The Star Entertainment Group reported 1H19 earnings yesterday and EBITDA was up 3% on the same time last year, at $297m.
SGR delivered a strong result with revenues up over 6%. We have the stock now trading on a 5.3% dividend yield and see low single digit earnings growth ahead.
We recommend adding a covered call option to enhance the income return.
Ramsay Health Care was one of our picks heading into the earnings result on Thursday. The result came in ahead of market consensus.
RHC delivered a good 1H19 result which demonstrated the Australian business continues to achieve decent revenue growth.
We view the stock price as full value now at $65
Coca Cola is under Algo Engine sell conditions and there was nothing in yesterday’s FY18 earnings release that would suggest a recovery is near. FY18 NPAT earnings fell 7% to $388.
We look for the CCL share price to remain weak and $7.50 is the next level of support based on a stable dividend outlook.
Brambles has announced the sale of its IFCO business to Triton & Luxinva for US$2.51bn. The proceeds will be used to:-
$300m return of cash through a $0.29 special unfranked dividend and up to $1.65bn on-market buy-back. The balance will go towards reducing debt.
Our key concern with BXB is the recent earnings result showed underlying EPS growth of 2% and with the stock trading 22x earnings, it looks expensive.
Alumina is now under Algo Engine sell conditions and we expect the share price to struggle below the $2.80 level.
Alumina prices are likely to weaken over the next 12 months which will weigh on the cash receipts from the AWAC joint venture.
2018 net profit after tax was reported at US$690m. AWC declared a total dividend for the year of US$0.227, which was ahead of market expectations.
Stay short AWC with a stop loss above the $2.80 resistance.
QBE Insurance Group is under Algo Engine buy conditions and is a current holding in our ASX 100 model portfolio.
FY18 earnings were announced today and QBE delivered ahead of consensus. Growth was strong and upgrades to 2019 earnings are now likely.
Sonic Healthcare reported a 1H19 result that was in line with consensus expectations. Moderate single digit earnings continue to flow through from Australia, US and Germany.
FY20 forecasts are for 3 – 4% EPS growth. We consider the stock slightly expensive and look to buy on a the next pullback.
IPL is under Algo Engine buy conditions following the higher low formation at $3.20.
The stock price has been sold off following concerns around the impact of the Queensland floods. In particular, the short term closure of the Phosphate Hill plant and the impact to rail transport.
With the stock now trading 10x FY20 earnings we see much of the downside risks, already priced in.
Accumulate IPL between $3.00 and $3.20
Flight Centre Travel Group delivered 1H19 PBT of $140 million, at the low end of the 1H19 guidance range.
A positive of yesterday’s result was the announcement of a $150m capital return , declared through a $1.49 special dividend.
We see support for FLT at $42.50 and we’re inclined to take profit at $48.
Santos STO announced 2018 full year results with NPAT beating consensus.
FY18 NPAT of US$727m and the final dividend has increased to $0.062.
We expect to see Santos continue to increase their capital spending over the next 2 – 3 years with the focus being on the Cooper Basin.
Buying pressure will likely abate within equities, and oil prices over the coming weeks. We look to buy STO, WPL, OSH & ORG on the next technical low.
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