The Federal Government is currently conducting a number of reviews into the healthcare industry. These include the Reform of the Federation White Paper, the Private Health Insurance Review, the Primary Health Care Advisory Group, and the Medicare Benefits Schedule Review. You might have seen recent media stories about an online government survey that the public can take to provide feedback on a range of issues and options for private health insurance reform. Continue…

by Stuart Jackson Posted in Health Care, Insightful Insights, Insurance.

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We have just come through another bank reporting season, so in this blog post we will provide an update on how we saw the results.

In summary the results were generally a bit softer than expected, with quality weaker than the reported numbers would otherwise indicate. Continue…

by Stuart Jackson Posted in Financial Services, Insightful Insights.

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As set out in the previous parts of this series (here, here and here), Treasury Wine Estate’s (TWE) performance has to improve significantly on an underlying basis to justify the current share price. The fall in the currency is not enough to justify the share price by itself. Continue…

by Stuart Jackson Posted in Insightful Insights.

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In the third part of my series on the initial assessment of the investment case for Treasury Wine Estates given its leverage to a falling Australian dollar, we look at the influence of industry structure on returns and the potential upside from the falling AUD. Continue…

by Stuart Jackson Posted in Consumer discretionary, Insightful Insights.

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The importance of ROE (return on equity) and buying companies with bright prospects is sacrosanct here at the Insights Blog but why? ROE is an important explanatory variable for superior share price performance and so we want businesses that can sustain high rates of return. When I talk about bright prospects it is the sustainability of these high rates of return that I am referring to. Whether the bright prospects relate to a rising tide of customers, the ability to pass on rising costs, the ability to be the low cost provider or the changing competitive landscape, how these factors serve to produce a high rate of return on equity is what we care about.

Continue…

by Stuart Jackson Posted in Insightful Insights, Investing Education.

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In the second part of my series on the investment case for Treasury Wine Estates (TWE) given its leverage to a falling Australian dollar (AUD), we look at what is already factored into the share price. Continue…

by Stuart Jackson Posted in Companies, Insightful Insights.

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In this series of blogs, we will take you through an initial assessment of the investment case for a stock that potentially benefits from a particular investment theme. If the initial assessment warrants further investigation, we would then prepare a full investment case and valuation. Continue…

by Stuart Jackson Posted in Companies, Insightful Insights.

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As we have discussed a number of times in the past, the major banks face significant headwinds from increasing capital adequacy requirements over the next few years. This is due to a partial reversal of the significantly lower risk weightings that were applied to major bank mortgages, combined with the need to generally hold more equity capital to reduce the potential risks given their ‘too big to fail’ status in the Australian economy. Continue…

by Stuart Jackson Posted in Financial Services, Insightful Insights.

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One of the themes that has driven some stocks in the last 6 to 12 months has been food quality and safety in China. Stocks such as Bellamy’s (ASX: BAL) and Blackmores (ASX: BKL) have experienced extremely strong share price appreciations recently on this theme as demand from Chinese consumers for premium international brands with perceived food safety has driven significant sales growth. Continue…

by Stuart Jackson Posted in Companies, Consumer discretionary.

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