On 27 November Telstra (ASX:TLS) held an investor day to update shareholders and other stakeholders on progress in respect of the T22 strategy. What new information did we glean from the update?
As readers will know, Telstra is a significant holding in The Montgomery Fund and a company we follow with interest.
When it comes to investing in small caps, Australian investors are spoiled for choice with around 2,000 small caps listed on the ASX. For us at Montgomery, there are realistically around 400 small caps that meets our investment criteria. Out of those, we invest in 30 to 50 stocks at any one time.
There is no doubt that Australia’s small companies market has the ability to generate significant wealth. This is because stockbrokers don’t earn enough revenue from brokerage on small companies and therefore don’t research them, leaving them undiscovered and potentially very cheap.
Australian toll road operator, Atlas Arteria (ASX:ALX), has announced a new, simpler ownership structure that should benefit the company and its shareholders. The deal includes the separation from Macquarie Group – thus ending ongoing management fees to the ‘silver doughnut’ – and an increased stake in APRR, Europe’s fourth-largest motorway operator.
Aristocrat Leisure (ASX: ALL), one of the world’s largest manufacturers of gambling machines, has been a stellar performer over the past five years, rising some 400 per cent. It’s recently reported results were impressive, to say the least. Free cash flow was up 16 per cent. Dividends rose 22 per cent. And debt was down.
With the launch of the iPhone 11 hardware cycle, Apple has done something it has never done before – it lowered the starting price of the most popular iPhone model. The company, known for selling premium hardware at a very premium price, appears to be taking a more elastic approach to pricing as the global smartphone market reaches maturity.
This week Google confirmed it would pay US$2. 1 billion in cash to acquire wearable fitness tech company Fitbit. The deal appears to have saved Fitbit, who pioneered the market but now faces intense pressure from a wide range of competing products, including the Apple Watch.
As an investment manager our number one goal is to compound the wealth of our investors in a prudent manner while trying to protect against the permanent loss of capital. If we can achieve this then we as investors alongside our clients will be not only successful but should also be happy.
Some time back, our Montaka global fund took a short position in iRobot (Nasdaq: IRBT), which makes Roomba robotic vacuum cleaners (RVCs). So far, our strategy is paying off, with the IRBT share price collapsing over the past six months.
Earnings season for the third calendar quarter of 2019 is well under way. While the team at Montaka are busy analysing the results of many global businesses, here are five key numbers that have stood out to us over recent days.