WDS Christmas Wrap

Nearing the end of what has been a stellar year for WDS. Extraordinary capital gains and two whopping dividends……but at $35/$36 is it still a good investment as we head into 2023?

Personally I’m more positive than I was a couple of months ago. The market has been conditioned now to a WDS stock price at these levels and some of the rotation into other sectors has ceased due to fears of the bear market dragging well into next year. ie WDS looks good again relative to the broader market.

The big capital gains are behind us you would have to think - but many financial experts/pundits have energy and health as the two top sectors going into a likely recessionary environment in 2023. WDS a very good bet in a cross sector portfolio with a health and energy bent.

Whilst I’ve wound back the big exposure I had I’ve let go of the idea of exiting all together. WDS is a medium to long term hold for me now. The ‘big thinkers’ (as Rick Rule contemptuously refers to them as - see video posted by @Boursebandit - highly recommended) have been made to look totally stupid in 2022 when it comes to fossil fuels. It is clear now that we’ve got decades of fossil fuel use ahead of us - whether we like it or not……the underinvestment in the oil and gas space (driven by the big thinkers) really messes with the supply side and will continue to keep prices high (Brent at US$80plus with the Chinese economy sputtering along in second gear is testimony to that)……WDS obviously stands to benefit from this macro situation….if the governments will just stay out of the @$&!*!# way !

Some reasonable capital gains are on the cards I think (can see it trading in the low 40’s in 2023 if China gets going again) and even if it hangs around mid 30’s, dividends in the $1.50 to $2 range per half year look likely for some time yet. Either way I’m pretty satisfied that WDS stacks up as well as any ASX big cap stock going into 2023.