Michael likes Inghams (ING), Australia’s largest chicken producer. “Inghams (ING) is suffering from a drought-induced rise in feed costs,” he says.
“Many analysts have turned against ING, but the share price fall from near $5 to closer to $3 in my view fully factors this costs squeeze, and at current levels, long-term investors may consider ING a reasonable value proposition,” he adds.
On the other hand, Michael doesn’t like the online advertising and data services group carsales.com (CAR).
“Carsales.com (CAR) has is trading within 6% of its all-time highs,” he says.
“Despite a decline in profit this year, analyst are still projecting future growth at rates well above average.
“If consumers remain conservative, there is a real risk to the growth estimates.
“At 27x next year’s earnings, in my view the risk for CAR shares is on the downside,” he adds.
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