Invast Blog

Small Cap Favourites: Pepper Group Limited

Pepper is a stock we’ve been watching closely, we wrote about it back in June when the stock price was sitting at around the $2.20 mark (read the note here). Since then, the stock has bounced nicely back towards the $3 per share market as of the time of writing. A recent announcement from the company caught our eye last week.

In the note, Pepper says that it divested around $400m of loans from its balance sheet to a separate buyer. The announcement explains that Pepper will continue with these types of divestments. They make sense, interest rates are low and there are many buyers chasing yield. By the same token, Pepper gets to recapitalise its balance sheet and appease any market concerns around the credit quality of its book.

The full announcement can be found on the company’s site or under ASX announcements, dated 19 August 2016.

It’s a smart move and one that we think may continue to help Pepper as it seeks to highlight the value of its entire business. There are a lot of interesting parts to this business, it’s in the right space to grow through scale. More divestments will help articulate this to a crowded market place.

pep

We continue to watch it closely and will update if the stock rises above $3 per share.

Invast is very well placed to bring you some huge opportunities in the coming months. Execution costs for ASX stocks are 0.06% (6 basis points) above minimum charge, which means for a trade with a notional exposure of AUD 10,000, the applicable commission is only AUD 6.00.

To be onboard with the full set of benefits, you need to become an Invast client.

You can self-navigate through our simplified account opening process here.

 

Peter Esho

Chief Market Analyst

Peter Esho is a member of Invast’s Investment Committee and Chief Market Analyst at Invast Financial Services in Australia.   The Invast’s Investment Committee constructs professionally constructed global thematic portfolios of Direct Market Access (DMA) CFDs over highly liquid global shares and ETFs through its new PortfolioInvestor platform. Since 1960, the Invast Group has grown to become one of the largest and most successful global brokerage firms, offering state-of-the-art trading technology and unparalleled service catering to all levels of traders.

Invast Financial Services Pty Ltd (ABN 48 162 400 035) is regulated by the Australian Securities and Investments Commission and holds an AFS Licence 438283 which authorises it to carry on a financial services business in Australia.

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