Prosus is a holding company controlled by Naspers (South Africa) who 20yrs ago invested in a Chines internet company with a goal to sell $10 cents to every Chines i.e. Tencent. Today that stake is worth US$122bn. A holding company, like the very famous Berkshire Hathaway of Warren Buffet fame, acquires private and publicly listed …
Oil prices are coming down from recent peak and in my view should trade in a US$100bbl -US$120bbl range. However, oil stock prices are down far more and look to be pricing the elusive demand destruction sought to eventually curb oil prices. I ran a price sensitivity on Chevron, one the best performing oil majors, …
What is the downside risk? On Fed Funds rate headed to 4% the SP500 could have a further 15% decline. Given that inflation is not moderating and becoming anchored, entrenched or part of the business and consumer psyche, the Fed, ECB and many central banks have and are raising rates to quell demand, to force …
Lithium mining stocks took a hit on Goldman Sachs report/prediction that LCE prices would collapse in YE23 (to US$16k ton form US$54k ton). The rational is that supply / capacity is coming on fast and the market will go from deficit to over supply by end of YE23. Key to this assumption is a significant …
The Escudo strategy has done relatively well in the high market volatility. YTD its up 2.2% vs. SP500 -14% and NASDAQ down 23%. I have focused on the energy, diversified financials, raw materials, and consumer staples sectores for most the year and have recently added what I consider value tech, Amazon, Adobe, Google, Microsoft and …
The US equity market is not out of woods yet but I believe we may have reached a bottom. The Fed has effectively raised rates without raising rates and this has bludgeoned consumer and business sentiment. Lending costs, especially for housing has shot up far more than the 75pb Fed funds rate. 1- Inflation may …
SQM is the best lithium stock in the world! Far more appealing than ETF LIT and the preoperational small caps. 1Q22 dramatically changed the outlook SQM record breaking 1Q22 results with EBITDA up 614% to US$1.1bn. LCE (Lithium) prices jumped to US$30k ton vs 4Q21 US$14k SQM is now selling 70% of production near the …
Hapag Lloyd reported 1Q22 with a 178% gain in EBITDA and increased YE22 guidance by 15% to US$15bn (middle of range) as TEU rates continued to increase driving margins up despite higher oil costs and flat volumes. However, the company believes TEU rates are near a peak and could decline in 2H22, which is in …
Amazon faces maturity: With 10% of the US retail market, sales growth in 1P and 3P as well as its prime, media and advertising segments should slow. Amazon has become the market. AWS also slows: Amazon Web Services is 33% of the market with heavy weight competition (Microsoft, Oracle, Google) . Growth rates of 30% …
Financial assets are in a bear market. Buying the dip may be painful. Valuations need to decline as rates i.e. the risk free , increases. Look at the chart below. The Fed funds, the rate that US banks borrow from the Fed and is a global reference for the cost of capital, is likely to …
