Stock picks NZX 2024

[Shareguy]

It's been reported that FB were the winners in the 2023 NZ Herald share pics with a 5.9 percent total return. Nothing to rave about given investing in a good high yielding term deposit with lower risk would have got you a higher return. Still a wins a win. Craig's were 2nd with a 1.8 percent return, while Jarden were last at a -17.8 percent return.

For 2024 FB expect

NZ company specifics to drive performance more than thematics.

NZ valuation caps to narrow between hot (industrial property,clean energy) and cold (office,aged care)

M and A is back

NZ firms may adjust their capital structures after steep increases in debt costs have put balance sheets in focus.

FB-Five stocks to watch in 2024

Ryman
Precinct properties
Mainfreight
Aft Pharmaceuticals
A2 milk

Thoughts?

[winner (n)]

Have FB given up on Oceania ...had picked them in 2023 .......prob don't buy into the pivot story etc

[BlackPeter]

It's been reported that FB were the winners in the 2023 NZ Herald share pics with a 5.9 percent total return. Nothing to rave about given investing in a good high yielding term deposit with lower risk would have got you a higher return. Still a wins a win. Craig's were 2nd with a 1.8 percent return, while Jarden were last at a -17.8 percent return.

For 2024 FB expect

NZ company specifics to drive performance more than thematics.

NZ valuation caps to narrow between hot (industrial property,clean energy) and cold (office,aged care)

M and A is back

NZ firms may adjust their capital structures after steep increases in debt costs have put balance sheets in focus.

FB-Five stocks to watch in 2024

Ryman
Precinct properties
Mainfreight
Aft Pharmaceuticals
A2 milk

Thoughts?

The thing with the future is -nobody can see it until they reached it, and then its not the future anymore.

But for what it is worth - I would agree with Ryman and Mainfreight in the list above. Ryman fits well into a slow REIT recovery story (and with their CR and following SP punishment already behind them).

Precinct might as well fit into the REIT recovery, but I don't know enough about them to have an opinion.

Mainfreight is an outstandingly managed freight company. Freight companies are traditionally the first benefitting from any move out of recession, and surely - this will happen in 2024, won't it?

AFT - ask me what crypto currencies do this year? I don't see any moat for them, but plenty of hype, but this never stopped the markets. Throw a dice, but in my view not investment grade.

A2 - hmm, it is in a way together with Synlait in the claws of the dragon. Dragon wants food, and if the dragon decides that its good for it to allow A2 to flourish, it will. Otherwise - bad luck for holders. Ask the dragon what it wants to do, I would not know.

Talking about some other opportunities they have not mentioned:

In my view worthwhile watching as well are building industry (particular infrastructure); like e.g. FBU, STU, ... While I don't know whether an investment into more roads is the wise thing to do (though I am sure National /ACT / NZF will do it anyway), there is no other option but to invest into water infrastructure (pipes, sewage), bridges and to fix the next handful of weather damages courtesy to global warming this year. Why not invest in industries which produce stuff people need?

other REITS (including Retirement villages) like CDI, OCA, ARV, ...

Tourism / hospitality like eg. THL, MCK (part hospitality, part REIT)

NZ agriculture - while some are still in choppy waters, the industry has so far a good chance for a great year: SEK, SCL, CVT ( comes with lot of hype). Why not invest in industries which produce stuff people need?

and yes, I think TRA might have as well still some fuel in the tank ;

Looking at this (certainly not complete) list - I think there is no shortage of opportunities on the NZX (but yes, I have as well some money in US + Europe ... many overseas companies run on amazing cheap PE's ... and you never know, how our local government will screw up the NZ economy).

[Basil]

The NZX gross index inclusive of all dividends paid by all companies during 2023 is up a miserable 0.3%, (gone backwards in inflation adjusted terms by 5.7%), after losing 12%, (19% in inflation adjusted terms) in 2022.  The best performing broker's recommendations in 2023 did not beat inflation.
The incoming Govt have forecasted on a per capita basis, (per person after adjusting for new migrants) we are going to be in recession for the next two years.
This is very sobering stuff, incredibly sobering and is why I think corporate bonds are a good relatively low risk asset class for the next 2 years along with investing a LOT overseas in countries with quite frankly, better growth prospects.

I have a lot of head scratching to do regarding 2024.  Not seeing a lot to like on the NZX.  It's hard to make good progress against a tide that's still going out.  Looking highly likely I will throw the guys at Discovery funds a bone early in the new year as well as continuing to hold a large position in Barramundi and moderate position in Marlin, (probably add more to Marlin).    The total mess Labour have made to our economy will take a lot longer than one 3 year term to try and clean up.  Maybe if National get another term there is more hope for our economy turning around ?

[BlackPeter]

The NZX gross index inclusive of all dividends paid by all companies during 2023 is up a miserable 0.3%, (gone backwards in inflation adjusted terms by 5.7%), after losing 12%, (19% in inflation adjusted terms) in 2022.  The best performing broker's recommendations in 2023 did not beat inflation.
The incoming Govt have forecasted on a per capita basis, (per person after adjusting for new migrants) we are going to be in recession for the next two years.
This is very sobering stuff, incredibly sobering and is why I think corporate bonds are a good relatively low risk asset class for the next 2 years along with investing a LOT overseas in countries with quite frankly, better growth prospects.

I have a lot of head scratching to do regarding 2024.  Not seeing a lot to like on the NZX.  It's hard to make good progress against a tide that's still going out.  Looking highly likely I will throw the guys at Discovery funds a bone early in the new year as well as continuing to hold a large position in Barramundi and moderate position in Marlin, (probably add more to Marlin).    The total mess Labour have made to our economy will take a lot longer than one 3 year term to try and clean up.  Maybe if National get another term there is more hope for our economy turning around ?

Things so bad? Maybe the doctor needs to prescribe some happy pills?

Lets face it - the new government is not better in predicting the future than anybody else ... but as we know, every new CEO is trying to paint a really dark picture of the present, just to create a lower base to make their achievements look bigger.

That's what Chris Luxon is doing - just painting a bleak picture to make sure that people see him in 2 and a bit years as the saviour who got us outof the terrible hole. This is the time where digging is good for every incumbant. Sure - there are always people falling for this talk, and yes, it is really entertaining, but just make sure you don't believe it yourself!

Assuming the big world economies (like US, Europe, SE Asia and ah well - Australia) recover (and currently it does look in my view more positive than negative for all of them), things will go up here in NZ as well. Not even Labour could prevent that from happening, so why should a National government be still worse?

People want to eat good fruit, vegies, meat and fish, they want to drink good wine, they want to travel to exotic and pristine places (admittedly - National is screwing our environment up as fast as they can, so this is a negative) and send their children for training purposes overseas. So - why do you think the future for NZ looks that bleak?

[Basil]

No happy pills required, I have Tony the Pony at the dog park and my boat...both happy places. 
I prefer to consider myself a realist rather than an optimist or a pessimist.
The full effects of interest rate increases have not flowed through yet, average mortgage rate I read recently is "only" 5.7% so there's a lot more pain coming for the remaining mortgage holders who are yet to face the interest rate reset drama.  Going from 3% to 7%+ is excruciatingly uncomfortable and has a devastating effect on discretionary income.

RBNZ's sole myopic focus is inflation now and its clear there's no fairy tale soft landing for our economy.  A recession is ugly compared to the growth going on in the U.S. for example.  The average multiple of the market is stretched compared to the 10 year Govt risk free rate where it is so even after 2 years of terrible NZX performance we're not a cheap market overall.

From a macro top-down high altitude perspective, the NZX does not look like an attractive place to invest in equities, corporate bonds, yes.  Some companies with exceptionally talented management will do well despite the economic malaise and I predict Turners will be one of them.

[snapiti]

easy to pick the NZX........stay away from the whole thing and invest on the ASX

[LoungeLizard]

The tide going out is a good way of describing where the NZ economy is at the moment. It will, of course, come back in again but there's no reason to expect that to be anytime soon. At least 2 years, more likely three, of low-zero economic growth fueled by low domestic demand, low productivity, and high debt - both Government and household. Throw an increasingly turbulent international backdrop into the mix and I really can't see how there's going to be a lot of good news stories for the NZ economy in the medium term.

In this context it is hard to find safe havens on the NZX. I'm 60% in term deposits (which, being a man of leisure,  soak up my excess imputation credits). I think there may be some joy in stocks like STU as National gear up for long needed infrastructure spending. GNE also is going to be well positioned to ride the move to renewables. Best defensive stock in my opinion is IFT, for it's renewables investments and also data centres for the coming AI storm.

Apart from that, TRA for the steady dividend and potential further growth. 

[BlackPeter]

easy to pick the NZX........stay away from the whole thing and invest on the ASX

Yeah right ... but then, much easier to lose money on the ASX. Wonder as well, whether Australia will stay in times of climate change the lucky country.

Are you NZ tax resident? In this case - the tax treatment of NZ Investors on the ASX sucks. So - better add all the franking credits you can't use into the loss bucket and keep dreaming about the imputation credits a NZX holding would have given to you.

Sure - ASX is different to NZX, but different is not always better ...

[KW]

Yeah right ... but then, much easier to lose money on the ASX. Wonder as well, whether Australia will stay in times of climate change the lucky country.

Are you NZ tax resident? In this case - the tax treatment of NZ Investors on the ASX sucks. So - better add all the franking credits you can't use into the loss bucket and keep dreaming about the imputation credits a NZX holding would have given to you.

Sure - ASX is different to NZX, but different is not always better ...

Makes no difference if you are buying shares that don't pay a dividend.  Which is most of the growth companies.  No real growth companies left on the NZX.  

Only NZ company I hold is SKO.  And even that is beginning to bore me as everything else on the ASX rips higher while it stagnates. 

[snapiti]

The tide going out is a good way of describing where the NZ economy is at the moment. It will, of course, come back in again but there's no reason to expect that to be anytime soon. At least 2 years, more likely three, of low-zero economic growth fueled by low domestic demand, low productivity, and high debt - both Government and household. Throw an increasingly turbulent international backdrop into the mix and I really can't see how there's going to be a lot of good news stories for the NZ economy in the medium term.

In this context it is hard to find safe havens on the NZX. I'm 60% in term deposits (which, being a man of leisure,  soak up my excess imputation credits). I think there may be some joy in stocks like STU as National gear up for long needed infrastructure spending. GNE also is going to be well positioned to ride the move to renewables. Best defensive stock in my opinion is IFT, for it's renewables investments and also data centres for the coming AI storm.

Apart from that, TRA for the steady dividend and potential further growth. 

a lot of damage can be done with the tide going for a meaningful amount of time

[LoungeLizard]

I've also found that in recent times I've adopted more of a trading mindset in trying to pick good entry points and also exiting at the first sign of trouble (HGH). I used to subscribe to the time-in-the-market theory but these days investors can't be too complacent and need to review their portfolio very regularly. There really isn't any point imo in holding even a blue chip stock through thick and thin, if one see's a downtrend or negative macro environment emerging. The trick (and the fun) is getting out before it all hits the fan, and coming back in once the damage is done! 

[Basil]

I've also found that in recent times I've adopted more of a trading mindset in trying to pick good entry points and also exiting at the first sign of trouble (HGH). I used to subscribe to the time-in-the-market theory but these days investors can't be too complacent and need to review their portfolio very regularly. There really isn't any point imo in holding even a blue chip stock through thick and thin, if one see's a downtrend or negative macro environment emerging. The trick (and the fun) is getting out before it all hits the fan, and coming back in once the damage is done! 

Well said mate. You're as cunning as a ravenous Beagle.

[Crackity]

Jeez so much negativity on this thread by experienced investors - probs means the NZX is gonna rip higher in 2024.....

[winner (n)]

Jeez so much negativity on this thread by experienced investors - probs means the NZX is gonna rip higher in 2024.....

I think you are on to it .....good year coming up for the NZX I reckon as well