GQG - GQG Partners Inc

[InsvestoBoy]

I'm surprised that this stock doesn't get more of a mention. (I do hold).

View attachment 170347

Definitely gets a mention on the AFR every now and then, Robert Frost mentioned it as a buy Nov 9 2023, pretty much perfectly bottom ticking the current 60% run.

This small caps fundie says GQG Partners is a buy

OC Funds investment chief Robert Frost says the market is too conservative on the US money manager and has been buying up IDP Education and Domain Holdings after heavy sell-offs.

www.afr.com

I had it on my watchlist since then but never bought, even though they do seem to often be good businesses, I always struggle getting long pure fund managers, prefer those that give you exposure to what they're managing like MQG/WES/SVW/SOL

 

[Dona Ferentes]

Has seen $US2.9 billion ($4.4 billion) of net inflows so far this year, thanks to “solid business momentum in a variety of geographies and across channels”.

Funds under management at the end of January hit $US127 billion, which is a record high

 

[Dona Ferentes]

and, finally, above the 2021 IPO price .

.
if only they hadn't tried to be so smart, and come to market at 1.50. The narrative at the time was that Australia allowed/ carried a 25 per cent premium , and a listing elsewhere FTSE, NY, would have been at a lower price.

 

[Dona Ferentes]

GQG Partners has had $US10 billion ($15 billion) of fund inflows which helped lift total assets under management to a record $US120 billion. Two factors drive that increase.

The first is impressive performance. GQG’s flagship global equity fund delivered a 34.1 per cent return in the year ended January net of fees, 11.7 per cent above its benchmark, and over the past three years has delivered 18.8 per cent, or 7.3 per cent ahead of its benchmark.

On a call with analysts, executive chairman and chief investment officer Rajiv Jain explained how the firm has cleverly ridden the rise, fall and renewed surge of the global tech sector.

In 2021 and 2022, Jain felt the “car was getting overheated” in the tech sector, and sold down these stocks. But he started buying again last year and GQG’s top 10 holdings reads like a who’s who of this bull market: Nvidia, Meta Platfoms, Ozempic maker Novo Nordisk, Microsoft, Alphabet, Eli Lily, Petrobras, Total Energies, Visa and Amazon.

Late in the analyst call, CEO Tim Carver revealed the second big hook: low fees. Carver delivered what was effectively a stinging attack on rival managers, claiming their bloated headcounts gave them little choice but to charge fat fees.

GQG’s weighted average management fee of 48.8 basis points compares to 70 basis points at Magellan, and 112 basis points at Platinum. And Carver can’t see rivals closing the gap. “Now it becomes very, very difficult for firms like that to bring headcount down to a level that they would need to, to sustain the fee margins that we charge on our products.”

 

[dyna]

Another $ 6 Billion funds inflow for the 1/4 .
GQG seems to being coasting along OK.
S.P. up 4% on the news release , to $ 2 .29 .

 

[dyna]

S.P. now at $ 2. 53 . Investor Roadshow Report for 1st Half of 2024 is out today . They've done well with performance . F.U.M. increase has been impressive too , reflected in the run up in share price from $ 1.50 in January .
$ 3 .5 Billion exposure to markets here in OZ . $ 29 Billion to US Mutual Funds .
And... ( here's the worry ) : $ 15 Billion new exposure to Private Markets . Not a stock to set and forget , I suppose. Will have to watch more closely from now on .

 

[qldfrog]

S.P. now at $ 2. 53 . Investor Roadshow Report for 1st Half of 2024 is out today . They've done well with performance . F.U.M. increase has been impressive too , reflected in the run up in share price from $ 1.50 in January .
$ 3 .5 Billion exposure to markets here in OZ . $ 29 Billion to US Mutual Funds .
And... ( here's the worry ) : $ 15 Billion new exposure to Private Markets . Not a stock to set and forget , I suppose. Will have to watch more closely from now on .

I have an open buy order but indeed 32% in private funds which might be a startup to track school pickup queue or a patch of land..with great potential..who knows..

 

[dyna]

Oh , better check if that's 32 % of total F.U. M.
Doesn't sound right , does it ?
I'll have to go read it again , s..l...o...w...l..y ..
Might not look so alarming , after all , eh ?

 

[dyna]

$ 15 Billion intake for month of August takes F.U.M. up to $ 161 Billion .
So the $ 15 Billion exposure to unlisted assets looks to be about 9 % of total assets .
Nothing to worry about , then ?
It is a lot of dough . Need to keep that in mind .

 

[qldfrog]

$ 15 Billion intake for month of August takes F.U.M. up to $ 161 Billion .
So the $ 15 Billion exposure to unlisted assets looks to be about 9 % of total assets .
Nothing to worry about , then ?
It is a lot of dough . Need to keep that in mind .

My green light in a sea of red

 

[qldfrog]

A nice surprise so far since the 5th purchase

 

[qldfrog]

I should havekept quiet: the freedom fries of the market taught me a lesson :-2.43% today
I still hope it will follow the general euphoria

 

[qldfrog]

I should have kept quiet: the freedom fries of the market taught me a lesson :-2.43% today
I still hope it will follow the general euphoria

No real sadness "Dona"
Still handsome profit on that parcel and with minerals going gangbuster, even the super :mostly cash, reduced by half September exposure, and PM focused get a 5 digit boost.
This is a very good week, and from now on, i will shut up especially about my recent successes

 

[Value Hunter]

GQG Partners has had $US10 billion ($15 billion) of fund inflows which helped lift total assets under management to a record $US120 billion. Two factors drive that increase.

The first is impressive performance. GQG’s flagship global equity fund delivered a 34.1 per cent return in the year ended January net of fees, 11.7 per cent above its benchmark, and over the past three years has delivered 18.8 per cent, or 7.3 per cent ahead of its benchmark.

On a call with analysts, executive chairman and chief investment officer Rajiv Jain explained how the firm has cleverly ridden the rise, fall and renewed surge of the global tech sector.

In 2021 and 2022, Jain felt the “car was getting overheated” in the tech sector, and sold down these stocks. But he started buying again last year and GQG’s top 10 holdings reads like a who’s who of this bull market: Nvidia, Meta Platfoms, Ozempic maker Novo Nordisk, Microsoft, Alphabet, Eli Lily, Petrobras, Total Energies, Visa and Amazon.

Late in the analyst call, CEO Tim Carver revealed the second big hook: low fees. Carver delivered what was effectively a stinging attack on rival managers, claiming their bloated headcounts gave them little choice but to charge fat fees.

GQG’s weighted average management fee of 48.8 basis points compares to 70 basis points at Magellan, and 112 basis points at Platinum. And Carver can’t see rivals closing the gap. “Now it becomes very, very difficult for firms like that to bring headcount down to a level that they would need to, to sustain the fee margins that we charge on our products.”

The long term problem with fund managers is that scale is a double edged sword. Short term profitability increases because if its a well managed business they can probably go from $100 billion to $200 billion in FUM with only 10% more headcount and 15% more marketing spend etc. If you are doing things right you should get good margin expansion while simultaneously reducing fees for customers.

The downside however is once you get past a certain size it starts to impact returns. For example if you get to $200 billion plus of FUM at the point you are mostly restricted to buying only the larger stocks.

Lets assume for example you have $200 billion of FUM spread across various products (for example 12 different funds) and lets say for example that equates to 500 stock positions in total. That is an average investment per position of $400 million dollars!! If you are investing $400 million in a single stock on average that basically precludes micro-caps and small cap stocks or at least makes their performance largely irrelevant if they are small positions (say $50 million, etc).

This means you are largely restricted to a much smaller universe of stocks which will be large caps and the bigger mid cap stocks e.g. stocks in the S&P 500,stocks in the ASX 200, stocks in the Nikkei 225, etc. This means firstly you have a smaller pool of stocks to choose from, secondly the larger companies tend to be better covered and researched by analysts meaning larger companies are less frequently undervalued. In addition the rise of passive index funds has pushed up the valuations of larger stocks vs smaller stocks meaning its harder to find undervalued stocks in the large cap space.

 

[finicky]

Not Held
Market Matters afternoon report:

• GQG Partners (GQG) -19.32% hammered today after a fresh Hindenburg report about U.S listed company Adani came to light. GQQ are known to have a large holding, CEO Rajiv Jain announcing in January that profits on the company stood at $4bn.

 

[Garpal Gumnut]

I found this article in the Times of India on GQG and Adani's problems in the USA. I know nothing about GQG.

gg

 

[Dona Ferentes]

I found this article in the Times of India on GQG and Adani's problems in the USA.

I know nothing about GQG.

I think that's a good way to stay.

 

[finicky]

Despite the Adani set-back Greg Canavan at fat tail investment advisory has reinstated a Buy on GQG.
Excerpt:

" ......GQG had $100 million in cash at 30 June. It generated over $200 million in operating cashflow in the six months to 30 June and has very little reinvestment needs.

So the company has ample capacity to carry out the buyback. And if it can buy back shares with an implied return over 10-12%, as a long-term investor you’re better off having them do this than paying the cash out as a dividend.

Keep in mind, though, that it generally takes time to recover from sharp share price falls. So don’t expect a quick share price recovery, especially while the Adani charges continue to get media attention.

At the current price (around $2.30), GQG trades on a forecast yield of 9.4% for CY24 and 10.5% for CY25 (assuming the buyback doesn’t reduce the dividend). So you get a good income stream with this investment. That’s because it’s a very high return on capital business. And because it’s capital-light, there’s plenty of free cash flow available for shareholders.

To reiterate, GQG Partners is now a BUY."

Not Held
No current intention to buy. Prefer cash.

BTW Market Matters tends to disagree:

• GQG Partners (GQG) -14.04% hit hard as UBS cut their rating and price target by 30%, down to neutral with a $2.30 PT (from $3.30), saying Adani issues will compound already slowing inflows. We ultimately think this will turn into outflows making GQG vulnerable.

 

[dyna]

you’re better off having them do this than paying the cash out as a dividend.

Yes , good point and as a non - resident , it's one of the bugbears I've always had with U. S. investments : the damn 30 % withholding tax , although it's halved to 15 % if you keep renewing the I.R.S 's flammin' W- 8 BEN form every few years . Better off , owning American ETF 's or Buffett's shop , I reacon .

 

[dyna]

GQG still in downtrend , but up 6 % to close at $ 2.21 on today's announcements , below .