Related Articles
Top Stories
Feb 12 2012 15:59
Moral hazard, financial weapons of mass destruction, a huge mess - these were the words used by a founder member to sum up the collapse of the Pinnacle Point Group.
Feb 12 2012 14:54
American billionaire George Soros has slammed German Chancellor Angela Merkel, warning that her policies could lead to a repeat of the Great Depression.
Feb 12 2012 13:39
Impala Platinum and the National Union of Mineworkers have reached an agreement regarding an illegal strike at the Rustenburg mine, the union says.
Johannesburg - Defensive stocks such as British American Tobacco (BAT), MTN and Adcock Ingram remain popular choices with asset managers in 2010, with little interest in small cap companies.
Said Alwyn van der Merwe of Sanlam Private Investments (SPI): "Even though we expect equities to be slightly less robust next year, they are still likely to find support in the low interest rate environment and high cash holdings, both locally and internationally."
His recommendations were for British American Tobacco, MTN, Steinhoff International, Lewis, Northam and Sasol. The firm also said it liked South African banks African Bank Investments Limited (Abil), Standard Bank and Investec.
Commenting on furniture manufacturer Steinhoff, Van der Merwe told clients: "With its growth prospects into Eastern Europe and a potential UK listing to unlock value in the future. It is a share to watch in 2010."
Not all agree on Steinhoff's prospects, however. Value investors including managers at Investec, Rand Merchant Bank (RMB) and PSG were net sellers of the stock in the third quarter of 2009.
Stockbroker BOE picked industrial powerhouse Bidvest, telecommunications firm MTN, listed beverage play Capevin, Impala Platinum, financial services firm RMH and pharmaceutical firm Aspen. Other stocks included were retailer Woolworths Holdings, information technology firms Pinnacle Micro and EOH.
BOE told clients: "Given the strong market position of MTN in most markets, and a forward focus on cost reduction, this should allow for an improvement in margins. We expect that the company will re-rate relative to its emerging market wireless competitors."
While MTN has proven a popular choice for investors, not all firms are convinced.
Imara SP Reid, a stockbroker, recently downgraded MTN on the back of concerns around the impact of the strong rand and pressure on telecomms firms to reduce costs to consumers. This includes the recent decision to lower interconnect rates going into 2010.
But British American Tobacco featured in the recommendations of Barnard Jacobs Mellet (BJM). The firm said clients should consider Spar, Liberty International, Adcock Ingram and City Lodge.
On City Lodge BJM said: "The share has compelling growth prospects and is likely to remain an attractive dividend payer with a healthy balance sheet."
*Author holds shares in Standard Bank and African Bank
- Fin24.com