Key points
- Inflation is up in 2022 and interest rates could be about to rise in turn
- While that's normally dire for ASX tech shares, one fund manager is betting on Computershare
- They believe the company is well positioned to benefit from rising interest rates
The whispers that haunted the market last year have become official in 2022. Inflation is up, and that means rising interest rates might not be too far away.
As The Motley Fool Australia's Zach Bristow recently reported, ASX tech shares generally struggle through periods of inflation.
But one fundie is backing an ASX technology giant in 2022. In fact, they've boosted it to the number 2 spot in their portfolio. And its share price is making it even more attractive.
Is this ASX 200 tech share a buy in times of interest rate rises?
Head of Australian equities at T. Rowe Price Randal Janneke has flagged Computershare Limited (ASX: CPU) as the ASX 200 tech share to buy in times of high interest rates.
The financial administration company provides share registry services to market participants, as well as various financial services to entities all around the globe.
But that's not exactly what's said to make Computershare a great ASX 200 inflation buy. Instead, Jenneke is bullish on the company because of what it does with its revenue.
"Essentially … Computershare owns a lot of businesses by which it collects cash before it pays it out to investors," said Jenneke.
"That means it's able to invest that cash in money markets. But the problem becomes, when interest rates are cut to zero, the income that they generate on those money market investments are basically zero.
"[W]hen rates start to rise it means they can actually start to generate some interest income on that pool of assets. And we think the business is very well positioned to benefit from rising rates, particularly in the US, where roughly half their business is based."
Not to mention, the company's acquisition of Wells Fargo Corporate Trust Services has also got Jenneke bullish.
Finally, the Computershare share price – $20.29 at Thursday's close – has excited the professional investor. He believes it's very attractive at valuation levels.
