Founder Evidente. Top rated quantitative analyst, Evidente

Sam Ferraro

Founder Evidente. Top rated quantitative analyst

Evidente

Evidente is an independent financial education firm that delivers innovative financial advice to wholesale investors, including active long only funds, hedge funds, pension funds, and sovereign wealth funds, in Australia and globally.  Drawing on academic research in asset pricing, behavioural finance and portfolio construction, Evidente provides wholesale investors with commercial solutions to stock selection and asset allocation decisions across equities and other asset classes.

Thematic (Sector/Industry)

<ul><li>This post provides an update of Evidente&rsquo;s currency model.&nbsp; Under-valuation of the A$/US$ has now reached an extreme, while the Big Mac index also points to deep A$/US$ under-valuation.&nbsp; ASX listed US$ earners have performed poorly despite the renewed deprecation of the A$ over the past six months.&nbsp;</li><li>I also assess the investment case against Brambles, which generates around half of its revenue in North America.&nbsp; The company will be undergoing a capex hump at a time when its marginal return on capital has been deteriorating to the point of recently turning negative.&nbsp;</li><li>I examine its remuneration scheme and conclude that the fact that the board, ESG advisory firms and institutional investors endorse complex and opaque Long Term Incentive plans of this kind, suggests that the bloated corporate governance industry has a long way to go to achieving adequate alignment of interests between senior executives and shareholders.</li></ul>

This post provides an update of Evidente&rsquo;s currency model.&nbsp; Under-valuation of the A$/US$ has now reached an extreme, while the Big Mac index also points to deep A$/US$ under-valuation.&nbsp; ASX listed US$ earners have performed poorly despite the renewed deprecation of the A$ over the past six months.&nbsp;I also assess the investment case against Brambles, which generates around half of its revenue in North America.&nbsp; The company will be undergoing a capex hump at a time when its marginal return on capital has been deteriorating to the point of recently turning negative.&nbsp;I examine its remuneration scheme and conclude that the fact that the board, ESG advisory firms and institutional investors endorse complex and opaque Long Term Incentive plans of this kind, suggests that the bloated corporate governance industry has a long way to go to achieving adequate alignment of interests between senior executives and shareholders.

A$ buy signal strengthens | Investment case against Brambles

Equity Bottom-Up

iShares MSCI Australia / Equity Bottom-Up

<p>Commentators and analysts continue to be vocal critics of the insatiable appetite for income&nbsp;that investors have developed in recent years. The argument goes that this trend has encouraged companies to return capital back to shareholders in the form of higher dividends and buy-backs, at the expense of investing for future growth.&nbsp; Thus, companies are apparently foregoing valuable growth opportunities stemming from investors' short-termism. Although record low interest rates have contributed to the 'reach for yield' in financial markets, this post argues that investors' loss of trust in CEOs' ability to undertake value accretive projects and acquisitions has had an important influence on corporate payout policies.&nbsp; Moreover, the greater propensity for companies to return capital back to shareholders has been far more powerful in reducing the agency costs of free cash flow than the noise created by the bloated ESG industry. I develop a framework for identifying stocks with unsustainably high payout ratios (JBH, MND) and unsustainably low payout ratios (AGK and ASX).</p>

Commentators and analysts continue to be vocal critics of the insatiable appetite for income&nbsp;that investors have developed in recent years. The argument goes that this trend has encouraged companies to return capital back to shareholders in the form of higher dividends and buy-backs, at the expense of investing for future growth.&nbsp; Thus, companies are apparently foregoing valuable growth opportunities stemming from investors' short-termism. Although record low interest rates have contributed to the 'reach for yield' in financial markets, this post argues that investors' loss of trust in CEOs' ability to undertake value accretive projects and acquisitions has had an important influence on corporate payout policies.&nbsp; Moreover, the greater propensity for companies to return capital back to shareholders has been far more powerful in reducing the agency costs of free cash flow than the noise created by the bloated ESG industry. I develop a framework for identifying stocks with unsustainably high payout ratios (JBH, MND) and unsustainably low payout ratios (AGK and ASX).

A loss of trust and the quiet revolution in corporate governance

Australia

Monadelphous Group Limited provides engineering and construction services to the resources and petrochemical industries. The Company provides mining and processing industry maintenance, mining equipment refurbishment, project management, construction, and airport ground handling services. Monadelphous Group serves customers in Australia.

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Monadelphous (MND AU)

A$ buy signal strengthens | Investment case against Brambles

This post provides an update of Evidente’s currency model. Under-valuation of the A$/US$ has now reached an extreme, while the Big Mac index also...

Sam Ferraro

A loss of trust and the quiet revolution in corporate governance

Commentators and analysts continue to be vocal critics of the insatiable appetite for income that investors have developed in recent years. The...

Sam Ferraro

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)