Combined Motor: Small-cap business

Adrian Saville presented his in-depth investment thesis on Combined Motor (JSE: CMH) at Best Ideas 2017.

Small-cap business Combined Motor is a family-built business that has significant interests in motor vehicle retail, car hire, marine and leisure craft, vehicle repair, and financial services. Established in 1977 and listed on the JSE in 1987, the business has a market value of R1.4 billion, 2,600 employees, turnover of R11.0 billion, and earnings of R180 million. The group’s underlying businesses are a powerful generator of cash, which translates into a debt-free enterprise that has bought back 25% of shares outstanding over the last three years and that trades on a 7.5% dividend yield and 7x earnings.

About the instructor:

Adrian Saville has been involved in the investment management industry since 1994, when he formed an investment vehicle which later led him to establish BayHill Capital Advisors (in 1998), the forerunner to Cannon Asset Managers. Adrian is an executive director and Chief Investment Officer of Cannon Asset Managers. He has experience in managing all of the major asset classes, including equities, bonds, property, cash and derivative instruments. Adrian’s qualifications include a Bachelor of Arts (Honours) degree (cum laude) and M.Com (cum laude) from the University of Natal. He completed his PhD (Econ) at the University of Natal in 1997, for which he was awarded the Economics Society of South Africa’s Founders Medal. He is a UNESCO laureate and a matriculant of Linacre College (Oxford). Alongside his career in asset management, Adrian holds a Visiting Professorship in Economics and Finance at the Gordon Institute of Business Science. He has published widely in peer-reviewed journals and books, and is a member of the Investment Analysts Society and Economics Society of South Africa. Adrian is married to Kerry; they have a daughter, Sydney-Bo, and son, Saxon. Adrian claims that fatherhood is the most rewarding investment he has ever experienced.

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