10k Words - May 2021

 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. 

With casino operator Crown Resorts is receiving the attention of a number of suitors and the latest, Star, has established that gaming mergers typically feature synergies equal to 12% of EBITDA. Dealogic show the corporate interest in Crown has contributed to a 459% increase in the value of announced M&A deals in Australasia for the first half of CY2021. Gavekal has the earnings yield on US equities remaining above the 20 year median spread on fixed income. Morgan Stanley sets out correlation between key assets. Bespoke breaks down the recent performance of the top 1,000 US stocks. Back in Australia, Equitable Investors looks at monthly seasonality for small caps. With the Australian federal budget just announced, Evans & Partners provided historical context on government debt.


Pulling out synergies in gaming sector M&A (as % of EBITDA)

Source: The Star Entertainment Group


Announced M&A transactions in Australasia ($US)


Source: WSJ, dealogic



US earnings yield spread on treasuries

Source: Gavekal, Macrobond


One year correlation among key assets

Source: Morgan Stanley



Russell 1000 Decile Performance since Feb 12, 2021

Source: Bespoke


Monthly index price returns from January 2013 to April 2021 and “Pre-COVID” (pre-March 2020): S&P/ASX Small Industrials (XSI) & S&P/ASX Emerging Companies (XEC)

Source: Equitable Investors


Australia budget & gross government debt

Source: Evans & Partners



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