We have two stocks to bring to your attention to this week. This recommendation is based on Tony’s analysis using data from Sunday, 28 Nov 2021. 

1. Small Cap: LAU

Lindsay Australia Limited (XASX:LAU) is into transportation of refrigerated and general freight, logistic services associated with the import and export of horticultural goods and merchandising of rural supplies. The Lindsay Australia Group comprises of Rural, Transport and Fresh Logistics.

Some of the reasons we like LAU this week include:
  • It has a QAV score of 0.27
  • It has a new three point upturn
  • Average Daily Transaction is around $40,000
  • Price-to-Operating Cash Flow is 2.44
  • Share price is less than the consensus valuation
  • Share price is also less than our IV #2
  • Growth/PE is less than 1.5
  • Yield is higher than the current bank rate
  • Financial health is stable
  • Quality score is 67%

Disclosure: Cameron has owned LAU for several months.

2. Large Cap: WAF

West African Resources Limited (XASX:WAF) is a gold resource company which focused on acquisition, exploration and development of resource projects in Burkina Faso, West Africa. The Company’s flagship project is the Boulsa Gold Project.

Some of the reasons we like WAF include:

  • QAV score of 0.14
  • Average Daily Transaction of $5.1 million
  • Price-to-Operating Cash Flow is 5.96, a little on the high end of us, but still safely under 7
  • Financial health is strong and steady
  • Share price is less than the consensus valuation
  • Share price is also less than our IV #2
  • Current PE is the lowest in three years
  • Growth / PE is less than 1.5
  • Forecast IV is great than twice the current share price
  • Quality score is 86%

Please Note: 

Our recommendations are based on the share price as of the date of the download. If the share price changes, this will affect the QAV score and its ranking on our buy list, so please take price changes into account before making any investing decisions.

Also note that while we apply a high level of science in our selection process, some stocks may not perform well in the short term. Like Warren Buffett, we aim for a 60% success rate (meaning 60% of our stocks will do well in the short term, the other 40% will not). So it’s very important to monitor your portfolio and to sell the ones that don’t perform to your expectations. The way we do this in QAV is using Rule #1 and the 3PTL. If you’re not familiar with how to use those, please listen to the podcast and consider joining QAV Club

We have very strict guidelines about what we disclose about our own portfolios, and when we buy and sell stocks that appear as our stocks of the week. You can read our guidelines here

Finally, please also note that this isn’t personal financial advice and you should consult a financial planner before making any investment decisions.

Each Monday we publish our full buy list for QAV Club members.