CIMIC Group had been a holding in the ASX 100 model and was removed earlier this week. Our Algo Engine triggered the sell signal as price action developed into a lower high structure.
CIM reported FY18 NPAT up 11% to $780m which is marginally below consensus.
The earnings result is at the upper end of the $720–780m guidance, issued by the company last year. FY19 guidance now stands at $820mn or 6 – 8% growth.
CIMIC is trading on a forward yield of 3.7% and we consider the stock as fair value. For investors holding CIMIC, we recommend selling a $48 call option to enhance the income return.