Like
Michael likes Soul Pattinson (SOL). Its share prices is heavily marked down for its coal exposures. Investors comfortable with investing in coal may consider this a contrarian play, with kickers in the copper, zinc and debt exposures. SOL has a 40% stake in Brickworks, which is trading close to all-time highs. I’m prepared to back these professional investors at a share price close to $21,” he said.
Source: Google
Dislike
“I don’t like Woolworths (WOW) and Coles (COL),” Michael says.
“Both stocks recently traded through all-time highs and both have failed to “go on with it”. “At PEs of 27x and 24x respectively, they are estimated to grow over the long term at 2% and 3%.
“These numbers mean both are trading on much higher PE/G ratios.
“Combined with share price signs of exhaustion, in my view they both look like crowded trades that could go quickly and horribly wrong.
“A trade deal between China and the US could see a shift away from defensive stocks and trigger a significant sell down in grocers,” he adds.
Woolworths
Coles
Source: Google
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