WorldWide Markets with Simon Brown

Available Episodes

5 of 556

Peloton Free Cash Flow | New Inflation Target for SA?
SARB inflation target 🎯 Inflation remains well below target at 2.8%, raising expectations of a rate cut at Thursday’s MPC meeting. New long-term target could shift to 3%. ⏳ Rate cut coming? Market’s betting on 25bps; Simon wants 50bps. 💡 Lower target = anchored expectations = tamer wage negotiations. Peloton (PTON) 🚴‍♂️ The pandemic darling may be turning a corner with solid free cash flow returning. 💵 Q3 FY25: $94.6m FCF (vs $10.7m in Q1) 📉 Stock at $7.50 (down from $170). Risky turnaround, but improving numbers. 📊 Subscriptions reviving; de-risked but needs deeper digging. Gold Power Hour coming 19 June 🪙 Event: “Know when to hold it, know when to fold it.” 📆 19 June with Standard Bank 📈 Gold had its highest ever weekly close – bullish candles and all. Rand strength 💪🇿🇦 ZAR gaining momentum: from 19.90 to 17.88. 🌍 Dollar index weakening, Trump tariff noise not shaking markets – yet. 🔮 Simon sees 16.80 as possible ahead. USDZAR 27 May 2025 | weekly chart Trump tariffs whiplash 🇺🇸🌀 🗓 Flip-flops on 50% EU tariffs: delay to June? Or back to July 9? 🎭 Oval Office ambush with Ramaphosa. No real surprises. 📉 Market's still waiting for an actual deal – not just handshakes. Renegen* (REN) & ASP Isotopes (ASPI) 🧪 🚨 Renegen deal: 1 share of ASP gets ~0.09 of REN. 🛑 Simon holding Renegen for Phase 2 helium – not keen on ASP. 💰 Nasdaq listing delays = funding delays. Sasol (SOL) ⚖️ 💸 Transnet drops appeal, SOL gets R4bn court award. 📈 Stock rally confirmed – chart looking better, Brent still a drag. 🛢 Oil remains the key driver. Pick n Pay (PIK) 🛒 📉 Still losing money, but less than before. 👷 Sean Summers’ contract extended to 2028. Break-even delayed. 💰 Boxer + R4bn cash > market cap = value if turnaround succeeds. 🚧 Market says: “We don't believe it. Yet.” Nampak (NPK) 📦 ✅ Another slow but steady turnaround. 📊 Results not amazing but consumer headwinds easing. Altron (AEL) 🚗📡 📈 Strong Netstar performance. Solid accounting tailwinds coming. 💬 Simon: “One of the few real turnaround wins.” 🧠 Potential still there – analyst upbeat. Harmony (HAR) + Copper 🇦🇺🔧 💰 Buying Aussie copper mine for $1bn – diversifying away from gold. ⚖️ Adds immediate copper cash flow = de-risked future. 🔌 Copper demand = chips, EVs, energy. Chart still flat for now. PGMs: Platinum & Palladium 💿 🔁 Trading in long-term ranges (R830–R1100). 📉 Not breaking out yet; charts uninspiring. 📦 Stockpiles still working through post-Russia invasion. 📉 EV transition and reduced supply in focus. Simon Brown * I hold ungeared positions. All charts by KoyFin | Get 10% off your order
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20:26
US Debt Downgrade Not New News | Big Day for Sasol & Renergen
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20:17
Has Trump Shown us how Tariffs Resolve?
🎯 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 vs. Big Pharma 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 Group: Surprise Trading Update 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. 📈 🛒 Boxer’s Debut Results 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. 🏪 🏅 AngloGold Ashanti*: Cash Flow Soars 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. 🪙 🏘️ Calgro M3 vs. Balwin 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. 🏡 Simon Brown * I hold ungeared positions. All charts by KoyFin | Get 10% off your order
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20:40
We can all be Buffett, Kinda | Sell in May & Go Away?
🧓 Warren Buffett Steps Down as CEO of Berkshire Hathaway Buffett officially steps aside as CEO at age 94, replaced by Greg Abel. Still remains Chairman Berkshire A shares up ~44,000% since the 80s No dividends ever paid, only share buybacks His legacy: simplicity, repeatable process, and long-term vision Emphasis on reading years of balance sheets and loving cash flow Fun fact: 96% of his net worth came after age 65 🏦 Investing Lessons from Buffett Stick to quality companies at reasonable prices Focus on permanent capital and compounding Keep your process simple and repeatable Don’t chase hype — focus on fundamentals South Africa's Chris Seabrooke noted as a local Buffett-like investor 🌸 "Sell in May and Go Away" – Myth Busted Simon critiques the old market adage. S&P returns from May–October average 0.49%, Nov–Apr average 1.02% Transaction costs, taxes, and missed rallies make timing unreliable Verdict: It's a nursery rhyme, not an investment strategy 🛢️ Oil Falling as OPEC Hikes Production OPEC+ accelerating production increases Brent now ~$60/barrel Impacts: ✅ Good for fuel prices & oil consumers ❌ Bad for Sasol (though price hasn’t reacted much) 🏚️ Fracking rigs in US may shut down if prices fall further Possible geopolitical angle: helping Trump by lowering gas prices 💵 Rand Strengthens ZAR at R18.24/USD, nearing a key R18.30 technical level Boosted by stronger exports, higher gold prices Could trend toward R17 if momentum continues 🪙 Gold Surging Again Gold bouncing back above $3,000 after recent dip Driven by: Central bank buying Rebound in ETF inflows (especially in Europe, Asia, and US) General inflation and recession fears Upcoming FOMC decision adding fuel to the rally 🏛️ FOMC Decision This Week Fed expected to hold rates US inflation stickiness, strong jobs data, and political independence from Trump all in play Simon expects no change but criticizes SARB for being too hawkish despite low SA inflation (2.7%) 🧠 Palantir Results – Big Numbers, Big Risks Q1 Revenue up 39% YoY to $884M Customers up 39%, EPS (non-GAAP) at $0.13 Price-to-book: 58x ⚠️ EV-to-sales: 100x ⚠️ Heavy stock-based comp = shareholder dilution Analysts split: mostly neutral or bearish You’re investing in Peter Thiel’s vision, not value metrics Simon Brown * I hold ungeared positions. All charts by KoyFin | Get 10% off your order
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21:27
Alphabet is way Cheap | Nasty US economic data
🎙 Episode Summary: This week, Simon unpacks Alphabet’s surprisingly cheap valuation, troubling US economic data, South African CPI figures, Trump’s trade mess, and the implications of Aspen’s customer fallout. Plus, he previews the Berkshire AGM and upcoming JustOneLap events. 📉 US Economic Data Shock Q1 GDP: Expected +0.2%, came in at –0.3% 😬 Imports surged 40%, skewing GDP down Retail inventories and trade balance signal deeper issues PCI inflation at 1.8% vs. 1.2% expected Recession fears intensify US GDP Q1 2025 🇺🇸 Trump’s 100-Day Trade Tangle Trump promised 90 trade deals in 90 days — none signed yet India might come to the table soon Tariff chaos continues, shelves may empty by July Xi Jinping not engaging — trade uncertainty remains high 📊 Alphabet (GOOGL) is Looking CHEAP PE under 20, forward PE ~17 🔥 YouTube: $9B in rev, larger TV share than Netflix Cloud turning profitable; Waymo surging Risks: Antitrust cases, weakened core search, AI competition Analyst sentiment: 13 Strong Buys, 39 Buys, 12 Holds Price targets: Avg $202, High $240 🧠 Search Wars: Google vs. AI Google Search = cluttered & ad-heavy Simon prefers Perplexity & ChatGPT for clean, accurate info Questions around ad revenue in AI-driven search era 💥 Aspen: Trust Broken Lost a major take-or-pay client 🧪 Share down ~33%; questions around facility utilization Replacing lost volume could take 12–18 months Confidence in management fading Aspen | Weekly 29 April 2025 📉 SA CPI Drops to 2.7% Well below target band midpoint of 4.5% Inflation lowest since mid-2020 Will SARB cut rates? Depends on FOMC outcome on 7 May 📚 Budget 3.0 Incoming New budget after VAT hike rejection 21 May – Stay tuned for more policy drama 🏛 Berkshire Hathaway AGM Saturday @ 14:30 SA time 🧓 First meeting without Charlie Munger Warren Buffett expected to address investment outlooks and succession Simon Brown * I hold ungeared positions. All charts by KoyFin | Get 10% off your order
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21:35