23 Stocks for 2023 | 7 more stocks – including Seek, Family Zone, Ulta Beauty! Pt II

Candice: [00:00:10] Hello and welcome to Talk Money To Me. Thanks so much for tuning in. I'm Candice Bourke. 

Felicity: [00:00:15] And I'm Felicity Thomas.

Candice: [00:00:17] Now we are back, as we promised, with part two of our 23 stocks for 2023. 

Felicity: [00:00:22] Yes, we are another very exciting episode. So as a little bit of a reminder, last week we covered off Elders, Playside, Qantas, Merck. We also did a big splash into Uranium Silex, Paladin, Boss Energy, Peninsula and Lotus Resources, Disney and Total Energies. 

Candice: [00:00:41] That's right. We finished on Total Energy. Now, before we reveal more of the stocks to be added to the 2023 list, please remember our chat today is not considered personal advice, even though we are registered financial advisors at Shriram Partners. As always, the podcast and the content discussed does not constitute as financial advice, nor is it a financial product. Essentially, guys, the podcast is general in nature because we don't know you yet, so we don't know your personal circumstances. But as always, you should reach out to a professional like us before you make your investment decisions. 

Felicity: [00:01:14] Now, all the companies discussed on our show are offered in good faith based on facts known at the time, and do not contain all relevant information in respect of the financial products to which they relate. And today is the 31st of the first 2023. Now, the Fed is actually meeting at the end of the week. So the market's kind of going a bit sideways at the moment. Not really sure which way to go. So let's jump straight into it. CB, what is your first stop for the 2023 order pattern? 

Candice: [00:01:42] Well, the first company I'm going to start off with is a company not going sideways in at all. In fact, it's a really well known Australian Large-cap resource name which has recently hit impressive highs in the market and analysts believe there's more upside to come. So I'm talking about mineral resources. The code on the ASX is mine and has a whopping market cap of 17 and a half billion. 

Felicity: [00:02:05] So we love good resource stock and it is in already in a lot of our clients portfolios, luckily a top performer. So we know it's the Australian quarterly update season at the moment. Can you give us a few highlights from the December quarter? 

Candice: [00:02:17] So overall the data for December quarter was mixed with some areas of business doing well. Those arms I've just explained and then others facing some challenges. So firstly, the iron ore production, you know, shipments were down 9% for the quarter in December, ending 2022 due to timing and congestion impacts. The market is expecting, however, shipments to hopefully recover by the second half of FY 23.

Felicity: [00:02:45] Yes, with China reopening, it makes sense. All right. What about the second point exactly? 

Candice: [00:02:49] It's very much dependent on what is really going to happen the latter half of this year with everything going on in the background, with all the different markets, supply chains and the big interest rate conversation all having. Secondly, spodumene in there. One asset what Gina I hope I said that right. Felicity They shipped quite impressively up 45% for the quarter, but it was below a lot of the street estimates. So technically a miss on estimations there. And at Mount Marion, the mean share price, there was about 5% for the quarter, quarter on quarter but 14% down year on year. So kind of mixed reviews like good for the quarter but miss on earnings and like, you know, given the context of what's going on, it is a slight miss there. However, the prices are reverting back to the spot indices. So mixed grade expansion delay to July is disappointing. Thirdly, the lithium hydroxide. So again, in those areas it was a bit of a miss. But in Mount Marion the production and realised pricing was very strong, up three and a half percent for the quarter. So mixed bag as you can kind of tell so far. But I really want to focus on the last point, which I think is the most interesting update is in actually the Lockyer Deep's negotiations.

Felicity: [00:04:05] Okay, so what is the latest on the Lockyer deeps negotiations and why do you want to highlight it? 

Candice: [00:04:11] Well, if you're keeping up with the latest news that comes out pretty much on the daily, Norwest Energy's board has recommended that Min revise their offer 497 million to a definitely different valuation. So in reply, Mine Resources has increased their off market takeover bid to acquire all of the shares of Norwest Energy, offering one share for every 1300 end share, which implies about a valuation for the Lockyer Deep's asset of about 2.5 billion. 

Felicity: [00:04:43] Wow. Okay. That's quite a lot. 

Candice: [00:04:46] It's a it's a pretty big investment. Like, you know, the investment community's standing up here because it's like when, you know, Microsoft dropped 10 billion in I like this is kind of dissimilar in the miner mining aspect, I would say. Obviously different sectors, but really interesting M&A this is going to go through. So I say that because it means minority JV partner in the Lockyer Deep Gas project based in the Perth Basin with principal assets in the Nonoperating interest in onshore exploration permits mean and its subsidiaries are parent operators and essentially owns the remaining interest. So I mean you have a really great active plan of exploration for this Perth Basin, including drilling up to seven wells over the next two years into early calendar year 2023 and really fast tracking the appraisal and development studies at Lockyer Deeps.

Felicity: [00:05:39] Okay. So with all that exciting news, right, I mean, does this give a revision in the recent price target? And I guess how did that come about? 

Candice: [00:05:48] Yeah, exactly. So long winded explanation to really get to. It's lifted the valuation to almost $13 per share, 100% de-risked by 2029. You know exciting for the export LNG area I mean is pushing on with their decarbonisation and downstream chemicals you know through really exciting future facing commodities which we always talk about. So I think that's going to deliver further value. I think it's a really good energy play for mine overall with this asset if it does come off. You talked about, you know, how is it revised the upside? Well, it's trading around 92 and a half at the moment, 92.55 levels in the market. And our analysts who cover mine resources have a price target of $112. It's important to note that this valuation is based on a one times NVP for the commodity side of the business and eight times FY 24 eve to EBITDA for the mining services segment of the business. So I think that's pretty attractive from a value perspective. Eight times is pretty good ratio.

Felicity: [00:06:55] Yeah, absolutely. 

Candice: [00:06:56] Now, year to date, maybe our listeners are thinking, hang on Candice, the stock has rallied a lot and you can't deny it has like to be one of the best Aussie miner. You know, names that we have in our clients portfolio. It's rallied about 23% year to date. But if our analysts are right, let me break down the forecast returns for you because this is where I get really excited. So if the price target of hundred and 12 comes off, that's an upside of 21 and a half per cent just on the capital movement in the markets, the company is flushed with cash, so they're forecasting a 7.6% yield fully franked. So the total forecast of return could be as high as 29% and the market is more placing like eight 10% upside. So if our analyst sees, you know, right on this bullish conviction, that's about 20% difference to what the market thinks, it could rally to double digits. Again, double digits, really hope it comes off. That's why I'm really strong on my conviction for mine resources to add to your 2023 list. So that's mine added for me. Now let's turn to your first stock for the 2023 list. What have you got? 

Felicity: [00:08:03] Felicity Okay, so I'm going to add another resource name. So the code is stay and the name of the company is called Strand Line. 

Candice: [00:08:11] So I buy it here. Okay, so y strand line. 

Felicity: [00:08:14] So essentially they've got the Coburn project, which will produce approximately 230,000 kilotons of heavy mineral concentrate per annum with a mine life of 22 and a half years. They've also got the extension potential for a further eight years. Now Coburn will actually supply 5% of the Weld zircon and 10% of the world's chloride eliminate demand. Now Coburn has a top quartile revenue ratio due to the high proportion of premium, zircon and brutal and really low operating costs. So Coburn has a shallow, free flowing, coarse grain sand and a very low under 3% of slimes content. 

Candice: [00:08:54] Okay, so another name that comes to mind comparable to Australian line, although a lot bigger in terms of market cap is Iluka already mentioned on talk to me another great idea so similar kind of business and financials. 

Felicity: [00:09:08] Absolutely. So strand line is about 500 mil market cap and Iluka is about $4.6 billion market cap. So there's a larger blue chip position there and a more of a growth. Our small cap idea why it's relevant, I guess. Iluka December quarter update really provided further commentary on zircon and high grade titanium feedstock markets. In short, why it's buy markets are remaining tight, inventories are low, and supply constraints are likely to see prices well supported. 

Candice: [00:09:37] And I know that they recently reported like I think even today or yesterday. So anything interesting to come out of that recent report? 

Felicity: [00:09:43] Yeah, absolutely. So they actually reported today, this morning before this recording. So that's very good timing. Now they've got consolidated cash of 66.7 million, so a lot of cash on the balance sheet overall. That project construction reached 99% completion by the end of the quarter again. The first shipment of heavy mineral concentrate, or H.M.S. was completed as part of the commissioning and ramp up of the wet concentration plant and the second shipment of HMRC completed as well, with HMRC stockpiles building ready for feed into the Mineral Separation Plant or MSP for future sales. So really strong mineral sands market see that HMRC sales exceed DFS price assumptions, which is very positive. Now selling HMRC is in accordance with tramlines accelerated cash flow and ramp up plan and provides a robust operational basis to transition to or commissioning of the downstream MSP in the March quarter. So the focus really remains strong on increasing production throughout the mine, which I think is very exciting. I think it's really important to focus on what management is looking at. So they're really focusing on the transition from construction to operation. Now it's worth noting that over 65% of the operating costs have actually been locked in. Below are DFS estimates, including the mining contract, power, Contract and freight logistics, because that's obviously when things can kind of blow out a little bit. So while inflation in the mining industry kind of remains an industry wide issue, when not expecting to see significant cost increases at Cobain because a lot of it's already locked in and. 

Candice: [00:11:21] Locked in a lower DFS estimate. So hopefully more upside than what the company's flagging. All right. So let's talk about the price target. You know, the trading kind of normality that star has had in the market and upside that you can say.

Felicity: [00:11:34] Yeah, absolutely. I mean, strangling is kind of flowing around the whole 38, $0.35 to about 45 cent mark last time I checked is about $0.42 at the moment. And we're really retaining a buy recommendation with a price target of $0.80 because COBAN is a world class mineral sands development, it's fully funded under construction, and especially because the catalyst of mineral sands market remaining super tight basic supply and demand. So that's about upside of 90% from current levels. 

Candice: [00:12:04] Double digits. Very impressive. I really hope that one comes off as well. 

Felicity: [00:12:07] So do I. All right, so that's my first one for the second part of 2023. So, Candice, what is your next idea for us? 

Candice: [00:12:16] So for my next stock, I'm also sticking in the Australian market and picking another familiar, well-run business. This company's a market leader in the online employment classifieds market in Australia and New Zealand, but also in other global economies. So I'm talking about sake where the current market cap of just shy of 9 billion, 8.6 billion. Now a lot of our listeners will be familiar with sake and its business model, but did you know it also operates a learning business in Australia, New Zealand, which is one of the major sellers of online tertiary courses in Australia. Like how cool is that? 

Felicity: [00:12:51] It's very cool. And the business has done a really good job at diversifying its business revenues, which is a big tick for us. 

Candice: [00:12:57] Exactly. So not only is it, you know, very well dominated in the ANZ market, but Seac owns a number of international assets in China, South East Asia, Brazil, Mexico and Africa. And important to note that, you know, they well-diversified, but I guess where they're really great is in the Australia New Zealand market because that's their bread and butter making up about 74% of the overall revenues reported in FY 22.

Felicity: [00:13:23] So why are you keen for sake now putting in the order pad right now?

Candice: [00:13:27] So a couple of reasons. Like a lot of good quality stocks have come off, you know, in the 2022 volatility. So the first one being, you know, the stock declined about 15% year to date, which is making it very tempting to buy in or top up. But if you look at their recent AGM announcement, Seek reiterated their FY 23 guidance, which was really viewed quite positively by the market. Given that the market concerns around, you know, slowing macro, the doomsday that we're all reading in the headlines, but SEEK is kind of having a different story there. So if I go back to the valuation in a nutshell, I think the sell off, in our opinion, it's offering an attractive price to buy in at 14.9 times FY 23 estimated EBITDA margins, which is about 20% discount to the ten year average run rate. So I think it's a good time just on the kind of P and and the valuation. And then another quick point is the industry outlook looks positive. I think sake should continue to benefit from its market leading position in the online employment classification space, particularly growing. It's relatively, you know, low in cost comparison to underlying salaries and recruiters placement phase. 

Felicity: [00:14:39] Okay. And what about internationally? What is the growth looking like there? 

Candice: [00:14:43] I think there's a lot of growth that they can push in the Asia market. So it would be really interesting to see if they can leverage the externally experience into these different markets. But let's not ignore the elephant in the room. Right. The risks, because I know that's what you're thinking. We are in of. Very different economy. A high interest rate. You know, the Fed and everyone is worried about unemployment levels. But I think six online revenues have considerable cyclical leverage and resilience throughout a lot of different employment cycles. They are market leader and we can't ignore up comers like LinkedIn, but I think we're not at that point yet. 

Felicity: [00:15:22] So, Candice, what is the current price? What is the price target over the next 12 months and what is the upside looking like? Well, it's.

Candice: [00:15:29] Currently trading around 24 kind of 40 levels, but the valuation that UBS have is a price target to be reached in 12 months of 27 and $0.80. So that's about 14% upside on current levels. I think, you know, dynamically it's that valuation is behind dynamic pricing power and growth contribution, you know, on average of 6% over the next three years. So let's see if that comes true. 

Felicity: [00:15:56] How good is that another double digit return? Exactly what we like to hear on talk Money to Me. 

Candice: [00:16:01] Now we're going to reveal the rest of our 2023 stocks. But just before we do that, we're just going to take a short break to listen to our sponsors. And we're back. Alright, Felicity, hit us with your second pick. 

Felicity: [00:16:13] Okay, so I'm going to go with technology. Right. And cybersecurity. I think it's a really good place to be if we head into more of a deflationary environment. My party is actually families owned cyber security. The code is FZ. So now it is a new buy on talk money to me, but I did actually pictured on Equity Mates before we actually started on talking money to me. However, it's really new for our part. I'm actually buying more for our clients and taking full advantage of this technology. Sell off. 

Candice: [00:16:40] Yeah, the tech. All right, so let's go into background for families own, etc..

Felicity: [00:16:44] So just a little refresher. Families doing cyber cybersecurity engages in the development of parental control platforms. It intends to create a system that manages the majority of the parental control functions in a cloud based application. 

Candice: [00:16:56] So let's talk numbers. You know, what were their recent highlights that you took from the report? 

Felicity: [00:17:01] Yeah. So they reported yesterday they released a really strong quarterly update with a R of 85 million. However, there were some headwinds. It was a really strong result in the context of December typically being the slowest sales quarter. The ARPU has continued to rise with education products reaching over $6 per annum. That's actually up from 5.50 in the prior quarter. That was driven by cross-sell and upsell. Now the group is making steps towards a 2 to 3 year target of ten points per annum per user. Now, families and also highlighted its plan to achieve cash flow break even in FY 23. That's huge, right? So operational cash flow of 8 million was ahead of our $6 million estimate. They've got a really good sales pipeline of over 18 million. So to compare that, that's actually 80% growth year on year cost reductions of $3 million in FY 23. Again, that's also signalled to be on track and achieved. Now the group is actually trading at only two and a half times annual recurring revenue. That's a 40% discount to emerging cloud comps and we really expect a material rewrite as the group approaches cash flow breakeven. And I know investors are really looking at companies that have cash flow breakeven and it's a huge target at the moment. I mean, ZIP rallied the other day because they had two positive quarters. 

Candice: [00:18:18] Very much so. Investors want that certainty in a really uncertain market. You know, cash flow, positive, first step to solid earnings and paying out dividends. So why a buy right now? And talk about the valuations, too. 

Felicity: [00:18:29] So essentially, given its global footprint scale and the recent share price action, we see a lot of value at current levels. It's being sold off significantly. So the current price is actually around 23 to $0.25, which I believe is really oversold. Our price target is now $0.57, so we've actually decreased it from $0.68 per share. The reason we've done that and we've revised our estimates is because we're now actually only assuming a five times IRR multiple versus seven times multiple previously. That is our discounted cash flow methodology because I know a lot of you actually do ask about that and we're happy to share it. We might actually share it on some of our tiles on Instagram at some point. So Candice, that's mine. Families own cyber security. I think it's a really good company to hold for the long term. And cyber security is so important protecting, you know, future generations because there is a lot of cybercrime out there. To Candice, what do you have for me. 

Candice: [00:19:26] Something so different to cyber crime? I'm going to revisit Ulta Beauty, which I pitched almost a year ago back in Feb 2022. So the share price in the past year has soared 39%, reaching all time highs literally overnight at 512, a US per share on the close in the US. So I hope you looked into this one, guys, because if you did, you would have made nearly 40% upside. To remind you, the code is Ulta and it's listed on the US with a market cap of 25.8 billion. So sticking with my billion market cap theme for this part of part two. 

Felicity: [00:20:01] Yeah. And so I recall that Ulta Beauty is actually the largest beauty retailer in the United States. 

Candice: [00:20:07] Correct. And so the conviction of why I first found this company and liked it is still standing up, in my opinion. Go back to that episode to really get like the 1 to 1 on the conviction behind it. But essentially it operates more than a thousand stores across the United States, 48 states predominantly. It's in quite cleverly located in the high traffic location, a lot of foot traffic in the CBD and centres of the US areas. And the typical store is approximately 10,000 square feet, which has about 950 square feet dedicated to its full on service. Salon.

Felicity: [00:20:43] Look, we love a full service salon, so why are you liking Ulta Beauty again? You know, it has rallied 48% since you last picked it. Why are we buying more? 

Candice: [00:20:52] Well, I think there's more upside to come. And, you know, the end of 2022 really signalled a super clean and impressive beat of expectations. I think there's more resilience in the beauty category that investors are giving, you know, a lot of this company credit for and other comparables if you look at. The bull story for this company. It's showing that its financials is also supported to the further recovery into 2023, more quote unquote normal levels with more room to run on their upward estimate revisions and structural improvements to their retailers margins. And the impressive points gained in the recent quarter on comparable levels speak volumes of how much is companies really dominating in the category. So if you look at the company's comps of 14.6% over its peers, that was mainly driven by 10.7% gain in traffic. And remember their really smartly located their stores to, you know, quickly go get a service from the salon after work or before you drop your kids off, whatever it is. Like it's really cleverly situated, these companies.

Felicity: [00:21:54] Yeah. So you see something nice in the window and you're like, Oh, I'll just go have a look. And they end up buying quite a few things. So let's look at the financials now. What's the upside and where is it where is it sitting at the moment? 

Candice: [00:22:05] So I think what's really pleasing to say about the the latest financials is that, you know, the company is noting that the trends are actually now moderately higher than pre-COVID levels. So they really learnt their lessons and they're really kicking new goals into this new post-pandemic world. So as a result, when I first pitched the stock, a lot of analysts have lifted their price targets into 2023 because it's a really attractive risk reward payoff here. So the price target has been lifted from 590 previous it was 540 US per share and that's based on a 22 times FY 24 EPS estimate, which is really not really stacks out to an impressive global growth company in the beauty category. So if it comes off, it's about 24% upside on current levels. Now, remember, there's no dividend with this one because it's a growth company. So we're just looking at growth in share price. 

Felicity: [00:22:59] Yes, double digits. Again, I think we've all done double digits for all of these picks, which is very exciting. Hopefully it plays. 

Candice: [00:23:05] Out. So let's move on to your third pick.

Felicity: [00:23:08] Okay. So my third pick is actually back to resources. Surprise, surprise. Now I'm reiterating my buy on Aygo Independence Group. So a little recap there. A diversified Australian mining company owns and operates the Nova Nickel mine in Western Australia and holds a 49% interest in the tech giant Australian lithium JV, giving it a rate through of 20 just under 25% ownership in the Greenbushes Spodumene mine and 49% of the Q Wana lithium hydroxide refinery. 

Candice: [00:23:37] Okay, so we know a lot about the video story from previous iPads and it is a really well-known stock in Australia. But any other comments on the lithium market? You know, more broadly. 

Felicity: [00:23:46] Yeah, absolutely, because I think a lot of listeners think that lithium has kind of been overhyped, but lithium markets and equities have traded in anticipation of a demand air pocket whereby supply would catch up to slower demand in Europe and China. But with rapid Covid reopening in China and growing expectations for sales rebound post Chinese New Year, we're really refreshing our outlook. We believe the lithium markets will remain in a deficit for the near and medium term before moving to a structural deficit. Long term, this needs a demand rationing price for which is actually seen no evidence in the past 12 months despite record high prices that are orders of magnitude above costs. So I gain a lot of conviction on price that rationed demand is hard given the speed of the secular transformation in lithium fundamentals that are underway. So I really think that it's not overhyped. There is a supply deficit long term. 

Candice: [00:24:42] Yeah, and I guess there's more catalysts to come right with China. So what are you kind of waiting and watching for? [00:24:48][6.1]

Felicity: [00:24:48] So I've got three points here. I think China's rapid Covid reopening is very bullish. I think the global energy storage demand is actually forecast to grow by 50%. Again, bullish signal and lithium supply delay. So supply and demand continues to be in a deficit really near medium and long term. 

Candice: [00:25:06] Okay. So it has rallied a fair bit like a lot of these, you know, future facing commodities are up in the market about 16% since April 2022 when you first pitched it. So what more upside can you say? 

Felicity: [00:25:19] Yeah. So with quality lithium in nickel production, it presents a compelling case as a diversified EV raw material exposure in your portfolio. We remain very bullish on lithium in nickel, right? So we've upgraded our prices 50% across our forward estimates, which actually lifts mean, like you previously said, it also lifted Igo, which is really fantastic. They just announced today a record interim dividend of $0.14 per share. They have reduced debt, so debt is actually being reduced down to 175 from 221 million TEKE. So it's about 690 at the moment. Net profit after tax is 591 million. Underlying free cash flow, which is what we look at, is 433 million and cash in the bank is five. 50 million at the moment. So, I mean, this is no speculative buy.

Candice: [00:26:13] This is looking really strong. 

Felicity: [00:26:15] This is a solid blue chip for your portfolio. Current price is around 1480 levels. Price tag, it's actually been increased to 19.90. So upside is around 34% from here. So double digits. Here we go. Let's add more to our portfolio and ride this out over the next ten plus years. What are you bringing? What's the name of the company you're bringing to the order pad then? Candace. 

Candice: [00:26:37] So for my next stock idea, I'm going to come back to Australia and I think it's a really familiar business name for a lot of our Aussie listeners. I'm liking James Hardie at these level and I think there's a strong bull case and conviction over the next 12 to 24 months. So if you're not familiar with the business, the code on the ASX is JHX And sticking with my billion market cap theme, it's got a really large market cap of 13.96 Bill. 

Felicity: [00:27:05] Okay. So what did James Hardie do for people that aren't that familiar with the name? 

Candice: [00:27:09] So it's listed and founded in Australia, right? And the company is a manufacturer predominantly of fibre cement building products with primary operations across North America, Europe, Asia and Australia. But a lot of the market is actually factoring in the risk of their business areas and revenue in the US because of the housing market concern. So I think that's, you know, those fears I think are super valid because despite not being a new housing stock, James Hardie has underperformed US homebuilders and other comparables by about 20% for the calendar year of 2022 and even more sadly, down about 40% since Jan 2021. 

Felicity: [00:27:50] Oh, wow. So this is one that's been hit pretty hard over the last few years. 

Candice: [00:27:54] This is a recovery story. I think I'm going to add it to that category.

Felicity: [00:27:58] Like Qantas was. That was a good one.

Candice: [00:28:00] Correct. So I think this is where I think the upside is, right? I think that there's more growth than what the market's factoring in in the north east, particular part of the market in the US division, given that the market's opportunity, even as a result below the traditionally quote unquote James Hardie standard, it's going to see significant volume support at market volumes. So I think this is going to ensure that the F24 in PAT remains well above the pre-COVID levels, factoring in the current price. I think what's also positive in terms of what we're seeing in the market is that, you know, business revenues like with Ulta Beauty and that's the same case for James Hardie, is actually exceeding pre-COVID levels. So another business, really well-run quality management, great balance sheet, great fundamentals that have learnt the lessons from COVID and are benefiting in the future. 

Felicity: [00:28:51] Okay. So are there any other areas, I guess, or catalysts for a potential upside and recovery for James Hardie? 

Candice: [00:28:57] Yes, I think going back to their core business thesis and model, I think there's significant upside. They're looking again at their north, east and Midwest and regions of the US and looking through the analysis there, TAM potential in detail suggests significant pathway for growth. So the penetration upside is significant with vinyl share in the region of over 60% and their fibre cement of about 8% while housing stock, you know, the highest proportion of houses over 40 years old, that's really suggesting a remodelling. So consumers are wanting to freshen up their house, which is going to benefit for companies like James Hardie. And I think that while the contractor is really an important decision maker, you know, in the building sector, it's also the buying the buying process is really driven by the consumer as a growing part in the decision making process. And recent surveys suggest that now the consumer makes about 30% of the decision time, which is up from pre-COVID levels. So I think that's a positive trend to help with my conviction. 

Felicity: [00:30:01] Okay. So you think that that trend's going to continue well into 2023. So let's have a look at valuation then. What does what's the valuation look like for JHX? 

Candice: [00:30:10] Yeah, so I think again, this is another sold off last year it was off about 30%, so great buying opportunity for a really well-run company with really quality high conviction fundamentals that I look for in the building housing and construction space. So top pick for me in this sector and analysts agree. So UBS have placed a 12 month valuation at 40.40 cents and their valuation is about a 55% upside to the current share price. So hopefully another double digit upside here, you know, excess of 50% would be nice trading around 3150 levels. So Felicity, let's finish off this second part of the episode. What is your final pick for the 2023 list? 

Felicity: [00:30:53] I've really stuck with my resources today, so I'm actually going to reiterate a buy on JL one. So Global Lithium Resources now again spoke more in detail about it last year, end of last year, rapidly growing lithium exploration company. The focus on 200% owned and highly prospective WA project, the model by lithium project in the Pilbara region and the Manna Lithium project in the Goldfields region. [00:31:20][26.4]

Candice: [00:31:20] Yesterday, when you pitch last year there has been a bit of a sell off recently but great buying opportunity for our clients. Considering its prospects in our quality pipeline and I can understand why it's every right for a buyer for you. 

Felicity: [00:31:33] Absolutely. So. Global Lithium Resources released its December 20, 20 two quarter activities report. It was really a transformational quarter for the company as it moved to 100% ownership of the lithium project raised 121.5 million to fund the acquisition and announced 148% increase in its lithium resource. So scoping study at Manor and further resource upgrades are likely to be the next catalysts as well to look out for. 

Candice: [00:32:00] And I think also what's important is the strong management as well, right?

Felicity: [00:32:04] Absolutely. So in our view, geoscience management team is highly experienced in a sector that's rapidly evolving. This is really, really important when you're looking at a resource exploration company. So in note, the managing director Ron Mitchell, has more than 11 years in the lithium ion battery metals industry with senior roles at Tin Qual Lithium Corp. So that was Argo as well as Talisman Lithium. Now, non-executive director colleague Lee Lehman was previously the chief operating officer of none other than your Fortescue Metals for four years. He also held senior roles at Rio Tinto. 

Candice: [00:32:39] Very impressive Line-Up of executives. So any other key highlights as well tonight? 

Felicity: [00:32:44] Yes. So global lithium has finished the quarter with 76 million in cash with, which leaves it well funded to complete the exploration programs and mine studies. Tick. Really, the global lithium is strategically well positioned with shareholders support from mineral resources as well as shochu. So the company's assets are actually located adjacent to mine resources. What Gina and Mount Marian Deposits and Mine Resources has an 8% interest in jail. One now shows you TNA ultra clean technology owns 9.9% of jail. One is actually affiliated with China's largest electric vehicle battery maker, Contemporary Amperex Technology. So China one has a really exciting ten year offtake agreement with shows a 30 A and a, So that is definitely something that I think is really positive in holding the stock long term. 

Candice: [00:33:38] And talking about long term. You know, what is the upside? What has our analyst given a valuation on it?

Felicity: [00:33:44] Yeah, so at the moment it's trading around the $2.40 levels. It did drop to about 180 earlier in January, which we were just buying up for clients and still buying under 2.15, which was the recent raise price target. In the next 12 months, we're saying 3.80. I mean, it could be earlier ride upsides, about 58% on a current levels. 

Candice: [00:34:05] Another double digit upside. Add that to the list. Alright, so just to recap, all of the stocks that we're liking so far for 2023 we had last time, Elders, Playside, Qantas, Merck, the uranium play, which is Silex, Paladin, Boss, Penny and Lot, Disney. And then we ended on Total energies this week. 

Felicity: [00:34:25] We have mineral resources, we have strand lines, we've got sake, we have family zone, cyber security, we have Ulta Beauty, we have Independence Group, we've got James Hardie and we have global lithium resources. 

Candice: [00:34:39] And just before we wrap up, just a reminder, as we mentioned last week, the Equity Mates community survey is live and up. We've also announced the next FinFest festival date, which is the 11th November of this year. So hope you guys can make it to Phoenix. We loved last year's version of it. 

Felicity: [00:34:57] Yes, very exciting. So buy your tickets now. Now, before we sign off, please remember, although Candice and I are financial advisors at Shaw and Partners, please note our discussion today does not constitute financial advice. Please seek professional advice before making any financial or investment decisions. 

Candice: [00:35:14] As always, you can reach out to us through our socials Instagram. The handle is @talkmoneytomepodcast for daily market updates. 

Felicity: [00:35:22] Or you can send us an email to tmtm@equitymates.com. Until next time. 

Candice: [00:35:28] Bye bye.