See what some of the top investment minds tip at Sohn Hearts & Minds
Not sure what to do with your money? See what Sohn Hearts & Minds investing talent tip.
PHIL KING, REGAL FUNDS MANAGEMENT
Nickel Mines (NIC: ASX)
A bull on the outlook for the mining industry which King says will benefit from an expected increase in infrastructure spending as government seeks to stimulate growth.
Says Nickel, which has mining operations in Indonesia, listed at a big discount but risks should disappear from the share price soon.
EMMA FISHER, AIRLINE FUNDS MANAGEMENT
Mineral Resources (MIN: ASX)
Diversified mining services company with operations in WA and NT in iron ore and lithium. Trading at a big discount at only five times earnings.
Has grown earnings at 15 per cent a year since listing in 2006.
Mining services business is more stable as it is tied to production, not capital spending.
JUN BEI LIU, TRIBECA INVESTMENT PARTNERS
A2 Milk (A2M: ASX)
Strong presence in the expanding China market for infant formula. Already one of the top 10 brands in the online market it is now expanding into mother and baby stores in China where the growing middle class is keen to give their children the best start on life.
ANDREW MACKEN AND CHRIS DEMASI, MONTAKA GLOBAL INVESTMENTS
Floor & Décor (FND: NYSE)
US-based flooring retailer. Chief executive Tom Taylor worked at Home Depot before joining the company. Same store sales have growth by 15 per cent a year. Scale means it can sell at low prices. Play on strength of the US housing market.
ALLAN GOLDSTEIN, COOPER INVESTMENTS
Fortive (FTV: NYSE)
Diversified industrial technology company which makes equipment to detect leaks and owns manufacturer of charging stations for electric vehicles. A spin-off from US company Danaher whose founders still own 11 per cent stake in the company.
NICK GRIFFIN, MUNRO PARTNERS
TradeDesk (TTD: NASDAQ)
Digital advertising specialist trading in advertising and programming inventory. Set to be a major winner from the streaming wars which are now gripping the media industry.
Company to benefit from move to streaming by giants such as Disney. Griffin says programmatic advertising will allow different ads to be directed as different viewers, even when they are watching the same program.
Founded by Jeff Green, TradeDesk allows the trading of those ads with Griffin predicting that it could grow its share of the market from 10 per cent to 20 per cent.
HAMISH CORLETT, TDM GROWTH PARTNERS
Spotify (SPOT: NYSE)
An online music platform which has saved the industry from being decimated by the internet. Spotify has huge potential to increase revenue from its free products and its podcasts.
With a specialisation in the audio business, it competes strongly against much bigger more diversified companies, such as Apple and Amazon. Predicts that the company has the potential to rank alongside of the big tech stocks such as Facebook, Apple, Netflix and Google to create FANGS.
BABACK POUSHANCHI, COTA CAPITAL
Smartsheet (SMAR: NYSE)
Enterprise software platform which has some 5.5 million users including its largest client, CISCO. The platform is used by 94 of the top 100 US companies but has low overall penetration and could grow rapidly with new products and as it hits new markets, including Australia.
SETH FISHER, OASIS MANAGEMENT (HK)
Sanken Electric (6707: JT)
Japanese company that makes sensors and power semi-conductors for electric vehicles is one of the groups benefitting from Japan’s corporate governance revolution.
Hong Kong-based Oasis is in talks with company about restructuring to sell its power systems business and to focus on highest returning areas.
MARKUS BIHLER, BUILDERS UNION (UK)
Wizz Air (WIZZ: LON)
The London-listed Hungarian low-cost airline stands out in a tough industry. Bihler says the eastern European airline market is catching up with western European market. Wizz Air has average ticket cost of $US40 ($59). Company has delivered annual average returns of 29 per cent since its listing in 2015.
CATHERINE WOOD, ARK INVEST (USA)
Tesla (TSLA: NASDAQ)
ARK holds a 10 per cent stake in the upmarket electric company and energy company founded by the controversial entrepreneur Elon Musk.
Wood predicts that Tesla has the potential to become one of the world’s largest autonomous taxi companies.
She predicts that Tesla shares which finished at $US350 last Friday could easily reach as high as $US700 in 2024 on the strength of its electric car business.
Predicts there could be even more upside if the autonomous taxi business takes off. Scotches bearish takes on the car maker that is changing the industry despite the large short positions some managers have taken.
BEENEET KOTHARI, TEKNE CAPITAL MANAGEMENT (USA)
GDS Holdings (GDS: NASDAQ)
China data centre group with operations in major cities including Shanghai and Beijing, which is essentially a play on providing digital infrastructure to the Microsofts and Amazons of China. Clients include Chinese ecommerce giants Alibaba and Tencent. Fast growing player in cloud computing with a hard to replicate position.
SHORTS
ANDREW MACKEN AND CHRIS DEMASI, MONTAKA GLOBAL INVESTMENTS
Sports Direct (SPD: LON)
UK sports equipment retailer founded by billionaire Mark Ashley. Business hit by competition from online retailers. The company has increasing debt and it’s being chased for some 674 million euros ($1.1bn) of back taxes by tax authorities in Belgium. Bought House of Fraser.
PHIL KING, REGAL FUNDS MANAGEMENT
PolyNovo (PNV: ASX)
King says biotech is the biggest bubble on the ASX. Mentions Polynovo in a list of other potential shorts including Pro Medicus, Nanosonics and Clinuvel.
King warns that passive investors have helped fuel the bubble in health care and bio tech stocks in Australia.
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