Transcript QAV #506

QAV 506 Club

Cameron  00:06

Wel­come back to QAV, TK. Episode 506. We’re record­ing on the 15th of Feb­ru­ary, 2022. Hap­py Valen­tine’s Day for yes­ter­day, Tony.

Tony  00:18

Thank you, Cam. Hap­py Valen­tine’s Day to you. I’m in a sep­a­rate state to my wife so I sent her some cup­cakes.

Cameron  00:25

Oh right. You guys recog­nise Valen­tine’s Day? We don’t, we’re like “meh”.

Tony  00:29

We don’t know either nor­mal­ly but because we’re apart, I thought oh, I bet­ter send some­thing. But I was think­ing of just send­ing up some­thing nice any­way because we’re apart but then I thought oh, Valen­tine’s day, most of the stuff you’re buy­ing, well that I could buy, was for Valen­tine’s Day so I just took the oppor­tu­ni­ty.

Cameron  00:42

I’d be think­ing, see­ing as you for­got your wed­ding anniver­sary a cou­ple of weeks ago, you’d be tak­ing any oppor­tu­ni­ty to lay it on thick.

Tony  00:49

Yeah, well I did, I did send some flow­ers after that.

Cameron  00:52

Spread­ing it on thick like veg­emite on hot but­tered toast.

Tony  00:57

Ooh, and hot cross buns.

Cameron  00:59

Off air we were talk­ing about the Super bowl ads and I thought we should do this on the show. It’s the only — Chris­sy and I laugh about this — its the only tele­vi­sion adver­tis­ing we see all year, are the Super bowl ads, because we don’t have a TV. So, we nev­er see ads.

Tony  01:13

You don’t see them in Aus­tralia, any­way. It’s only for the North Amer­i­can mar­ket. Even in Cana­da we did­n’t see them, like they charged by region.

Cameron  01:20

But we don’t see any ads all year, I’m say­ing, we nev­er see an ad.

Tony  01:25

Okay, but I watched the Super bowl last night on TV and the ads are Aus­tralian ads because its shown here. You don’t see the US ads.

Cameron  01:31

Oh, yeah. Okay, so we watch them on YouTube. I’m not going to watch the actu­al game, I don’t care about the foot­ball. I care about the half­time con­cert, which was awe­some. And I know you would­n’t have appre­ci­at­ed it.

Tony  01:41

I hat­ed it.

Cameron  01:43

Yeah, yeah, you would. It was awe­some. I seri­ous­ly teared up. To me, it was… just to see Dr Dre and Snoop, and most­ly Em. I remem­ber when those guys, like par­tic­u­lar­ly Dre and Snoop, were con­sid­ered the down­fall of Amer­i­ca thir­ty years ago. Tip­per Gore was putting parental advi­so­ry stick­ers on their albums because “oh,” you know, “it’s the African Amer­i­cans. They’ve got a plat­form now, be care­ful. They’re talk­ing about smok­ing weed, and that’s nev­er going to be legal. Oh, whoops.” And to see them be so main­stream now that they’re doing the Super bowl half­time game, so inof­fen­sive to your aver­age white Amer­i­can that they can do the Super Bowl. I thought it was real­ly great.  I was gonna tell you about the Lar­ry David ad. So, it’s like, it’s Lar­ry as char­ac­ters through­out his­to­ry. First guy shows him the first wheel, he goes “what’s that?” It’s the wheel. He goes “Eh. I don’t know. I don’t like it.” But it rolls. He goes “Yeah, so does a bagel. I don’t care. It’s not good.” And then they were invent­ing the toile, h e does­n’t like that, ad the fork, he does­n’t like that. All of these major achieve­ments, and it ends up with a guy at the end talk­ing to Lar­ry about cryp­to as an invest­ment. Lar­ry’s like, “eh, I don’t think so. It’s nev­er, I’m nev­er wrong about these things. I don’t think so.” And we were talk­ing about that in ref­er­ence to the fact that some­body said they should, they want­ed to adver­tise a cryp­to fund on our show and I turned him down instinc­tive­ly, I go like “yeah, it’s it’s nev­er gonna hap­pen. We’re nev­er gonna do that.” And then I thought maybe we should just take their mon­ey and we can just do a piss take ad and every­one would know we were jok­ing.

Tony  03:18

Like the old Gra­ham Kennedy ads on Mel­bourne Tonight.

Cameron  03:21

Yes, yes. Well, next time. Next time, I’ll think about that. What else? Cop­per’s a buy again, Tony, I think. Did you check the chart?

Tony  03:31

I did. I checked it this morn­ing. Yep, no, it’s a buy again, absolute­ly. Been sort of skirt­ing around the buy, it was only a small sell and then it came back again. So, yeah, it’s def­i­nite­ly back into buy ter­ri­to­ry now.

Cameron  03:42

That’s good. So, who does that put back? There’s BHP…

Tony  03:45

BHP, Sand­fire, Aure­lia Met­als. Yeah, those three come to mind straight­away.

Cameron  03:52

Good. Now, there was in our buy list we put out yes­ter­day, we had tak­en VUK, Vir­gin UK, off because we thought it had a qual­i­fied audit. You had anoth­er look at it and said, “yeah, no, it does­n’t qual­i­fy as a qual­i­fied audit.” It’s a non-qual­i­fied, qual­i­fied audit.

Tony  04:13

Yeah, the audi­tors were hap­py with the com­pa­ny. To be fair, the con­fu­sion is around, it’s a very unusu­al audit state­ment for Aus­tralians because it’s, it’s a UK based com­pa­ny and so the for­mat of the audit report is dif­fer­ent. The audi­tors, I think prob­a­bly by leg­is­la­tion, called out quite a bit of detail about whether the com­pa­ny was a going con­cern or not so they list­ed ‑a bit like a key audit mat­ter — they list­ed all the things they inves­ti­gat­ed to see if the com­pa­ny was a going con­cern. And then at the end said, “yeah, it’s fine. It’s a going con­cern, at least for the next 12 months.” So, I think if you just glanced at it you might draw the oth­er con­clu­sion that they were high­light­ing the fact that the com­pa­ny may not be a going con­cern, but no, it’s fine, just a dif­fer­ent for­mat.

Cameron  04:56

So, for QAV club mem­bers that are look­ing at the full buy list, you can take off the qual­i­fied audit for VUK. ASX CEO Dominic Stevens announced a bit of a sur­prise retire­ment recent­ly.

Tony  05:09

Yeah, sor­ry, and just before we leave VUK, it’s back on the buy list too once you put that qual­i­fied audit back in. So, it’s a good high ADT stock for any­one who needs that. Yeah, so Dominic Stevens, head of the ASX retired, and the day it hap­pened I just hap­pened to be about to log into the AFR web­site and they have, at the bot­tom of the page, they have all the head­lines and I went, “oh, shit. ASX CEO, leaves.” And I thought, “oh, okay, that could be bad news.” But, then after I prob­a­bly had 24 hours to read the sto­ries in detail, I think it’s okay. He’s announced his retire­ment, he announced it on the same day as the results came out and per­haps he did that so that it would all be on the same day and there would­n’t be an over­shad­ow­ing of one or the oth­er. But he did say he’s stay­ing on until they find a replace­ment, and he’s been there for sev­en years. I think he’s been there for nine years in total, and quite a few as CEO. The only thing that I’m a lit­tle bit, I don’t know, it’s a bit of a cau­tion in my mind is that the ASX for a long time have been try­ing to replace their big IT sys­tem which is called the Chest Sys­tem, which is the sys­tem which tracks every­one’s own­er­ship of their share port­fo­lio or their pieces of stock in shares. And it’s an old sys­tem, it’s behind the times and peo­ple will know that because they get print­outs every quar­ter of their share­hold­ings and the trans­ac­tions that have tak­en place where­as in this day and age, you think you’d get it by email at least. But the ASX under a pre­vi­ous CEO decid­ed to, sort of, leapfrog one cycle of the tech­nol­o­gy rev­o­lu­tion and go straight to a blockchain solu­tion. That was start­ing, was I think it was due last year, and it has been pushed back two years. There’s been an awful lot of push­back from mar­ket par­tic­i­pants, par­tic­u­lar­ly the stock bro­kers who’re just say­ing, “look, why are we the first coun­try any­where to be using Blockchain for such an impor­tant piece of infra­struc­ture?” So, it’s a bit of a cau­tion in my mind that Dominic Stevens has seen the writ­ing on the wall and does­n’t want to be CEO of the ASX when the chess sys­tem moves to blockchain, but I could be draw­ing a long bow there. I’m not sure. And they’ve still got a year or two now to get it all sort­ed out. But I think it’s okay. I think he’s flagged that he’s going, it’s for a rea­son­able rea­son; he just wants to retire, he’s been there for a long time and he’s going to hang on until some­one replaces him. So, it’s a bit of non-event for me.

Cameron  07:27

“ ‘Stevens exit may cause some con­cern, although it is not com­plete­ly unex­pect­ed’ accord­ing to Citi Group ana­lyst Nigel Pit­t­away, adding that ‘the com­pa­ny’s first half result was a small beat to con­sen­sus expec­ta­tions.’ ” Not sure if it’s relat­ed, but the mar­ket does­n’t seem to have han­dled it very well. They’re down about 5%, I think, since he announced it last week.

Tony  07:50

Yes. And, it was our, it was my pick for stock of the week last week. So, the Kynas­ton kiss of death is alive and well.

Cameron  07:57

Well that’s why. I heard, I got an email from Dominic Stevens say­ing that he want­ed to go out on top. He said, “well if Tony’s picked us as the stock of the week, this is when it’s time to, you know, can’t do any bet­ter than that.” Yeah. “Job is done,” you know, “mis­sion accom­plished.” Petrol prices are up, Tony. I filled my tank yes­ter­day and it was like close enough to two bucks a litre, and I was like, “that’s, that’s expen­sive, what the hel­l’s going on?” And then I did read a sto­ry about it, I think it was in the Finan­cial Review today or yes­ter­day, talk­ing about some of the rea­sons why petrol prices are up, blah, blah, blah, Rus­sia, Ukraine, Russ­ian oil, blah, blah, blah, if the US put sanc­tions on them what’s going to hap­pen, World War Three, etc, etc. But, also just talk­ing about the trick­le through impacts to the econ­o­my of petrol prices going up. They also said it had some­thing to do with oil’s not back to its all-time high but the Aussie dol­lar is low. So, the com­bi­na­tion of oil going up, the Aussie dol­lar going down means the petrol is expen­sive here and that has trick­le on impacts through the econ­o­my. Have you had any thoughts about what that means? Do you care? Prob­a­bly not.

Tony  09:16

Well, I mean, I care in the wider con­text. I think it’s bad for the econ­o­my, because I’ve spo­ken about this before, I think there’s three impor­tant things to mid­dle-class Aus­tralia in terms of their wal­let. One is petrol prices, because that’s a thing they do every, well, from my Shell expe­ri­ence, every ten days you fill your tank, and if it’s now cost­ing twice as much as it did a lit­tle while ago that’s got to hurt from a bud­get­ing point of view. The sec­ond one is inter­est rates ris­ing, prob­a­bly the biggest cost for every house­hold is their mort­gage inter­est and mort­gage repay­ments every month. So, if they start to go up, which they are, then that’s anoth­er blow to peo­ple’s spend­ing abil­i­ties. The third one is the Aus­tralian dol­lar and it’s a bit of an each way bet, that one, because a low dol­lar hurts peo­ple’s bank bal­ances again because, or their spend­ing again, because we import most of our clothes, white goods, black goods, all those things come from over­seas, we have almost no man­u­fac­tur­ing base here our­selves. So, we pay more for refrig­er­a­tors, TVs, clothes, when the Aus­tralian dol­lar is low. That’s the bad side of the Aus­tralian dol­lar being low. The good side, though, is that it’s good for unem­ploy­ment, or good for employ­ment, because what we do do well in Aus­tralia is we export raw com­modi­ties. So, it does cre­ate more work in the min­ing indus­try and the agri­cul­tur­al indus­try. Both of those are doing real­ly well at the moment, and so they’re employ­ing peo­ple. A low dol­lar, I think, is a net pos­i­tive for the Aus­tralian econ­o­my but it does, it does hurt peo­ple’s cheque­books. So, yeah, I think we’re not there yet, but we’re start­ing to get pret­ty quick­ly into a world of pain for mid­dle-class Aus­tralia and that will hurt our econ­o­my.

Cameron  10:48

Good for peo­ple like me that earn a big chunk of their income in US dol­lars. I’m always super hap­py, except the fact that Chris­sy and I are plan­ning on going to the US in a few months. So, we won’t be so hap­py when we get over there, but, if we buy stuff with the Aus­tralian dol­lars.

Tony  11:04

Yeah, that’s right, the Pacif­ic peso. Oth­er thing to be aware of is the oil price is going up, as you said before, large­ly dri­ven by geopo­lit­i­cal events, par­tic­u­lar­ly by the threat of war in the Ukraine. Whether it hap­pens or not, just the fact that it’s a threat is dri­ving up the price of oil pre­dom­i­nant­ly because Rus­sia is a big oil exporter and if sanc­tions are put in place then that’s less oil in the mar­ket, and the oil price goes up. And so, this is a bit of, the mar­kets kind of pric­ing that in at the moment in terms of their prob­a­bil­i­ties of there being a war. The thing is, though, that’s got to hap­pen and the oil price may have already fac­tored in that hap­pen­ing. So, I think the only thing I’d say is that peo­ple need to be quite aware of what hap­pens with the oil price, because it may slip quite quick­ly. So, have your alerts set if you’re a share­hold­er of San­tos or Beach Ener­gy in par­tic­u­lar. They may well come off if Rus­sia pulls back or the sanc­tions don’t hold, because I noticed too last week that the, or just a cou­ple of days ago, the Chan­cel­lor of Ger­many was in talk­ing with the Ukraine about it all because at this stage I think Ger­many has­n’t yet bought into the idea of sanc­tions because they’re a huge importer of Russ­ian oil and gas. So, there’s no guar­an­tee that the sanc­tions even if there is a war will actu­al­ly have any sort of prac­ti­cal impact in terms of oil, because Ger­many will still need it.

Cameron  12:23

Be fun times if the US tells them they can’t buy it and they buy it any­way.

Tony  12:30

Yeah, who knows what’ll hap­pen, but I guess I’m high­light­ing the fact that this could change quick­ly and the oil price could drop back again. So, just have your alerts set. Most of our oil and gas stocks are way above their three-point trend­lines any­way, so it should­n’t be a prob­lem but if some­one’s bought in recent­ly watch your rule 1s.

Cameron  12:47

Okay, mov­ing on. I had a look at our port­fo­lio, the QAV port­fo­lio yes­ter­day. It’s dropped back a lit­tle bit ver­sus the ASX 200 from last week. I think we were doing three, for the finan­cial year that is, I think we were doing three times the ASX 200 for the finan­cial year last week. This week, we’re about two times. So, it’s caught up to us a lit­tle bit but we’re still three times the ASX 200 since incep­tion, so it’s on track. It’s doing good.

Tony  13:15

No exact­ly, and I think we had a good week last week, too. I got the Navexa email which says that our top three per­form­ing stocks were ZGL, Zicom Group, up 12.5%; IGL, the IVE Group Lim­it­ed, up 10%; and KSC, K&S Trans­port up near­ly 8%. So, a lot of good stuff hap­pen­ing.

Cameron  13:34

ZGL final­ly went up? What? Oh, IGL or ZGL?

Tony  13:40

Both. ZGL went up 12.5%.

Cameron  13:42

What the hell? It was, it’s done noth­ing for a long time. Oh, look, it’s spiked. Wow. I won­der what that was all about.

Tony  13:51

I could­n’t find any­thing when I had to look, but I’ve got to expect this because of the results that are about to get announced would be my guess. Cer­tain­ly, it was for KSC, they came out with a trad­ing update a week or two ago — actu­al­ly sor­ry, a lit­tle bit more than that, three weeks ago — say­ing their prof­it was going to be about 25% up on last year.

Cameron  14:08

I did notice that one of our stock tips last week, I think OEL was last week along with the ANZ, I think OEL was our small cap.

Tony  14:15

Otto Ener­gy, yeah.

Cameron  14:17

It went up 0.01 of a cent which means it jumped like 30% or some­thing like that. Actu­al­ly, Google Finance was telling me it was up 100%, but I don’t think that’s right. When we rec­om­mend­ed it was 1 cent. Oh no, it was 100%. When we were rec­om­mend­ing it, it was 1 cent, it jumped up to 2 cents. There you go, 100% on your mon­ey if you got in and out of OEL.

Tony  14:44

The oth­er news for the week as well along with oil going up is gold’s going up too. Just being seen as a safe haven in case there is a prob­lem in Europe, and with Bit­coin being so volatile I think peo­ple are prob­a­bly start­ing to see gold as more of a safe haven than Bit­coin. So, it’s up to, I think it’s, the last time I had a look it was about $1850 US dol­lars. So, its, yeah, get­ting back up there again.

Cameron  15:04

Good stuff. What else did you want to talk about? SGF?

Tony  15:08

Yeah, so some­one asked a ques­tion a cou­ple of shows ago about whether it was worth­while actu­al­ly check­ing for qual­i­fied audits in 200 ASX stocks, I think they sug­gest­ed. And I did notice in the lat­est buy list that SGF, which is the Star Enter­tain­ment Group, so they run the casi­no in Syd­ney, they have a qual­i­fied audit this time around. And that’s a top 150 stock, so it can hap­pen to big com­pa­nies.

Cameron  15:30

Hold on, isn’t SGF SG Fleet group?

Tony  15:34

Oh okay, giv­ing you the wrong code, have I? Its Star Enter­tain­ment Group is the one I’m think­ing of. SGR, my mis­take.

Cameron  15:40

SGR. Okay, thanks.

Tony  15:43

Yeah, so the audi­tors have just — kind of the reverse of the UK — they’ve raised a going con­cern issue large­ly because of COVID and the impact it’s had on Star Enter­tain­ment Group and their casi­nos and the, you know, social dis­tanc­ing reg­u­la­tions and all that. So, it’s got a qual­i­fied audit. Whether or not that’s real­is­tic giv­en that things are get­ting back to nor­mal, but who knows what will hap­pen if there’s anoth­er vari­ant, but I guess that’s what the audi­tor is say­ing is that this busi­ness has been through the wars in terms of being shut down and social dis­tanc­ing rules reduc­ing its turnover. And if it hap­pens again, it might be a bad thing for the com­pa­ny.

Cameron  16:18

Well, Crown Casi­nos, Crown Resorts has just agreed to a $9 bil­lion takeover bid by an Amer­i­can pri­vate equi­ty firm, maybe that’s in the future for Star as well.

Tony  16:30

Yeah, quite pos­si­bly. In fact, I think at one stage Star actu­al­ly lobbed a bid for crown. So yeah, there’s cer­tain­ly room for con­sol­i­da­tion in the in the gam­ing indus­try in Aus­tralia. There are lots of reg­u­la­tion issues. There’s some talk the takeover of Crown may not go ahead for reg­u­la­to­ry rea­sons, it still has to get all the pro­bity checks done and signed off from three state gov­ern­ments. So, it’ll prob­a­bly go through but it’s by no means a com­plete 100% cer­tain­ty at the moment. But yeah, Star Enter­tain­ment Group could be next as well.

Cameron  16:58

Well, what else have we got? MAM? Were you say­ing you don’t know why MAM sorts to the top of the buy list? But it was­n’t at the top of the buy list as far as peo­ple are aware, because I sort­ed it man­u­al­ly down, so.

Tony  17:09

Yeah, okay. I’m using my ver­sion of the spread­sheet. Is it hap­pen­ing in the Flit­man mod­el? I think you use that, don’t you?

Cameron  17:15

Yeah, I haven’t done the Flit­man mod­el this week, so I don’t know.

Tony  17:19

Okay. Yeah, I don’t know, I haven’t been able to fix it. So, Alex who did the down­load this week high­light­ed the fact that MAM with a QAV score of 0.10 was com­ing to the top of our buy list dur­ing a sort, and I had a look at it and could­n’t solve it. So, typ­i­cal­ly when that hap­pens it’s because there’s some kind of for­mat­ting issue, and it’s sort­ing, you know, space 0.10 ahead of 0.10, or what­ev­er the detail is, I’m not sure. So, I haven’t been able to work it out. I’ll keep look­ing and try and do it, but if any­body out there is bet­ter with Excel than I am and they can look at the spread­sheet and know what the prob­lem is, it’d be great to hear. Maybe Brett can give us a hand.

Cameron  17:56

Alright, so if you see MAM turn up at the top of your list when it should­n’t let us know, par­tic­u­lar­ly if you can work out why. All right, what do you got for your stock of the week, Tony?

Tony  18:06

Yeah, Nufarm, the crop pro­tec­tion and seed busi­ness. I spoke about it towards the end of last year in terms of what its under­ly­ing com­mod­i­ty chart was turn­ing up. So, it was a buy because of gly­cophos­phate or some­thing sim­i­lar. But it’s popped up on the buy list again. So, it was on the buy list I think last year, it came off and now it’s turned up again and it’s back on the buy list. It does have a Sep­tem­ber report­ing date, so we’re not get­ting recent fig­ures at the moment, so the turn­arounds large­ly because of share price which is why it’s come back onto our buy list. But I thought I’d run through it as, as a pulled pork today.

Cameron  18:40

It’s had a great run recent­ly, it was $4.30 on the 24th of Jan­u­ary. Cur­rent­ly at $5.51.

Tony  18:48

Yeah, unfor­tu­nate­ly, as I said that it went off the buy list dur­ing part of that so it’s just come back on now. But I think the the­mat­ics are there. It’s a bit of a turn­around stock, this one, and it can be volatile because those under­ly­ing chem­i­cals can be volatile. But at the moment it’s sup­ply­ing to the agri­cul­tur­al sec­tor which is doing real­ly well, both from exports and from local sales, so I think it’s set for a run. But to run through the num­bers, you’ll see why I’m say­ing it’s a rebound. It’s PE is trad­ing at 34 times at the moment, so it’s quite high, but it’s Prop­Caf, its price to oper­at­ing cash flow was only around five times. So, it’s obvi­ous­ly, it’s gen­er­at­ing lots of cash but it’s not flow­ing through to the bot­tom line. But, as we’ve seen with oth­er com­pa­nies if that top line con­tin­ues then the bot­tom line will improve as well, which I think it prob­a­bly will giv­en that the agri­cul­tur­al sec­tor is so bull­ish. As I said, it’s a crop pro­tec­tion busi­ness, so it makes pes­ti­cides, her­bi­cides, that kind of thing. Think Round Up that peo­ple may have used in their own their own homes. It also diver­si­fied a while ago into a seed busi­ness, so it’s also sup­port­ing the agri­cul­tur­al indus­try from sort of cra­dle to grave is what they’re try­ing to do. So, that’s the sort of essence of the busi­ness. It’s a large com­pa­ny, so it’s ADT is near­ly $5 mil­lion per day, so that’s going to suit every­body, I think, who is lis­ten­ing to this. Its price is still slight­ly below its con­sen­sus tar­get, so it scores for that, how­ev­er it’s not a Star Stock at the moment and I imag­ine that’s because of its low ROE and low earn­ings it won’t qual­i­fy. But, if they do rebound I would­n’t be sur­prised if this becomes high­ly rat­ed by Stock Doc­tor which improves the score, and that can boost the share price as well as that catch­es on. The finan­cial health, how­ev­er, is sat­is­fac­to­ry and steady. It gets a point for that. It’s, the price, how­ev­er, is above IV1 and 2, and I’m using a price of $5.54 which was the price on the week­end when the down­load was done. I think it’s slight­ly below that today, but not by much. But it is less than, it’s around about its price to book but def­i­nite­ly less than price to book plus 30%, so it gets a point for that. It is fore­cast to grow, so by 33%, but with the PE ratio being so high the growth over the PE isn’t scor­ing above 1.5, so we’re not get­ting a score point for that. Direc­tors hold 5% of the com­pa­ny which is good, but not 10% which we look for. So, we’re not get­ting a score for that. On the man­u­al entries, on the man­u­al dol­lar front, it’s a record low PE from the last three years so it gets a two for that. And it’s also a new upturn since its last results, so it gets a score for that. Equi­ty is a bit bumpy, so it’s not get­ting a score for con­tin­u­ous­ly increas­ing equi­ty. Sum all those things up and we get a qual­i­ty score of 67% and a QAV score of 0.13. So, it’s on the buy list, I think it’s worth a look, and I would­n’t be sur­prised giv­en the strength in the agri­cul­tur­al sec­tor if it rebounds from here.

Cameron  21:40

Wow. Well, it’s had a good run of late. I’m just look­ing at it in Stock Doc­tor. Okay, it’s been up as high as $10 going back to 2017. Okay.

Tony  21:56

And I think a rea­son for that is it is very com­mod­i­ty dri­ven, so, and the gly­cophos­phate, the whole suite of those chem­i­cals can be quite volatile. And not just, obvi­ous­ly it’s dri­ven by sup­ply and demand, but it can also be dri­ven by how much is stock­piled as well. So, if a com­pa­ny like Nufarm starts to buy up and fill its ware­hous­es does­n’t mat­ter what hap­pens with the price of gly­cophos­phate if it’s got lots of stock to sell, that’s the price. So, there’s a few vari­ables there, and they’ve been high before but they have come down quick­ly. So, just be aware.

Cameron  22:27

You know, this one looks like a bit of a falling knife to me over the last three or four years. Sort of been, it’s been slid­ing down­wards since April 2017. Had a nice spike just in the last month, kicked it back up. But, you know, would you buy this with a chart like that?

Tony  22:46

Yes, I would def­i­nite­ly. Again, I kind of think of the three-point trend­lines as a range, and if you can see it kind of trad­ed down in a range that had troughs run­ning through, say, from Jan­u­ary 18 through maybe Octo­ber 18, down to about May 19. But it also had a peak to that range as well, you sort of look at May 18 going down through maybe Jan­u­ary 19, and then July 19. So, you can see a sort of trough run­ning down and then it went side­ways for a bit, and now I think it’s on the up phase again. So, yeah, no I think it’s a clas­sic rebound­ing sort of graph.

Cameron  23:28

Right. But if we look at sort of, if we go down to its first real big trough May 19 it then rebound­ed up through to, sort of, Octo­ber 19 a bit like it’s done recent­ly. But then it, yeah, went side­ways as you said, then it came back down and it went up, down up. It sort of seems to be climb­ing its way back upwards though, does­n’t it, since Octo­ber 2020?

Tony  23:53

It does, yeah. I think so. But again, you know, no guar­an­tees, it could turn down again. But, it’s a very cycli­cal busi­ness and I think giv­en that the com­mod­i­ty is strong and the sec­tor that it serves is strong I think it should get set up for a rebound.

Cameron  24:06

Inter­est­ing­ly, it does­n’t have a COVID cough. Comes a bit late. But if you look around March 2020 when near­ly every oth­er stock I look at com­plete­ly bot­tomed out, it did­n’t. It actu­al­ly went up between March 2020 and May 2020, then it dropped after that when we went into lock­downs.

Tony  24:25

Yeah, right. Just think­ing about, would won­der if there’s a lag in the ag indus­try, per­haps.

Cameron  24:31

A lag in the ag.

Tony  24:32

Yeah, it would have been I guess. Oh, I don’t know, did exports con­tin­ue on unabat­ed dur­ing the COVID cough and that year? Prob­a­bly did?

Cameron  24:40

No idea.

Tony  24:41

Yeah, no idea either.

Cameron  24:43

All right. Thank you for tak­ing us through Nufarm, NUF. Any­thing else before we get into the Q&A, Tony?

Tony  24:50

Nope, that’s me done. Thank you.

Cameron  24:52

All right. This first ques­tion comes from Dave: “hi Cam, ques­tion for TK. Say, hypo­thet­i­cal­ly, Tony had inher­it­ed some shares in a newish tech stock — let’s call it Afterzip — after the pass­ing of his great-great aunt.” That’d be dif­fi­cult for you, would­n’t it, Tony? “At the time he inher­it­ed them the shares were just $6, but since then they have rock­et­ed over to $100. The stock is high­ly regard­ed in cer­tain cir­cles, even though it has reg­u­lar cap­i­tal rais­ings and has yet to turn a prof­it. The stocks have not had any QAV Bible rea­sons to sell since Tony inher­it­ed them. Would Tony still be hold­ing them?”

Tony  25:34

Yes, I would. And you’re right, I don’t have any great-great aunts, and I think I’m prob­a­bly the only per­son who own shares in my fam­i­ly. So, I’m not expect­ing any inher­i­tances, unex­pect­ed inher­i­tances with peo­ple who have share port­fo­lios any­time soon. But to Dav­e’s point, yes, I would hold it, and I’d just use three-point trend­lines to trade it. I’d prob­a­bly draw a rule 1 at the price when I obtained it — and I’m assum­ing there’s no tax issues here. Sounds like he’s just using this as an exam­ple so we don’t take tax into account, but it can be an issue with inher­i­tances. But yeah. So, yeah, no. And the rea­son, my log­ic for that is, if it’s not a three point sell and it’s not a rule one, it’s going up. So, I would just hang on for the ride until it was time to sell and then put that mon­ey back into QAV. Because, bear in mind, if the oth­er alter­na­tive is that if Dave sold that stock, Afterzip or what­ev­er he called it, there’s a 60% chance you get one that goes up, but there’s a 40% chance you get one that goes down. So, I do have a bit of a bias to hold­ing things, you know, mak­ing cas­es to hold things for as long as pos­si­ble. I’m still pret­ty ruth­less when it comes time to sell. But as described, I would hold it until it became a rule 1 or three-point trend­line sell.

Cameron  26:44

If you inher­it­ed it, why is there a rule one?

Tony  26:48

Well, I guess it’s a bit of a, an emo­tion­al rule 1. Like, if you, I don’t know, let’s say we put a num­ber on it; say he inher­it­ed $100,000 worth of AfterZip. You don’t real­ly want it to go down to 80,000/70,000 or as After­pay did, all the way down to 30 or 40,000. So, I’m going to rule 1 it based on the price that I received it at and just pro­tect the cap­i­tal.

Cameron  27:09

Just a line in the sand. Dave con­tin­ues, “I use this to high­light a broad­er point. As I see it, there are three things in your con­trol in invest­ing: what to buy, assessed by qual­i­ty, when to buy, i.e. the buy price, assessed by val­ue, and when to sell, i.e. the sell price assessed by sen­ti­ment. What and when to buy is very well served by the QAV check­list sys­tem, how­ev­er, when to sell is near­ly entire­ly sen­ti­ment dri­ven. Much like growth invest­ing, and red flags aside, there’s no assess­ment of whether the com­pa­ny has main­tained qual­i­ty or val­ue. Has Tony ever con­sid­ered a reverse check­list for sell­ing? Some­thing that iden­ti­fies that the com­pa­ny is of poor qual­i­ty or val­ue? Or does the stairs up, lift down anal­o­gy mean sen­ti­ment is all you should wor­ry about when sell­ing?”

Tony  27:57

First of all, it’s a real­ly good sum­ma­ry of the process, but it’s also a real­ly good ques­tion. And I have tried to find anoth­er method­ol­o­gy for sell­ing, and lis­ten­ers to the show might remem­ber I did go all the way to a live test of look­ing for stocks in my port­fo­lio that had a QAV score that had reduced to 0.05. So, we buy things above 0.10, and so effec­tive­ly, they were half the hur­dle rate for buy­ing some­thing. I ran that for, I don’t know, six months, nine months maybe? And it just did­n’t work. It was mar­gin­al­ly worse gen­er­al­ly than them run­ning with a three-point trend­line sen­ti­ment, but then it got to the stage where I sold one stock which then went on to have a great run, and I just went “no, let’s just, it’s not worth pur­su­ing.” This was also a ques­tion that’s been asked before around, you know, we looked at putting a QAV port­fo­lio into Straw­man, and one of the ques­tions Straw­man at the time was ask­ing was what do you think the val­ue is, or what’s the tar­get price for this stock? And I real­ly have no idea. I’ve played around with regres­sion to the mean, there’s got to be some kind of regres­sion to the mean involved in sell­ing a stock. Whether it’s what you think is the IV and then if, while it trades below the IV you buy it, and when it trades above it you sell it, that might be the answer. But I’ve known plen­ty of exam­ples where I’ve bought some­thing and then it just gets big­ger and big­ger as it climbs up the index­es, as it gets onto more and more fund man­agers screens, and they’re hap­pi­ly pay­ing prices way above what I’d be pay­ing as a val­ue investor, but they’re just not val­ue investors. They might be index investors, they might be long term buy-and-holds, or what­ev­er. So, there’s a whole broad church of rea­sons why peo­ple buy stocks, and I’ve always strug­gled to find any sort of log­ic to when to sell and always found that my assess­ments of IV have been grey at best, that the mar­ket does­n’t work like a spread­sheet when it comes to that and it’s more like a pen­du­lum. So, we’re try­ing to get on the pen­du­lum when it swings too far to the val­ue end, but, you know, it’s pret­ty hard to time when it gets too far to the growth end because every time I try to do that it keeps going. Or, you’ve just missed it and it swings all the way back. So, I appre­ci­ate the ques­tion but I haven’t come up with the answer to that yet, but hap­py to dis­cuss it fur­ther if any­one’s got any ideas.

Cameron  30:07

You know, I guess what Dave seems to be sug­gest­ing is that if you iden­ti­fied that the com­pa­ny had gone from high qual­i­ty, we won’t buy it usu­al­ly if it ranks poor qual­i­ty. I have seen a cou­ple of times when stocks had a low-ish qual­i­ty score but still gets a good QAV score, but it does­n’t seem to hap­pen that often. But, assum­ing that we bought a com­pa­ny that had a high-qual­i­ty score and then for some rea­son it end­ed up with a poor qual­i­ty score, if the share price is still going up, we’re not going to sell it, right?

Tony  30:40

Yeah, exact­ly. So, why would you if it’s still going up? That’s the beau­ty of sen­ti­ment. If once it breaks sen­ti­ment, sure, sell it, but that tells you its gonna stop going up by def­i­n­i­tion.

Cameron  30:49

At the end of the day, we buy a com­pa­ny because it’s passed our met­rics, but we sell it based on when we have to.

Tony  30:58

That’s right, too. That’s the oth­er ele­ment, is we want to try and hold it for as long as we can, you know, helps max­imise-or min­imise cap­i­tal gains tax if that’s more than twelve months. But yeah, ide­al­ly, I’d love to have a port­fo­lio which you just set and for­get because it’s so far above its sell line.

Cameron  31:13

Yeah, we don’t want to sell, real­ly. Thanks, Dave. Next ques­tion is from Mark, “could you please ask Tony why there is no cut off for low qual­i­ty scores like there is for high price to cash ratios? For exam­ple, on the buy list,” he’s talk­ing 7th of Feb, “there are five com­pa­nies with qual­i­ty scores less than 60% and one — the ASX — with a qual­i­ty score of 38%. That’s the one I was think­ing of, recent­ly. “My under­stand­ing has been that the point of the qual­i­ty score is to avoid val­ue traps, shares that are cheap for a rea­son, i.e. they’re shit. A qual­i­ty score of 38% sounds pret­ty shit to me. Thanks, Mark.” Then he sent me anoth­er email going, “oh my god, I just saw you picked it as your stock of the week!”

Tony  31:57

And it’s down 5%, so Mark’s right. I looked up ASX today, it is a lit­tle bit high­er than that since its results came out. Now around 46 I think, and I just got an email from Stock Doc­tor say­ing they were upgrad­ing its Star Stock rat­ing so it’ll be slight­ly high­er than that. But that aside, I take Mark’s point. We’ve talked about this before but it does­n’t mean we can’t talk about it again, but yeah, gen­er­al­ly if you go top-down on the buy list most of the stocks at the top have real­ly good qual­i­ty scores. It’s only when you get down towards the bot­tom that you’re get­ting into small­er qual­i­ty scores. I’m just look­ing at the buy list, the lat­est one. So, for exam­ple, at the bot­tom of the list with a QAV score of 0.10 is MXI, Maxi Parts, which has a qual­i­ty score of 31%. Even though there are oth­er ones with that same score that have as high as 67%, gen­er­al­ly at the bot­tom you’re get­ting low­er qual­i­ty scores. If I go to the top of the list and have a look, we’ve got Zicom Group with 64, but then Medusa Min­ing with 92, GWR Group with 100% qual­i­ty score, Phoenix Resources 82, Axiom Prop­er­ties has come on with 108%, Grange Resources 110, etc., etc. So, they gen­er­al­ly do sort of fall, the bet­ter-qual­i­ty scores fall to the top of the list. I think that, you know, with­out try­ing to force it and put a cut off score, and I used to use a cut off score of 75% for qual­i­ty but I did find that I was miss­ing out on the val­ue stocks who had low­er qual­i­ty scores but were still being real­ly good invest­ments because they were going up because they were cheap. So, it’s where you draw the line. Now, if we drew the line, like the QAV score of 0.10 was real­ly just a sort of wet fin­ger in the air in terms of my expe­ri­ence. I could eas­i­ly have said let’s make the QAV score cut off 0.15, in which case you’re prob­a­bly going to have more, you’re going to have stocks with high­er qual­i­ty scores in the bot­tom of the list. So, I think that’s the rea­son. I have played with putting a thresh­old on the qual­i­ty score before but then I was always kick­ing myself that one that fell just below that was doing real­ly well, so that’s why I haven’t done it. It’s a good ques­tion, it’s prob­a­bly some­thing I can flick to Dylan and see if he can come up with a cut off score for qual­i­ty that max­imis­es our return over the last ten years. Good ques­tion.

Cameron  34:06

The way I think of it is that, you know, we’re look­ing for that com­bi­na­tion of qual­i­ty and val­ue, and you’ve fudged togeth­er a way of mea­sur­ing the com­bi­na­tion of those two things but it’s a guessti­mate. Is that the right word? No. Like, it’s you’ve drawn a line in the sand some­where based on all of the data that we throw in. And ASX was only our large cap stock of the week last week because we had already picked every­thing else that was above it, we had to go right down to the bot­tom of the list to find some­thing we had­n’t rec­om­mend­ed yet.

Tony  34:39

Yeah, and last week the prob­lem was every­thing was a Josephine and ASX was about the only thing that was­n’t a Josephine.

Cameron  34:44

That’s right. Yeah. Thanks, Mark. James asks, “has TK done any analy­sis of his aver­age hold­ing peri­od using the QAV method, or broad­er analy­sis of how often his port­fo­lio gets turned over? Try­ing to get a sense of what is nor­mal,” I told James I think we’ve spo­ken about this a few times, and I think from mem­o­ry you’ve said that you turn over rough­ly about 60% of your port­fo­lio on an aver­age year. Is that right?

Tony  35:12

Yeah, that’s right. I’m pret­ty sure it’s prob­a­bly aver­age. I did pull out a year’s worth of trans­ac­tions a year or two ago once we start­ed QAV and it was 60% turnover in a year. So, I think that was prob­a­bly about right.

Cameron  35:24

And your aver­age hold­ing peri­od?

Tony  35:26

Haven’t worked that out, but I’m guess­ing if you’re turn­ing over 60% it’s prob­a­bly going to be six-twelve months. Yeah, you’re turn­ing half over every year, rough­ly. So, yeah, I’d say, again, I tend to try and hold on to things. So yeah, I’d say prob­a­bly nine months, but that’s just a bit of a guess. Try and get to twelve because we get CGT relief when that hap­pens, so that’s always in the back of my mind.

Cameron  35:49

So, about 60% on aver­age a year, and most of that hap­pens around report­ing sea­son in a nor­mal year?

Tony  35:58

Yeah, def­i­nite­ly. This and Sep­tem­ber are prob­a­bly the two most volatile times for us dur­ing the year.

Cameron  36:04

Out­side of things like the GFC or the COVID cough, all that kind of stuff.

Tony  36:10

Exact­ly.

Cameron  36:11

Which hap­pen on aver­age, what, every cou­ple of years? Major cri­sis?

Tony  36:16

Yep. So, well, well, the COVID cough prob­a­bly every five years when you get a 30% or more cor­rec­tion, but you do get 10% cor­rec­tions every, prob­a­bly, eigh­teen months to two years. But they usu­al­ly aren’t enough to trig­ger any sort of mas­sive turnover in the port­fo­lio.

Cameron  36:32

Hope that helps, James. Next ques­tion is from Andrew: “I would love TK’s take on how I imple­ment rule 1. When I buy a share I auto­mat­i­cal­ly put in a stop loss of 10% that stays in place for thir­ty days. After that, I have a trail­ing stop loss based on clos­ing prices only of 10% if high­er than the orig­i­nal stop loss. As it is trail­ing, the SL [stop loss] can only move up. Once the share is a 10% prof­it, that means the stop loss­es break even. My stop loss does not go high­er than that. My exits are then either breakeven or one of the oth­er TK rules; 3PTL, falling knife, bad news. My approach is easy to imple­ment as my cus­tomised spread­sheet,” that’s the AF spread­sheet, this is AF who’s ask­ing this ques­tion, “flags which stop loss­es to adjust and by how much. Of course, my spread­sheet has the thir­ty days and 10% as para­me­ters rather than being hard cod­ed. Is this in keep­ing with how TK believes rule 1 should work? Are thir­ty days and 10% sen­si­ble? Cheers, AF.”

Tony  37:38

That’s slight­ly dif­fer­ent to how I do it, I just note and raise an alert in Stock Doc­tor for what the price is that’s 10% below what I paid for the stock. And then, yeah, just set and for­get. I don’t try and adjust­ed back to break even over time. But, it’s an inter­est­ing point Andrew makes, that if the stock does go up do your raise your stop loss? I’d be inter­est­ed in his results and see how it goes and com­pares to what I do. The rule 1 alert I put in is there just to give me some wrig­gle room if the share price goes up and comes back, but stops me from los­ing more than 90% of my orig­i­nal invest­ment which pro­tects cap­i­tal. Inter­est­ing com­ment, inter­est­ing point, though. I know Col­in Nichol­son used to do that, he used the raise his stop loss­es all the time as the share price went up. So, he was always pro­tect­ing not only his orig­i­nal invest­ment, but, you know, what he’d made in prof­its. But then you get into that sort of dis­cus­sion we had last week about do you use a long term, three-point trend­line even if the price is way above it, or do you sort of use a hug line and try and hug the upward slope to pro­tect prof­its? I think if you raise the stop loss too much — and Andrew isn’t sug­gest­ing that, he’s just say­ing bring it back to break even after the share price ris­es 10% — I think the high­er you make that stop loss, the more volatile your port­fo­lio is going to be.

Cameron  38:54

And we’ve talked about this a lot in recent shows.

Tony  38:57

Yeah. Prob­a­bly the last month or so has been a good exam­ple of what I do and how it works. Like, for exam­ple, ASX is only like a buck or two above my orig­i­nal pur­chase price so if it goes much low­er I’ll be sell­ing, but I would have sold out a lit­tle bit high­er, well 9% high­er, I guess, if I use the Andrew Flit­man stop loss pro­ce­dure, because the price went up and has come back. But, I find it does give you just a lit­tle bit more wig­gle room to let things set­tle and recov­er again if you make it 10% below your pur­chase price.

Cameron  39:26

But Andrew is sug­gest­ing that after the share price goes up, he just has breakeven as his stop loss rather than buy price less 10%.

Tony  39:33

Yeah, let’s see how it goes, Andrew. If it works, great, we can change what I do.

Cameron  39:37

Run it for six months and report back, Andrew, please.

Tony  39:40

Yeah, thanks.

Cameron  39:41

Final­ly, the most impor­tant ques­tion came in from Luke The Gibon­a­tor: “what brand of golf balls does Tony pre­fer to use? I’m a bit of a Srixon soft feel guy myself.” Oh, and what kind of golf balls do you use, Luke? Boom, boom. I have no idea what a Srixon is.

Tony  40:01

It’s a brand of golf ball.

Cameron  40:03

See­ing as the QAV, offi­cial QAV, golf balls are the Call­away num­ber ones, I’m hop­ing you say that.

Tony  40:09

Yeah, no it is. I gen­er­al­ly use Call­away, so either chrome soft or super soft, and occa­sion­al­ly Titleist Pro V1s — gen­er­al­ly they’re giv­en to me as presents, but that’s fine. They’re the prob­a­bly three I use the most. I have used Srixon’s soft feel before and they’re, they’re pret­ty good too. Just depends on how I’m play­ing and what the con­di­tions are. So, the super softs and the Srixon soft feels I find work bet­ter in the wind and then the sort of hard­er, more sort of pro golfer like balls like your Titleist Pro V1s and Call­away chrome softs spin a lot more. So, if you’re play­ing well, and there’s not too much when they gen­er­al­ly work bet­ter because they spin more around the greens. But if you’re, like I do a lot, play­ing in high winds they’re going to spin side­ways more than they spin for­ward. So, you lose a lot. Yeah, Call­away’s for me.

Cameron  40:58

And speak­ing of golf, I under­stand you took Tay­lor out, my son Tay­lor out for a hit yes­ter­day.

Tony  41:05

Yeah. So, Tay­lor and I are involved in Char­i­ty Exchange, our raf­fle busi­ness, and one of the char­i­ties we sup­port, Sport­ing Chance, had a golf day at Met­ro­pol­i­tan yes­ter­day which is one of the, I guess, top ten, maybe even top five cours­es in Aus­tralia. And it was a love­ly day. And Tay­lor came out and played left hand­ed begin­ner golf with us. Good fun.

Cameron  41:26

What was his score?

Tony  41:27

Oh, we did­n’t score. We were play­ing what was called an Ambrose, so you always took the best shot and played from there. But it was good. Good day, good fun. Good to have the boys down, that was good fun, and catch up on their gos­sip and what they were up to in the big city. They were hav­ing fun, most­ly at night, not so much dur­ing the day. But yeah, it was great. Real­ly good, thanks.

Cameron  41:45

Sleep­ing dur­ing the day and par­ty­ing every night.

Tony  41:48

Yeah. But thanks very much, Luke, for a golf ques­tion. That’s great. And of course, the clas­sic — Luke will appre­ci­ate this — the clas­sic answer to a ques­tion of what golf balls you’d like to play is a box of pro­vi­sion­al balls, because they always seem to go bet­ter than the first shot. But you can’t buy those, of course.

Cameron  42:04

Alright, well, that’s all the ques­tions for this week. So, it’s a short­er show than it has been recent­ly, which means we can talk about TV. I watched the doc­u­men­tary a cou­ple of days ago, over the week­end, Djan­go & Djan­go. It’s an Ital­ian doc­u­men­tary, it’s just come out, I think it’s on Net­flix. Basi­cal­ly, it’s Quentin Taran­ti­no talk­ing about the spaghet­ti west­erns of Ser­gio Cor­buc­ci, who in Once Upon a Time in Hol­ly­wood is the direc­tor that Leonar­do DiCapri­o’s char­ac­ter Rick, when his careers sort of on the downs­lope, Al Paci­no organ­is­es for him to go to Italy and make some films with Ser­gio Cor­buc­ci. So, yeah, Taran­ti­no did this big doc­u­men­tary on the films of Ser­gio Cor­buc­ci, and if you love spaghet­ti west­erns, or if you just love hear­ing Taran­ti­no talk about film, which I do — I could lis­ten to Taran­ti­no talk about movies all day long. High­ly enjoy­able, high­ly enjoy­able doc­u­men­tary, high­ly rec­om­mend­ed.

Tony  43:07

Oh, cool. Well I’ll look it up. Can you name any of the movies of Ser­gio Cor­buc­ci that peo­ple might know?

Cameron  43:14

Well, the most famous one is there in the title: Djan­go. The orig­i­nal Djan­go, 1966, star­ring Fran­co Nero, which was sort of you know, Taran­ti­no named his film based on that. And Fran­co Nero actu­al­ly has a cameo with Jamie Foxx in Djan­go — what­ev­er his film was called — Djan­go…

Cameron  43:33

Unchained.

Cameron  43:34

Unchained? I was going to go Unbent. He also did The Great Silence, La Grande Silen­zio, and he did a bunch of, like, Bud Spencer Ter­ence Hill films.

Tony  43:46

Oh, they’re my favourite.

Cameron  43:48

Yeah, I down­loaded a cou­ple of those to rewatch. I haven’t seen those — my dad used to take me to the dri­ving in the 70s and ear­ly 80s as a kid and we’d see those.

Tony  43:56

Me too. The Trin­i­ty movies. They were great.

Cameron  43:59

Yeah, “they call me Trin­i­ty.” Yeah, Trin­i­ty Rides Again or some­thing.

Tony  44:03

Is Still My Name, yeah.

Cameron  44:05

Yeah, I think we used to see them on dou­ble bills at the dri­ve-in in Bund­aberg with a Bruce Lee or a Chuck Nor­ris film or some­thing like that. But I did­n’t realise until I looked him up again this week that they were actu­al­ly Ital­ians, those guys. Because as a kid, I mean, it was all sub­ti­tled prob­a­bly or dubbed or what­ev­er and I did­n’t pick it up. Dubbed.

Tony  44:24

It was ter­ri­bly, ter­ri­bly dubbed.

Cameron  44:26

I did­n’t realise they were Ital­ians and he just said, “oh, you need Eng­lish sound­ing names.” So, any­way, check that out. What have you been, what have you been watch­ing late­ly, Tony, that’s good?

Tony  44:37

I’ve been addict­ed to The Book of Boba Fett. It’s fan­tas­tic. On Dis­ney+. It’s only sev­en episodes.

Cameron  44:45

Real­ly sur­prised that you’re into The Book of Boba Fett.

Tony  44:48

Are you being sar­cas­tic, are you?

Cameron  44:50

No, I’m sur­prised.

Tony  44:51

Oh, real­ly? Oh, it’s bril­liant. Oh Temuera Mor­ri­son, a great actor any­way. I mean, it’s back in the Star Wars uni­verse that I grew up with and love, you know. If peo­ple remem­ber Boba Fett Dies at the end of The Return of the Jedi, or dur­ing the return of the Jedi.

Cameron  45:06

Yeah, he’s in the mouth of the Sar­lacc when he gets knocked off of Jab­ba’s ship by Han Solo. How does he sur­vive that?

Tony  45:14

That’s where it starts. So, he wakes up in the bel­ly of the sand worm and fights his way out. The rest of the series is set on Tatooine main­ly. So, he gets picked over by the Jawas, gets res­cued by the Tusken raiders and gets accept­ed into their cul­ture, and then they’re destroyed by — what do they call them? Nicko bik­ers? And it just goes on and on from there, how he sorts of works from being almost naked in a desert and left for dead through to being the biggest crime lord in Mos Eis­ley. It’s real­ly good, just a great series and well made. It’s a, Jon Favreau wrote it and Robert Rodriguez pro­duces and directs a cou­ple of the episodes. The visu­als are great, the sound­tracks bril­liant, and at the end of every episode it’s worth wait­ing for the cred­its because they, they run through all the sto­ry­board paint­ings. Which is how I remem­ber first com­ing across the orig­i­nal Star Wars film, was the art­work came out first and it just brings all that back too, it’s just great.

Cameron  46:09

Have you watched the Man­dalo­ri­an?

Tony  46:11

I watched the first series and did­n’t get into it that much. And the Man­dalo­ri­an cross­es over with this one as well.

Cameron  46:16

I saw the episode of this one where they brought back Luke, and it was amaz­ing. I saw the one that his cameo, his appear­ance in Man­dalo­ri­an, which was great, but it was also a lit­tle bit weird, sort of the CG that they did. But the new one that they did, I know that they hired the guy, the spe­cial effects artist on YouTube who did the face-off stuff.

Tony  46:36

Deep fakes.

Cameron  46:37

Deep fake, yeah. Appar­ent­ly, they hired him to do it. It was much bet­ter, it was like stun­ning­ly good. And I read some­where that his voice was done by AI. That’s insane.

Tony  46:47

It is, isn’t it? Giv­en that Mark Hamil­l’s around and could have done it. And he’s actu­al­ly in the cred­its, so I’m not sure, he may have been involved some­how. But yeah, it was a real sur­prise see­ing a young Luke back in the, on the screen again. It was great.

Cameron  46:59

Well, your prob­lem is that Mark Hamill today sounds like this. *uses a gruff voice*

Tony  47:03

True.

Cameron  47:05

He does­n’t sound like twen­ty-six year old Mark Hamill any­more.

Tony  47:08

Sounds like the Jok­er on Bat­man.

Cameron  47:09

Yeah, he does. So yeah, yeah, it was pret­ty cool see­ing Luke back in it again. You’ve got to won­der how far are we from them just being able to do a real sequel to Return of the Jedi, with all of the orig­i­nal actors look­ing as young as they were, just doing it all CG?

Tony  47:29

Well, exact­ly. I mean, how far are we from not need­ing actors?

Cameron  47:32

Yeah.

Tony  47:33

They don’t have to age any­more, do they?

Cameron  47:34

Don’t tell Hunter that.

Tony  47:38

He should prac­tice his deep fake skills, maybe.

Cameron  47:42

He’s prac­tis­ing not talk­ing to his father skills at the moment. He has­n’t spo­ken to me for a month. Pissed at me. Alright. Well, that’s, that’s the show for this week, Tony. Thank you for your time, as always. Any time­line on when you’re head­ing home?

Tony  47:57

Yeah, prob­a­bly in a cou­ple of weeks. So, just wait­ing to find out, my father in law turns nine­ty on the third of March, and they’re talk­ing about hav­ing a din­ner for him the Sat­ur­day before, which will be Sat­ur­day week. So, after that, I would think.

Cameron  48:10

Good thing the Christ­mas present I sent you did­n’t have a short shelf life.

Tony  48:16

Oh well, thank you. I’m look­ing for­ward to get­ting back there and open­ing up all those Christ­mas presents.

Cameron  48:22

Good stuff. Well, I’m look­ing for­ward to com­ing down to Syd­ney and catch­ing up with the folks down there at some point. We should do that when you get back, maybe, do a bit of a Syd­ney event after things are back to some sem­blance of nor­mal­i­ty.

Tony  48:35

Yeah, hope­ful­ly its not too far away.

Cameron  48:37

We’re still wear­ing masks — Chris­sy and I are any­way, every­where we go here, when we go to Kung Fu. We’re the only peo­ple wear­ing masks, pret­ty much, but we’re still hard­core about it. Sur­pris­ing­ly, schools been back for a week and a half and we haven’t got COVID yet. I thought we’d get it with­in the first day. Fox was back at his hip­pie school where half the fam­i­lies there are anti-vaxxers.

Tony  48:58

Yeah, you’re lucky because there was a bump in the num­bers when school went back, but does­n’t seem to have gone any­where, which is good. But any­way, Tay­lor asked me yes­ter­day if I was still COVID para­noid. Not real­ly, but if I’ve got the resources to avoid it I’m going to use it. I’m not going to go and dive back into it, so.

Cameron  49:16

I’m COVID para­noid for you. I don’t want you to get it.

Tony  49:20

Well, did you see that there was an arti­cle in the Fin today about a new study that came out from the UK, that peo­ple are devel­op­ing heart prob­lems after get­ting COVID?

Cameron  49:30

One of the long COVID symp­toms?

Tony  49:31

Yeah, part of the long tail.

Cameron  49:34

Ah, yeah that’s what I wor­ry about the most. Fog­gy brain syn­drome and who knows what else we’ll end up track­ing back to long COVID with­in a few years.

Tony  49:44

Yeah, exact­ly. Any­way, so I think a cou­ple of weeks is the short answer. Three at the most.

Cameron  49:50

Alright.

Tony  49:51

Four, maybe four. It’s so nice down here, Cam, you should come down. It’s just bril­liant. I’m look­ing out the win­dow now, clear blue skies, 23 degrees. Just won­der­ful.

Cameron  50:03

Yeah, well, don’t tempt me. Alright, thanks mate. Cheers.

Tony  50:09

Thanks mate, bye.

Cameron  50:14

The QAV Pod­cast is a pro­duc­tion of space craft pub­lish­ing pro­pri­ety lim­it­ed autho­rised rep­re­sen­ta­tive of AFSL 520442 AFS rep­re­sen­ta­tive num­ber 001292718. Please don’t make any invest­ment deci­sions based sole­ly on lis­ten­ing to this pod­cast this is pre­sent­ed as gen­er­al advice only not per­son­al finan­cial advice. We don’t know your per­son­al finan­cial cir­cum­stances. Please see a finan­cial plan­ner before mak­ing any invest­ment deci­sions.