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

August 9, 2024August 16th, 2024

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1. Education exported

There were reports earlier in the week that the Australian Government will introduce a cap on international student enrolments at Australian universities of 40%, based on 2019 levels. For context, Australia issued 219k student visas in 2019. And almost 377k student visas were granted in the year to 30 June 2024.

We are yet to get final details on the cap from the Government, but it is interesting to consider this proposal against the proportion of fee income major universities get from international students (see red in graph below). International Education is Australia’s 4th biggest export industry…watch this space.

Source of fee income for Group of Eight Universities

Source: ABC, Most recent annual reports from each university (August 2024)

2. Raisings rising

We’ve seen very strong growth in junior miner equity raisings for several months now, supported by stronger commodity pricing. Raisings are a leading indicator for exploration spending and capital is typically deployed within ~2-3 months. A pickup in exploration spend bodes well for ALQ, a holding in the Firetrail Australian High Conviction and Absolute Return Funds, which has >50% market share in exploration related testing.

Source: FactSet, Jefferies (August 2024)

Source: FactSet, Jefferies (August 2024)

3. Gone bush

This is the first time since record began in the late 1990s that capital city unemployment has been sustainably above regional unemployment rates.

Source: ABS; RBA (August 2024)

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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