Seek – FY21 Outlook Upgraded

Posted on | by Leon Hinde

SEK:ASX is under Algo Engine buy conditions.

Seek announced a strategic refocus with ‘SEEK’ and Investments. Seek will focus on the existing business and Investments, being an investor and business builder, allowing Seek Investments to access third-party capital.

1H21 result with EBITDA of $246m.

Revenue will likely increase from $1.7bn, (in FY21), to $2bn in FY22, EBIT to increase from $270m to $400m. The forward div yield remains at less than 1% and 50x FY22 PE ratio.

Seek offers terrific growth prospects, but the valuation remains stretched.

Sonic Healthcare – Valuation Review

Posted on | by Leon Hinde

SHL:ASX is under Algo Engine buy conditions and is a current holding in our ASX model portfolio.

If we strip out the jump in FY21 profits from COVID testing and look at what FY22 and FY23 normalized business conditions look like, we still get to a valuation that supports the current share price.

FY22 revenue is likely to be around $7.6bn on EBITDA of $1.7bn. EPS will be 30 – 40% up on FY20, which will support a forward yield of 3.5%.