BUY ON WEAKNESS
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research.

EPS of 83c matched estimates; revenue of $1.587B was 2% short of estimates. 
EBITDA of $289M was also 2% short. 
The outlook was better, though, with a 'solid order picture', the end of China lockdowns and supply chain normalization. 
The dividend was raised 10%. 
Things are looking a bit better here.  
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HOLD
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research.

EPS of $0.027 beat estimates of ($0.044) and revenues of $352.16M missed expectations of $361.39M. 
The stock rose as better-than-expected adjusted EBITDA helped to lift the name and as its guidance for CAPEX was less than expected. 
Management noted this was its strong quarter of production at the lowest costs for the year. 
Significant progress was made at its mines and it is well-funded to complete construction at Greenstone for the first half of 2024. 
The results largely looked strong, but the name has not held up as well as the underlying price of gold and the company's debt levels are quite high. We would consider it to be OK at current levels, although its high leverage does present some level of concern for us. 
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BUY
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research.

 LUN is now trading at 12.7x times' Forward P/E. In the 4Q, LUN’s revenue declined -20% to $811M, beating estimates of $757M, and EPS was $0.25 beating estimates of $0.13. 
The balance sheet is strong, with net debt of $10M. 
Total debt is just a fraction of the trailing twelve-month cash flow of $877M, although cash flow declined around 40% compared to $1.5B last year. The company is trading at a reasonable level compared to Book Value, around 1.2x Price/Book. 
Based on consensus estimates, sales are expected to slightly decline by -2%, while EPS is expected to decrease by 24% next year, as demands for commodities slow down due to an uncertain macro environment.
Overall, a decent quarter, and the result is better than expected. 
The company has paid growing dividends and repurchased shares over the last few years supported by a solid balance sheet, valuation is also reasonable. 
We think the current share price offers an attractive buy entry points for long-term investors. 
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COMMENT
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research.

Inflation has been a hot topic in the investment community in the last two years. Every investor wants to protect their portfolio from losing purchasing power by diversifying into different asset classes such as real estate, foreign currencies, gold, real estate, crypto, etc. We think one of the best hedges against inflation is through the ownership of great businesses with significant pricing power that could raise prices to offset costs pressure without losing volumes. The following business criteria help protect against inflation:

  • Gross margin of 50% or higher
  • Market cap larger than $100 million
  • Net debt to EBITDA ratio below 3.0x

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COMMENT

Covid created market distortions that we are untangling now. For instance, we were in lockdown, so we bought a lot of home computers and office furniture, which drove up those prices (inflation) and manufacturers pumped out more, expecting sales to last. But we got those Covid vaccines out of nowhere, and demand suddenly dropped. Meanwhile, after Covid people couldn't wait to go on vacation or retire, because they realized that life is short. Add to that Pres. Biden's well-intention waiving of college tuition, which is contributing to inflation. It would have better if he had introduce this measure in 2009 as Obama's vice-president, not now. History cannot help, offering us guidance, because we are in unprecedented times.

BUY

He's holding the CEO's feet to the fire, because the CEO guaranteed to him that he will right his company's ship this quarter.

BUY

Likes the stock and their products which facilitate the production of semiconductors.

DON'T BUY

They're losing a lot of money. Avoid.

BUY

A rare SPAC that he likes. They raised a lot of money to gradually consolidate the very fragmented bowling business. Shares are up 14% this year already.

STRONG BUY

Warren Buffett just released his annual shareholder letter--essential reading on Wall Street. The S&P was down 18% last year, but Berkshire was up 4%. Annual compound gains since 1965: 9.9% S&P vs. 19.8% Berkshire. He has always recommend Berkshire stock, because they make long-term bets on the underlying business. The business, not the stock is what Buffett invests in. Berkshire is the top shareholder of 8 S&P stocks, like Chevron, Amex and Coke. Lessons: diversification, long-term thinking and compounding.

BUY

A Warren Buffett core holding. He gradually built his holdings in the late-80s and into the 1990s then didn't touch the shares. Coke and AmEx are now among his largest holdings. Total cost: $1.3 billion apiece. Last year, he earned $704 million in dividends from Coke + $302 million from AmEx in 2022 alone.

BUY

A Warren Buffett core holding. He gradually built his holdings in the late-80s and into the 1990s then didn't touch the shares. Coke and AmEx are now among his largest holdings. Total cost: $1.3 billion apiece. Last year, he earned $704 million in dividends from Coke + $302 million from AmEx in 2022 alone.

BUY

Trade-down companies are the place to be in this economy. Their outlets are the final destination for marked-down merchandise. SKT was down only 7% in 2022, while retail peers were down double-digits. They delivered a bottom line beat last week with a 97% occupancy rate.

BUY

The FDA figure who was key in getting their Alzheimer's drug recently left the FDA, but all the Alzheimer's plays declined except Biogen.

BUY ON WEAKNESS

The CEO has left, but the stock will lost alot of today's gain (on the news), but pounce on that. A great long-term play that he prefers CP.