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JSE Direct with Simon Brown

Weekly podcast hosted by Simon Brown covering the JSE and listed companies.
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Now displaying: July, 2022
Jul 27, 2022

Simon Shares

  • New energy rules for South Africa. Who wins?
  • Silverleaf Investments on Easy Equities. Know what you're buying.
  • Food retailer updates, Shoprite* (JSE code: SHP) winning. Pick n Pay (JSE code: PIK) bounding back and Woolies* (JSE code: WHL) struggling.
  • Cashbuild (JSE code: CSB) and Mr Price (JSE code: MRP) updates show consumers under pressure
  • IMF upgrades SA GDP growth for 2022 to 2.3% up from 1.9% they expected in April.
  • Results from Kumba Iron Ore (JSE code: KIO) and Anglo Platinum (JSE code: AMS)
  • US data Wednesday and Thursday.
  • Omnia (JSE code: OMN) was ex-div 800c on Wednesday and is now back in the longer-term channel. If you've been waiting to buy, now's your chance.

* I hold ungeared positions.


 

Jul 20, 2022

Simon Shares

  • Local June inflation, 7.4%, MPC tomorrow.
  • BHP Group* (JSE code: BHG) update, they are worried.
    ArcelorMittal South Africa (JSE code: ACL) trading update says global growth and recessions fears "present challenges for the outlook of commodities and steel demand in the next 12 to 18 months.".
  • China's holdings of U.S. debt fell below $1 trillion for the first time since 2010
  • Alviva (JSE code: AVV) delisting at 2500c.
  • Brent oil trade keeps on trucking, buy below $100 exit $113.

* I hold ungeared positions.


 

Jul 13, 2022

Simon Shares

  • US June inflation 9.1%, and core inflation was also up a 5.7%!
  • Still stage 4. Rand continues to weaken.
  • Back backs between 4 July 2022 & 8 July 2022
    • Naspers JSE code: NPN) bought 659,095 shares at an average price of R2 648.3315/share for R1.745 billion (US$104.73 million).
    • Prosus (JSE code: PRX) bought 6,240,339 PRX shares at an average price of €67.1361/share for €418.95 million (US$428.59 million).
  • SARB now considers cryptocurrencies as a financial asset and will create regulations around them. This means cryptocurrencies can be listed on SA exchange platforms but the process will take 12-18 months.

Dividends, love them but be careful.

  • But we also need to remember a few important things about dividends.
  • They can disappear as we saw in 2020. Even the most stable dividend payer can stop paying. REITs which have to pay them by law being a REIT structure) stopped paying because payment would see them fail their solvency tests.
  • They are backwards-looking. A high dividend yield is certainly attractive, but is it because the price has been falling? Could this be a warning of a dividend cut?
  • Cyclical stocks (think commodity stocks) pay massive dividends sometimes, then nothing for years.
  • Boards can change the cover ratio. This is the percentage of HEPS they pay as dividends. In tough times they can cut them. As the company matures they pay more.
  • Progressive dividends are the worst. The idea is that every year the dividend goes up a set percentage regardless of profits. A few local stocks have tried the idea, all have abandoned the idea.
  • Cash dividend vs. script dividend. I'll usually take the script.

Jul 6, 2022

Simon Shares

  • Still stage 6. Rand continues to weaken.
  • Naspers (JSE code: NPN) and Prosus (JSE code: PRX) both are holding well after the hard run the previous Monday on results and buy-back news.
  • Resources under pressure, all of them.
  • Supply chains adjusting
      • Just in time is now just in case
      • Higher inventories
      • Higher costs
      • More localisation

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