How Perpetual's Vince Pezzullo invests when multiples retreat

The Rules of Investing

Livewire Markets

Markets are a right mess today, thanks to surging inflation and the fear of what that will do to earnings.  

In this environment, you want companies that have the market position, leadership and balance sheets to survive. However, actually finding these companies is no mean feat. 

On today's episode of The Rules of Investing, Livewire's David Thornton sits down with Vince Pezzullo - Deputy Head of Equities at Perpetual. Vince joined Perpetual in 2007 and has covered a heap of sectors since then; you name it - chemicals, financials, banking, telecommunications, materials and REITS.

He now heads up the Australian Share fund, Geared Australian Share fund, Direct Equity Alpha fund and the Perpetual Equity Investment Company (ASX:PIC) with about $435 million under the hood.

LIC
Perpetual Equity Investment Company Limited
Australian Shares

There's not much we don't cover in this episode. We take a granular look at the affect inflation is having on valuations and company decision-making, the structural shifts afoot in the energy market, and the qualities every company in your portfolio should have. 

We even discuss an Irish gambling stock making waves in a wide-open US market.   

This episode was recorded on June 23, 2022. 

 

Timestamps

  • 1:45 - Company margins
  • 5:00 - Investing to get down the cost curve
  • 6:00 - DuPont ROE
  • 7:30 - Growth stock valuations
  • 9:30 - Energy, the global tax on growth
  • 10:45 - Shifting trade flows
  • 13:10 - Santos
  • 14:30 - Energy sector going from spot price to contracts
  • 19:45 - Banks margins and rising rates
  • 23:00 - Inflation: 1990s vs 1970s
  • 25:30 - An investment checklist during high volatility
  • 28:00 - The limit to duration risk
  • 29:10 - The importance of real assets
  • 32:00 - The Irish bookmaker making waves in the US
  • 39:00 - 3 favourite questions

And for a succinct wrap of the interview's main takeaway, be sure to check out Glenn Freeman's follow-up article here

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The Rules of Investing is one of Australia's top investing podcasts. We interview the leading investment minds from Australia and overseas to better understand their processes and philosophy. After launching in October 2017, there have been over...

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