Ben Griffiths of small cap fund manager Eley Griffiths Group invests outside the ASX 100 and has his eye on the smaller up-and-coming stocks. Ramsay Health Care was once in their portfolio but is now way too big and outside their universe of investible companies. But he does have his eye on Healthscope.
“It’s on about 23 times [earnings] but on our modelling it’ll do about 23% in round numbers EPS growth,” he says.
“That sort of stock is a great example of a stock that can perform well.”
They also like aged care, given the ageing demographic and the willingness of people to pay more for a better care experience in their twilight years.
“[The government] needs the private sector to help do the heavy lifting and that’s exactly what Japara are doing,” he said on the Sky Business Switzer TV show.
He says companies like Japara Healthcare (JHC) and the newly listed Regis Aged Care (REG) have got solid EPS growth coming.
“Several other aged care operators are coming to market and that will be a hot space again because it’s going to grow revenue…which will translate through to meaningful EPS growth,” Ben explains.
One of Switzer Super Report expert Charlie Aitken’s (and don’t miss Peter’s article today on how to use Charlie) favourite things at the moment is the China-facing sector of inbound tourism.
“Recent Sydney Airport (SYD) data is showing a steady climb in inbound international passenger numbers (+3.3% PCP) as airline capacity increases and Australia becomes a better relative value proposition for international tourists,” he says.
Where they are coming from is summarised below.
Source: Sydney Airport
And Peter offers a little bit of caution about some oil price suggestions.
“If you think one day the oil price will go higher, the energy experts say Oil Search for capital gain and Woodside for yield and some price rise,” he says.
“But the oil price might go a bit lower if the experts can be believed. And history shows, given their wild and wrong predictions, they can’t be believed!
“Oil is more speculative than ever!”
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