05
Nov
2019

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Five key numbers we have learnt from earnings season

Earnings season for the third calendar quarter of 2019 is well under way. While the team at Montaka are busy analysing the results of many global businesses, here are five key numbers that have stood out to us over recent days.

  1. 140 million businesses (most of which are small businesses) use Facebook services each month to help their businesses grow…
  2. … Of these, only 7 million businesses currently advertise via Facebook’s platform.
  3. 33 per cent of Apple’s gross profits now stem from services, not the sales of hardware.
  4. More than half of advertisers’ Search spend on Google is now optimized via Google’s internal machine-learning algorithms.
  5. Approximately 60 per cent. This is both the current growth rate of Microsoft’s cloud business, Azure; and its gross profit margin.

Every one of these numbers are extraordinary. They speak to the high-quality of these businesses as well as the significant growth prospects that lie ahead.

One of the defining features of the Montaka funds and the Montgomery Global funds is our ability to add value across the size spectrum. Today, six of our portfolio holdings have market capitalisations in the single-digit billions; and half of our names are at or below approximately $30 billion.

But we also own some of the largest businesses in the world when it makes sense. And we believe Apple, Facebook and Microsoft are three mega caps, worth more than $500 billion each, that continue to represent significant opportunities for future investment returns.

The Montgomery Global Funds and Montaka own shares in Facebook, Apple and Microsoft. This article was prepared 04 November with the information we have today, and our view may change. It does not constitute formal advice or professional investment advice. If you wish to trade these companies you should seek financial advice.

Our Funds

The Montgomery Fund

  • AUSTRALIA/NZ
  • Concentrated high conviction equities
  • From $25,000
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Montgomery Global Fund

  • GLOBAL
  • Concentrated high conviction equities
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Montgomery Alpha Plus Fund

  • GLOBAL
  • A market neutral strategy
  • From $50,000
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Montaka Global Access Fund

  • GLOBAL
  • Access long/short global equity portfolio
  • From $50,000
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Montgomery Global Equities Fund (ASX:MOGL)

  • GLOBAL
  • Concentrated high conviction equities
  • No minimum investment - see your broker limits
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Montgomery Small Companies Fund

  • AUSTRALIA/NZ
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Our Funds

Concentrated High Conviction Equities

Listed

Montgomery Global Equities Fund (ASX:MOGL)

Global
Available on the ASX as an Exchange Traded Managed Fund, invests in 15 to 30 quality global businesses for long-term capital growth with a target distribution yield of 4.5% per annum. Mirrors the strategy of the Montgomery Global Fund.
Unlisted From $25,000

Montgomery Global Fund

Global
Invests in 15 to 30 quality global businesses for long-term capital growth. Priced daily. Mirrors the strategy of the Montgomery Global Equities Fund (ASX:MOGL).
Unlisted from $25,000

The Montgomery Fund

Australia/NZ
Aims to provide long-term growth and income by investing in 20 to 40 high-quality Australian and New Zealand businesses trading at attractive valuations. Priced daily.
New Fund

Montgomery Small Companies Fund

Australia/NZ
Aims to provide long-term growth by investing in 30 to 50 high quality, undervalued, Australian and NZ small and emerging companies with strong growth potential. Priced daily.
Unlisted from $1 Million

The Montgomery [Private] Fund

Australia/NZ
Seeks to deliver absolute returns from a portfolio of high-quality Australian and New Zealand businesses. Capital preservation is paramount. By invitation only.

Alternate Equity Strategies

Unlisted from $50,000

Montgomery Alpha Plus Fund

Global
Aims to generate positive returns in both rising and falling markets. Invests in 80 to 180 global businesses expected to deliver above-average returns, while selling short a similar-sized portfolio expected to deliver below-average returns. Priced daily.
Unlisted from $50,000

Montaka Global Access Fund

Global
Aims to generate materially higher risk-adjusted returns, net of fees, than is generally available in the equities market over the medium term. Priced monthly. Provides retail investors access to the Montaka Global Fund.
Unlisted From $1 Million

Montaka Global Fund

Global
Aims to generate materially higher risk-adjusted returns, net of fees, than is generally available in the equities market over the medium term. By invitation only.