June Portfolio Holdings Performance Market Movers: July 2022
June was a rough month for stock markets around the world as many moved into bear market territory (down 20%) with the TSE index only off some 9%. The BOC raised its interest rate by 50 basis points on June 1st and the Fed followed by raising their’s 75 basis points. China shut down important sections of its economy exacerbating supply side shortages; inflation remained strong; the war in Ukraine raged on. Canada is faring better with strong commodity prices and higher consumer spending on the back of high employment, excess savings and growing real wages. The BOC will likely act aggressively and may be able to bring inflation down without a recession. Real estate prices will weaken, but the strong demographics in Canada will dampen the impact.
Topicus.com Inc (TOI)
The second best performer this month was Topicus.com Inc (TOI) whose shares at $72.63 were up 8.94%, while down 37.4% YTD. TOI is a leading pan-European provider of vertical market software and vertical market platforms to clients in public and private sector markets. It acquires, manages and builds vertical market software (“VMS”) businesses. Its revenue consists primarily of software license fees, maintenance and other recurring fees, professional service fees and hardware sales. It is owned 74.71% by Constellation Software, a large and well-established public software company. The stock price dropped significantly over the last three months from a high on April 8th of $104.09 to a low of $66.63 0n May 31st presumably in sympathy with the overall technology market. Its quarterly results announced on May 3rd were satisfactory: Revenues at 203.8 million euros were up 13% and cash flow up 16% with over 200 million euros cash on hand. Accordingly, the stock price moved raggedly over the month in a relatively narrow range rising through the end of the month.