The team at Maxim hope you and your family remain in good health, having enjoyed the best year possible under the circumstances. If one were to look into a crystal ball this time last year, there is no way anyone would have foreseen the events of 2020.
COVID-19 has, and will continue to have, a lasting impact on global wellbeing, everything from individual’s health, both physical and mental, to balance sheets of both private citizens and Governments. This is before we start to consider the tragic loss of life that thankfully we New Zealanders have largely avoided.
Not everybody has been affected equally. Tourism businesses have suffered more than retailers, which have been surprisingly resilient as exemplified by Briscoe Group repaying $11.5 million received in wage subsidies from the NZ Government. This has been a microcosm of the broader NZ stock exchange, and other major exchanges, such as the ASX, Dow Jones and Nasdaq, where after a tumultuous start to the year share prices have recovered strongly and markets are trading at record highs.
The theme for the upcoming year is that good quality companies will perform well in a range of market conditions. All things considered given the tumultuous year we have just endured we are extremely proud of the performance of the stock picks we made this time last year for our clients. In total, of the five stocks we selected they produced an average return of just over 32%, including dividends, compared to the return of 12.42% for the broader NZX50 index.
Please contact us if you would like us to share with you our top stock picks for 2021 via email or call 04 282 0811. As usual, disclosure statements are provided on request and free of charge. Our top stock picks for 2021 span the following market sectors:
Retirement/aged care – strong outlook due to the nature of New Zealand’s residential property market and aging demographic profile.
Property – this sector continues to be of high interest due to scarcity of supply, low interest rates and the ability to leverage against existing property assets.
Freight forwarding and logistics – post COVID-19 more business is being conducted remotely and consumers are shopping to a greater extent online. Distribution and logistics firms play an important role in ensuring that the changing nature of consumer behaviour is satisfied.
Food and beverage – companies that have sustained good distribution and supply arrangements are benefiting during Covid-19 as others struggle. The increasing need for the world to be fed remains a theme worth investing in.
Energy – we are consuming more energy locally both through a greater number of domestic holidays as air travel is less accessible. The reliance on freight forwarding/courier and logistics firms to bring us goods ordered online remains strong.
Wishing you a safe and prosperous festive season, we hope to see you in 2021.
This article reflects general views and opinions of Maxim Financial Markets Limited at the time of publication. Nothing within the article should be relied upon as a basis for making any investment decision. Please contact us to seek specific investment advice before making any investment decision. A Financial Advisor disclosure statement is available upon request.