A Rosier North American Bricks Outlook and Portfolio Revaluations Lift Brickworks’ and WHSP’s FVEs

An improved medium-term outlook for no-moat Brickworks’ North American brick operations--combined with the revaluation of a number of no-moat Washington H. Soul Pattinson’s, or WHSP's, long-term investment holdings--drive upgrades to our sum-of-the-parts fair value estimates for WHSP and Brickworks to AUD 20.60 per share and AUD 19.30 per share, respectively. The increase in our fair value estimates for the cross-shareholding-linked names represent respective valuation upgrades of 8% and 9%. While shares in Brickworks screen as approximately fairly valued, WHSP shares are materially overvalued, trading at a sizeable 57% premium to our revised valuation.