Investor Insights

Property advertising platform, REA Group (ASX:REA), was one of the first businesses to announce its results this reporting season. Given the COVID-related restrictions on real estate transactions, it was a strong performance.  And, pleasingly for investors, the company will be paying a dividend.

Since listing on the ASX in January 2019, the share price of broadband provider, Uniti Wireless (ASX:UWL) has enjoyed spectacular growth. From an IPO price of 25 cents, shares have rocketed to $1. 60, with the business growing via consolidation. The upcoming merger with OptiComm Limited (ASX:OPC) will make the business even stronger.

In 1976, US economist, Herbert Stein, famously stated that “If something cannot go on forever, it will stop. ” His observation could well be applied to the ballooning value of many technology companies, some of which have never made a profit, and possibly never will.

The world has changed drastically over recent months and our portfolios have also been updated to reflect the new realities we face today.  With the June quarter now behind us, that rounds out an extraordinarily turbulent 12 month period. In this video update, Andrew shares Montaka’s latest thinking.

In recent months, The Montgomery Fund has accumulated a significant position in Woolworths – it’s now one our largest positions. And we remain positive on the outlook for the company over the medium term, even after the recent rally in its share price.

It’s a testing time for investors, with so many hitherto great businesses on their knees, and others looking well over-priced. But it’s still possible to identify structural winners with a long growth runway at reasonable prices. I think one of these could be Sydney-based medical device innovator, Nanosonics (ASX:NAN).

We believe Spotify (NYSE: SPOT) is an attractive investment opportunity because it commands an improving leadership position in the structurally growing, global digital audio streaming marketplace, underpinned by its expanding reservoir of proprietary consumer preference data. Flywheel: scale, technology, and data Spotify is the world’s largest digital music and podcast streamlining platform.

When the stock market sold off dramatically in March this year the US Federal Reserve responded by pumping financial markets with liquidity for the next three months and the stock market rocketed. But the Fed’s role in financial markets has moderated recently and signals that share market investors should proceed with caution.

The Montgomery Small Companies Fund, which was launched in September 2019, recently hit a record high. Since inception to 30 June 2020 The Fund has returned 3. 63 per cent,  which compares very favourably to its benchmark, the S&P/ASX Small Ordinaries Accumulation Index outperforming it by 12. 11 per cent.

The coffee can investment approach is an important concept that illustrates a key factor in how we view prospective businesses. It was coined by famed advisor Robert Kirby, who discovered that one of his clients had been selectively acting on all his buy recommendations, putting away the stock certificates and ignoring any sell recommendations.

You’d think that Australia’s global winemaker and distributor, Treasury Wine Estates (ASX:TWE), would be reasonably immune to the effects of the COVID-19 pandemic. But the owner of famous brands like Wolf Blass, Lindemans and Penfolds is also feeling the pinch, with its latest trading update pointing to a tough year ahead.

Many readers will be familiar with the transformation being wrought in the information technology space by cloud computing. Where previously an enterprise would own and maintain all of its own computing infrastructure on-premises, increasingly, businesses are coming to view computing as a non-core activity that is best consumed as a service.