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Insightful Insights

  • Influenza Outbreak in America

    Ben MacNevin
    January 14, 2013

    It is winter in the United States, and there has been a severe outbreak of influenza. New York State declared a public health emergency on Saturday, with nearly 20,000 cases of flu reported across the state so far this season (compared with 4,400 cases reported in the whole of last season). There has been a widespread public services campaign to encourage people to receive vaccines, and under the emergency order pharmacists in New York will be allowed to administer flu vaccinations to patients between 6 months and 18 years old, temporarily suspending a state law that prohibits pharmacists from administering immunisations to children.
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    by Ben MacNevin Posted in Health Care, Insightful Insights.

  • Value Investing

    Tim Kelley
    January 12, 2013

    Value investing can be a laborious process. Properly understanding the many aspects that influence the value of a business is time-consuming, and in many cases the end result is to add one more company to the large pile of “No” decisions.

    There are much quicker ways to arrive at investment decisions, one of which is to use trend-following systems. A large body of academic research has demonstrated that, historically, it has been possible to earn excess returns in a variety of markets over time by employing systematic trend-following methods (note that systematic trend following is something done by a computer employing back-tested statistical methods, not by an analyst casting their eye over a price chart).

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    by Tim Kelley Posted in Insightful Insights, Investing Education.

  • Paragon Care Limited (Guest Post)

    Harley Grosser
    January 10, 2013

    The following report has been contributed by Harley Grosser – a private investor. Harley has identified a small company he would like to share his findings and personal beliefs about called Paragon Care Ltd which is aiming to take advantage of the growing aged care industry. Paragon is a distributor and manufacturer of medical equipment, and has attractive prospects if it can continue securing major contracts with hospitals. Investing in small companies that have high growth potential but are yet to produce sustainable earnings is risky, but they can be rewarding for people with the right risk profile and investment horizon. Do not purchase or sell any securities without first seeking and taking personal professional advice.

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    by Harley Grosser Posted in Companies, Insightful Insights, Intrinsic Value.

  • Best Value CEO

    Ben MacNevin
    January 9, 2013

    At Montgomery Investment Management we are pleased to learn that Graham Turner of Flight Centre has been named the best value Chief Executive Officer for 2012 by Egan & Associates.

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    by Ben MacNevin Posted in Insightful Insights, Tourism.

  • Performance to 31 December 2012

    David Buckland
    January 7, 2013

    The Montgomery Fund was launched on 17 August 2012. In the period to 31 December 2012 The Fund delivered a return of 16.88%, after expenses.

    Over the same period the S&P/ ASX 300 Accumulation Index appreciated by 8.68%.
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    by David Buckland Posted in Insightful Insights, Value.able.

  • WHITEPAPER

    WHY I'M DOUBLING DOWN ON THE CALL TO INVEST IN PRIVATE CREDIT AND DIGITAL INCOME

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  • Credit Corp – Underpromise, Overdeliver

    Russell Muldoon
    January 4, 2013

    Back in August 2012 when CCP’s share price was falling, following what we considered to be conservative guidance for the full year, internally we prepared the following table:

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    by Russell Muldoon Posted in Companies, Insightful Insights.

  • Webjet – Selling Convenience

    Ben MacNevin
    January 3, 2013

    With the number of Australian friends who seemed to be enjoying White Christmases (overseas holidays) this year, I wanted to briefly discuss an often touted criticism of Webjet’s business model.

    Like many businesses, customers can easily search their website free of charge for what they are after (in the case for flights, room nights, holiday packages), but then purchase the product and bypassing the booking fees by going directly to the supplier – in this case Airlines, hotels, car rental agencies. This is the core reason Webjet’s business model was considered ‘unsustainable’.

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    by Ben MacNevin Posted in Insightful Insights, Tourism.

  • Farewell 2012, Hello 2013

    David Buckland
    January 2, 2013

    Despite the global economic slowdown, 2012 was a good year for investors in the major share markets.

    The Australian All Ordinaries Index, was in the middle of the pack, appreciating 13.5 percent from 4,111.0 to 4664.6. Virtually the entire gain was recorded in the six months to December 2012.
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    by David Buckland Posted in Insightful Insights.

  • Signs of a merry Christmas at JB Hi Fi?

    Tim Kelley
    December 24, 2012

    JB Hi Fi (ASX:JBH) is a retailer we have followed closely over the years. What attracted us to the business was a focused and well-executed business model that delivered strong returns on equity, coupled with a store roll-out program that allowed those returns to be realized on an expanding pool of assets. Over time, this led to increasing market share and growing EPS. In fact, between 2004 and 2010 EPS grew at a rate of over 30% p.a. compound.

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    by Tim Kelley Posted in Companies, Insightful Insights, Value.able.

  • We are delighted by Silver Chef

    Russell Muldoon
    December 20, 2012

     

    We are delighted by the trading update provided late Wednesday night by Silver Chef’s (ASX: SIV) – a business I mentioned just last week on the Sky Business Channel as a ‘Stock to Watch’. It is also one we own in the both The Montgomery Fund and The Montgomery [Private] Fund.

    Management have forecast strong EPS growth of 12.7% to 18.3% for the first half. This would be an excellent achievement in what many have dubbed a tough retailing environment. Clearly not everyone in the retail sector deserve to be tarred with the same brush.

    Our expectations are for the business to report earnings at the top-end of this range given the underlying momentum and demand for their product suite.

    Silver Chef provides lease financing to hospitality businesses under the Silver Chef brand and more recently, for commercial businesses under its GoGetta brand and excellent risk management processes appear to be in place. Both brands enjoy a growing a reputation as industry-leading financing product providers. In particular Rent-Try-Buy and Rent-Grow-Own put less stress on a businesses cash flow in their start-up phases, a large reason for their take-up.

    Management have indicated to us that they believe their potential market is equivalent to about $250m in revenue per annum. At the full year 2012, SIV reported $85m in revenue. With the potential to expand by a factor of 3x from here, we are long-term holders and anticipate many more positive future updates. Keep watching this space.

    A word of caution. We have a large holding across our two well-diversified funds in Silver Chef and as shown, the share price has performed spectacularly well recently. Please therefore seek professional advice and understand the risks.

    by Russell Muldoon Posted in Companies, Insightful Insights, Market Valuation, Value.able.