Caltex Australia is under Algo Engine sell conditions and was removed from the model portfolio late last year at $28.50.
Fuel retail margin was A$35-45mn lower at end-February, (based on the same time last year), driven by diesel pricing and gasoline retail competition. The company will provide a Q1 trading update at its AGM on 9 May 2019.
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In FY20 we assume $25.5b in revenue and 4% increase in EBIT to $1.07b which flows through to $1.25 in dividends, placing the stock on a 4.5% forward yield.
For investors who are not taking up the buy back offer, we recommend selling a covered call option to enhance the income return.
For more detail, please call our office on 1300 614 002.
