 cents.” 

That means resisting the urge to chase what is fashionable and accepting that sometimes cash flows take years to force a rerating. However, Goldberg remains steadfast in his belief that “Eventually, the weight of cash flows forces stock prices to where they belong.”

Price paid and price sold are the only two variables an investor can truly control. If intrinsic value cannot be estimated, Collins St simply will not invest.

Mixed signals and broken macro relationships

On the macro front, Goldberg admits the world feels disjointed. Australia is in a per-capita recession and productivity is stalling, even as AI promises efficiency. In the US, tech jobs are evaporating. Traditional relationships, such as gold vs USD, and unemployment vs inflation, look less reliable.

He cautions, however, against assuming historical patterns have “broken.” 

“When you're in it, it feels massive… It's very hard to know while you're in it if the patterns have been broken or it's just your perspective.”

Still, he believes the long arc of technological progress, from industrialisation to globalisation to AI, ultimately improves living standards despite volatility. 

The key for investors is avoiding permanent errors, taking risks only when affordable, and maintaining a consistent process through uncertainty.