Editor’s Pick
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Is it time to hit the ‘buy’ button?
Roger Montgomery
July 8, 2022
If there’s one investing axiom to hang your hat on, it’s this: the lower the price you pay, the better your returns over the longer term. With the price-to-earnings (P/E) ratios of many high quality businesses compressing, I therefore think it’s time for long-term investors to buy while so many others are fearful. continue…
by Roger Montgomery Posted in Editor's Pick, Market commentary.
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How much would higher immigration rates help equity markets?
Roger Montgomery
July 5, 2022
In this week’s video insight Roger discusses how the fate of equity markets now hinges materially, but not solely, on the employment picture and the how central banks navigate the very serious choice they have to make between inflation or recession. continue…
by Roger Montgomery Posted in Editor's Pick, Market commentary, Video Insights.
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How KFC is making CKF a bear market winner
Roger Montgomery
June 30, 2022
Fast food businesses usually do well when times are tough, as many people – and families in particular – opt for less expensive places to eat out. It’s therefore no surprise that Collins Foods (ASX:CKF) – which operates KFC and Taco Bell in Australia and KFC in Europe – has outperformed the market. For the month ending 27 June, the Small Ordinaries Index fell eight per cent while CKF declined half that amount. continue…
by Roger Montgomery Posted in Companies, Editor's Pick.
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What if interest rates don’t go as high as the market is predicting?
Andreas Lundberg
June 27, 2022
With many market watchers expecting the Reserve Bank of Australia (RBA) to keep raising interest rates, high growth companies with no current earnings, but with potential for strong growth, have been heavily sold off. But, due to the economic impact, I’m not so sure the RBA will raise interest rates by as much as predicted. And if I’m correct, investors will be able to pick up (some of) these high growth companies at more favourable prices. continue…
by Andreas Lundberg Posted in Editor's Pick, Market commentary.
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Why it pays to invest when markets are heading south
Roger Montgomery
June 24, 2022
Warren Buffett once observed that “In stocks, it’s the only place where, when things go on sale, people get unhappy.” Which is ironic, because bear markets give long-term investors a wonderful opportunity to make market-beating returns. And the lower the market falls, the more excited we should be about buying shares in quality businesses at knock-down prices. continue…
by Roger Montgomery Posted in Editor's Pick, Market commentary.
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Hang onto your hat, as the free money epoch comes to an end
Roger Montgomery
June 23, 2022
The last couple of years have been one helluva ride, haven’t they? Thanks to a heady cocktail of record low interest rates and massive government stimulus, we’ve seen ballooning valuations for companies with no profit – and little or no prospect of making any. But the free money epoch is now ending, and the dire consequences have only just begun for these companies and their shareholders. continue…
by Roger Montgomery Posted in Companies, Editor's Pick, Market commentary.
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Would you like P/Es with that?
Roger Montgomery
June 17, 2022
Recently I penned a post proposing the importance of investing in quality companies with solid growth prospects. The suggestion is based simply on rather basic arithmetic; buy and sell shares on the same (now compressed Price to Earnings Ratio) and the investors Internal Rate of Return (IRR) will equal the Earnings Per Share (EPS) growth rate the company achieves. continue…
by Roger Montgomery Posted in Editor's Pick, Market commentary.
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A Tale of two market machines
Polen Capital
June 15, 2022
While several factors can affect stock prices, Polen Capital believe long-term returns are ultimately driven by sustainable earnings growth. continue…
by Polen Capital Posted in Editor's Pick, Polen Capital.
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A forecast slowdown is not a recession
Roger Montgomery
June 6, 2022
Most economists are forecasting a domestic and global economic slowdown. According to the UCLA Anderson Forecast, economic obstacles, including the Russia–Ukraine war, China’s COVID lockdowns, supply chain bottlenecks and labor shortages, and the consequent inflationary pressures on both finished goods and raw materials are well known, and in some cases becoming entrenched. continue…
by Roger Montgomery Posted in Editor's Pick, Global markets, Market commentary.
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Price and Value are two different things – just ask Canva investors
Roger Montgomery
June 3, 2022
With the share prices of tech stocks having cratered in recent months, there are perhaps few more opportune times than now to revisit the important difference between Price and Value. It may surprise investors that every business has a real worth or a true value that may bear no resemblance to the currently traded price. continue…
by Roger Montgomery Posted in Editor's Pick, Investing Education.