Three JSE stock picks on Amelia Morgenrood’s list

PSG Wealth’s Amelia Morgenrood identified three companies as her stock picks in the JSE’s SA Stock Picks series – Sibanye-Stillwater, Mondi, and Equites Property Fund.

Morgenrood is a certified financial planner with expertise in estate planning, investment, offshore investment, retirement planning, stockbroking, tax planning and wealth management.

She has been a stockbroker for around 30 years and is a member of the South African Institute of Stockbrokers.

Here are Morgenrood’s stock picks, with an explanation of why she considers these companies good buys:


Morgenrood’s first pick is the mining company Sibanye-Stillwater. 

Sibanye started as a gold mining company in 2013 but has since expanded into other high-demand metals like copper and platinum.

Morgenrood praised the company’s CEO, Neal Froneman, for Sibanye’s growth. Under his leadership, the company has grown from “a miner with a handful of deep levels of gold mines” to a “world-class platinum group metal supplier.”

Sibanye is now a top-three PGM producer.

Froneman is renowned for his deal-making skills, she said, which have been put on display in the past few years.

In 2021, Sibanye embarked on a battery metal acquisition strategy and has made several acquisitions in pursuit of this. 

The company has bought a hydrometallurgical processing facility from a French company and 85% of a Finnish lithium group.

This expansion into Europe is “strategically important”, said Morgenrood, as the continent will likely be the hub of electric vehicle manufacturing in a few years.

Sibanya also has a copper mine in Tasmania that is set to start up, with a target of extracting 27,000 tonnes of copper and 16,000 tonnes of gold per annum.

Both copper and gold prices are predicted to soar in coming years as demand for both is increasing rapidly.

Copper, in particular, is projected to be increasingly valuable as the supply deficit increases.

In December 2022, the CEO of Glencore estimated that new copper demand of 100 million tonnes per annum will lead to an annual deficit of 50 million tonnes per annum by 2030.

Sibanye also has huge exposure to gold, a metal currently seeing record-high demand.

Central bank purchases have been stocking up on gold over the past year, which has led the gold price to soar in recent months.

Some analysts say the gold price could push beyond $2,000 in the coming months.

Sibanye-Stillwater CEO Neal Froneman. SOURCE: Flickr

Despite Sibanye’s strong position in the metal industry and growth potential, Morgenrood warned that it is not a stock for short-term investors or “those with weak stomachs”.

In January, the mining company released results for the six months and year ended 31 December 2022, which showed that its profits had halved in 2022.

Part of the reason for this is cable theft, to which the company lost more than R1 billion in production in 2022, as well as “a more challenging macro-economic environment and geopolitical environment”, according to Froneman.

Sibanye has stated that it did not see significant growth for the company in South Africa and labelled the country too risky.

However, there appears to have been a change of heart in the company, as Froneman recently stated Sibanye would still be mining in South Africa for a long time.

The company has big plans for expansion in the future.

It hopes that, in 10 years, its current business will only be 10% of its business as it continues to expand its position in the future car market.

Despite its recent results, Morgenrood believes Sibanye’s production will normalise, and its battery metal strategy will pay off.

The company’s share price plummeted in the past year to where it now stands at just under R38 and the company has a current price-to-earnings (P/E) ratio of 5.82.

Sibanye-Stillwater precious metal refinery. SOURCE: Sibanye-Stillwater website.


Product packaging giant Mondi is another company with a plummeting share price that presents investors with an opportunity to buy a good quality company at a reasonable price, said Morgenrood.

In January 2022, Europe-based Mondi lost a third of its value due to the then-imminent Russia-Ukraine war. 

The Russian market accounted for a fifth of the company’s profits, and it had solid growth prospects in the country.

However, once its share price showed a slight recovery, Mondi sold its Russian plant for €1.5 billion.

Morgenrood suspects that, after the Russian government and Mondi’s shareholders approve the sale, the company will likely return some of those funds to shareholders as a dividend.

Mondi operates over 100 production sites in over 30 countries in three business divisions.

It is also a highly innovative company which makes it a leader in development, said Morgenrood.

Mondi was a beneficiary of the Covid-19 trend of e-commerce and consumer packaging. 

One of its recent developments is e-commerce grocery packaging that can maintain internal temperatures for more than a day, eliminating the need for refrigerated trucks.

Mondi is also set to benefit from Europe’s imminent banning of plastic bags.

Mondi is listed on the JSE – where its share price is currently around R285 – and the London Stock Exchange.

It is a good quality company trading at quite a low valuation and is well-suited to “a more conservative investor that wants to keep it for the long-term,” said Morgenrood. 

SOURCE: Mondi website

Equites Property Fund 

Equites Property Fund is a Real Estate Investment Trust that focuses on packaging and warehouse properties.

It is a specialist owner and developer of prime logistics assets in both South Africa and the UK.

Equites’ logistical assets were valued at around R26 billion at the end of August 2022.

Morgenrood believes the strong demand for A-Grade warehousing facilities in South Africa and Equites’ multinational reach makes the company a good stock pick.

The company’s tenants are multinationals prepared to sign long-term leases, give Equites commercial might and tend to meet rental payments on time.

Since January 2022, the share has lost a third of its value and, according to Morgenrood, presents a good opportunity for investors.

Equites’ share price on the JSE is currently around R15, with a P/E ratio of 5.89.

Equites Property Fund CEO Andrea Taverna-Turisan. SOURCE: Facebook