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Scaling new heights: Is it too late to buy Mesoblast, Gentrack, and Corporate Travel Management?

If there was ever any doubt that the bull market rages on, just check the number of companies hitting new 52-week highs every week, and compare it to the number hitting 52-week lows. There’s nearly triple the number, and that has consistently been the case for more than a year.

Here’s my take on whether the following 3 companies, at new 52-week highs, still offer an opportunity:

Mesoblast limited (ASX: MSB) – last traded at $2.95, up 18% in the past 12 months

Shares in Mesoblast have been soaring recently following a successful capital raising, and progress in the company’s clinical trials. Just on Monday Mesoblast announced progress in its heart failure trials, although as I noted in an article then, there doesn’t appear to be much to get excited about.

Nevertheless, in this case, the market appears to have its eye firmly set on Mesoblast’s possible growth and reportedly huge target market – it’s just uncertain when the company will actually be able to begin profiting from those things. I’m not a buyer of Mesoblast today.

Corporate Travel Management Ltd (ASX: CTD) – last traded at $20.14, up 47% in the past 12 months

Another new high for Corporate Travel Management – the past 5 years have been filled with them. The business has grown rapidly in recent years and has always looked overpriced to me – I wasn’t a buyer at $14, nor at $17, and still not today at $20 (more fool me), but its results have consistently belied the apparently high share price.

Corporate Travel is now at a size where I would expect its growth to slow, which makes the company look expensive. However, I have been consistently wrong on this one so readers may wish to seek a second opinion.

Gentrack Group Ltd (ASX: GTK) – last traded at $4.05, up 88% in the past 12 months

Gentrack shares have had a pleasant year after a number of events that were well received by the market, including modest profit growth and the recent acquisition of Junifer Systems in the UK. Gentrack appears to grow through a combination of acquisition and its sticky customers (who rely on Gentrack’s software) and pricing power. While the company doesn’t look cheap on conventional metrics, it’s not a business that I would bet against over the long term.


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Motley Fool contributor Sean O'Neill has no position in any stocks mentioned. The Motley Fool Australia owns shares of Corporate Travel Management Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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