MoneyTalks is Stockhead’s regular drill down into what stocks investors are looking at right now. We’ll tap our extensive list of experts to hear what’s hot, their top picks, and what they’re looking out for.

Today we hear from Jun Bei Liu, lead portfolio manager for the Tribeca Alpha Plus Fund at Tribeca Investment Partners.


What’s hot right now?

In a challenging economic environment, investors are typically more interested in looking at companies with growth potential to offset inflationary pressure.

Growth stocks are companies with the potential to outperform the overall market over time, whereas value stocks are those currently trading below what they are worth with the expectation they will provide a superior return.

From that point of view, Liu says her four picks – two ‘growth’ picks and two ‘value’ picks – offer shareholders earnings resilience.

She says both Ramsay and Xero are very fast-growing businesses with their own unique driver for earnings growth with or without economic activity.

Domino’s, on the other hand, is a different story.

“The stock will be somewhat impacted by economic weakness in the mature markets like Australia but the story with Domino’s is that you are actually not paying much for its offshore markets where it will generate returns,” she says.

“Once the short-term challenges pass, we believe Domino’s is on very, very long multiples with investors paying a cheap price for it.




“I think what’s key is that the health care sector is still going to outperform,” she says.

“Within that context, Ramsey, who is a health care business and whose earnings have been impacted severely by the COVID lockdown, is on the way up rapidly.

“We’ve seen that improvement in earnings as the world returns to normal with the waiting list for private hospitals increasing.

“This company is well positioned in our view over the next 12 months and whether economic activity is going to slow down or not, it’s not going to have a meaningful impact on this business’s earnings trajectory.”



While the XRO’s share price has underperformed its peers quite severely due to the slowdown in economic activity out of the UK, as well as the business investing its revenue back into the company to grow, Liu says she sees an opportunity in the stock.

“The business has taken a step forward saying that they are going to reduce some of the spend to target profitability.

“We’ve seen the share price has improved somewhat on that, but we do think there’s a meaningful catch-up to be had in the next three to six months just as this business transitions from one of purely growth to growth with profitability.

“Xero is disruptive technology which is taking share away from the old accounting system and its market gain will more than offset economic activity – it also has a demonstrable market share in the UK, Australia, US, and New Zealand.”



“This is a controversial pick because the share price has underperformed meaningfully due to missing some of its shorter-term targets,” she says.

“Domino’s is a business you buy for the longer-term growth trajectory with its growth potential across its addressable markets.

“It’s not just in Australia, it’s around the world – it’s in Japan, it’s in Europe, and now it has expanded into Asia in places such as Malaysia, Cambodia, and Singapore.

“Short term, the company has been facing or is still facing some headwinds, just given higher costs such as input costs and labour costs, but in the longer term the story hasn’t changed.

“The share price has fallen more than, well close to, 40 per cent but we see a significant amount of opportunity taking a longer-term view in this company despite short-term challenges.”



Liu’s other ‘value’ pick is $2.33bn market cap company, Star Entertainment Group.

“The valuation it is trading on is steeply discounted relative to its intrinsic value and is not too far from its hard asset backing, which is the property it owns,” she says.

“To me, this is a very deep value play, but the challenge with value play is it might take time.

“In our view, this is something that in the next 6 to 12 months you will start to see quite substantial amount of upside.”


The views, information, or opinions expressed in the interviews in this article are solely those of the interviewees and do not represent the views of Stockhead. Stockhead does not provide, endorse or otherwise assume responsibility for any financial product advice contained in this article.