Equitable Investors

Apparently , Confucius didn’t say “One Picture is Worth Ten Thousand Words” after all. It was an advertisement in a 1920s trade journal for the use of images in advertisements on the sides of streetcars. Even without the credibility of Confucius behind it, we think this saying has merit. Each month we share a few charts or images we consider noteworthy. The damage to the Australian retail sector is set out in The Australian's store closure count and reinforced with an update on payments volumes from Tyro Payments (ASX code: TYR). Meanwhile, sell-side analysts have proven slow to respond to the impact of COVID-19 and social-distancing, as evidenced by UBS' aggregatge numbers for the ASX - but they are starting to catch up. Markets threw the baby out with the bath water when the epidemic hit home but now businesses that aren't immediately hit are being looked at again, like The Citadel Group (ASX code: CGL), which sells software and consulting to the government and health s

In a market where some are pitching a value opportunity based on the forward PE of the overall equities market being below average, be wary. The forward PE is likely based on a very stale "E". To quote strategist Gerard Minack in a recent interview, "just be aware that if that's based on the current forecast earnings, that forecast is bunk". Photo by Jean Carlo Emer on Unsplash Analysis from Ord Minnett highlights how bunk the market-wide "E" is right now. The broker tracked 207 companies of which only 116 had updated the market since late February - that's just 56% of companies. Those stocks that have not yet updated the market have only fallen 33%, Ord Minnett has calculated, compared to a 44% fall for those that have. Analysts have been typically slow to revise their earnings projections, with "downgrades deeper for those that have updated". Is the market being complacent with regard to those companies that have not provi