Stock Watch - Stock Picks — cash and City Lodge hotels
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Ian Cruickshanks from SAIRR chose cash as his stock pick of the day and Graeme Körner from Körner Perspective chose City Lodge Hotels.
Cruickshanks said: "I believe that being sure of getting your money back at the end of a fixed period is the most important factor and that sort of security is very important. The South African economy hasn't disappeared into a big black hole, we have great management, innovative and very able in difficult circumstances. They will pull it right in time and at that stage I want to have cash so that so we can get fully or over invested within the next 5 years."
Körner said: "I have a slightly different view, for 2019, the GDP numbers are in and we know it's terrible. We look forward and I'm going to go with City Lodge. I think it's an incredibly well run and well placed business. If the president is effective in galvinising the country and we start to see a little bid good news - which would be really nice, then suddenly business travel will start picking up and you will see 60% occupancy rate move up to 63% but the thing that I really like is that they just carried on doing their thing, and they build quite a few hotels elsewhere in Africa which means that they have grown their balance sheets by around 20%. So maybe not this year, fast track to next year and this stock could give you 9 or 10 rand of earnings.
Cruickshanks said: "I believe that being sure of getting your money back at the end of a fixed period is the most important factor and that sort of security is very important. The South African economy hasn't disappeared into a big black hole, we have great management, innovative and very able in difficult circumstances. They will pull it right in time and at that stage I want to have cash so that so we can get fully or over invested within the next 5 years."
Körner said: "I have a slightly different view, for 2019, the GDP numbers are in and we know it's terrible. We look forward and I'm going to go with City Lodge. I think it's an incredibly well run and well placed business. If the president is effective in galvinising the country and we start to see a little bid good news - which would be really nice, then suddenly business travel will start picking up and you will see 60% occupancy rate move up to 63% but the thing that I really like is that they just carried on doing their thing, and they build quite a few hotels elsewhere in Africa which means that they have grown their balance sheets by around 20%. So maybe not this year, fast track to next year and this stock could give you 9 or 10 rand of earnings.
