MFG in the BUY zone, page-1132

Also look at these facts.
1.As at last Friday 4 Feb 2022 FUM of MFG is still around A$ 94B. We haven’t got the latest outflow for January 22 to get the final figure.
2. Last FY 21 EPS was $2.45 before one off adjustment like Barrenjoey and fund restructure cost. Assuming Barrenjoey will at least break even these cost are not there in FY 2022. Therefore on 94B you can expect about A$ 2.20 EPS. Current valuation is far too low.

3. In the portfolio so called tech stocks are around 35%. This includes Sap,Alibaba,Net
flex, Google,FB,MSFT.Amazon. Most of these have become growth and value companies. For example MSFT around PE of 30 is still ok as the growth is so high and will be long time to come. They paid 68B cash recently for games related purchase. Who in the history had these kind of money just to pay in cash.
When Buffet was asked why he changed his mind to buy Apple few years back, his answer was Apple products have become. “ sticky “ meaning more consumer oriented goods companies like McDonald’s, P&G, Nestle.
So in my opinion MSFT, Google, Sap, Amazon definitely belong to that category. Just imagine a world without them. PE in twenties is well accepted, just like fast paced consumer goods companies.
Of course if there is a major recession these will come down with the market reduction.

4. In stock markets you are not going to be genius to get everything correct all the time. So much is written about FB holding in MFG. But it first appeared in MFG portfolio around early 2017 when it was A$ 150. It looks like portfolio was reduced in December to 3.9% from 6% or so. That is around A$ 310. Not bad.
5. If you have not noticed for last 3 months or so total MFG portfolio % increased is higher that S&P 500 , ASX 200, world index. This includes infrastructure too.
6. Global equity of MFG on annual basis is still behind world index. However from around 19% underperformance during mid 2021, it is down to 10% at end December 21. Over next few months those high underperformance months of 2021 will disappear and with current performance trend of MGOC it will slowly disappear.
Only unknown to my mind is still the current outflow . As soon people become comfortable with current MFG performance, I am expecting it to stop.
At that stage MFG will have about A$300M to start expanding the business with purchase of other business.
7. While Barrenjoey is doing extremely well in this hyper active market in two to three years time it can change as M&A can be volatile. Current low interest rate will not last.