Simon’s weekly wrap: Coal is dirty, but can it make a lot of money?

This week MoneywebNOW looked at how the SAB Zenzele Kabili share has done since listing, the Thungela Resources listing as well as the US recording the highest inflation rate in over a decade and the highest core inflation in over three decades.
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The SAB Zenzele Kabili share has done great since listing trading up to over R200, but this seemed expensive, so I spoke with Craig Gradidge of Gradidge Mahura Investments about the fair value. Because this BEE share only holds AB Inbev shares and debt, we can work out a fair value fairly easily and Craig has done the math and his fair value is way below the current share price. So be careful.

The US recorded the highest inflation rate in over a decade and the highest core inflation in over three decades. I spoke with Wikus Furstenburg from Future Growth about the base effect and whether central banks will raise rates. He also commented that we’ll see another base effect next year when these large numbers are being used for the reference and he cautioned about tapering the central bank stimulus spend.

Property has had a horror year as a result of the pandemic, but two stocks have fared very well even as lockdowns impacted their markets. Sirius Real Estate operates in Germany servicing the SME sector while Stor-Age* stores your excess goods locally and in the UK. I spoke with both CEOs about results and growing during a pandemic.

Thungela Resources listed on Monday and most people dislike the stock as coal is dirty and in time will no longer be the dominant source of energy. But Viv Govender from Rand Swiss has other ideas and thinks there may actually be opportunity for investors who don’t mind their investments getting dirty.

Also this week: How behavioural science can play a role in improving consumer choices. ‘If we make better financial decisions we are ultimately better off financially…we’ll have more money and we’ll retire better’: Adam Gottlich, head of behavioural science – client solutions, Standard Bank.

The writer holds Stor-Age

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Seems like it, you cannot drive big industry and factories with wind mills and solar panels.

Plus SA’s Power stations need thermal coal or gas.

Converting coal power stations to gas takes many years.

Then there is the Steel manufacturing industry, they need coal also.

coal is required in the manufacturing of plastic plus lots of products, too numerous to mention

End of comments.

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