Market Valuation
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Spotting value in an uncertain climate
Roger Montgomery
January 27, 2016
We aren’t in the business of forecasting and it has no place in our investment process which last year delivered investors in The Montgomery Fund returns of more than 19 per cent against the stock market returns of just 2.8 per cent inclusive of dividends. At the beginning of 2015 we thought there wasn’t a lot of value around and lower returns should be expected. Even though we were right about the market’s aggregate return, it didn’t prevent the generation of attractive returns for investors. continue…
by Roger Montgomery Posted in Insightful Insights, Investing Education, Market Valuation.
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Chasing dividends often overlooks growth
Roger Montgomery
December 7, 2015
We have previously written about the bubble in stocks (and inevitably property) inflated by the baby boomer’s desperate search for yield. We described the pursuit of yield as a fad. So, while we were not surprised to watch investors rushing into higher yielding banks and Telstra, we were shocked to hear of investors buying BHP for its ‘progressive’ dividend. continue…
by Roger Montgomery Posted in Investing Education, Market Valuation.
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Woolies Blows It!
Roger Montgomery
October 29, 2015
We have warned many investors here and in the media about the ultimate impact on Woolworths from the increasingly successful threat of hard discounters like Aldi… continue…
by Roger Montgomery Posted in Insightful Insights, Market Valuation.
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Rollercoaster, but reasonable longer-term
Russell Muldoon
October 8, 2015
The one-year forward price-to-earnings (P/E) ratio for the S&P/ASX 200 Index has been on a rollercoaster recently. We would like to try to put a framework around the market movements to more-broadly understand the thinking around the volatility. continue…
by Russell Muldoon Posted in Insightful Insights, Market Valuation.
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Branding: A debate; is it really a competitive advantage?
Scott Shuttleworth
September 14, 2015
Let’s define the term ‘competitive advantage’, what does it mean? There’s unfortunately many definitions, confusing a vital tenant of investment theory. Bruce Greenwald of Columbia University defines it as “being able to do what rivals cannot.” We can extend on this in such a way to suggest that having a competitive advantage will enable a firm to earn abnormally high returns.
Interestingly, competitive advantages when defined in this light, can both be thought of as the same as barriers to entry. continue…
by Scott Shuttleworth Posted in Consumer discretionary, Insightful Insights, Manufacturing, Market Valuation.
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How are we reacting to difficult markets?
Tim Kelley
August 25, 2015
It has been an interesting few weeks in global equity markets. In Australia, as in other countries, we have seen some violent swings in equity prices, with most of the swings being in a generally downward direction. continue…
by Tim Kelley Posted in Insightful Insights, Market Valuation.
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The Signs Of Market Tops
Russell Muldoon
April 25, 2015
Variant Perception, a US based research firm has published a thematic report on “understanding market tops” which we found interesting. continue…
by Russell Muldoon Posted in Insightful Insights, Market Valuation.
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Don’t yield to income!
Russell Muldoon
March 12, 2015
In recent times the market has been captivated by the ‘chase for yield.’ This phrase simply represents the symptom of the repressive money printing acting on interest rates globally. As a result of these low interest rates, funds are being ripped out of the safety of cash and poured into riskier assets in the pursuit of higher returns. continue…
by Russell Muldoon Posted in Companies, Insightful Insights, Market Valuation.
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WHITEPAPERS
Will the market boom or bust in 2015?
Roger Montgomery
March 6, 2015
The answer to that question will be known in a few short months. We already have some pretty good indications that validate our optimism. But some equally solid arguments can be mounted that validate our caution.
Roger Montgomery is the founder and Chief Investment Officer of Montgomery Investment Management. To invest with Montgomery, find out more.
by Roger Montgomery Posted in Companies, Economics, Insightful Insights, Investing Education, Market Valuation, Whitepapers.
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Does the market offer value?
Tim Kelley
March 4, 2015
Over the long haul, the equity market tends to offer a pretty good deal. Compared with holding cash, investors assume a significant amount of risk, but that risk is generally well-rewarded with higher returns. If your timeframe is long enough, the risks tend to even out somewhat, and the returns compound meaningfully. Staying in cash for twenty or thirty years would normally be a dreadful investment strategy. continue…
by Tim Kelley Posted in Insightful Insights, Investing Education, Market Valuation.
