Ann: 2023 Strategy Briefing Day Presentation, page-23

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Gindaldan

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08/06/23

08:41

Post #: 68186925
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Originally posted by Nydem: ↑

I can understand your thinking ....for us our recent buys were more about the returns over the next 12 months and onwards. Our recent WES buy was part of that income calculation along with some other income producing shares in different sectors (diversification of shares). Just as an example not using our actual figures but an example on a $500K investment for a family business we could currently receive an interest rate of around 2-2.5% from the banks....interest rates for businesses being much lower than personal rates currently .....for the shares we invested in with WES along with other shares we can get an average return of around 7.65%. In terms of income producing i'd much rather have the latter than the former ....and in terms of stability any increased return carries with it a degree of risk which imho is mitigated by our low average cost on all these shares ....on balance I feel that in the long term WES will easily return over the $55 perhaps even up to $60 mark so long term yes even at these prices some growth there is possible, along with stable dividends.

Same deal really with other share investments recently made in different sectors. I'm more about growth being a bonus really, but smaller growth with hopefully a more stable income production at a higher rate than we could get on term investments with a major bank. Returns on term deposits for the last few years have been terrible, for some lower interest rates have put a real dent in income production since Covid struck the world. That's not to say we don't hold term deposits as well, again part of a balanced portfolio overall.

I'll have to respectfully disagree with your thinking that buying WES now is buying a great company at a bad price ....for us now was a good time to increase WES holdings as part of a larger diversified investment. I'll also comment that every persons situation is individual and what might be right for us at this time certainly may not be right for others. I'm not one to ever tell anyone else what to do or not do with their own investments, I can only speak of my own thinking. Cheers

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Wes will go higher in the long term, however at this price and economic environment would it beat the index (all ords) in the short term? My opinion is no, not at its current EPS and likely massive consumer shock to come. Hence why I wouldn’t buy at this price, albeit I wouldn’t and won’t sell my existing holdings for the same reason as you - diversified earnings.

So my view is its an opportunity cost buying this great company now at this price as cheaper options exist elsewhere and or I could achieve the basic investment objective by investing in an index fund, albeit which would have a 2-3% weighting in WES.

WES Price at posting: $48.00 Sentiment: Hold Disclosure: Held
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0 Great analysis

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