MENU

Why I think WAM Global Limited (ASX:WGB) looks like a good buy today

I think that WAM Global Limited (ASX: WGB) looks like a good buy today.

As a reminder, WAM Global is a listed investment company (LIC) operated by LIC specialists Wilson Asset Management.

It’s unique compared to the other LICs it operates like WAM Capital Limited (ASX: WAM) because WAM Global focuses on overseas shares whilst all the other ones invest on the ASX.

However, it does use the same strategy of investing in undervalued growth shares where the investment team can see a catalyst to improve the valuation. Its target is small and mid-caps, although the definition of a small cap on the ASX is different to international shares.

Some of its current top holdings include American Express, Diageo, Hasbro, HCA Healthcare, Logitech and Scout24. These would all be very large businesses on the ASX.

One of the main reasons why I believe that WAM Global would be a good buy today is that it’s now trading at a small discount to its underlying assets. At the end of October 2018, it reported it had pre-tax net tangible assets (NTA) per share of $2.13, compared to the current share price of $2.08 – a 2.5% discount. Most of the other WAM LICs trade at premiums.

I believe that most Australian investors have far too much of their portfolio invested in ASX shares. Whilst I think there are a lot of quality shares on the ASX it only represents around 2% of the opportunities of the global share market.

There are going to be some good opportunities in the rest of the 98% of the global share market. Indeed, many of those non-ASX shares are trading at better value because there’s a lot of money in Australia looking for a home, sending valuations higher than normal.

Foolish takeaway

If WAM Global wasn’t already one of my larger positions I would definitely consider buying some shares at today’s price, it’s at a more attractive price than the initial offering price of $2.20. Over the long-term it could become one of the best LICs on the market once it starts paying a dividend.

Another quality share displaying excellent capital growth and income growth is this hot ASX stock.

This top Aussie stock is now expanding beyond Australia and New Zealand shores

You might not know this market leader's name, but it's rapidly expanding into a highly profitable niche market here in Australia. Even better, the shares boast a strong, fully franked dividend that should balloon in the years to come. In other words, we're looking at the holy grail of incredible long-term growth potential AND income you can watch accruing in your account in real time!

Simply click here to grab your FREE copy of this up-to-the-minute research report on our #1 dividend share recommendation now.

Motley Fool contributor Tristan Harrison owns shares of WAMGLOBAL FPO. The Motley Fool Australia has no position in any of the stocks mentioned. 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 Scott Phillips.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss a very important event! Chief Investment Advisor Scott Phillips and his team at Motley Fool Share Advisor are about to reveal their latest official stock recommendation. The premium “buy alert” will be unveiled to members and you can be among the first to act on the tip.

Don’t let this opportunity pass you by – this is your chance to get in early!

Simply enter your email now to find out how you can get instant access.

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our Financial Services Guide (FSG) for more information.