Buy Hold Sell, by Livewire Markets

Finding winners in the mighty mid-caps

They say from little things, big things grow. And that is certainly true for Australian companies. But on every company's way to the top, they have to pass through a funny little area in the middle. Ladies and gentlemen, let us introduce to you - the mid-cap universe. These companies may not have the same balance sheet strength as names at the top of the market, and may not be the pocket rocket growers down the bottom, but according to Lonsec's Peter Green, this diverse equity class deserves a spot in your portfolio, particularly when considering downside protection. 

Mid-caps embrace companies between 100 and 51 on the ASX-100 index and have been some of the best performers over the last twelve months. Thanks to companies including Oz Minerals and Nine Entertainment (up 151% and 102% respectively), investors have been pleasantly surprised as this equity class shot up around 30% over the last twelve months.

As the market continues to rally, will the fertilising ground for these Aussie zingers turned large caps follow suit? According to Bruce Williams and Catherine Allfrey, we may be approaching the end of the stellar run.

In this thematic episode of Buy Hold Sell, Livewire Markets' Bella Kidman sits down with Bruce and Catherine to talk all things midcaps, where they're seeing opportunity in the space. Plus, they'll share one mid-cap stock that has been misunderstood by the market. 

Note: This episode was filmed on 9 June 2021.

Buy Hold Sell: 5 founder-led mid caps

At Livewire we are told time and time again that behind every great business is an even better management team. We're told to invest in people rather than the business, to seek out CEOs who have prior experience building successful companies, to find leaders with "skin in the game," and, better yet, to back businesses led by founders themselves. 

So, in this episode of Buy Hold Sell, Livewire Market's Bella Kidman is joined by WaveStone Capital's Catherine Allfrey and Elston's Bruce Williams for a look at five local founder-led businesses. 

We'll put a spotlight on Seek (led by co-founder Andrew Bassat), the eponymously named Goodman Group (led by Gregory Goodman), Flight Centre (led by co-founder Graham Turner), Mineral Resources (led by Chris Ellison) and WiseTech (led by Richard White), to figure out whether founder-led really is all that. 

Note: This episode was filmed on 9 June 2021.

Buy Hold Sell: 3 fan favourites and 2 stocks on the rise

"Triple-0, what's your emergency? Your small and large-cap picks for 2021 have taken a dive off a cliff? And returns barely have a pulse?"

Oh dear. 

Well, it can feel like an emergency, can't it? Small caps are down -5.85% for the year, while large caps are faring slightly better at -5.05%. Meantime, the benchmark S&P/ASX Small Ordinaries Index has returned around 6%, while the S&P/ASX 200 has lifted nearly 9%. 

But it's not over yet. There's more than just one stock pick or two in town. And you know it. That's why in this episode of Buy Hold Sell, Livewire Market's Ally Selby was joined by Marcus Burns from Spheria and Chris Stott from 1851 Capital to get their thoughts on three regularly requested stocks across Livewire's platforms. 

We put Brainchip Holdings (ASX:BRN), EML Payments (ASX:EML) and Tesserent (ASX:TNT) on the chopping block. And for a bit of fun, we asked our small-cap fundies to share one beaten-down stock on the rise. 

Note: This episode was filmed on 27 May 2021.

The Battle of the Small Caps

I invite you to call to mind the great contests of the recent past. Ali versus Foreman! Fischer versus Spassky! Federer versus Nadal! Gatting versus Warne!

Actually, maybe scratch that last one - but you get the picture. These were titanic tussles with everything at stake, all to play for, and no quarter given. Glorious triumphs and disastrous defeats that could bring a tear to even a psychopath's eye. 

Now, in a worldwide first (we assume), we give you the Battle of the Small Caps!

Chief adjudicators of this soon to be fabled duel include Marcus Burns from Spheria and Chris Stott from 1851 Capital. In this very special thematic episode of Buy Hold Sell, the two small-cap specialists pit fan favourites against each other and crown winning stocks from each sector, leaving the rest out to dry.

We'll pit NRW Holdings against Mader Group. Temple and Webster against Nick Scali. CSR against Fletcher Building. And Pro Medicus against Healius. 

And just because we are feeling generous, our fundies also throw in two exciting opportunities within the small-cap arena. 

Who knew that Buy Hold Sell could get any better? 

Note: This episode was filmed on 27 May 2021.

Buy Hold Sell: 6 high-conviction small caps

They say that it is an investor's best ideas that produce the best returns. 

It sounds simple, right? (Right?) And yet, investors and fund managers' portfolios consistently balloon out to 40, 50, or even 60 holdings or more, with diversification for downside protection often to blame. 

And while no one - and I mean no one - likes to see their portfolio in the red, Harvard Business School researchers Miguel Antón, Randolph Cohen, and Christopher Polk recently found that a portfolio of high-conviction holdings - AKA your best ideas - actually statistically outperforms. 

In fact, they found that active and hedge fund managers' top ideas outperform the market - as well as their other holdings - by approximately 2.8-4.5% per annum. Meantime, the vast majority of the other stocks these managers hold don't exhibit this significant outperformance. 

So, in this episode of Buy Hold Sell, Livewire's Ally Selby is joined by arguably the best Aussie small-cap managers in the country - Chris Stott from 1851 Capital and Marcus Burns from Spheria, for their analysis of their best three ideas. Plus, they'll share their thoughts on each other's top holdings too. 

Note: This episode was filmed on 27 May 2021.

Buy Hold Sell: 5 stocks in a hot sector

After underperforming the benchmark for more than a decade, financials are back - buoyed by a sudden switch to cyclical and economically sensitive stocks and an all-encompassing fear of impending inflation. 

Since Pfizer and BioNTech's vaccine announcement in early November last year, Aussie financial stocks have risen nearly 30%, far outpacing the S&P/ASX 200's still impressive 11% return. 

So, what are the biggest growth plays in the sector? Buckle up my friends, because in this episode of Buy Hold Sell, Livewire Markets' James Marlay sits down with local large-cap legends Matthew Haupt from Wilson Asset Management and Scott Olsson from Firetrail Investments to answer this very question. 

Plus, they also share one COVID-bashed stock they believe is ready for a rebound. 

Note: You can watch, read or listen to the discussion below. This episode was filmed on 12 May 2021.

 

Billions in dividends, strong earnings and more to come

The banks are back, baby. Or so it seems. NAB, CBA, ANZ, and Westpac have handsomely rewarded investors for their patience during tumultuous 2020, with nearly $7 billion in dividends expected to flood the market over the coming months. 

The good news doesn't stop there. Or at least, that's according to Wilson Asset Management's Matthew Haupt and Firetrail Investments' Scott Olsson. They argue the banks' recent earnings reports, released earlier this month, are "extremely encouraging", while the incoming deluge of dividends is supported by "strong reported earnings." 

But with this good news in the bank (see what I did there?) is there a chance for these giants to fall, given interest rates are at historic lows and the banks' margins likely to come under pressure.

In this thematic episode of Buy Hold Sell, Livewire Markets' James Marlay sits down with Matthew and Scott to discuss some of the successes, surprises, and shortfalls of the Big Four's earnings reports. Plus, they share some of the risks for investors to keep on their radar.  

Note: You can watch, read or listen to the discussion below. This episode was filmed on 12 May 2021.

Buy Hold Sell: Best of the Big Four and 2 fundie favourites

Love them or hate them you really have to hate the banks. Right? Well - maybe not so fast. After all Aussie investors love them, and why not? They've been a trusty source of dividends for years. And, last year, the banks endeared them to the broader public when they allowed people to pause loans and mortgage repayments, thus providing a life raft during peak COVID. 

Now, having recovered by an average of nearly 71% from their COVID-lows, the Big Four are flying higher on our cashed-up country's improving economic outlook. In fact, KPMG found that the Big Four have recently reported a combined cash profit after tax of $13.8 billion, up 62.3% compared to the same time last year. 

The Big Four banks continued to strengthen their balance sheets during the half-year, lifting their CET1 ratios by 105 bps to 12.4% - the strongest capitalisation the banks have boasted in decades, KPMG reported. 

So, in this episode of Buy Hold Sell, Livewire Markets' James Marlay sits down with Wilson Asset Management's Matthew Haupt and Firetrail Investments' Scott Olsson to put the banks head to head. Plus, they each share one financial sector stock that has caught their attention. 

Buy Hold Sell: 6 global leaders to replace the FAANG stocks

It's been a tough year for the global tech giants. After running hard 2020 they were met with a sharp sell-off in March and the NASDAQ composite fell 10.5% in less than a month. This week we saw the story turn from bad to worse as the mention of inflation from Treasury Secretary Janet Yellen kicked off another sell-off across the tech-heavy index.

We know that these companies won't stay on top forever, but who will replace them when they do fall? We sat down with experts to find out.

Global growth fundies Nick Griffin from Munro Partners and Alex Pollak of Loftus Peak join Bella Kidman to weigh in on which companies could soon replace the FAANG stocks. These include Roku, a platform allowing cord-cutters to access streaming services from their TV; Deere & Co, the tractor-maker revolutionising the agricultural industry; Crowdstrike, the leading provider in cloud-based cybersecurity; and Twilio, a cloud communications business, providing companies like Uber with their in-app messaging system. 

Plus, our fundies each share their top stock set to be the next global leader. 

The next dominant theme of the decade

Those who twigged Web 2.0 would transform the world over the past decade are doubtless feeling pretty smug right now. And why not? 

The likes of Facebook, Amazon, Apple, Netflix, and Alphabet (Google) have returned a respective 762%, 1767%, 1041%, 1431% and 780% over the past 10 years (or since listing). Together, an almost (read: very) ridiculous 5781%. 

But the perennial questions burn as hot as ever: Who's next? And what will be the next dominant theme set to take markets by storm? 

In this thematic episode of Buy Hold Sell, Munro Partner's Nick Griffin and Loftus Peak's Alex Pollak point to the shift towards decarbonisation of the planet as the next major trend set to shape global markets. 

Nick and Alex join Livewire Market's Bella Kidman to share their insight on how investors can get on the right side of this trade and where, specifically, they are seeing opportunities. 

Note:This episode was filmed on 29 April 2021.