ResMed – Opportunity Approaches
ResMed is a current holding in our ASX 100 model portfolio.
The company reports 1Q20 earnings on 25 October and we expect revenue growth to be 15%+ and EBIT to be up 10%+ on the same time last year.
We look for an entry-level into RMD on the current price weakness and will update our readers further, following the earnings result.
Evolution Mining – Opportunity Approaches
Evolution Mining is under Algo Engine buy conditions and is a current holding in our ASX 100 model portfolio.
We see a buy-side opportunity approaching following recent price retracement. Look for the short-term indicators to turn positive within the support range indicated on the chart below.
Medibank – Algo Buy Signal
Medibank Private is under Algo Engine buy conditions and is a current holding in our ASX 100 model.
At 19x forward earnings and 2 – 4% earnings growth, Medibank is a strong candidate for a covered call overlay to enhance the investment returns.
The stock trades on a forward yield of 3% and when adding a covered call, we can boost the cash flow to 10% on an annualized basis.
Buy MPL at $3.25 and look for a move higher to $3.50 before selling call options.
For more information on this strategy, please call our office on 1300 614 002.
BHP – Algo Buy Signal
BHP Group is under Algo Engine buy conditions and is a current holding in our ASX 100 model portfolio.
The company reported Q1 production that was below analyst forecasts. The impact was most significant in copper where production was down 9%. Iron production was down 2% and thermal coal was also lower.
Despite the soft quarter, BHP reiterated its full-year production guidance.
Based on FY20 revenue of $43bn, EBITDA $25bn, net income $11bn, we have BHP trading 15x forward earnings and 4.5% yield.
Accumulate BHP within the $30 – $34.50 price range.
Resmed – Buy
ResMed is under Algo Engine buy conditions and is a current holding in our ASX 100 model portfolio.
RMD report earnings on the 24th Oct and the market is looking for 10%+ in EPS growth. We expect buying support to increase ahead of the result and see support building at $19.50.
A2 Milk – Buy the Dip
The A2 Milk Company is under Algo Engine buy conditions and is a current holding in our ASX 100 model portfolio.
2H19 earnings growth was 39% and FY19 revenue was up 40%. The market was disappointed in the FY20 guidance and consensus earnings growth expectations have come down to 20%.
We look to accumulate A2M near the $12.50 price level.
Webjet – Algo Buy Signal
Webjet is under Algo Engine buy conditions and see buying interest building, despite the impact of Thomas Cook going into compulsory liquidation.
FY20 revenue should increase by 20% to $440mn, EBIT 20%+ to $138mn and the effective dividend yield will move to 3%.
Buy Webjet $10 – $10.50 price range.
Sydney Airports – Buy Signal
Sydney is under Algo Engine buy conditions and is a current holding in our ASX 100 model portfolio.
We see buying support building between $7.80 and $8.00. On a rally back to $8.50, investors should consider selling a European call option into early 2020 to enhance the income return.
SYD goes ex-div $0.19 on the 28th of December.
IAG – Algo Buy Signal
Insurance Australia Group is now showing an Algo Engine buy signal and remains a long term holding in our ASX 100 model portfolio.
We see value emerging and consider the $7.50 price range as support and expect buying interest to remain solid.
Look for a move higher into the $8.00+ range and then sell covered call options to enhance the income return.
For more detail on the option strategy, please call our office on 1300 614 002.
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Investor Signals Pty Ltd
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