ANALYSE THIS: Electus Fund Managers’ Mish-al Emeran
We analyse Mish-al Emeran, equity analyst at Electus Fund Managers
If someone came to you tomorrow with R100m to invest in just one company, which would it be?
Italtile, assuming it is an investor with a long-term time horizon and the company fits the person’s risk profile. The share should also form part of a well-diversified portfolio of assets. Italtile has a strong and sustainable economic moat, which will allow it to continue delivering excess returns and strong cash flows. It has a vertically integrated business model that should enable it to grow earnings ahead of competitors, and it is trading at below its intrinsic value. It has a management team of people who are good stewards of capital.
Which talent would you most like to have?
It would be amazing to be able to read a woman’s mind. That would level the playing field for me at home, where I’m outnumbered by my wife and three daughters.
What was your first job?
My first "paying job" was as the scorer for my dad’s cricket team. I was young and got paid a pittance, but I did it for the love of the game. That’s probably where I started developing a sharp focus and discipline — two important valuation skills.
If you could fix one thing in SA today, what would it be?
SA’s Gini coefficient. We are one of the worst-ranking countries in terms of wealth and income inequality and low intergenerational mobility. There are several reasons for this, but I am a strong advocate for education to overcome poverty, unemployment and inequality.
What’s the best investment you’ve ever made?
It sounds clichéd, but the time and money invested in my education has laid the foundation and opened the doors that made it possible for me to succeed in what I seek to achieve.
What’s your favourite song?
Scar Tissue by Red Hot Chili Peppers.
What travel experience is on your bucket list?
A trip to Anfield, the home of Liverpool Football Club — the sleeping giants of English football.
If you found a lottery ticket tomorrow that had won $100m, what would you do with it?
Four things: pay off debt, take my girls out of school for a year to travel, buy an Aston Martin and invest in the Nedgroup Investments Growth Fund, which is managed by Electus Fund Managers.
What’s the worst investment you’ve made?
When I first analysed Naspers 10 years ago, it was trading at below R300 a share. I decided not to invest. This was not because I didn’t think it was undervalued, but rather because I was hoping to buy in with a higher margin of safety. My regret increased exponentially as I watched the share price rise, but I learnt some invaluable lessons about the way to incorporate a margin of safety into my investment and valuation decisions.
What is your most treasured possession?
My wristwatch. It was one of my first indulgences once I started working.
On what occasion do you lie?
Let’s just say my wife is blissfully unaware of how much some of my sports equipment costs.
What was your last purchase?
A pair of trail-running shoes.
Do you own bitcoin or any other cryptocurrencies? And why?
No. Because I don’t believe bitcoin is an asset; it’s more like a currency. Therefore you cannot value it or invest in it. You can price it and trade in it, but to be successful you must be aware that it has little to do with fundamentals and more to do with mood and momentum.