Wilson Asset Management is a leader in the Australian investment space, and its flagship listed investment company, WAM Capital Limited (ASX: WAM), is among the best in the business.
With a record like this (although this is before fees) it could be useful to see what the LIC has been betting heavily on. These are its 5 largest holdings as of 30 June 2017:
Hunter Hall Global Value Ltd (ASX: HHV) – 2.7%
Templeton Global Growth Fund Ltd (ASX: TGG) – 1.9%
Flight Centre Travel Group Ltd (ASX: FLT) – 1.9%
Afterpay Touch Group Limited (ASX: APT) (AFTERPAY T FPO on Google Finance) – 1.8%
ALS Ltd (ASX: ALQ) – 1.6%
Not all of the above companies are necessarily an opportunity right now, with Hunter Hall and Templeton both respected investment managers like WAM that require a long-term time frame if you’re considering investing. However, Flight Centre, Afterpay, and ALS are interesting picks.
Flight Centre shares have experienced a sharp rebound this year after rising airline prices saw the company upgrade its profit forecasts (after previously downgrading them) as business conditions picked up. With such a sharp rise in Flight Centre shares it is hard to say whether Wilson’s large holding represents conviction in the company’s value today, or gains that were made by buying shares back at $30.
Afterpay is a promising consumer lender with a difference; it offers buy-now + pay-later services for retailers. Although competition is appearing, Afterpay is growing at a cracking rate and the company appears an interesting prospect.
ALS is a testing services provider for testing minerals, food and pharmaceutical quality assurance, as well as specialist services to commodity producers. Again it is hard to tell here if the position size reflects confidence in the company or simply strong gains over the past 2 years since ALS hit a cyclical low.
Wilson is a skilled asset manager and rather than trying to get ideas from its largest holdings, which can change quickly and are reported infrequently, it may be better simply to invest in WAM directly.
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Motley Fool contributor Sean O'Neill owns shares of Flight Centre Travel Group Limited. The Motley Fool Australia owns shares of Flight Centre Travel Group 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.