Three things that got the team talking this week - Firetrail Investments

Weekly insights from the Trail

Three things that got the team talking this week

December 8, 2023December 15th, 2023

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1. Pizza party…

The US Domino’s business (DPZ) held their investor day overnight, and pizzas are proving popular in these uncertain economic times. The business is forecasting more sales (+7% annual global retail sales growth), more stores (annual global net unit growth of 1,100+) and more profit (8%+ annual operating income growth). The strength of the US business bodes well for Australian Domino’s (DMP), which we hold in the Australian High Conviction Fund. The Australian Domino’s business continues to innovate and have got some interesting new menu items online – check out their snack boxes if you need a mid-day feed!

Source: Domino’s US (December 2023)

2. Some things change, some stay the same…

As we approach the 4-year mark since the onset of Covid we reflected on what has seemed to change permanently, and what has returned to ‘normal’. Besides the adjustment to a work from home business culture, private jet travel seems to have enjoyed a structural shift post Covid. The US Federal Aviation Administration (FAA) monthly Business Jet Report provides a snapshot of trends in business jet activity, and the report from November 2023 shows continued strong demand for private jets.

Source: Bloomberg, Apollo Chief Economist (December 2023)

3. Can Trump triumph?…

As we close out 2023 the predictions for where 2024 will end have begun. None of Wall Streets largest banks are predicting the S&P500 to fall under its 2022 low, and the majority think it wont top the high from the beginning of 2022. What do you think?…

2024 is also a US election year. And election years tend to be strong years for the S&P500. S&P500 returns historically were positive 83% of the time during presidential election years (only 4 out of the past 24 election years were negative, i.e. 17%).

Source: Bloomberg, Wall Street firms (December 2023)

Source: Bloomberg, BofA US Equity & Quant Strategy (December 2023)

Disclaimer

This article is prepared by Firetrail Investments Pty Limited (‘Firetrail’) (ABN 98 622 377 913, AFSL 516821) as the investment manager of the Firetrail Australian High Conviction Fund (ARSN 624 136 045), the Firetrail Absolute Return Fund (ARSN 624 135 879), the Firetrail Australian Small Companies Fund (ARSN 638 792 113) and the Firetrail S3 Global Opportunities Fund (ARSN 653 717 625) (‘the Funds’). Pinnacle Fund Services Limited ('PFSL') (ABN 29 082 494 362, AFSL 238371) is the product issuer of the Fund. PFSL is not licensed to provide financial product advice. PFSL is a wholly-owned subsidiary of the Pinnacle Investment Management Group Limited (‘Pinnacle’) (ABN 22 100 325 184). The Product Disclosure Statement (‘PDS’) and Target Market Determination (‘TMD’) of the relevant Fund are available via the links below. Any potential investor should consider the PDS and TMD before deciding whether to acquire, or continue to hold units in, the Fund.

Links to the Product Disclosure Statement: WHT3810AU, WHT5134AU, WHT3093AU, WHT7794AU

Links to the Target Market Determination: WHT3810AU, WHT5134AU, WHT3093AU, WHT7794AU

For historic TMD’s please contact Pinnacle client service Phone 1300 010 311 or Email service@pinnacleinvestment.com

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