Nikko's Williams warns NZ shares are "expensive"
Nikko Asset Management's head of equities Stuart Williams justified his view by pointing to a current price-to-earnings ratio of 18.5, compared to a five-year average of 16.2.
Nikko Asset Management's head of equities Stuart Williams has warned New Zealand's share market is overly expensive though he acknowledged that yield has held up.
Speaking at the company's 2016 Investment Summit, Mr Williams justified his view by pointing to a current price-to-earnings ratio of 18.5, compared to a five-year average of 16.2.
He said the NZX50 was likely to deliver a more modest return this year than last year when the market gained 13% while noting it has already risen about 6%.
Yield from shares via dividends hasn't been ground lower, Mr Williams said, citing Spark's growing dividend policy and Chorus' reinstatement of payments to shareholders.
Speaking to his company's portfolio positioning, he said it was highly unlikely to have listed property in its portfolio.
With more than 50% of the local market owned offshore, Mr Williams said there was both opportunity and risk in that degree of offshore ownership, with index changes an opportunity for the investment manager.
It sold some, but not all, of its stake in Meridian Energy when the stock was added to an index last month, as it expected follow-through from other buyers which materialised, he said.
(BusinessDesk)
Sophie Boot
Wed, 06 Apr 2016
Wed, 06 Apr 2016
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Nikko's Williams warns NZ shares are "expensive"
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