Stock Watch - Stock Picks — Standard Bank and Amadeus IT

Nick Crail from Ashburton Investments chose Standard Bank as his stock pick of the day and Jean Pierre Verster from Protea Capital Management chose Amadeus IT Group S.A

Crail said: "My stock pick after this day as well as I suppose the last week is Standard Bank. Looking back into SA focused investing and really I think sentiment has been negative, it's been dire and then you see a bit of a
six-week recovery and now it's dissipated again. I think we certainly know we have challenges in this country and things that we are addressing, I think arguably too slowly. However there are green shoots and there are things that are actually starting to turn so in that environment I don't think we're seeing economic growth picking up significantly in the next let's say two years but longer-term there are opportunities ahead of us I
think, and for that reason I think when shares do get beaten down a little bit, I think there's some value
and I think Standard Bank is a quality company."

Verster said: "Mine is a company listed in Spain called Amadeus and Amadeus is one of three global distribution systems for airline tickets. So if you've ever bought an airline ticket, chances are you've used the Amadeus system. They connect travel agents and other buyers of airline tickets to the airline itself and because there only three of these networks internationally it means they are integral. Amadeus has been winning market share from the other players, they are especially strong in Europe and gaining market share in the US and because they control this network it means that they can raise prices every year and it's not very easy to switch from one provider to another if you're an airline. A lot of people thought that they would be disintermediated if you think of a lot of aggregator websites that allow you to buy a plane tickets, that has not happened. So because of that and the fact that there are so few players and they've got pricing power I think the valuation is reasonable and I w