Hello, and welcome to The Australian's Money Puzzle podcast. I'm James Kirby, the editor at The Australian, and welcome again to our series of shows where we look at the outlook for two twenty five and if you've listened to the episode with Mark Docom of global X, basically we went around the world in thirty five minutes or so with Mark looking at the outlook for markets themselves, right, so we looked at the consensus viewers, what will happen on the ASEX, what will happen on NASDAK, what will
happen on the big markets around the world. And today I want to zone in on the Australian market and the ASX. How did it do? What can we expect in the year ahead. My guest is jun Belieu. She has been on the show before. You would have known her, I'm sure from the Tribeca days. She is now the portfolio manager at a new operation called ten Capital, which kicks off this year, so it's going to be a special year for her. Always great to have you on the show. How are you going?
I'm very girl.
Thank you so much for having me. James were always lovely to talk about stock market.
I'm sure you do. Well, look just before we start, so we listeners will have got good context from the show where we're basically we looked at the global performance and in isolation, the Australian performance of the AX looked perfectly good. I mean, it all looked very fine, but it was only it was way way behind the US market. But we've covered that issue. So just to look at the Australian market, it did very well. We're talking eighteen
percent or so. The dividend yields something in the order of four exceptionally driven on this occasion by banks and financials, which was a surprise I expect for most people. Was it a surprise for you? I mean it seemed to me the consensus was from months and months cellier bank stocks and that that was wrong.
Right absolutely now, I expected banks to do so well, particularly in an environment where we thought the economy is going to slow down. Surely the banks can help hold on to its you know, its glory when their profit margin the NIM has already peaked at the beginning of the year. Remember March quarter was pretty much the peak of the earnings, and then from their nons on its
way down. But what has transpired is that the banks actually delivered best they expected profit clearly because our economy has remained reasonably resilient like around the world. And also which many didn't quite think about, is that the banks, you know, previous couple of years, they have provided a lot of provision, put a lot of provisions in their accounts, so that means when the economy is not as bad
as they expected, they actually write the profit back. So that's why we actually had a lot of burnings upgrade for the banks at the same time, because economy is doing well, they got so much excess capital they were just paying our special dividend buying back their shares, so really boosted their earnings profile for the last twelve month.
And that is too surprised of many.
You know, at the beginning of the year, wellflore CBA was done that one hundred dollars and it continued rally on and it is incredible.
It's been terrific. Obviously, it's about one hundred and fifty.
That's right.
I have an incredible performance for CBA, you know. I think that's one amazing thing. CBA is training at more expensive I think at least close a few weeks ago, more expensive there CSL.
You know, CSL is our all.
Time favorite, you know, long term growth company, and it's training chief of their CBA. So it's just seems to be a bit of disconnect at the moment.
So whatever wants to know. Of course, that's the impossible question of what will happen in the future. But if we look at the performance of the market and we say it was I mean, first of all, the IT companies, but that's a very small sector from a market cap point of view, did best, and then they were at fifty percent or so, which is extraordinary. But Comewell Bank they virtually did fifty percent over the year did about
forty something percent, which again is extraordinary. The financial stocks generally did thirty three percent or so. Would it be foolish for any of our listeners to think that those banks could continue on anything like that momentum? And what everyone says, you should sell the banks and the brokers have said this for six months and they've been wrong for six months, but maybe they will be right in
the end. If we have CBA at twenty eight times, which is miles ahead of its usual eratio, are they vulnerable to a sell off.
They are very vulnerable.
Vulnerable not only to a market sell off, they're also vulnerable to a market rotation. So this is what everyone's talking about. Will be a big theme for twenty twenty five, you know, rotation intersectors, whether it's the small cap companies who has underperformed, or resources company, you know, or into
some of the other cyclical industrial businesses. Banks since they done so well, they will be used as funding I don't know if you remember in twenty twenty four, perhaps in November, there was a couple of times or October November, there was a couple of days when the Resources company had a bit of rally because of China stimulus was coming through the day. BHP went up five percent, CBA was down five percent. It's a very clear genation and rotation that you can see. So I think it's very
vulnerable to that. Now, putting aside those technical issues for you know, being used as a funding source, you know a little bit, I don't actually think that the CBA shares or the bank shares will collapse, because calling for the collapse of the bank shares really require a collapse
of the you know, share market or the economy. I think economy is heading into an easy condition, easy financial condition in the next twelve month, because you know, we have interest rate slowly coming down, whether it's February or May, it's coming through. And then we have the you know, the economy is not doing too badly, so I don't think. I think the fundamental is strong for the share market. So that means that banks will hold these value but maybe it won't go up, you know, I don't think.
And you'll get another force if you sayll a fifty percent out of the banks. I think at best they probably do, you know, high single digit sort of return. Even that, I think it's a bit of a struggle. Probably admit to high single digit return. Share market itself though, I think, actually, well looks reasonably strong. It should do better than the banks. And then the leadership, you know,
they say who's going to be the best sector? Is going to be something else other than the banks and take them take the market much much higher.
So there the consensus is pretty mild, isn't it. For the A six the consensus is that it's going to do four or five percent in the twelve months. Some there's people that are both sides of that and maybe eight nine percent is more like an average year total return. Well, have you a number of yourself in your university, you have a number you're working on.
Yeah, I think I would do double digit. I think market condition looks pretty good, you know. I know our market has done well in the last couple of years, you know, all double digit returns, but really coming off you know, a low base, and looking into next year, you know, I do think that our market is actually they call it a cyclic call market. We our resources have yet to perform. Look at the share price performers HV has gone down thirty percent, the CVA has gone
up fifty percent. That kind of disparity is very strange, very rare to take place in the share market. So we do think the next year, you know, we have a lot of those bigger, you know, companies that will take the leadership and that will deliver.
Return for the market.
You know, usually at this point of the market cycle, we do see very good driver because you know, you just have the rate cut, so you have all the businesses that sort of lag behind started catching up. At the same time you have the tech businesses that's already done quite well. But I think because the interest rates coming lower, the evaluation will continue to be supported. So valuation is not a problem. So you know, it's positive for most of the actors going higher.
Okay, just to cover off on what actually did occur in twenty twenty four and which to me, I'm not surprised by the it doing very well. The financials. I am, like everybody else, surprised that people would value the banks so highly because the banks basically were treading water. I mean, with the exception of CBA, the big banks weren't trading water for years and years. But the third strong area
was consumer discretionary of twenty six percent. I thought there was supposed to be very weak consumer sentiment out there. What happened there?
I know, it's crazy, isn't there?
Sometimes from outside and looking in look at the share market, thinking what are those crazy investors doing. We're in the consumer recession, and yet our retailers are hitting all time hi, our JB high fire, others which couldn't give enough of them.
Look at what's happening.
Is that it goes down to the very cross of the you know, of the share market. Investor git mok investor always look forward twelve months, so we are buying future earnings, so we are sort of looking trying to look through that. You know, if the crystal ball, as say in twelve month, look in twelve month, consumer hopefully will be doing better our interest rate, our interest rate
will probably be already on the way down. At the same time, for some of the retailers, you know, your earnings will start to recover from you know, a trough that that's taking place somewhere between now and you know, the next few months, so you know, earnings on the
way up. So you know, potentially for retailers, you will be in the Ernie's upgrade cycle because as a consumer comes through, you know, your operating leverage is positive operating leverage, things always turn out to be better they expected.
Maybe then they'll have special dividend and all of that.
So you're at the beginning of that multi year upgrade cycle for the retailers. So they may look expensive at the moment, but looking forward twelve months, their earnings will grow.
Their multiple will you.
Know, not multiple expension is actually not multiple expension, it's more Ernie's will grow better than expected, and then with the interest rate, your value will expand. Valuation will expand, so hence why we're all rushing into those Put that aside, though, what are you know? It sounds like the these days, the cyber weekends you know has done, is doing incredibly bigger and bigger every single year.
So there's a lot of optimism.
Yeah, Black Friday, yeah.
Yeah they call they got all the names back Fridays.
Cyber Monday, yeah, that's right.
Yeah, so it's getting bigger and bigger. You know, I myself hit the shops that couldn't it looks like Boxing day, say oh, and just people everywhere. So I the feedback is that incredibly strong every single year. Might be a bit of softness into Christmas, but you know what we think is going to you know, deliver a strong February result, you know, as a result of that for a certain category.
Of course, it's got to be selective.
You know, the apparel's bit weaker, but electronics, consumer electronics is strong.
So this is.
What's happening now. Put these cyclical components aside. There is also an undertoe. It's about consumer electronics of the replacement cycle of the AI enabled devices. Now, I think it's still early days, but PC replacement cycle has been running very long dated now, so we're due for a pickup in replacing PC at the same time you got all
these new devices coming out with AI. I do think that it's JB hi FI or type enormal or persume electronics space is at the you know, sort of the early stage of that adoption phase which you will drive a lot of growth organic growth of the next five years or so.
Okay, dorees the AI. It's the concept behind your thinking that the arrival of the AI devices accelerates the replacement cycle.
So the idea is, you know, I think there's a lot of excitement about it, but at this stage we're still waiting for First of all, they're quite expensive, you know, we're waiting for the price deflation to come through. As you know with the consumer electronics products that as the price become cheaper, the adoption increases significantly. So and that's when actually mass market and j be high by these retailers make a lot of money.
So the price is still too high.
And then I think the product itself at this stage is not yet to steal that differentiated They just added you know, the sering, the talk and everything else, so you still didn't need a bit more so but that's definitely coming through, but it's just going to take a bit more time. That's your Probably next twelve month we'll see more definitive trend and then in the following five years you'll see a lot.
More of it.
Okay. It reminds me of the sort of golden age of the iPhone when they came through the first time as well. But that's basically the whole promise of the Internet, the promise of the mobile Internet, the singular product. Okay, yeah, yeah, yeah, very interesting. Okay, Well, take short break. We'll be back in a moment. Hello and welcome back to The Australian's Money Puzzle podcast. I'm James Kirkby. I'm talking to June
Bailu who has been on the show before. She's now at ten Capital and she's talking to me and you about Australian stocks in the year. Head and stay with us, folks, because we are if you can think, if you think about it, we are making our way through, right. So we're conceptually getting down through the sectors and then we're going to look at the stocks as much as we can. So before we do that, everything you said, not everything
you said, but substantially. What you said in the first segment did depend on the belief, if you like, that interest rates will drop in Australia next year. So that's absolutely crucial, isn't it to the outlooks put forward by you, went by by most of the market. Is it at risk?
It is a risk, but it's a very small risk.
Look, we have demonstrated, We've seen it again and again for decades. Right our capital flowies are connected globally. We're following very similar trends, even though they might be delays and timing and the like. So clearly, our interest rate never went up as much as the US, and then it took longer. So now going down, it's taking longer to come through as well. And you know, it's may not go go down as much as the US because we never went up that much, so, you know, but
it's abound to take place. You know, our inflation number, it's already showing a similar trajectory as the US. But although US is actually gathering more momentum in terms of you know, falling interest rate, Arawan is a little bit more sticky. The latest job number is still looking a little bit too strong for our you know, our RBA. But you know, regardless, we think you know all of
these you know, components in motion for a cut. Now the risk or the volatility will come though, is whether it's a February cut or is a you know, makeup. So you know, because the market participate just a few weeks ago or just you know, a month ago, was talking about potentially it's cut in February. If that takes place, you'll see market rally quite aggressively. And now you know the data after the job data, you know, markets pushing it out to.
May, you know.
So it's really about where the expectation is. So you will see share market go up and down based on the changes in that expectation. But regardless, interest rate will come down. Yeah, as with many other countries.
Okay, so you are comfortable with that basic trend the abstrates have reached to peak in this cycle fault. Okay, I'd like to try and just if I could maybe just go through three sectors with you which are of great interest to all our listeners. So you talked about rotation, the obvious rotation. You know, if you're sitting in London looking at the Australian market, the dead obvious rotation is from banks to big miners php Reo fortce Kew is that the most likely scenario.
It's a most likely scenario.
And also into industrial, so where we have a bit of industrial sector as well, So that's the most obvious. And then the second one is obviously the large cap to small cap. So as you know, people get more comfortable into the smaller cap companies and most of the small company earnings have really been hurt by.
High interest rate.
With the interest rate definitively coming down, you should see that earning growth pickups significantly. Remember there are trophlearning and then going to next year the earning will grow significantly. So you know, so I think we will see that clear sort of movement.
You know, large cap.
Will underperform the small cap. Yeah, so that's going to take place in the next two months.
Okay, when you say small cap, but I presume you have a definition. It can't be microcap. There's a lot of there's a lot of bad small caps out there as we know. Maybe the majority of them are a bad certainly the majority of them are ordinary in their history. Is what do you how do you approach that sector which is so diverse and so large, roughly two thousand stocks out there, even in Australia.
Yeah, you're absolutely right. Small cap is an index. It's actually full of danger. It's very important to actually stay to quality. You know, there might be the very top tier of the small cap that you often looking at, and you know the minute you go smaller, you required
to be very close to the management. Now, the opportunity, I guess in the next twelve month is finding some of those companies a little bit smaller but have been forgotten by investors because whether interest rate too high, whether that you know, it's just that environment that has hurt the share price performance microcab we'd expect that to perform as well in when the small caps started to do better. There's a lot of interest they're flowing down into microcabs.
So structurally we think that the overall did go smaller, they should do better. Now put one conditional disclaimer in there, though. You remember when we talked about interest rate. We're not sure if it's February or May, and you know that expectations might move, so based on that, the volatility we will see particularly will occur in the small end because
these companies are very leveraged to interest rate cut. Yeah, so when you start changing that, you know, whether it's may or it makes a big difference to their earnings. So these share prices can move by a low, large, big wave.
So yes, so even more volatile than usual with that perception that their day is coming, but we don't quite know when it is because we don't know when the red cuts will come. Okay, So two other sectors. One was healthcare. Now, healthcare has been terribly disappointing, hasn't it. And I know that. I mean at one stage, I think you were quite keen on Ramsey and that's really been a disappointment. The whole area has been a disappointment. I don't know if we could ever recover really as
a viable area for listed stock investment. What do you think?
I think the healthcare is interesting.
It used to be our growth leader, right, so when you want to buy growth company back then, we didn't have a big tech space. We didn't have many tech choices. All we ever do is buy CSL by the large healthcare company. But they have really disappointed our healthcare company. It's partly because of the labor you know, the you know, the inflation first of we had the labor shortage, and healthcare businesses our labor businesses heavy businesses, right, and they
really struggled to find people. And now the inflation that's coming through the labor force. Most of those costs actually structural, you know, because there's been a lot of nurses leaving the industry and you know, so they we have found that all of these businesses now really structurally have higher costs. And for a place like private hospitals, actually it structurally cost is higher. You know, unless government can come through try and help in the way. It almost seems unsustainable
in the way. But put that aside, I think, you know, healthcare sector is still very defensive sector. It's going to struggle in the environment where you know, risk goes, so where everyone want to go smaller, want to buy companies that more leveraged to the to the upswing in the economic activity. Because remember healthcare doesn't affect get affected by the economic activity. Even economy picks up, people don't go to doctors more. So I think in that environment they
sort of status quo. That's right, it's status quo. So you know, the only thing we know is that you know, potentially you have you know Ramsey, what we're hearing things that's been so poor it's actually doing a little bit better. But it's not economically sensitive. It's more of a value stock that's for the long service. Well now resme. On the other hand, we actually think that looks okay, you know, and it's gone through crisis with a GLP what but now it's looking better.
Okay, okay, we come to individual's stalks and minute. Let me just do one more sort of sector with you, which is reads property trusts. So it looks as we speak that is the disappointment of the year was in property trusts. Was in Digico. Only two weeks ago people were I have people writing into money Puzzle furious that they didn't get stuck on the float. But now they're probably not furious because they would have lost money as we speak in December. So tell me about property trusts.
It seems to me the properly trusts have been skewed. The notion of a property trust has been skewed. We have Digito, which is a play on AI. We have Goodman, which is a play on technology logistics and AI. And properly trusts in the sense of a property landlord. I don't know if they really I think to some extent, even the figures for last year, which were reasonable for something of a recovery for a rates in Australia, Yeah, it's of seventeen percent, which is you know, bany on
with the market. Okay, so it did the market no better, no worse. What do you think the outlook is for twenty twenty five and does the presence of Digitico and Goodman sort of disturb or mislead us to some degree about property trusts.
I think it's a really good question. I do think the property trust will do okay. You know when we start cutting rates. I know they've done reasonably okay, in line.
With the market.
But once the race does start getting caught, so we will see. What's the main thing is that we will see improvement in the market transaction. One of the biggest thing is that the property a special commercial property. They're not selling and they're not transacting. The buyer don't want to sell at this price, and then you know the seller sorry sell it, or the driser vine. So it's coming in the middle. So with the rates coming down,
it absolutely make the valuate should stack up. If anything, we actually still start to see quite a lot of commercial property market like Cyney is actually improving, you know.
Quite rapidly.
Then that net absorption is actually very strong in the Sydney market and Melbourne we've seen early signs of improvement. So you know, I do think the property fundamentally will improve. But there is still a lot of stock sitting in the private market that we're waiting to be sold. So you know, we just need the rate cut to come through, so that will the overall sector looks okay, but it has to for investors.
You need to focus on value.
Aside from Goodman that's a different story, but everything else you've got to focus on value because I do think the value end of the property market will do better than the you know, the more expensive part of it.
Goodman Group is different.
It's almost like you've got you almost have that next lego growth of the data centers. So you know, so a lot of investors we just keep that as part of our portfolio. It gives that whole data center exposure. Great you know, management being running great industrial portfolio and you know we trust them can do a great job. And the new the pipeline is coming through is incredible, so we will keep that in the portfolio.
Did you go. It's interesting, right, And you're absolutely right. They trying to structure this deal.
First of all, if the deal was not shown to most of the people, most of the institutional manager didn't really get meetings with men with the management. You know, one of the big things for investors to invest money is that we're going to meet the management. We have to you know, get comfort and then so we can invest. They want to structure in a way like TUYG, where it'situtional investor gets zero holding and then give it to retail so hopefully there'll be enough you know, interest to
buy them. But when you don't have meetings for an institutional investor who is going to support the share price when it was so, I think that's a misstep on their sides. I think they were very confident it will get away, but unfortunately this one was overplayed.
Okay, very interesting. Okay, folks, We're going to take a short break and we will be back talking about individual stocks. It will not be advice, if we won't even be recommendations, but it would be individual stocks, which I'm sure it'll be very interested in. Okay, back in the moment, Hello, and welcome back to the final segment of our special show today on Australian shares. We've been talking about the sectors.
We've been talking about opportunities and risks coming up in twenty twenty five, and now I just want to talk to Junebilu about specific stocks. Always a tricky area, right, but let's talk about them. If we look at the four banks, it would seem to me that they are all slightly overpriced, and CBA is exceptionally overpriced. I am only reporting. I'd be like what Booker analysts are saying, right, and they're saying the fair value on Combank is about
one hundred dollars. It's at about one hundred and fifty dollars. I mean, that's like fifty percent overvalued if that's true, and it happens to be the most important stuff probably in the market. Right we put BHP to one side. It is certainly the most important income stock. So if what's your approach to bank stocks this year?
Look, I think the bank stocks that it's very hard to hold them at this price, you know, to be honest, I think when the market, we expect market to be struggled in twenty twenty five, and that's not going to be led by banks, you know, We're going to put money towards other businesses that share price will go higher with the banks itself. You know, CBA traditionally for a good quality bank should be trading at about seventeen times.
It's trading at twenty eight. Every metric you cannot justify, you know, So to us, it's very hard to hold those businesses much rather to put money into something else, you know, as you know traditionally, so as a fund manager, our performance is judged against the benchmark, which is for me, it's ASEX two hundred. So we need to buy companies that are better than what Airsex two hundred does, and banks certainly is not going to do that this year.
Okay, Now let's talk about on the other side that the miners, I mean, the obvious ones are the big three, Real, PHP and Force squ very much despite their best efforts and all the talk about future facing metals and battery metals, still very much are in our companies, still very much dependent and arn Or still very much dependent on China. So to me, that seems may be their obvious rotation,
but it's there's a risk there. That's a that's more elevated than perhaps is obvious because it's so focused on one metal, which is arn ore, and that metal is so focused on the on China's so far on successful attempts to restimulate its economy.
Yeah, your concern is very much right.
We've seen China tried over the last year and a half try to stimulate its economy and it hasn't happened. My view is that, look, give how you know, given how much it's underperformed, and China continuously coming up with new stimulus, they will just keep trying until they get it right. So we know, if you're better, if you're not buying those businesses, you're betting against China not able to get there, and it's very hard. You know, China has a lot of you know in reserve and eventually
they'll get there. You're betting against its policy direction in the old days, and you know you'll lose money. So my view is that given the value presents of those big miners, it does look like it's got a very strong upside from here now. But you're very right, it's very much depends on if the stimulus can reignite that consumer confidence that corporates in China, and so I'll take it for that space. Is that we moving into slowly
moving into larger miners. Don't go to the exotic ones because these are the ones that don't make money when the commodity price is weak. You much rather stay, you know, with the larger diversified names that BHP real simply because they got copper. They got quite a lot of other commodities which world will need. So, you know, so the less que to what.
May or may not go right or within China. That's how we see it.
We should talk about lithium obviously being such an obvious So that's an obvious calamity. It was extraordinary, really, wasn't it. What happened to the lithium price, which which it fail.
Look, it just simply comes on down to Initially there was a lot of demand going to ev and the projection for evil production and demand is enormous.
At the same time, lithium was actually even though.
It's found everywhere in the world, but it's actually very difficult to pull it out. So we had a couple of company try very hard to pull it out. Meanwhile, there's this supply and demand, so there's just not enough lithium for the production of the battery and going into
the EV. And then since then we had a lot of production coming through with seeing Australian companies of shore companies with a lot of lithium production come through, and at the same time, demand for EV actually hasn't grown as much as we expected, you know, the instead of growing EV, it's so the usage for hybrid you know, for the battery is less than what we expect. So hence why we started having that sort of collapse in the lithium market.
Now where we are.
At the moment, lithium price even though it looks like it that has found the bottom, but we're still having supply you know, coming on at this price, which is a concern because you want to see supply pulling the pulling the supply at this price so that means, you know, the price will go higher and that means everyone can make a bit more money for those lithium producers, and it's not happening at the moment.
Demand side. China's actually doing okay.
It's European market, it's actually pretty tough for the evs you know, sell through. So I think that market is still very tough for you. Look at the list of lithium companies. If you put today's spot rate lithium into their ship into the earnings, they still come down grade. Ernie still come down grade quite a big way. Whereas you compare to the iron ore miners you put today's price,
they actually come upgrade. I think in the case of Bullski it's come upgrade thirty forty percent in terms of earning. So I think you want to sit in a company where Ernie's going to get upgraded then downgraded.
Right, okay, And that test you towards the big miners at this point, the big diversified miners. Okay. I was looking at something. I was just thinking about the private equity boom and how they come in and they cherry pick our market. And I was looking at Bain Capital, which has now bought Virgin Alliance. It has bought in Synia the old IF financial services group, and so it comes in and it picks off these kind and it bought STA Care Services. That's so diverse, isn't it? If
you were But that's a big time stock picking. Can you tell us some of that? It doesn't matter in sector agnostic? Are there certain stocks that you are particularly enthusiastic about this year.
And look, I think there are many companies who we always be in a portfolio with a bit of everything. So we've got a bit of growth company. So Premedicus will be our top pick within that name. You know, we think every portfolio should have one, and that's around for Medicus. Every portfolio you have one, and that just it's one of those companies you keep in your bottom drawer and let a compound for you over the year
after year. And then we think other parts of portfolio you might have a bit of value, you know, something that might come through, you know in senior as you talk to. We thought that was a value stop for us. And now ban is bidding for the business. That share
price done very well. There's another one we really like, which is Treasury, why we actually liked for quite some time and now unfortunately the share price hasn't worked because you know, whenever investor here about China China exposure, don't want to invest in it. But the company business itself is doing quite well. And remember they had the tariff removed from them not very long ago, probably you know, six eight months ago, and they just started going back
into China is selling very well. So you know that business training on less than twenty times less than twenty CBA twenty eight and it's going to growth that boudigit and it's got a luxury brand, which is the pen Fall. You know, it's actually just sitting there looking extremely attractive to those private equity players, you know, and our view is that's not going to sit.
Here for very long.
They had a bid some years ago, didn't they treasure once?
Yeah, that's right, and there's been a lot of interest in the market for this business.
Okay, can I just run through a couple of quick ones with you CSL. In fact, CSL has been pretty disappointing for quite a long time now. There's virtually no dividend. The share price has really been drifting for I don't know two years. Do you think this year is there any prospect that it will return to the stock it was really.
I think it will be a mid range stock now. It's not going to be the market leader in growth because now we have YCE Tech zero, we have the new contenders to be the leader in growth where CSL. The challenge is because it you know, cyclically it would do double digit growth for the next couple of years because earning was depressed because of high you know, difficult to clip blood and you know all that COVID impact And now next couple of years looks good, but that's cyclical recovery.
Beyond that, for.
A growth company, you need more structural taiale with they haven't got the next product, then the B four purchase haven't demonstrated it's the next leg of growth. So we kind of just have a bit more uncertainty of what's beyond in the next you know, beyond three years.
Okay, yes, they had some disappointing products which determinate basically or they didn't go ahead with Yes, all right, now we should just cover the bases here. Traditionally people would always have had the big retailers. We did talk about consumer statements. I was interested how enthusiastic you were, even knowing that consumers discretion had gone off by twenty five percent or so last year. You think there's a lot of energy yet in that spaces there are particular stocks
that shine for you. Yeah.
Absolutely, I think there's a lot of energy into that space. In fact, I think investors should buy on the dip for any of those companies look good quality ones. We like JBHII into this environment. We like the smaller some of the smaller cab retailers, you know, we like flight Center, you know, we like Axteller, we like Nick Scally.
You know.
I think that a lot of those businesses represent Preaty coage earnings upgrade cycle.
You know, should we headed into this environment?
Okay, all right, very good. I'm sure people are taking loads of notes, and I would say listeners that though we're talking to an exceptional fund manager, it is one fund manager's view and nobody knows the future. But it's been a terrific distillation. And very good of you to come on the show and I give your outlook on stocks, because not everybody is brave enough to actually name stocks one by one, and often you're straining to get someone
to even mention one. So terrific. And thank you of look with your new venture in the year ahead.
Thank you so much, Thank you for having me. I always love to talk about stock anytime with great to.
Have you on this show. And that was June Belu from ten Capital Folks. Ten Capital, that is her new outfit. She is a fund manager which has its branching out on her own in her own units this year twenty twenty five. And we do wish you the very best, and we wish you the very best. And I hope that was very useful to you. I'm sure it was. I found it particularly interesting. Okay, we'll be back and be talking to you in the next part of the series in a couple of days