Buy Hold Sell, by Livewire Markets

Buy Hold Sell: 3 dogs of the ASX (and 2 darlings headed higher)

If there is one thing investors have heard on repeat over the last 12 months, it's that there's a massive opportunity in small-cap stocks, which were, at the time, massively undervalued compared to their large-cap counterparts. 

And while experts' predictions seem to have come to fruition, with the Small Ordinaries Index outperforming the ASX 100 since the beginning of the year, a handful of stocks - plagued by negative news - have been left behind by the benchmark. 

Take IDP Education (ASX: IEL), for instance, which has seen its share price fall around 14% in 2024. Or Bapcor (ASX: BAP), also down 14%. Or Cettire (ASX: CTT), which has retraced the gains made in the early part of the year and is now trading back where it started. 

So, in this episode, Livewire's Chris Conway was joined by Datt Capital's Emanuel Datt and OC Funds Management's Aaron Yeoh to see if there is any value in any of these beaten-down stocks. 

Plus, they also each name a darling that has been headed higher in recent months - and they believe it can push higher still. 

Note: This episode was recorded on Monday 6 May 2024. 

The secret sauce of good growth stocks (and 2 that tick all the boxes)

Given interest rates remain at decade-long highs, and hopes of cuts continue to be pushed out into the future, it may be surprising for some that growth companies have continued to go from strength to strength. 

The S&P/ASX 200 Growth Index, for example, has risen 7.76% over the past 12 months. In comparison, the S&P/ASX 200 Value Index has lifted just over half of that at 4.71%. 

According to OC Funds Management's Aaron Yeoh, this is because a lot of companies have readjusted to a higher interest rate environment and have had a closer look at their cost bases, meaning earnings are now more sustainable for growth companies. 

 

Similarly, Datt Capital's Emanuel Datt believes it's because valuations within small-cap growth opportunities still remain compelling compared to their large-cap counterparts, and in addition, can help investors earn higher returns to keep up with or exceed inflation.  

So in this episode, Livewire's Chris Conway sat down with Datt and Yeoh for their tips and tricks for identifying good growth companies on the ASX. 

They analyse the financial factors, management requirements, and competitive advantages that they believe are important to winning growth stocks, and each select a stock that ticks all these boxes and more. 

Note: This episode was recorded on Monday 6 May 2024.

Buy Hold Sell: 5 growth stocks for the next 5 years

Growth stocks are the bread and butter of investors who are happy to stomach typically higher prices for exceptional above-market earnings growth. 

These companies typically exhibit high earnings and sales growth, a unique product or service, significant market share in their industries, impressive moats, and loyal customers. 

Take WiseTech Global, for example, which has seen its earnings grow at a compound annual growth rate of 43% since listing on the ASX, seeing its share price lift 2,319% (and counting) over that same period. 

So in this episode, Livewire's Chris Conway was joined by Datt Capital's Emanuel Datt and OC Funds Management's Aaron Yeoh for their analysis of three quality growth stocks with stellar growth trajectories over the next five years. And as a sneak peek, there's only one stock our fundies agree on. 

And just because we know you love a stock pick, each of our guests shares a strong buy they are backing over that same time. 

Note: This episode was filmed on Monday 6 May 2024.

Buy Hold Sell: 5 small stocks with big catalysts on the horizon

Just as in science, catalysts are the starting point for major change or action in life. It may be a whistleblower whose revelations lead to significant systemic change, or an enzyme that helps speed up a chemical reaction. 

In investing, however, catalysts trigger a drastic change in a stock's share price trajectory. And while no one can know the future, the prediction of catalysts to come can help investors profit over the short term. 

This could be new management, an earnings report, a new product/service announcement, legislative change, mergers and acquisitions, broker ratings changes, and for the short sellers out there, short reports. 

So in this episode, Livewire's Ally Selby was joined by Elston's Justin Woerner and LSN Capital's Nick Sladen for their analysis of five small stocks with big catalysts on the horizon. 

And for those looking for some spicy stocks for their portfolios, only one of these stocks is rated as a sell by one fund manager - and the other believes it is a buy. 

Note: This episode was recorded on Wednesday 24 April 2024. You can read an edited transcript below. 

https://www.livewiremarkets.com/wires/buy-hold-sell-5-small-stocks-with-big-catalysts-on-the-horizon

2 undiscovered stocks (and how to analyse under-the-radar companies)

Want to learn how to identify undiscovered stocks before the rest of the market does? Of course, you do - what else are you going to talk about at your next dinner party... Or at the pub over a lukewarm beer... Or around the office coffee machine? 

In this episode, Livewire's Ally Selby was joined by LSN Capital's Nick Sladen and Elston Asset Management's Justin Woerner for a deep dive into how investors can do exactly that. 

They share why investors, like you and I, may have an advantage in discovering mispriced stocks in the typically undercovered small and micro-cap arena, the screens they use to identify winning stocks, and one non-negotiable that every company that makes its way into their portfolios needs to possess. 

They also outline the risks investors should be aware of when hunting for gems in this area of the market, and whether it's worth investing in IPOs - because God knows, this anonymous writer has been burnt doing exactly that. 

And just to help you level up your dinner party/office/pub chat, we also asked Woerner and Sladen to name an under-the-radar stock they are buying today. You're welcome. 

Note: This episode was recorded on Wednesday 24 April 2024. 

Buy Hold Sell: 3 under-the-radar stocks (and 2 overcrowded darlings)

There's something to be said about discovering a gem of a stock the rest of the market missed. Like uncovering a musician before the world does, or being the first to watch a TV series before everyone else's eyes are glued to the same screen. It's a great feeling - and one that may leave you asking, 'Am I better than everyone else?' 

In most cases, probably not. But to help you on your way, this episode is dedicated to covering under-covered and undiscovered stocks. This anonymous writer is in the camp that everyone deserves a little confidence boost right now - particularly you, my dear reader. 

Today's hunting ground is small-cap stocks - given these are typically less covered by analysts. The stocks in this episode have market caps between $500 million and $850 million, so they are also less likely to be in the playing fields of the big fund managers and are more likely to not be on investors' radars. 

Livewire's Ally Selby was joined by LSN Capital Partners' Nick Sladen and Elston Asset Management's Justin Woerner for their analysis of these under-the-radar stocks. 

Plus, they also each name an overcrowded small-cap darling that could be due for a sell-off from here. 

Note: This episode was filmed on Wednesday, 24 April 2024. 

Buy Hold Sell: Demand wave to power future-facing commodities (and 4 stocks to ride the wave)

As the name would suggest, future-facing commodities are those that will carry humanity forward as we take on the momentous task of decarbonising the world.  

These are the commodities that are essential to the energy transition, including lithium, nickel, cobalt, manganese, graphite and copper. 

Much of the demand for these commodities is expected to be driven by the uptake of electric vehicles over the next two decades, with governments around the world - including Europe, China, the US and Australia - providing incentives for people to 'go electric'. 

We have already seen spikes in demand (and subsequent supply responses) for many of these commodities. And while the journey will likely remain volatile, on the whole, the wind only seems to be blowing one way; 

• Most analysts predict that global demand for lithium will double or even triple by 2030, according to Deloitte
• Demand for battery-grade nickel is expected to increase 50% by 2030, according to Deloitte
• Cobalt consumption over the last decade has tripled globally due to rising demand for electronics and EVs, and the demand is set to double again by 2035
• Macquarie forecasts a doubling in graphite supply over the next decade but predicts a deficit in 2025 due to demand from the EV market
• Demand from the EV market is expected to take up more than 60% of global graphite demand by the end of 2030
• S&P Global Market Intelligence projected in 2022 that annual global copper demand will nearly double from 25 million to roughly 50 million tonnes by 2035 

However you slice it, demand for these commodities is only going to grow and, in most instances, the question is whether or not supply will keep that. That will create a host of opportunities. 

As such, we sat down with Lowell Resources’ John Forwood & Acorn Capital’s Rick Squire, to get their take on what's hot and what's not when it comes to future facing metals. 

Note: This episode was recorded on Wednesday, 10 April 2024. You can watch the video, listen to the podcast, or read an edited transcript below.

4 undiscovered gems as gold prices hit record highs

There are a couple of hot commodities right now, including uranium, cocoa, and gold. The latter exploded higher in February this year after being stuck in a range for the best part of five years.

Several reasons have been posited for gold's renaissance, the primary being that investors who expect the Fed to cut rates have been buying the commodity. 

A low-interest rate environment reduces the opportunity cost of holding non-yielding gold and weighs on the US dollar, making bullion cheaper for non-US buyers. 

One of the other reasons has been the buying of central banks - led by the People's Bank of China - to ease reliance on US dollars. Central banks have always viewed gold as a store of value and a haven in times of economic volatility - the type that might be precipitated by dramatically changing rate expectations. 

Whatever the reason for the rally, gold is hot and investors have been keenly focused on the opportunities presented by the rich assortment of gold stocks available on the ASX. 

To help you sort the wheat from the chaff, we sat down with Lowell Resources’ John Forwood and Acorn Capital’s Rick Squire for their top picks and outlook on the gold sector.

Note: This episode was recorded on Wednesday, 10 April 2024.

Is there still upside to uranium? (and 4 stocks fundies are buying)

The law of supply and demand determines commodity prices. Currently, the uranium market is undersupplied, just as more nuclear reactors requiring fuel are being brought online. Some reports suggest the market will remain in structural undersupply for more than a decade.

It’s one thing for an underlying commodity to rally. Where the rubber meets the road for investors, however, is in equities. In that vein, we engaged Rick Squire from Acorn Capital and John Forwood from Lowell Resources to discuss the risks and opportunities in uranium. They also share a couple of stocks that appear overpriced, as well as four names they would buy today.

Note: This episode was recorded on Wednesday, 10 April 2024.

The stocks headed for the ASX 20 (and 2 on the way out)

Over the last five, 10, 15 and 20 years, mid-cap stocks have managed to outperform both their large and small-cap counterparts. They've done this with the same volatility as small caps and, over the last decade, they've grown earnings at around 7.5% per annum - more than double that of the small and large-cap indices. 

So, why is this? According to Blackwattle's Tim Riordan and Auscap's Will Mumford, it all comes down to quality. These businesses are more likely to have established themselves with some sort of competitive advantage and have more of a growth runway ahead of them to expand globally. 

Meanwhile, two-thirds of the ASX 20 - Australia's largest listed businesses - are either major banks, reliant on China's iron ore demand, or exposed to the declining long-term outlook for oil and gas. 

So in this episode, Livewire's James Marlay was joined by Riordan and Mumford for a look at two companies that could push these incumbents out of the ASX 20. 

Plus, they also provide a deep dive into the mid-cap segment of the market, the positive factors that investors should look out for, and some of the red flags to have on your radars. 

Note: This episode was recorded on Wednesday 27 March 2024. You can read an edited transcript below. 

https://www.livewiremarkets.com/wires/the-stocks-headed-for-the-asx-20-and-2-on-the-way-out/