🎯 Tariff Talks: Where Are We Now?
Simon Brown recaps the evolution of Trump-era tariffs, with recent developments around:
US-China deal: effective 54% tariff on Chinese goods, 10% on US goods
UK, Mexico, Canada, Vietnam likely settling around 10%
Expectations for other regions like EU, Saudi Arabia, South Africa
Conclusion: tariff escalation seems contained, reducing recession risks
Key Insight: Markets are stabilising as the worst-case tariff scenario is dialed back.
Trump targets high drug prices in the US, pushing for:
30-day deadline for pharmaceutical companies to lower prices
Unclear legal basis; possible price controls debated
Pharma stocks bounce back slightly after initial drop
Simon’s Take: Healthcare is risky for investors due to constant regulatory pressure — he stays away.
Lewis expects a 55–65% EPS increase, sparking:
A ~16% stock price surge
Ongoing share buybacks and high dividends (7.8% yield)
Strategy: loan book expansion, carefully managing bad debts
Verdict: Strong fundamentals, still looks cheap. Simon and analysts are bullish. 📈
First results since Boxer listed:
Modest headline earnings (new shares diluted results)
25 new superstores & 35 liquor stores planned annually
Operating margins on par with Shoprite* (~5.5%)
Stock trading at fair valuation (R64.77), analysts' target: R76.66
Insight: Promising growth but priced in. Shoprite still Simon’s preferred pick. 🏪
Highlights from AngloGold’s trading update:
7x increase in free cash flow
New dividend policy: $0.125 quarterly minimum + 50% of FCF
26% production increase (aided by Egypt acquisition)
Concerns: strong rand + weak gold price pressure the stock
Simon’s Position: Holds the stock, likes the dividends — cautious on expansion. 🪙
Property sector comparison:
Calgro M3*: Sub-R1m homes, shifting from gov’t subsidies to open market
Balwin: Mid-to-high-end units (R1.1m–R3m+), annuity income from parks & amenities
Both cautious due to election risks and past invasions
Bottom Line: Simon owns Calgro, likes both for their contributions to housing. 🏡
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