Insightful Insights

This week David Jones announced their 2012 results and reported a 40% decline in profit. The only positive was that 4th quarter sales fell by just 1% on pcp whereas 1st quarter sales had fallen 11% on pcp. Actually there was another positive; the 35% decline in earnings per share was inline with expectations.

Separately the company also provided an update to its property strategy. Investors should understand that anything DJS does with its properties is simply a takeover defence against private equity (or Premier Investments perhaps) pulling off the same stunt that was done on Myer. That is; launch a takeover, succeed, sell off the property portfolio and get the business cheaper. if DJS shows it is proactive in this area it becomes much harder from Private Equity to argue that they are “adding value”.

DJS intrinsic value (see Fig. 1) has now not increased since 2004 and according to Skaffold.com DJS’s intrinsic value is not expected to rise at all over the next two years.

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by Roger Montgomery Posted in Companies, Insightful Insights, Intrinsic Value, Takeovers.

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Notch up another win for investors who use Skaffold. Back in August last year I was asked by a viewer on Sky Business what I thought of MacMahon Holdings (ASX:MAH).

You can watch the video here at 5 mins 20 seconds.

When asked the question, I looked at Skaffold.com and noting the very small change in intrinsic value over many years I said “This business is not going to deliver sustainable long-term outperformance”.

Today’s near-40% share price decline, announcement of a cost blowout, a downgrade to previous earnings guidance and the immediate resignation of the CEO Nick Bowen is a blow to those investors who own the shares of MacMahon and do not own Skaffold.

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by Roger Montgomery Posted in Companies, Insightful Insights, Investing Education, Skaffold.

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Roger Montgomery discusses his insights into how to view takeover offers, and in particular he discusses the Sundance Resources (SDL) takeover bid with Ross Greenwood on Radio 2GB.  Listen here.

This program was broadcast 19 September 2012.

by Roger Montgomery Posted in Insightful Insights, Investing Education, Radio.

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Yesterday’s Australian Financial Review highlighted comments from Mark Williams, Shell’s global downstream director.

“The global economy seems weaker to me than the numbers indicate”, said Mr Williams. “I still expected more suction out of China than we’re getting. I’m just a bit uneasy with what we are seeing in terms of fuel demand and chemical demand”.

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by David Buckland Posted in Companies, Insightful Insights.

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Its no news we have been warning investors about the risk of declining iron ore prices since late calendar 2011. Most recently we have been warning of a bear trap – the risk associated with buying stocks when they appear to be ‘cheap’ because they have fallen a long way but poor fundamentals are likely to see prices even lower.

Figure 1 outlines how The Montgomery Funds have been thinking about China, Iron Ore and our big miners.

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by Roger Montgomery Posted in Energy / Resources, Insightful Insights, Market Valuation.

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Roger Montgomery discusses why investing in heavily leveraged companies is a risky pursuit in this Australian article published 15 September 2012. Read here.

by Roger Montgomery Posted in Energy / Resources, In the Press, Insightful Insights.

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Join Roger as he explains how the long-standing principles of value investing can be applied so that you too can identify A1 businesses for your portfolio and beat the index. Watch here.

by Roger Montgomery Posted in Insightful Insights, Intrinsic Value, Investing Education, Market Valuation.

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by Roger Montgomery Posted in Energy / Resources, Insightful Insights.

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Roger Montgomery discusses the new Qld Government levies on mining, and the likely impact on mining stocks with Ross Greenwood on Radio 2GB. Listen here.

This program was broadcast on 12 September 2012.

by Roger Montgomery Posted in Companies, Insightful Insights, Radio, Value.able.

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Do Regis Resources (RRL), Silverlake Resources (SLR), Decmil Group (DCG), BC Iron (BCI), Corporate Travel Management (CTD), Sirius Resources (SIR), Sirtex Medical, SRX), Rio Tinto (RIO), Energy Action (EAX), ASG Group (ASZ), Seek (SEK) and Eastland Medical (EMS) makeRoger’s coveted A1 grade? Watch this edition of Sky Business’ Your Money Your Call broadcast 12 September 2012 to find out, and also learn Roger’s insights into the best opportunities. Watch here.

by Roger Montgomery Posted in Insightful Insights, TV Appearances.

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