EM Chat: Bold predictions for 2021

Bryce Leske: [00:00:56] Welcome to another episode of Equity Mates, our aim is to help you on your investing journey, break down the barriers from beginning to dividend. Whether you're an absolute beginner or Warren Buffett, we guarantee Equity Mates. We'll have something for you. My name is Price and as always, I'm joined by my Equity Mates friend. How's it going? [00:01:14][17.3]

Alec Renehan: [00:01:15] Very good bryce. We're back for 2021. [00:01:17][2.3]

Bryce Leske: [00:01:18] 2021 I've come in with a new interest. [00:01:20][1.8]

Alec Renehan: [00:01:20] You have. I didn't want to say anything but that was, that was a little bit of a stumble out of the gate. Doesn't bode well for what the year will hold. [00:01:30][9.3]

Bryce Leske: [00:01:30] Look, I'm just dusting off the cobwebs, so please forgive me. And I promise next time we come in, it'll be big. [00:01:36][6.5]

Alec Renehan: [00:01:36] Equity Mates you heard him and hold him accountable to that. [00:01:40][4.0]

Bryce Leske: [00:01:40] So, yes, back for twenty twenty one first episode. We've just finished off the summer series with Superhero, which was a lot of fun. Hopefully our audience will. Hopefully you guys got something out of it. Yeah but hey, New Year, New Equity Mates ready to roll. [00:01:57][16.4]

Alec Renehan: [00:01:58] Oh no, no, no, no. New Year. Same Equity Mates with a little bit of twist. Yes. Equity Mates of the law and Equity Mates for the line. [00:02:07][9.7]

Bryce Leske: [00:02:09] So what to expect this year? We've spent the summer redoing some of the formats for some episodes based on the feedback that we've been getting from you over the last 12 months or so. We've also revived to get Started Investing podcast, which is a second podcast that I like, and I started back in 12 and nineteen end of 2019. That is all about the fundamentals of investing. So if you feel like what we're discussing in this podcast is often going over your head, we would suggest going and starting with that podcast and then coming back here. So we'll be doing a weekly episode on that as well. [00:02:46][37.8]

Alec Renehan: [00:02:47] I mean, I would suggest listening to both. Of course, [00:02:49][2.0]

Bryce Leske: [00:02:51] we've got a new contact form on our website, Equity Mates, dot com forward slash contact. There's a whole bunch of stuff that we'll be referring to. Throw out the episodes and throw out this year that you can go and provide us with some information. We really want to bring you guys on the show. And this is an opportunity for you to provide information for us to give you a call and bring you on the show. The best part has been coding all night to get the voice recording component. [00:03:16][25.5]

Alec Renehan: [00:03:17] Yes, a lot of it [00:03:20][2.5]

Bryce Leske: [00:03:20] must be nice, a lot of code and you can go onto the website and leave us a voice message, and then we're going to be able to play that voice message on the show so you don't even have to talk to run it if you don't want to. [00:03:32][11.6]

Alec Renehan: [00:03:32] First message recorded was someone telling us that they support the Gold Coast song right here. Appreciate that comment. Probably not going to play it on the show. I think if you record something, tell us who you are. Yes. And just give us more than a sentence would be my two request. But hey, if you want to just send us a little private message, you can still do it. We won't play it on the show. We won't play [00:03:57][24.5]

Bryce Leske: [00:03:59] What we would love to hear from you are your stock pictures, be it through the voice recording software that is coded in heart to the website or through whatever means all of our social channels. We're going to be really focusing on the portfolio this year. And as part of that, we want more stock pictures from the Equity Mates community and want to hear what your ideas are. [00:04:19][19.8]

Alec Renehan: [00:04:20] If you are going to record it as a voice memo, you've only got 90 seconds. So you're going to have to be sharp on the pitch [00:04:26][6.7]

Bryce Leske: [00:04:27] and 10 times not [00:04:28][0.9]

Alec Renehan: [00:04:30] if if you want to record it. And then we can call you on the show and have a bigger conversation, we can do that or you can write it in you basically, however you want to contact us, we're trying to make it available. [00:04:43][13.1]

Bryce Leske: [00:04:44] That's right. Yes. Making it as easy as possible to close out what is happening in twenty, twenty one. Very exciting for Equity Mates media. We've got some new shows launching. Yes. Which is going to be great. The 14th of February is the launch date for one of them Valentines Day. Yeah. And then we've got another one launching not too soon after that. If you would love to also launch a show hit us. We're always open to two ideas and we can help support that. So keep your eyes tuned as tuned is tuned and not again. [00:05:16][31.9]

Alec Renehan: [00:05:16] So, so Equity Mates to peel. Peel the curtain back a little bit. There's this running down the curtain back to the pool. But this really makes me look like a fool for what I was about to say, which was Bryce in our friendship group is known for Leskie isms where he takes two sayings and mashes them together in some strange way. But I think I just think it's contagious. [00:05:45][29.4]

Bryce Leske: [00:05:47] And most exciting is the Equity Mates TV show that we have just launched on OPIS. It it would be out now. Twenty seven launched last week, and Alec and I four days a week for 15 on Osbey streaming channel, you'll be able to catch us for sort of 15, 20 minutes each day talking about everything not related to what happened on the markets that day. We're going to be taking a bigger picture view on what's going on in the world of finance and investing. So make sure you tune into that. It will be streamed as well as available on demand through the Osborn's app and on our YouTube channel. So make sure you subscribe to both of those. Yes. [00:06:26][39.8]

Alec Renehan: [00:06:27] If you take a deep breath, you've got the outdates. I think there's probably one more thing that we want to talk about here, which is we've had a few Equity Mates reach out and ask how they can support what we're doing. Yeah, we've obviously gone full time and now we're trying to keep the lights on and a roof over our head. You've got a very lavish lifestyle, not just trying to maintain. Not true for people watching on video, zoom in on Brice's hair and look at how many products in that space. But we have now set up an ability to support Equity Mates, Equity Mates, dot com slash support. If you love what we're doing here, if you think this content is valuable, if you want us to be able to spend more time making content rather than trying to get sponsors for the show, please support us. But don't feel like you have to. This content is going to remain free. This is just an if you want to support what we're doing and you can, it would be greatly appreciated. [00:07:34][66.6]

Bryce Leske: [00:07:35] Nice Equity Mates dot com forward slash support. All the information will be there at and noncommittal donation or ongoing recurring sort of payment. So we would very much appreciate anything that you can throw our way so. [00:07:50][15.6]

Alec Renehan: [00:07:52] Should we get started? Totally. So after talking about how we hope that people find our content valuable, we're going to do perhaps one of the least valuable but most fun episodes that we always start the year with. And that is we're going to throw out some wildly bold predictions for the year ahead. [00:08:11][19.1]

Bryce Leske: [00:08:11] Yes, that is right. And bold predictions for twenty twenty one. We do it every year between Equity Mates tradition now and usually, we take a beer each on old predictions. So let's continue in that vein. Yeah. No time like the present. [00:08:25][13.9]

Alec Renehan: [00:08:25] Yeah. I think before even though you've just said no time like the present before we get into it, look, there are heaps of people that make predictions every year and most of the time they're wrong. So we're just learning into that. We know that most of the predictions that you make every year are going to be wrong. So that's why we're going big and we're going bold here. So we don't necessarily expect them to play out. There's some thought behind each of them. But you would not be taking these predictions to the bank, let's just put it that way. [00:08:54][28.4]

Bryce Leske: [00:08:54] No, not a bit of fun. [00:08:56][1.4]

Alec Renehan: [00:08:57] Surprise predicting a market crash for like four years in a row to kick off this podcast. Let me tell [00:09:02][4.8]

Bryce Leske: [00:09:02] you that this time it's quite optimistic. [00:09:04][1.9]

Alec Renehan: [00:09:05] You're quite optimistic about time for years and we finally cracked a smile. [00:09:08][3.6]

Bryce Leske: [00:09:10] Very nice. All right. Do you want to kick it off? [00:09:11][1.3]

Alec Renehan: [00:09:12] Sure. Actually, no. You know what? I want you to kick it off. [00:09:14][2.4]

Bryce Leske: [00:09:15] OK, look, there is a whole preamble that I thought I could do around the context and everything, but we might leave it for another episode and just get stuck into the bold prediction. So my I'm going to start at a macro level. And I think firstly, I feel like I'm going to be starting the year with a proceed with caution sort of sign on the front of anything that I do. Whilst everything seems to be going along quite nicely at the moment, it feels like, you know, once we move past the election, the markets are a bit frothy at the moment. Anything is possible. [00:09:46][31.7]

Alec Renehan: [00:09:48] However, I thought you said there wasn't going to be a preamble. [00:09:50][2.0]

Bryce Leske: [00:09:51] Sorry, I say bold prediction. Number one, the S&P 500 and the ASX 200 were both finished the year, up over 15 percent. Well, yeah, [00:10:02][11.2]

Alec Renehan: [00:10:03] that's pretty bullish for me. Yeah, it's bold and bold [00:10:07][4.4]

Bryce Leske: [00:10:08] now for a few reasons behind this, I feel like the US might potentially suffer a bit of an economic slowdown now that Biden's in and might take more control of covid situation, you know, for some sort of a shutdown that Trump was just not willing to do. However, we know that there's a divergence at the moment between the economy and the markets. So if that were to happen, and I'm sure you're going to talk about it again, then there's going to be some levers pulled by central banks even further, particularly if markets start to fall. And I think with huge stimulus packages likely to come through incredibly low interest rates and potentially in Australia, a bit of a pre covid, I guess, resurgence in some of the parts of the economy that have suffered over the last 12 months. It's all sort of pointing towards a pretty favorable equities market. [00:11:01][52.8]

Alec Renehan: [00:11:02] Fair enough. [00:11:02][0.3]

Bryce Leske: [00:11:03] So, yeah,. [00:11:03][0.7]

Alec Renehan: [00:11:04] Nice one. All right. Very bullish from you. [00:11:06][2.1]

Bryce Leske: [00:11:07] Are you going to take that? [00:11:08][1.1]

Alec Renehan: [00:11:10] Oh, yeah. We take them. We don't take them on. Yes, sure. I'll take it. Yeah. [00:11:13][3.3]

Bryce Leske: [00:11:14] OK, nice. What do you got? [00:11:15][1.1]

Alec Renehan: [00:11:16] All right. I am going to stay macro I guess the US Federal Reserve, when markets get choppy, they are now in the habit of printing money and using that printed money to buy bonds. At the start of twenty twenty two, I had about four trillion dollars worth of assets on their balance sheet during covid. That's increased to about seven bit over seven. My bold prediction for twenty twenty one is that the Fed's balance sheet increases to over 10 trillion dollars. [00:11:46][30.5]

Bryce Leske: [00:11:47] So just to explain that you think the Fed will buy three trillion dollars more of assets this year and to do what [00:11:54][6.8]

Alec Renehan: [00:11:54] I think if market. So it's like once they realize that they've got a tool that works, they're just going to keep using it. And they did it first during the GFC and it worked. They did it again during it and it worked. And now I think it's almost going to be an automated response whenever markets get a little bit nervous and start falling or there's, you know, there's any issues. Their response is print money, buy bonds. [00:12:19][24.8]

Bryce Leske: [00:12:20] So then really is the underlying prediction here that you think markets something's going to happen in the markets to trigger this event? [00:12:27][7.4]

Alec Renehan: [00:12:28] I'm not saying that, but I wouldn't be surprised. I think, look, I think valuations are pretty stretched, although we're saying some good reports come out of the US at the moment. There's a lot of zombie companies which are, you know, companies that basically can't cover the interest payments. And then there's a lot of unprofitable companies. Just feels like a. Frothy environment at the moment. [00:12:52][24.8]

Bryce Leske: [00:12:54] OK, I will take that. [00:12:56][2.8]

Alec Renehan: [00:12:57] OK, I know this one. [00:12:57][0.8]

Bryce Leske: [00:12:59] No too bold prediction for me again, is that a word on the street is that Libra is coming this year. Facebook's cryptocurrency. I'm predicting that we will see a central bank trial, its own form of cryptocurrency. [00:13:11][11.8]

Alec Renehan: [00:13:13] I don't know if that's bold, but I don't even know if that's a prediction. I think that's already [00:13:16][3.1]

Bryce Leske: [00:13:16] happened that hasn't. The Swiss have done a like wholesale digital currency, but there hasn't been one where they've trialed their own cryptocurrency. So, yeah, I feel like that's pretty bold. But if you don't if you don't think it's bold enough, what [00:13:32][15.6]

Alec Renehan: [00:13:32] about China's central bank? Digital currency? [00:13:34][2.1]

Bryce Leske: [00:13:34] Say they say it doesn't count. [00:13:36][1.4]

Alec Renehan: [00:13:39] Doesn't count. OK, how is that trial about? The Asian giant completed a trial in September and is currently rolling it out on major e-commerce platforms within the country. December nine. Twenty twenty. [00:13:52][12.9]

Bryce Leske: [00:13:52] Now, I don't think so. [00:13:55][2.9]

Alec Renehan: [00:13:55] Not well. I am definitely not yet excluding China. [00:14:00][4.8]

Bryce Leske: [00:14:01] That's bullshit. It's China. [00:14:05][3.9]

Alec Renehan: [00:14:05] Oh, well, no, I agree with you. I think I think it will happen. Although, you know, it's it's not a script, is it a cryptocurrency if it's not decentralized or is it just a digital currency. [00:14:16][10.8]

Bryce Leske: [00:14:17] Yeah, well, I guess digital currency. [00:14:17][0.9]

Alec Renehan: [00:14:18] Yeah. Anyway, let's not get too in the weeds on crypto. We've, we've kicked off the year with Federal Reserve bond buying and cryptocurrency. We need to really right this ship and I'm I'm going to right the ship with a simple one. Netflix. The streaming service will finish the year down. Its share price will be lower at the end of the year than it is was the start of the year. [00:14:41][22.7]

Bryce Leske: [00:14:41] OK, any reasoning? [00:14:43][1.7]

Alec Renehan: [00:14:44] So I did some back of the envelope math. Foxtel cost about sixty bucks a month, and in America cable was more expensive. But I guess the example still holds in their context as well. So Foxtel about sixty bucks a month. If you add up all the different streaming services you now have to subscribe to get the same content you got with Foxtel, Netflix. Eleven bucks a month and ten bucks a month binge. Ten bucks a month. Chayo twenty five bucks a month, Amazon Prime eight bucks a month. Disney plus nine dollars. And I don't think I've missed any, but it comes to seventy two dollars a month. So I just feel like we're reaching an over saturation point and I feel like something's got to give and people are going to be not willing to sign up to more and more subscription services. I don't think Netflix has a clear content advantage in Australia. There's not really any network effects other than being able to talk to your friends about the shows you're watching. But, you know, maybe having stand you having Netflix doesn't really harm us in any way like us both. Having Netflix isn't doesn't make it more valuable. So I just feel like Netflix will its growth rate will slow. And then the second part of it is Netflix has been taking out debt for years and years to fund their content strategy, which has worked because it's led to crazy growth. But if that growth slows and that debt starts coming into the market might rewrite Netflix. Now, I say that with the full knowledge that two days ago or when people are listening to this, last week, Netflix released a crazy report and was up like 10 percent in a day. [00:16:25][101.2]

Bryce Leske: [00:16:26] I think it was up 17 percent last night. Yeah, we're recording this on the 21st of chance, [00:16:30][3.5]

Alec Renehan: [00:16:31] but still, it's a long year. Yeah, there's a lot to play out. So I'm not going to change my prediction [00:16:35][4.7]

Bryce Leske: [00:16:36] without going too much into the weeds on this. It's probably worth another episode to fully explore that. I think we're going down the route where, you know, you might get an apple, come out and provide an iPhone that you pay a reasonably large subscription, get the iPhone or the Apple products. And I might talk about this a bit later, but you also then get all the services through the Apple TV or whatever it may be. [00:16:58][22.3]

Alec Renehan: [00:16:58] So maybe I that's basically just cable like that is what cable is. [00:17:04][5.4]

Bryce Leske: [00:17:04] It's it's going to go that way. [00:17:06][1.3]

Alec Renehan: [00:17:06] I don't know. I think that a lot of these companies like having a direct relationship with their customer and would be reluctant to go back to a cable model where they have an intermediary that they deal with, you know, like Disney and HBO and stuff like that, or Disney especially want that direct relationship with that customer. And they don't want to go through a cable provider again. So I know I can see the logic around what you're saying, but I just wouldn't I wouldn't lock that one in. [00:17:35][28.6]

Bryce Leske: [00:17:36] Before we move on, we're just going to take a quick break and hear from our sponsors. REM, you are all about getting fit. You've bought the Garmin, you bought the golf membership, you bought the gym membership, and you're on the My Master Chef. And even in lock down last year, you bought the. Resistance bands of Instagram that from memory didn't even come, [00:17:55][18.9]

Alec Renehan: [00:17:56] no, look, they didn't come, but all of that effort really was canceled out by the numerous menu log orders that were a real staple of my lockdown experience. [00:18:05][9.5]

Bryce Leske: [00:18:07] Well, we've just headed into a new financial year, so I think it's time you get money fit with Virgin Money, our latest sponsor. [00:18:14][7.0]

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Bryce Leske: [00:18:27] And with the Virgin Money Go transaction account, you can earn rewards on your everyday spending with zero monthly fees. Sounds like just what you need, right? [00:18:36][9.3]

Alec Renehan: [00:18:36] Yeah, the FBI. Twenty one get it didn't quite work. But if 20 to get rent money it might be to go [00:18:45][8.4]

Bryce Leske: [00:18:46] back to your own bait. Virgin money terms and conditions and monthly criteria apply. Now let's get back to the show. So I'm going to jump in here with a bold prediction for the ASX. It's a it's a multipart prediction here. The first one is that technology sector will be bumped from the number one performing sector and it will be replaced. This is, I think, kind of bold by industrials, which includes construction, transportation, business services, waste management. Within all that, you've got airports, infrastructure projects, building products like the Trans Earvin's of the World, consulting staff, and employment services, you name it. So I'm really banking here on an economic turnaround. [00:19:30][44.1]

Alec Renehan: [00:19:31] You're banking on a post covered. People are going to fly again. The government's going to do a big like. Let's rebuild Australia's stimulus package to pump money into the sector. [00:19:39][8.8]

Bryce Leske: [00:19:40] Yeah, I think that it's been if you look at the sectors that have obviously been hit hardest is one of the sectors that has been absolutely crunched. I think it'll outperform the ASX. And the bold prediction is that it'll be the number one performing sector bumping technology. [00:19:53][13.4]

Alec Renehan: [00:19:54] Yeah, I think I'm going to take you on that. So I'll take the bet and say that technology will be number one performing. I think everything you said could be right, but technology still could outperform it. [00:20:06][11.2]

Bryce Leske: [00:20:06] Of course, that's what's a bold prediction. Yeah, I would love to have put a retail consumer discretionary. [00:20:11][4.9]

Alec Renehan: [00:20:12] It's killing it right now. Yeah. The retailers that are reporting. [00:20:14][2.6]

Bryce Leske: [00:20:15] Yeah, I know, but I just feel that they're killing it in relation to the first half last year, like it's not the base they're coming from. Not that impressive. All right, let's move on. [00:20:25][9.7]

Alec Renehan: [00:20:25] All right, Aldar, I'll stay in Australia, given you've taken us back home on Macquarie Group, will break into the big four bank territory [00:20:34][8.9]

Bryce Leske: [00:20:36] in terms [00:20:36][0.2]

Alec Renehan: [00:20:36] of some market cap. So Macquarie Group's currently valued at about fifty dollars billion. Yeah, the smallest of the big four banks is ANZ at 70 billion. And the NAB and Westpac, Westpac are at seventy nine. I think Macquarie will be bigger than at least one of those three banks. [00:20:54][17.3]

Bryce Leske: [00:20:56] I agree with that. OK, so I think I think that. Well, I know that a lot of the stuff that they're doing, the agricultural space and AG, is going pretty well at the moment. [00:21:06][10.7]

Alec Renehan: [00:21:08] Yeah, but is going 80 billion dollars as well. Well, sorry. Yeah, yeah, yeah. [00:21:12][4.2]

Bryce Leske: [00:21:12] I guess also the banks might also do pretty well this year, so. You know, for the fun of it, I'll take it nice. Yeah, all right. Just a quick one. Rent house prices in Sydney to exceed 12 percent growth. [00:21:25][13.0]

Alec Renehan: [00:21:26] I'm seeing article everywhere these days like, oh, there was some report on ABC News that house prices were going to go up 30 percent. It's like ABC News pumping property. [00:21:35][9.1]

Bryce Leske: [00:21:36] We know why Australians love property. You're taking it. [00:21:39][2.8]

Alec Renehan: [00:21:40] I just have no opinion on the property market. That's I think will. The regions are particularly hot like I was way over summer. And there was there's a lot of chatter about just how quickly houses are going. You know, real estate agents are cutting their commissions. The prices are just going crazy. But that could cool down the centers if people are moving away because they can work remotely. I'll take it with absolutely no thought behind it and nor have you own property. I'll take it. All righty. All right. So I'm up and I'm going to go back overseas. I'm going to say that in twenty twenty one, China's big tech and we'll define who that is in a sec. But China's big tech, actually, China's big five, let's call it, will outperform the US Big five tech. I need more info. OK, so the US, like, what will we say, like the Fang stocks, your Facebook, Southwick's site wall and put Microsoft in? Yeah, well let's do the what did they call it now. Fang man, [00:22:47][67.2]

Bryce Leske: [00:22:48] Amazon, Microsoft, Google, [00:22:50][2.2]

Alec Renehan: [00:22:51] Apple. Do it in the Facebook, Apple, Microsoft, Facebook, Apple, Netflix. I'm doing that fan mag. I'm trying to spell it. Microsoft, Amazon. Yeah, Google. So that's six. I'm going to say China's let's call it that big five. So Tencent, Alibaba, JD.com Penge and Meituan. I'm feel like I'm missing a big one. But I'm going to say that that bucket of Chinese big tech companies outperforms the US big tech companies. [00:23:25][33.4]

Bryce Leske: [00:23:26] I'll take it. [00:23:26][0.5]

Alec Renehan: [00:23:27] OK, yes, I've got a sub prediction there. Tencent, currently valued at about 800 billion, will be China's first trillion dollar publicly traded company. [00:23:37][10.5]

Bryce Leske: [00:23:38] Not going to take that. OK, yeah, I feel like for reasons that you will explain in the next episode, OK, I'll keep it overseas in the States Ren. I think Zoome bombs and underperforms and that there is a potential for it to be acquired by Microsoft or Salesforce. [00:23:54][16.4]

Alec Renehan: [00:23:55] The acquisition thing for sure. No doubt. [00:23:57][1.8]

Bryce Leske: [00:23:59] Not any bombs though. I don't think, I think it's [00:24:02][3.1]

Alec Renehan: [00:24:03] how do you define bombs. [00:24:03][0.5]

Bryce Leske: [00:24:04] It'll finish down [00:24:04][0.6]

Alec Renehan: [00:24:05] even if it's acquired. [00:24:06][0.5]

Bryce Leske: [00:24:09] That's a subject, that's a subject. [00:24:10][0.9]

Alec Renehan: [00:24:12] I mean, you're banking on a very specific [00:24:13][1.6]

Bryce Leske: [00:24:14] it's not acquired if it's not acquired a bold prediction is it Bombs. If I've got it right here, if Microsoft and Salesforce to buy Zoom but if you say you call it like I write it, I write it in red. [00:24:29][14.5]

Alec Renehan: [00:24:33] I don't even know where that prediction. And look, I'll take it. [00:24:36][2.8]

Bryce Leske: [00:24:38] Zoom bombs and underperforms if Microsoft or Salesforce don't acquire it. [00:24:42][3.7]

Alec Renehan: [00:24:43] But you also do Microsoft and Salesforce will look like. All right, OK, I only got a few more. Let's start in the US door. The food delivery app will have a higher market cap than Uber. Hold on for context. Dorda is currently valued at about 60 billion. Ube is valued at 108 billion. [00:25:06][23.5]

Bryce Leske: [00:25:07] Yes. So are we going to see a door dash meteoric rise or are we going to see a fall in Aruba? [00:25:13][6.1]

Alec Renehan: [00:25:15] Maybe both. OK, maybe they'll make it right in the middle at around 80 billion dollar mark. Nice. [00:25:19][4.4]

Bryce Leske: [00:25:21] I'll take it, but I'd love to say it. [00:25:23][1.9]

Alec Renehan: [00:25:23] Yeah, yeah, yeah. [00:25:25][1.2]

Bryce Leske: [00:25:25] I'd love to throw you through a stat out of that door that has grown its market share from 17 percent to 50 percent in the States, which is, I think, phenomenal. Like even. Yeah, it's amazing, [00:25:38][13.3]

Alec Renehan: [00:25:39] amazing to me to give me the five minute spiel or are we going to run out of time, [00:25:43][3.8]

Bryce Leske: [00:25:44] not the five minute. Can you give a headline stats? [00:25:45][1.3]

Alec Renehan: [00:25:52] Doordash between January 2018 and October 2020 group between the 17 percent market share to 50 percent. They've built a really strong recurring revenue program that none of the other free delivery ups have. That starts to create some brand loyalty and a segment that didn't have any. But most importantly, they're also trying to become the Shopify of food delivery for businesses that want to do that, run their own orders through their own app. Yeah, similar to how Shopify provides the backend infrastructure toward Asia doing the same thing. Best example is Chipotle, where Chipotle. You ordered through the Chipotle app, not through a door dash or uber eats, but Door dash provides that software and then provides the driver as well or the rider. Over on the other hand, I think is now subsidizing two separate businesses. The thesis was ride, share and food delivery. Both have cause there's a synergy there. Yeah. So let's try and do both. But now what we're saying is that ride sharing cars, food delivery are more and more riders. And now it's two completely separate fleets of vehicles, two completely different sets of riders. And Uber eats, also Uber are subsidizing both. And so I think Door dash is focused on one thing. They're doing it better. Uber is focused on two things, and they're not doing deliveries for delivery as well as their competetior. [00:27:17][84.7]

Bryce Leske: [00:27:17] Well looking forward to seeing this play. [00:27:19][2.6]

Alec Renehan: [00:27:21] OK, twenty twenty one the year I don't waffle. [00:27:24][2.7]

Bryce Leske: [00:27:25] All right. Ran it looks like it's, you know, staying overseas again. Airbnb, this is my bold prediction. Airbnb to be bigger than the top global top five global hotel chains. [00:27:36][10.7]

Alec Renehan: [00:27:36] OK, I like this, but I need the details.. [00:27:38][1.4]

Bryce Leske: [00:27:38] So we've got the Marriott, Las Vegas Sands, Hilton Hage-Ali. Apologies for the pronunciation of that, but it is one of the largest hotel chains in China. Intercontinental at the top five in the world based on market cap at the time of recording, gives us a total market cap of about two hundred and thirty billion. [00:27:57][18.7]

Alec Renehan: [00:27:57] Okay. And Airbnb is at... [00:28:00][2.2]

Bryce Leske: [00:28:00] Airbnb is currently trading at 161$ and has a market cap of 97. So it's actually fallen since doing this bold prediction race. [00:28:11][11.2]

Alec Renehan: [00:28:13] so Airbnb 97, those five hotel chains to thirty. Yeah. And you're saying that Airbnb will be bigger than that. So at the end of the year, some of those hotel chains are going to have to slide. Yes. Or going probably both is going to have to happen. [00:28:25][12.7]

Bryce Leske: [00:28:26] Everybody's going to have to have a huge year. But look, I just think it's it's a very bold prediction. But I think the moat that it's got in this space at the moment and hopefully, with a bit of a turnaround in economic activity and the ability for people to start traveling, that's the bold part about this. But, yeah, that's my prediction. [00:28:46][20.2]

Alec Renehan: [00:28:47] I'll take it. Um, I yeah, I love Airbnb, but I feel like you've really you've really asking a lot of them. [00:28:57][10.1]

Bryce Leske: [00:28:57] I am. I'm asking the right questions. [00:28:59][1.7]

Alec Renehan: [00:28:59] Yeah, yeah. Yeah. Well, look, let's take a pause here and quickly here from our sponsors and then we'll come back to close out with some. Bold predictions. All right, so we've really focused on the U. S a lot, which I guess is an increasing thing for us as we realize how easy it is to invest over there and some of the companies over there, I'm going to move away from the US and move to Europe. And the U.K. has had a tough few years with Brexit. And now it's getting it's having a tough time with the coronavirus. But I think 20 twenty one will be a good year for the U.K. I'm calling the UK stock market will outperform all the major European markets. [00:29:52][52.5]

Bryce Leske: [00:29:53] Come on, go bald. It will outperform the S&P 500. [00:29:55][2.1]

Alec Renehan: [00:29:57] I'm pretty comfortable with the boldness of Michael, as is that. I'm going to stick with it, OK? [00:30:03][6.3]

Bryce Leske: [00:30:03] I like other European markets, but all equally other European markets. They're also having a tough time, so. Like, I don't think it's that impressive to outperform the Italian stock market, but Spanish [00:30:19][15.0]

Alec Renehan: [00:30:19] and German and [00:30:20][0.9]

Bryce Leske: [00:30:21] maybe German, maybe French, Croatian [00:30:25][3.9]

Alec Renehan: [00:30:26] True, Russia. [00:30:26][0.0]

Bryce Leske: [00:30:29] I think it will. [00:30:30][0.6]

Alec Renehan: [00:30:30] Let's just keep naming countries in Europe. [00:30:32][1.4]

Bryce Leske: [00:30:33] I think it will outperform. Yeah. Yeah, I think it will. I'm not going to take that. Yeah. Fair enough. All right. Closing it out. A couple more to go. I think that Apple will hit three trillion dollars this year. [00:30:44][11.2]

Bryce Leske: [00:30:47] It's currently two point two trillion. I think we'll say it hit three trillion by the end of the year off the back of a number of things. But happy to go into that later. I might do it for the portfolio, but that's my bold prediction. [00:30:58][10.5]

Alec Renehan: [00:30:58] Taken nice, a company whose is its sales and it's most doesn't matter. Automobile category two years ago. Don't get me wrong, great business. Heaps of cash on the balance sheet, growing it services business, but it's a long time until its services business overtakes its hardware business. [00:31:14][15.3]

Bryce Leske: [00:31:14] So it took 42 years for it to hit one trillion. It then took two years for it to hit two trillion. And then with the majority of that coming in the last five months, the reason for that is that it's taken recurring revenue from nine percent of its revenue to twenty four percent in the last five years. I expect that with the introduction of more recurring revenue streams this year to push it to three trillion because we know investors love recurring revenue. [00:31:42][27.9]

Alec Renehan: [00:31:43] Fair enough. All right. Well, let's see how that plays out. I've got one more and then we'll get into the IFL want to close it out. The traditional AFL ending show we like we sometimes try and pick the IPO of the year. So my last one, I'm going to try and pick the best IPO of twenty twenty one stripe. The payments platform. Is it IPO? It's rumored to be. [00:32:09][26.3]

Bryce Leske: [00:32:09] Oh wow. That's nice. Followed. [00:32:11][1.8]

Alec Renehan: [00:32:12] So my bold prediction is one that stripe does IPO in twenty, twenty one and two that it's the best performing in terms of and this is always, this is always a fraught conversation like what is the best performing mean, because if the investment bankers price the company at like. You know, five hundred billion dollars, it's not going to perform well because it started from such a high base, but similarly, if they price that five million, it's almost guaranteed to be the best performing because I undervalued it. And with that caveat in mind, let's just measure best performing as from IPO to the end of the [00:32:49][36.9]

Bryce Leske: [00:32:50] IPO opening price or IPO [00:32:51][1.5]

Alec Renehan: [00:32:53] price, the actual IPO price, a price that shares were sold. Yeah, yeah, yeah. [00:32:57][3.6]

Bryce Leske: [00:32:58] Um, OK, that's cool. I'm not going to take that because if I'm going to do an IPO of the year, [00:33:02][4.5]

Alec Renehan: [00:33:02] then we'll just go head to head. Yeah. [00:33:04][1.5]

Bryce Leske: [00:33:05] The amount of times that you said performing in is to grow [00:33:08][2.9]

Alec Renehan: [00:33:09] her for me, it's just not right for [00:33:11][2.9]

Bryce Leske: [00:33:12] me. I'm going to get it. [00:33:13][0.7]

Alec Renehan: [00:33:14] Now, of course, because you brought attention to. All right. [00:33:17][3.6]

Bryce Leske: [00:33:18] To close it out. And I think that road blocks will be the star IPO by 2021. And stick around for the next episode where I do a deep dove in roadblocks. [00:33:26][8.2]

Alec Renehan: [00:33:27] Are you going to do roadblocks as your talking? [00:33:28][1.4]

Bryce Leske: [00:33:32] Let's just stick around for the next episode. [00:33:32][0.8]

Alec Renehan: [00:33:33] Well, you've learned from my last year where in hindsight, I should have just made everything very much. [00:33:38][4.8]

Bryce Leske: [00:33:38] Well, let's discuss that in the next episode. So we're both not going to take those ones. But that brings us to the end of bold predictions for the stock market. Obviously, we like to close out with bold predictions for one bold prediction for the NFL season. [00:33:51][13.2]

Alec Renehan: [00:33:52] I'm surprised there's a prediction that you didn't make that I was expecting you to. [00:33:55][3.5]

Bryce Leske: [00:33:56] Yeah, yeah. But I actually do have it right here. And we skipped over it because we were talking too much crypto. But if you want me to make it, I'll say it. Bitcoin to hit ninety thousand US dollars by the end of the year, [00:34:09][12.7]

Alec Renehan: [00:34:11] like thirty five. [00:34:11][0.5]

Bryce Leske: [00:34:14] I mean look, it's not out of the realm of possibility. It grew 300 percent last year, three percent in this year and you're at 90k. [00:34:19][4.8]

Alec Renehan: [00:34:20] and you just grow 300 percent for the next 20 years. Your are a billionaire.That's why Bryce loves Long term investment. Look, I'll take it. I have no idea where it will end up. There was a moment there in January where it went from like 20 grand us to 40 grand us very quickly. And Bitcoin Twitter was about to lose its collective mind. So I just think we might have to delete our Twitter account if it gets to 90. [00:34:51][31.0]

Bryce Leske: [00:34:55] So we will put all of these up on Sociales. Yes, bang bang headline bold predictions and we will keep track of them over the year. And also, if you have any bold predictions, as we said, plenty of ways to contact us. We'd love to hear them. Yeah. What's your prediction? [00:35:10][15.2]

Alec Renehan: [00:35:11] OK, so normally we do a generic I say the Sydney Swans will win the flag and you say Essendon won't win the wooden spoon, but very ambitious for our respective clubs. I'm not going to do a Sydney Swans one this year. I'm going to say Gold Coast. The only AFL team to never make the finals will win a final in twenty twenty one chase. [00:35:34][23.3]

Bryce Leske: [00:35:35] Yeah, why? [00:35:35][0.8]

Alec Renehan: [00:35:37] I think they were looking pretty good last year. Matty Rühle. Like there's a lot that's good. Yeah. I don't think we should get too deep. So I think there's a lot of people who don't like AFL. Listen, so that's just let's just make the prediction. [00:35:49][12.0]

Bryce Leske: [00:35:50] I don't think they'll win a final maybe they'll make the finals. So I'll take it. I think I'm going to stick with Essendon. I think they'll win the wooden spoon. [00:35:59][8.1]

Alec Renehan: [00:36:00] Oh, that's your prediction. [00:36:00][0.8]

Bryce Leske: [00:36:05] Oh, I think Essendon will take that with a straight oh. [00:36:09][4.4]

Alec Renehan: [00:36:11] If any Essendon Bombers listen, sorry, this is a fan, but you should ostracizing from the club. [00:36:17][6.2]

Bryce Leske: [00:36:17] I'm a massive fan of the Essendon Football Club, but I go in every year with the lofty expectations and backing the boys in which rightly you should as a supporter. [00:36:27][9.2]

Alec Renehan: [00:36:27] Are you backing the boys. [00:36:28][0.6]

Bryce Leske: [00:36:28] Erm I'm backing them but I think they're just going, it's just going to be a tough year. Right. Yeah. [00:36:35][6.6]

Alec Renehan: [00:36:35] Wooden spoon I'd love to say. Oh I have to say. Oh it's going to be a long winter for you Bryce. [00:36:43][7.9]

Bryce Leske: [00:36:44] I know. Anyway so you're [00:36:46][2.5]

Alec Renehan: [00:36:46] going to take it. Of course. Oh well no. Yeah I'll take it just for the fun of the game, but I want it to happen. [00:36:52][5.3]

Bryce Leske: [00:36:52] Nice one. Yeah. Well that brings us to the end of our bold predictions and the first episode of 2021. Thank you so much for tuning in. And we look forward to having a massive year this year just to remind Equity Mates doesn't stop. When you have finished with this podcast, you can email us at contact@equitymates.com, follow us on all the social channels or visit equitymates.com/contact, if you want to leave us a voice message, if you stock for podcast recommendations as well, we do have to get started investing for the beginning. Buffet's and our latest podcast is Comedian versus Economist, where you hear comedian Adam and his brother breakdown macroeconomics in an easy to digest way, so if you're wondering what we're talking about with central banks and printing money and all that sort of stuff, head over to that podcast and they'll break it all down for you. But Ren brings us to the end. It was fun. Stay tuned, because next, we have details on our Stock of the year. [00:37:47][54.9]

Alec Renehan: [00:37:47] Can't wait. [00:37:47][0.0]

[2034.7]