Investment options profiles

" "
" "" "

Your investment options

At Craigs we provide you with the flexibility to build a portfolio of investments from our list of investment options.

We have over 240 investment options available for you to invest in. Our investment options include a range of equity, fixed interest, investment trusts, NZ managed funds, index funds and listed property trust investments, available on local and international listed and unlisted markets.

If you would like to review and make changes to your portfolio please contact your Craigs investment adviser or our Client Services team.

Read our research insights on three of our current investment options below.

Freightways Group Limited

Our Classification: CORE
Risk indicator: 6/7
Sustainability score: 4.5/5

About Freightways

Freightways operates in the express package, business mail, refrigerated transport, information management and secure destruction markets. FRW has grown organically and by acquisition, to become a leading New Zealand service provider with a growing Australian footprint.

What makes Freightways different?

Freightways acquired fast moving consumer goods (FMCG) transporter Big Chill in 2019. Big Chill primarily provides temperature-controlled transport and is the largest operator in the sector. Big Chill adds a layer of earnings diversification to Freightways suite of businesses. Earnings in the FMCG sector should be fairly resilient throughout economic cycles and complement Freightways other businesses that are more closely correlated with underlying economic conditions. In 2023, Freightways acquired Allied Express, one of Australia’s largest independently owned courier and express freight providers for A$160m. Allied operates primarily in the niche of 22kg+ parcels and complements FRE expertise in pick-up, process and delivery.

Opportunities and threats

Transport activity is closely linked to the economic cycle, albeit a little more cyclical. Freightways holds around a 40% market share of the New Zealand parcel market. With the proliferation of online sales (accounting for around 10% of total retail sales at present), parcel volumes are likely to continue to grow. While the company is exposed to the performance of the domestic economy, it is a quality name with a structural tailwind from increasing e-commerce spending. Additional strategic moves such as its pricing for effort scheme, move into refrigerated transport, and bolt on acquisitions which leverage its existing network, help improve the resilience of the business.

Our view and outlook

Freightways is a well-managed company with a quality franchise that is difficult for a competitor to easily replicate. Its service is embedded in the supply chain of its customers, and this has enabled it to develop strong customer relationships and brand loyalty. The industry structure remains relatively stable, with Freightways and its largest competitor, NZ Post, making up around 80% of the total market. While a large portion of its business is exposed to the domestic economic cycle, we note that any slowing in domestic growth should be partly offset by the longer-term structural increase in e-commerce spending. As online shopping grows, so will the volumes of packages needing to be shipped – this should be supportive for the company given the NZ market structure, assuming ongoing rational behaviour from its key competitor.

CSL Limited

Our Classification: CORE
Risk indicator: 6/7
Sustainability score: 4.5/5

About CSL Limited

CSL Limited (CSL) is a leading global biotechnology company focused on blood-plasma-derived biotherapies used to treat rare and severe diseases, such as immune deficiencies, bleeding conditions and inflammatory disorders.

What makes CSL Limited different?

CSL is the parent company of CSL Behring, a global biotechnology leader, CSL Seqirus, the second largest global flu vaccine producer, and CSL Vifor, a leader in iron deficiency products and kidney disease. CSL Behring drives CSL’s performance, generating around 70% of revenue across its therapeutic areas of Immunology, Hematology, Respiratory, Cardiovascular & Metabolic and Transplants. The division’s products are primarily developed from human plasma, which it collects from donors through its large network of plasma collection centres. Once collected, the plasma is separated and purified into different proteins, including immunoglobulin and albumin, to create a range of therapies.

Opportunities and threats

A key strength of CSL is its strong R&D capability, facilitated by an annual budget of around 10% of revenue. The commitment to R&D should ensure a regular pipeline of innovative products and new therapies with the potential to make sizeable contributions. A recent example is Haegarda which have grown rapidly to become a key medicine in the treatment of hereditary angioedema. A number of promising new products are under development, including CSL112, a therapy to reduce the risk of a second heart attack (a significant market globally).

Our view and outlook

Margins have been slow to recover from the impacts of COVID. Plasma collection continues to improve. CSL has also begun moving to Rika, its new plasma collection system, which should increase staff efficiency and reduce average donation time by 30%. Productivity will be at the heart of CSL’s margin recovery, which will likely take at least a few years. In the meantime, healthcare companies should be less prone to economic slowdowns than many other industries, providing resilience in the face of ongoing market volatility.

Amazon.com Inc.

Our Classification: CORE
Risk indicator: 7/7
Sustainability score: 3.3/5

About Amazon

Amazon is a multinational technology company with leading positions in two high growth industries, online retail and cloud-based technology infrastructure.

What makes Amazon different?

Amazon started as an online book retailer in 1994 and since then has invested heavily to create a leading ecommerce and public cloud IT infrastructure company. Ecommerce and digital transformation are powerful multi-decade trends and Amazon has capitalised on its first mover advantage by building market leading positions in both spheres. Amazon has continually invested in both areas to cement its competitive advantage. In its retail business, Amazon has used Prime to retain customers while investing in fulfilment centres and logistics to improve the overall customer experience and ward off competitive threats. The improvements Amazon continue to make in its fulfilment capability (same day delivery) imposes costs on its competitors by setting the standard and expectations around delivery times. Amazon is well positioned here to benefit from increasing demand arising from generative AI.

Opportunities and threats

Amazon Web Services is the dominant player in cloud infrastructure and will continue to benefit from ongoing healthy adoption rates as existing and new customers migrate more of their IT workloads to the cloud, spurred by developments in generative AI. The release of new cloudbased products and services also helps cement its competitive advantages. Amazon is also developing new growth pillars in advertising and entertainment. Advertising is a high margin business and the company is leveraging its considerable ecommerce network to provide an attractive value proposition to would be advertisers.

Amazon have spent large amounts of capital expanding its fulfilment capabilities – doubling its warehouse size and building out a transportation network the size of UPS in just two years. This investment cycle for its retail business is largely over now and we expect growth in the business from increasing engagement and use of eCommerce to be reflected in improving margins and profitability. However, the positive hype around the transformative nature of generative AI should sustain investment in its Cloud services for some time, an important underpin for sustainable long-term growth in the business.

Our view and outlook

Amazon is the leader in two large and rapidly growing sectors that are the beneficiaries of powerful megatrends. It is also developing new pillars of growth with a focus on its high margin advertising business. Amazon continues to add more customers to its retail platform attracted by the Prime benefits programme. Amazon offers strong value on a price to operating earnings basis with a significant margin of safety and should be a strong candidate for any global equities portfolio given the significant growth opportunities within both its online retail and cloud infrastructure businesses.

About risk indicators and sustainability scores

Risk indicators are assessed by Craigs Private Wealth Research team and are rated from 1 (low) to 7 (high). The rating reflects how much the value of the company goes up and down (volatility). A higher risk generally means there is the potential for higher returns over time, but with the risk of higher losses, and there are likely to be more ups and downs along the way.  To help you clarify your own attitude to risk, work out your risk profile at craigsip.com/risk-profiler or speak to your Investment Adviser.

Sustainability scores are assessed by Craigs Private Wealth Research sustainability team and are calculated as an average rating out of five for environmental, social and governance factors. An N/A sustainability score means a sustainability assessment has not been made. For further information on how we calculate these scores, please refer to this report or speak to your Investment Adviser.

Expert support, closer to home

How can we support your investment journey? Find us in 19 locations nationwide for experienced and personalised wealth management advice.