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Yo Neo-con. In your example both AIA and POT operate either monopolies or close to it. Monopolies are generally good defensive stocks becasue they have an ability to price-fix (as long as the ComCom is kept at bay) and therefore maintain profit levels in a time of downturn. NZX is another coy with high PE but monopoly position. High PE are not necessarily hyped, sometimes they just have very strong, defensible market positions.
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POT have got into a very strong market position at the moment but there is no reason why in a relatively short space of time this could change. There are many other commercial ports in NZ and in fact Tauranga (although they have a very effective rail arangement getting goods to and from akl) is not a logical place for NZ's largest port. In the case of AIA if say the govt were to impose tight regulations(quite concievable given it is a monopoly) it again could take a major hit overnight. So in both cases these stocks high PE's could come crashing down to earth given unfavourable conditions of which I have mentioned just a couple of possibilities. Of course in an economic downturn overall business goes down so monopolies lose out too (less passengers fly etc)
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What you say is correct neo-con but unlikely to happen, take for example AIAs recent move on departure taxes, a couple years back post 9/11 a temp $5 government scurity charge per passenger was imposed, now has been removed by government but AIA has kept the charge at existing level, $5 per passenger straight to bottom line, not a whimper from central govt or ComCom. The fact is that is is very had to prove monopolistic pricing in court, it requires very expensive economic analysis by the prosecution and it is relatively easily defended which is why we see few cases brought. Authorities are relatively underresorced vs large listed coys and law is not particularly tough.
RE POT, remember one of NZs biggest exports in terms of volume (cu m) is timber, POT is a the heart of the wood growing area, this is one of the main reasons why it is biggest, not to mention that it is just as close to the agricultural heartland of waikato at port of auckers. Ports of auckland has major infrastructure issues which are not going to be solved soon. It is very hard to get goods in and out of it. I think POT will continue to outpace POA. L8r