What’s happening with Computershare’s share price?

What does Computershare do?

Computershare [ASX:CPU] is a global share registry business. That means it manages shareholder communications for listed companies around the world. It has many other strands to its business too, including managing corporate actions (takeovers etc.) paying dividends, and managing mortgage payments in the UK market.

It generates fees for performing all these tasks. As it holds large short term cash balances (before distributing to shareholders) it also generates interest revenue. The move to slightly higher interest rates around the world is a plus for Computershare.

What’s happening to CPU’s share price?

Today, CPU’s share price jumped more than 3.5%. It comes on the back of a positive operational update which indicated the business was on track for sustainable growth.

As you can see in the chart below, CPU has been moving steadily higher since August last year. Positively, the move to new share price highs on a bullish trading update suggests there is more room to move for CPU. Often, a share price will rally into a positive announcement and then sell off once the announcement is out.

Source: Bigcharts

What now for CPU?

CPU benefits from increased economic and financial market activity. ISo its share price rise to new all-time highs tells you that investor and corporate activity is quite healthy, and not as gloomy as you might think from reading the press.

I expect to see CPU grow revenue and profits for the next few years, as the global economy continues to strengthen and move away from the threat of deflation. This solid fundamental backdrop, along with a healthy looking chart, should ensure steady share price gains.

Never assess a stock’s fundamentals without looking at the chart too. Combining fundamental analysis with charting can yield powerful results.

Greg Canavan
Editor, Money Morning


Greg Canavan is a Feature Editor at Money Morning and Head of Research at Port Phillip Publishing.

He likes to promote a seemingly weird investment philosophy based on the old adage that ‘ignorance is bliss’.

That is, investing in the Information Age means you have all the information you need at your fingertips. But how useful is this information? Much of it is noise and serves to confuse, rather than inform, investors.

And, through the process of confirmation bias, you tend to read what you already agree with. As a result, you often only think you know that you know what is going on. But, the fact is, you really don’t know. No one does. The world is far too complex to understand.

When you accept this, your newfound ignorance becomes a formidable investment weapon. That’s because you’re not a slave to your emotions and biases.

Greg puts this philosophy into action as the Editor of Crisis & Opportunity. As the name suggests, Greg sees opportunity in a crisis. To find the opportunities, he uses a process called the ‘Fusion Method’, which combines traditional valuation techniques with charting analysis.

Read correctly, a chart contains all the information you need. It contains no opinions or emotion. Combine that with traditional stock analysis and you have a robust stock-selection strategy.

With Greg’s help, you can implement a long-term wealth-building strategy into your financial planning, be better prepared for the financial challenges ahead, and stop making the basic, costly mistakes that most private investors do every time they buy a stock.

To find out more about Greg’s investing style and his financial worldview, take out a free subscription to Money Morning here.

And to discover more about Greg’s ‘ignorance is bliss’ investment strategy and the Fusion Method of investing, take out a 30-day trial to his value investing service Crisis & Opportunity here.

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