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Whats going to be the leading industry in 2010

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Werner_1
Super Contributor
In 2009 Capitec was one of the highest growth shares... I was lucky enough to have believed in the firm in Jan 2009, so that was quite cool... but now the question is: what is the leading industry/firm in 2010... i would like to hear what your thoughts are... I have made investments recently in a smartphone company - Research in Motion listed on the Nasdaq because i really believe this will be an industry to watch. Other investments in JPMorganChase because i dont think too much negative regulation will occurr in USA for banking even with all the hype, and they have a huge potential because of their recent acquisitions and now reduced competition... I found a cool biotech company in USA i am researching - www.celgene.com - could be quite interesting! Here in SA it seems that the companies i like are all a bit expensive. Whats your thoughts on industries that will make above average growth in 2010?
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8 REPLIES 8
Herms
Contributor
Hi Werner. I believe that the best performers in 2010 will be from the industrial index, especially retailers (shoprite) and diversified industrials (Bidvest). I also believe that Richemont isn't a bad choice at all if you have doubts in what the soccer world cup could bring to our economy,the consumer confidence will continue to increase throughout the year imo and that would really benefit all of these companies. According to my calculations all of these are currently trading at quite a substantial discount to their intrinsic value.
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Herms
Contributor
I would like tohear your opinions on these as well. Thanx Werner.
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Werner_1
Super Contributor
Thanks... i will look at them, i really liked the business of Richemont, awesome products! When money comes back to the consumer all those mentioned companies will pick up, Shopright is awesome for the fact that they always do well... people need to eat and they the most cost effective for that.
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kwagga
Super Contributor
Pawn shops, liquadators and auctioneers. On a lighter note - Dividend paying heavyweights - BATS for one.
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theyoungster
Super Contributor
people tend to forget that many companies during 2009 where conservative with there dividend policicies and, as a result some companies who performed better than expected mny have a bit of cash around to grow the business - my pick is OML,ANG and i actually very much like the entire selection of SATRIX DIVI
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john_1
Super Contributor
Wener, my guess... look at the best performers over the last 6-12 months and buy them... reason, business cycles are slower than market cycles, so stick with winners... also I feel that the rand is about to weaken relative to the dollar. I will be quite surprised if we have net growth on the JSE this year, simply beacuse everyman and his dog can see the market is way ahead of earnings...so I agree that defensive heavyweights have very real promise..
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Werner_1
Super Contributor
I actually read an article yesterday that said exactly the same about the ZAR-USD. I agree that the market is ahead of earnings and this is why i cannot find companies i really like right now much, but found 2 in USA and Canada. JPMorganChase will have an enormous boost when the economy turns, they have extended their business so much in recent years its something unbelievable, and very well managed, I also really like Capitec and that was my best performer in 2009, will not sell this one. another is my liking for smartphones and the future of these devices, had to buy research in motion because it is trading at a huge discount to companies like Apple and still having unbelievable growth in customer subscriptions, etc. I think the market will take time to really recover but once this is done, the banks will cash off bigtime because of more money flowing from consumer to producer, etc. and just general economic activity, thats why i like banks so much, companies will also start to try to raise money to grow, this is another income source for them... so right now, big solid banks that pay dividends are quite interesting for me....
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Not applicable
Also check out the motions put forward to tax short term foreign capital inflows (like Brazil did recently). That should reduce rand liquidity and weaken it (in theory). My personal favourite right now is Steinhoff, that should benefit from a weaker currency, creating a nice windfall, and Redefine - who are making offshore property investments - where they have the perfect storm scenario - a strong rand and weak international property markets.
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