I've enjoyed writing an intro paragraph each day, so I've decided to keep it. It lets me draw your attention to specific things, like the sheer level of selling by JSE-listed company directors right now. While everyone celebrates the GNU, many on the inside of our corporates are happily selling into that strength. That should tell you something about the level of caution required around this rally. And if it doesn't, then details in the numbers of the likes of Hyprop and PPC certainly should. Literally all you need to do each day is read Ghost Bites and you'll be on top of these issues.
There are a couple of events this week that you can register for. The first is a bizval webinar on Wednesday at 12pm, with yours truly in a panel discussion on preparing a business for exit (sale). The second is Unlock the Stock on Thursday at 12pm, featuring the management teams of Spear REIT and Adcorp.
Fresh out the oven: -
Ghost Bites: Prosus - Naspers is finally telling the right story under new management, with a focus on profitability. PPC's new CEO is taking no prisoners in the local business. Hyprop, Invicta, PBT Group and RCL Foods all released numbers, while Jubilee, Kore Potash and Orion Minerals released corporate updates. Along with all the director dealings in Little Bites, get the details in Ghost Bites>>>
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Magic Markets: With my travels abroad in the past week and the incredible improvement in sentiment back home, this was the perfect opportunity to focus on the dangers of home country bias in the latest episode of Magic Markets. For offshore vs. SA financial insights (including life on the ground), find it here>>>
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Dominique Olivier: Sometimes, businesses are here for a good time rather than a long time. For insights into trends that end and what that means for businesses (EskomSePush, anyone?) you can read this article>>>
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In case you missed it: -
Ghost Stories with Michael Field of Fedgroup: There are different ways to think about portfolio construction and how important elements like yield and inflation protection can be brought in. Learn more here>>>
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Unlock the Stock: Calgro M3 has been quite the story recently. To unpack the performance and prospects, the management team recently joined us on Unlock the Stock. You can watch it here.
- The Current brought to you by Investec: This year, SA is set to become the tenth-largest solar market in the world. In episode 4, Iman Rappetti spoke with Investec's Melanie Humphries, Bernard Geldenhuys and De Wet Taljaard from SAPVIA to explore SA’s apparent solar boom. Enjoy it here>>>
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Learn all about Calgro M3 |
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Calgro M3 is an excellent example of one of the smaller companies on the JSE that has delivered very strong recent share price returns.
To understand why, watch the recording of Unlock the Stock with the Calgro management team, available here. |
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Local company news:
Naspers - Prosus is under new management and it really shows. They are talking about profitability (I know, right?!?) and capital allocation. Miracles upon miracles, I tell you.
Speaking of new management, the PPC CEO isn't playing games. Although the local business managed to grow revenue through pricing increases, he's still in full wartime CEO mode as volumes have declined. Prepare for big changes at the company.
At the absolute other end of the success spectrum, we find Ethos Capital. The company is passing the hot potato that is Brait to its shareholders in an unbundling. The CEO of Ethos is stepping down after eight years, during which the share price more than halved.
Over at Hyprop, metrics in the local portfolio are of some concern. It's truly ridiculous that a property fund needs to worry about building reserves of potable water. Travelling overseas only makes this even more annoying, as our government is incredibly skilled at making everything the private sector's problem. Funds in Europe don't have to worry about basics like water.
Invicta, PBT Group and RCL Foods all released numbers that are well worth digging into for different reasons.
Jubilee, Kore Potash and Orion Minerals have released updates from the world of junior mining.
All these stories, plus the Little Bites, are available in Ghost Bites at this link>>>
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Trends that end: businesses with short shelf lives |
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What happens when a business finds itself offering a solution that no longer seems to have a problem? Can it adapt, or will it die?
With the sudden disappearance of loadshedding, Dominique Olivier dug into this concept. Read it here>>> |
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The only free lunch in investing |
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With volatility as the theme in markets in a year of elections, it’s important to keep your head as an equity investor. Take a long-term view and let the market do its job. Easier said than done, of course.
Kingsley Williams joined me to share practical tips and important insights into investing. The podcast and full transcript are available here. |
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International business news:
Novo Nordisk is experiencing ongoing high demand for Wegovy and Ozempic, leading to a decision to invest $4.1 billion to increase supply of the drugs. They are specifically focusing on the US market, where we know that obesity is a major problem. The sector isn't without competition, as Eli Lilly is also investing heavily.
And in a sign of the times, Ferrari has indicated that its electric model is scheduled for launch in the fourth quarter of 2025. The lack of engine sound is of course where all the focus is, as that's a core part of the appeal of a Ferrari to its client base. Time will tell how Ferrari deals with this and what the market thinks.
We covered Stellantis in Magic Markets Premium this week. To get access to this research and the rest of the vast library, subscribe to the platform here. |
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Macroeconomic Update The Japanese yen is at risk of falling to levels not seen since 1986. This is despite government interventions. The problem is the interest rate differential vs. the US, as Japan has near-zero rates.
The rand fell as much as 1.5% yesterday, its worst drop in nearly a month. Even with this drop, the rand remains the world's best-performing major currency in June. This morning, the rand has already clawed back most of that drop. The market will carefully watch the cabinet appointments.
Key indicators: USD/ZAR R18.09; US 10-year 4.23%; Gold $2,327; Platinum ZAR R18,111; Brent Crude $86.06
This macroeconomic update is based on TreasuryONE's morning update. |
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