Stock Tips Of The Week: YOW, PRU

We have two stocks to bring to your atten­tion to this week. This rec­om­men­da­tion is based on Tony’s analy­sis using data from Sun­day, 21 Nov 2021. 

1. Small Cap: YOW

Yowie Group Ltd (XASX:YOW, for­mer­ly GSF Cor­po­ra­tion Lim­it­ed) is a glob­al brand licens­ing Com­pa­ny, spe­cial­is­ing in the devel­op­ment of con­sumer prod­ucts designed to pro­mote learn­ing, under­stand­ing and engage­ment with the nat­ur­al world through the adven­tures and exploits of six endear­ing Yowie char­ac­ters.

Some of the rea­sons we like YOW include:

• QAV score 0.34
• Qual­i­ty score is 110%
• Price-to-Oper­at­ing Cash Flow 3.25
• Finan­cial health is strong
• Share price is less than the con­sen­sus intrin­sic val­ue
• Share price is less than Book Price + 30%
• Owners/Founders have a high (26%) own­er­ship

The main caveat with this stock is that the Aver­age Dai­ly Trans­ac­tion is very small — around $4000. So if it runs into trou­ble, there could be a lot of peo­ple try­ing to run for the exits. It’s prob­a­bly only suit­able to peo­ple who are trad­ing in very small parcels.

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2. Large Cap: PRU

Perseus Min­ing Lim­it­ed (XASX:PRU) is engaged in gold pro­duc­tion, min­er­al explo­ration and gold project devel­op­ment in the Repub­lic of Ghana and the Repub­lic of Cote d’Ivoire both of which are locat­ed in West Africa.

Some of the rea­sons like like PRU this week include:

• QAV score is 0.11
• Qual­i­ty score is 77%
• Good news in recent quar­ter­ly report
• Explo­ration “struck gold”, lit­er­al­ly
• Upgrad­ed pro­jec­tions
• Gold com­mod­i­ty price shift­ing side­ways but above sell price 
• If it keeps going side­ways the sell price will even­tu­al­ly catch up in 3–4 months, so that’s a risk
• But PRU has great num­bers 
• Large Aver­age Dai­ly Trans­ac­tion 6.5m
• Star growth stock
• Strong finan­cial health 
• Share price 1.68 (2021–11-24)
• Share price is cur­rent­ly less than Con­sen­sus IV
• Price-to-Oper­at­ing Cash Flow 6.83, on the high end for us, but below the cut off
• Share price is greater than Book plus 30%
• Share price is less than our IV2 
• Strong EPS growth
• EPS / PE = 5.1 which is very high 

We also want to let every­one know that Tony does hold this stock.

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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.