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Chicago-based investment firm Harris Associates LP has waded into the
Australian media sector, last week revealing it had mopped up a 5 per cent stake
in John Fairfax Holdings.
Some local fund managers suggested that early signs of a recovery in
advertising made companies such as Fairfax a more appealing investment prospect.
Harris bought 787,000 Fairfax shares, or a 5.01 per cent holding, on November
1, when the shares settled at $2.86 at the close of trade.
Although a turnaround in advertising has been largely priced into the value
of Fairfax shares, which on Friday sank 9c to $2.88, one analyst said there was
still some room for growth.
He said the size of a recovery was unpredictable and that Fairfax would
benefit greatly if the ad market beat expectations of low single-digit growth
this financial year.
Harris Associates fund manager David Herro met Fairfax chief executive Fred
Hilmer in Australia earlier this year.
Mr Herro, who examines the Pacific Rim economies for long-term investments,
has previously said that Australia is an important part of Harris's investment
strategy.
Australia's healthy economic outlook has underpinned interest in local
companies by Harris, which has about $US13 billion ($22.95 billion) under
management.
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