Unlocking value beyond consensus in gold, energy & consumer staples | Michael Goldberg

In today’s ROCast, Murdoch's joined by Michael Goldberg, Co-Founder, Managing Director and Portfolio Manager of Collins Street Asset Management. Michael’s flagship fund, the Collins Street Value Fund, has returned 14.85% over the past 12 months and 13.5% per annum since its inception in 2016. His background, shaped by early lessons in his family’s business in the rag trade and his unconventional path into finance, brings a fresh perspective on identifying deep value opportunities in the Australian Share Market.

In this episode, Michael dives into their core principles for value investing. We’ll explore how Collins Street Asset Management goes beyond conventional methods, refusing to rely solely on consensus data. Instead, they take a more hands-on approach—testing products themselves, asking family members if they’d use the product (like shopping at Myer), calling company representatives with his daughter to gain unique insights during Covid lock downs, and even hiring on-the-ground contractors to investigate factors like potential radioactive material fallout linked to a rumoured nuclear submarine incident nearby, which may have had a material impact one of there investments at the time.

Michael also highlights their unique “Mentor and Buddy” system, where investment ideas are rigorously debated and stress-tested. These strategies, combined with a disciplined focus on long-term outcomes, have helped the fund uncover undervalued opportunities others often miss. We’ll dive into case studies, including past and current positions in Metcash, ResMed, and Ramelius Resources, while exploring opportunities across sectors like gold, energy, and consumer staples.

In the ROCast, Michael Goldberg discusses the following ASX-listed companies:

1. CSR Limited (ASX: CSR):
   Goldberg's initial investment experience involved CSR shares, which he received as a Bar Mitzvah gift. This sparked his early interest in equity markets and Australian businesses.
2. Metcash Limited (ASX: MTS):
   The fund invested in Metcash, focusing on the turnaround strategies of its IGA stores. Key initiatives included price matching, store refurbishments, and staff retraining to improve operations and customer experience.
3. ResMed Inc. (ASX: RMD):
   The team analyzed ResMed, a company specializing in sleep apnea devices, as part of a broader discussion on healthcare trends and the impact of weight-loss drugs like Ozempic on related industries.
4. Beach Energy (ASX: BPT):
   An oil and gas exploration and production company operating in Australia and New Zealand, discussed for its role in the energy sector and its production potential.
5. Boom Logistics (ASX: BOL):
   Provides crane logistics and lifting solutions across industries such as mining and infrastructure. Recognized for its operational improvements and return to cash flow profitability.
6. Carnarvon Energy (ASX: CVN):
   Focused on oil and gas exploration and production, particularly in Western Australia. Discussed for its promising projects and strategic positioning.
7. Catalyst Metals (ASX: CYL):
   A gold exploration and development company with significant projects in Victoria. Highlighted as part of the fund’s gold investment strategy.
8. Humm Group (ASX: HUM):
   Provides financial services, including buy-now-pay-later solutions and consumer financing. Discussed as a financial sector opportunity.
9. Litigation Capital Management (ASX: LCA):
   Specializes in litigation financing, offering funding for legal claims. Explored as a niche financial service with unique growth potential.
10. NTAW Holdings (ASX: NTD):
    Distributor of specialty tires and wheels in Australia and New Zealand. Examined for its market position in the industrials sector.
11. Ramelius Resources (ASX: RMS):
    A mid-tier gold producer with operations in Western Australia. Highlighted for its production capabilities and role in the fund’s gold portfolio.
12. Retail Food Group (ASX: RFG):
    Operates well-known food and beverage brands such as Gloria Jean’s and Donut King. Discussed for its growth prospects and operational strategies.
13. Seven West Media (ASX: SWM):
    A leading Australian media company owning the Seven Network and various print and digital assets. Discussed for its strong media presence and potential market opportunities.
14. Westgold Resources (ASX: WGX):
    An Australian gold producer with a focus on Western Australian operations. Featured as part of the fund’s broader investment in the gold sector.

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