Monthly Message
For May, the Wutherich & Co. Composite was up 3.0%.
Most of our companies have reported their recent quarters in the last few weeks and, as expected, they are showing little immediate impact from global events. While there have been wobbles in some individual names, most are also reporting strong, long-term prospects.
Lack of mining exposure has reduced our performance relative to Canadian indices over the last two years. I recently attended a mining conference to refresh my knowledge of the space and, frankly, came away impressed. There are many Canadian and international companies doing remarkable things in precious metals, base metals, uranium and rare earths. Geopolitics and a rush to electrify are driving extraordinary demand for their output. That being said, commodities go through supercycles and this time may be no different. High commodity prices paper over a lot of mistakes and make weak companies look like Goliaths for a period of time. More often than not there is a David, waiting somewhere, with a sling full of unforeseen events to take them down.
I am not great at making big commodity calls. I focus on companies with strong, profitable, sustainable businesses and hold them for years. I will sift through my conference notes to see if any of the names I sat down with fit this bill.
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