February Newsletter
Investing personalities, Stock of the month & company update

What is your investing personality?

We at Investify have always believed in the saying “No one cares about your money more than you”. Therefore, you may be the most qualified person to do your own investing, of course, with a bit of help.

The first step that one should take is to identify the personality traits that will assist you or prevent you from investing successfully and then manage them accordingly. Although there are many risk profiling questionnaires available out there, very few useful behavioural models help people identify their own investing personality, such as the model developed by Bailard, Biehl and Kaiser. This model classifies investors according to two personality traits:

  • method of action (careful or impetuous)
  • level of confidence (confident or anxious).

Based on these personality traits, the model divides investors into 5 primary groups:

The Individualist: Careful and confident and often takes a do it yourself approach

The Adventurer: Volatile, entrepreneurial and strong-willed

The Celebrity: Follower of the latest investment trends

The Guardian: Highly risk averse and preserves wealth

The Straight Arrow: Shares the characteristics of all the above equally

Regardless of which group you fit into, you should manage your core assets in a systematic and disciplined way. Bear in mind you could potentially be your own enemy. Depending on your personality, strategy and circumstances, you may be sabotaging your own success. A guardian would be going against his or her personality type if he or she were to follow the latest market craze and seek short-term profits. Because you are risk averse and a wealth preserver, you would be affected far more by large losses than the high returns that come from high-risk investments. Be honest with yourself and identify the factors preventing you from investing successfully or moving you away from your comfort zone.

Stock of the month: Auckland International Airport Limited

What does Auckland Airport do?

Auckland International Airport (AIA) opened its runways in 1966 and today is the third busiest airport in Australasia with more than three-quarters of all international visitors to New Zealand arriving through the airport. Auckland Airport plays a significant role in supporting the New Zealand economy bringing around $15 billion worth of freight through the airport every year. Today, the company is focused on making Auckland an aviation hub for New Zealand and the Pacific Rim.

Why is Auckland Airport our Stock of the Month?

Auckland Airport is our February stock of the month due to their activity during this low air traffic period. The company has chosen to take this time of low air traffic to upgrade their core infrastructure. The company now has a number of new commercial developments under construction which is expected to be valued at more than $223 million upon completion with an annual rent roll of $116 million. Furthermore, on 16th February 2021, Auckland Airport announced that they have embarked on a three-year project of renewing the pavement throughout its airfield. Despite the decrease in revenue (which is now expected as the new normal due to Covid) reported in half yearly results, the increase in property revenue (up 2.4%), operating cash flow (up 8.96%) and keeping cost under control (down 34%), show some positive signs for Auckland Airport.

Recent stock news

On 18th February 2021, the company released their December 2020 monthly traffic update and their January 2021 monthly traffic preview. Dec '20 monthly traffic was down 70.3% with international passengers down 97.3% and domestic passengers down 32.2%. The preview for Jan '21 is slightly worse with traffic down 71.8% with international passengers expected to be down 97.6% and domestic passengers expected to be down 30.7%.

Financial record

1. Total number of passengers for the half was down 73.4% to 2.8 million from the prior corresponding period.

2. In terms of domestic and international passengers, both suffered with domestic passengers seeing a decline of 44.6% to 2.6 million. International travel as you would expect was down 96.8% to 187,003.

3. Revenue for the half was down 64.9% to $131.5 million. Property revenue for the half came in at $47 million (up 2.4%), driven strongly by rental growth in their existing property portfolio.

4. Earnings before interest, tax, depreciation, and amortisation for the half was down 56.3% to $122 million.

5. Operating Cash Flow for the half was up 8.96% to $169 million

6. Reported profit after tax for the half was down 80.9% to $28.1 million. Similarly, earnings per share was down 84.1% to 1.91 cents per share.

7. Core operating expenses were reduced 34% or $33 million for the half.

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