Franklin Templeton\u2019s specialist fixed investment manager is off and expanding its suite of said products with a fresh Aussie-shaped fund named thusly: Brandywine Global Opportunistic Equity Fund for Australian investors.<\/p>\n
Stockhead<\/em> asked Felicity Walsh, MD of Franklin Templeton Australia and Brandywine Global PM Sorin Roibu the where, why and who around some of the unlikely global businesses Brandywine is reaching in to.<\/p>\n Sorin says there\u2019s already high demand for strong global value equity strategies in the Australian market.<\/p>\n \u201cThe new fund invests in 60 to 100 global companies, limiting stock position size to 5 per cent at purchase, and aims to outperform the MSCI ACWI Index.<\/p>\n Felicity says the new fund is for investors seeking \u201cdifferentiated active opportunities.\u201d<\/p>\n Stocks in the portfolio certainly span a crazy mix of sectors and industries.<\/p>\n \u201cWe are generally invested in larger-cap stocks and our risk metrics are aligned with our view that opportunities are not plentiful in the current environment,\u201d says Roibu.<\/p>\n \u201cAs always, we are vigilant and awaiting new opportunities,\u201d adds Walsh.<\/p>\n \u201cMarket shifts can happen very quickly, and we are prepared to act opportunistically should investor fear arise in the US or elsewhere in the world.<\/p>\n \u201cBrandywine\u2019s distinct investment process is premised on the philosophy that valuation alone is not a catalyst.<\/p>\n \u201cThe fund\u2019s approach helps us to avoid value traps and style drift while enhancing the strategy\u2019s ability to capture diversified sources of return \u2013 through what we call \u2018multiple ways to win,\u201d adds Roibu.<\/p>\n \u201cWe use our macroeconomic insights to provide direction and bottom-up fundamental equity research to identify undervalued companies. On a micro level, we look for companies with solid balance sheets and strong free cash flow, favouring sectors believed to be well positioned to capitalise on key macro catalysts.\u201d<\/p>\n Here\u2019s a sample of the companies Felicity and Sorin are into.\u00a0<\/p>\n \u00a0<\/p>\n AerCap (NYSE:AER), the world\u2019s largest owner of commercial aircraft, is well-positioned to capitalise on the current shortage of planes due to Boeing\u2019s production issues.<\/p>\n AerCap (NYSE:AER) year to date<\/strong><\/p>\n\n Sorin says the company\u2019s scale and market leadership enable it to command favorable pricing in the current environment.<\/p>\n \u201cDespite the inherent value of its aircraft assets, AerCap\u2019s stock trades at roughly book value, presenting an attractive investment opportunity.<\/p>\n \u201cManagement\u2019s strategic decision to sell planes and use the proceeds to repurchase undervalued shares demonstrates their commitment to allocating capital effectively and maximising shareholder value. As the aviation industry recovers, AerCap is poised to benefit from the increasing demand for leased aircraft.\u201d<\/p>\n Next we head to Spain.<\/p>\n Banco Santander, a leading European bank with a diversified global presence, offers compelling value for investors, says Sorin.<\/p>\n Banco Santander SA (BME: SAN)<\/strong><\/p>\n\n \u00a0<\/p>\n \u201cWith 40% of its earnings generated in continental Europe and the remaining 60% from North America (20%) and Latin America (40%), Santander has a well-balanced geographic mix.<\/p>\n \u201cThe bank\u2019s current valuation, trading around tangible book value per share and at a mere 6x PE ratio, significantly understates its underlying profitability and future potential.<\/p>\n \u201cSantander\u2019s return on capital comfortably exceeds its cost of capital, indicating a strong competitive position. The investment thesis hinges on the bank\u2019s ability to grow earnings and improve its return on equity, driven by the tailwind of higher interest rates and the potential for a valuation re-rating as the market recognises its true worth.\u201d<\/p>\n \u00a0<\/p>\n \u201cFMC Corp, a prominent global agricultural chemicals company, has seen its stock underperform significantly this year due to temporary headwinds,\u201d says Sorin.<\/p>\n \u201cThe overstocked distribution chain has adversely impacted sales, production, and earnings in the near term. However, we believe that once these issues subside and sales and earnings normalize, the company\u2019s true value will be realised.\u201d<\/p>\n FMC Corporation (NYSE:FMC)<\/strong><\/p>\n\n \u201cThe business is expected to experience an inflection point in the coming quarters, and our analysis suggests that FMC Corp is currently trading at a substantial discount to its intrinsic value. As the agricultural sector continues to grow and the company\u2019s operational performance improves, FMC Corp is well-positioned to deliver significant upside potential for investors.\u201d<\/p>\n \u00a0<\/p>\n The views, information, or opinions expressed in the interview in this article are solely those of the broker and do not represent the views of Stockhead.<\/strong><\/em><\/p>\n Stockhead has not provided, endorsed or otherwise assumed responsibility for any financial product advice contained in this article.<\/strong><\/em><\/p>\n <\/span><\/p>\n The post MoneyTalks: Brandywine\u2019s new global game and the \u2018multiple ways\u2019 Aussies can win it<\/a> appeared first on Stockhead<\/a>.<\/p>","protected":false},"excerpt":{"rendered":"AerCap: A Global Leader in Commercial Aircraft Leasing<\/h2>\n
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Banco Santander: Undervalued European Banking Giant<\/h2>\n
FMC Corp: Undervalued Agricultural Chemicals Leader<\/h2>\n