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Listeners’ favourite stock picks for 2013: David Shapiro, Sasfin

‘You’ve got to get the ones that no-one’s thinking of.’

GUGULETHU MFUPHI: David, as we bring things to a close, we all know that we’ve been following very closely our stock picks for 2013, so much so that we’ve had a resounding response from a lot of our listeners as well as our market commentators on this show. I’ve got a few top picks for you. The most ones that we received were for Coal of Africa as a stock pick for 2013. Are you surprised by that at all?

DAVID SHAPIRO: Well, look, it’s coming off a very low base. It’s done a few transactions now. Now, first of all, coal will rebound after a rather torrid year last year, and the company will rebound. It’s done a few deals now in Maputo and also has some support coming through from the Chinese. So hopefully we’ll see it in the results. But the thing is that it’s run quite hard. The stock that I chose, which is Angloplats, is down by 20%, and we’re only one week into the competition!

GUGULETHU MFUPHI: Good luck for the rest of the year. We also have the likes of a Gavin Pike as well as Anton Lotter voting for Invicta, which is our second-most voted stock.

DAVID SHAPIRO: Ja, it’s another popular stock., going to do well. You’ve got to get the ones that no-one’s thinking of. Invicta’s a pretty good company. It’s a top choice among actual investment managers and I think it’s well placed to benefit from engineering, certainly from infrastructure development. That, together with Hudaco, very good companies, well placed for mining expansion and so on.

GUGULETHU MFUPHI: Another stock that people might not be too familiar with is Pinnacle Technology.

DAVID SHAPIRO: Also, it’s knocked the lights out over the last couple of years. It’s what Alec used to call a ten-bagger upwards. It’s still a good growth company. I wonder if it can keep pace with where it has been. I’ll be thrilled if it does, if it can keep pace with the kind of gains that we saw last year. I think it was one of these 50, 60% gainers last year. So to repeat that performance is going to be pretty good.

GUGULETHU MFUPHI: We also have Blue Financial Services, which is another quite popular one, and we have news of it seeking recapitalisation from its majority shareholders.

DAVID SHAPIRO: Well, those are the ones that can win the competition, coming off a low base, receiving kind of support financially and turning around. So I don’t know much about it. There’s new management there. I’m still holding back on it. We are watching it from a distance. But those are the kind of shares that can make the difference.

GUGULETHU MFUPHI: What has been a common trend – you mentioned that you voted for Anglo American Platinum, we also had the likes of Lonmin. A lot of resource stocks are proving to be quite popular this year for stock picks for 2013. It was obviously after the…

DAVID SHAPIRO: You heard what Martyn said about a rebound in the Chinese economy, a rebound in Chinese demand for materials, a better view. You heard what Hilton had to say about – what did he call it – resilient dynamism. If we get resilient dynamism coming through in the world this year and things start to pick up and people start to feel better about themselves, you might have a very strong demand for materials, demand for commodities here. So we are backing platinum turning around, also coming off a very low base.

GUGULETHU MFUPHI: Just as we wrap up, no-one voted for any telco companies – not even Telkom!

DAVID SHAPIRO: Ja, that’s a good thought. Telkom – when I say it’s dirt cheap, it deserves to be dirt cheap. But the slightest bit of good news can also see that turn around. MTN and Vodacom have also had superb runs and one wonders how much more they can go. But they are still giving you very good dividend yields.

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