AMC reported 1H19 sales of US$4.6bn, EBITDA of US$678mn and underlying NPAT of US$330mn.
These numbers reflect a relatively flat outcome, based on the same time last year. The key for growth will be the integration of the Bemis business and the $180mn in cost synergies.
Amcor should return to a 3 – 6% EPS growth environment from next year, this supports the 4.4% dividend yield.
This coming Monday, I will run a live Webinar at 12:30pm NSW time.
I will be reviewing my high conviction ASX buy and sell opportunities from the recent algo engine and model portfolio signals.
If you’re interested in attending, or watching the video replay at a later time, then please fill in this form to register.
In the following brief video we look at the large number of sell signals in the ASX market and how to protect the downside in your portfolio, whilst staying exposed to the upcoming dividends.
Using in-the-money European covered calls. For more information please call our office on 1300 614 002.
Amcor reports on Monday, we expect the earnings result to support the current share price rally. AMC has been a high conviction call, expressed on the blog and in the “Opportunities in Review webinar”.
Bendigo Bank, (BEN) reports on Monday, we’re cautious of this name and see the money being made on the short side.
Origin Energy (ORG) reports next Friday, we feel the LNG related income will surprise on the upside.
For more detail on the earnings season, register for Monday’s Opportunities in Review webinar.
Clydesdale & Yorkshire Bank, the UK spin-off from NAB, recently acquired Virgin Money. Their trading update for the December quarter was released overnight and there are some encouraging signs on increased cost synergy savings and improved margins in their loan books.
We see long-term value in CYB, despite the short-term volatility around the Virgin Money integration and Brexit impact.
We recommend adding Resmed to your watch list.
RMDis a global company involved in the development and manufacturing of medical products for the treatment of respiratory disorders. Global mask sales increased 10%+ on the same time last year.
Low returns from new acquisitions, disappointed investors and the soft 2Q19 earnings update resulted in the stock falling by over 10%
It’s difficult to say with certainly where buyers will step back in, but we are confident of the long-term story with Resmed.
The chart below illustrates the lower band where we see deep value for investors willing to take a 1 – 3 year outlook.
CBA reported their 1H19 earnings today and the number was slightly below market consensus. The miss was attributable to greater-than-expected margin pressure in their home loan book and costs in insurance.
Revenue came in at $12.4bn and pre-provision cash earnings at 7.1bn.
CBA is under Algo Engine sell conditions. The only one of the 4 majors, currently displaying a buy signal and held in our ASX model portfolio is ANZ.
CBA goes ex-div on the 14th of Feb $2.01 which places the stock on a 5.9 yield.
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.
James Hardie is a current holding within our ASX 100 model portfolio.
Today’s release of the 3QFY19 earnings were slightly below market consensus, however, the full year guidance for FY19 NPAT to be in the range of US$280-320m, supports a higher share price.
Off the back of the improved full year earnings outlook, James Hardie has rallied from $15 to $16.
Based on FY20 earnings, we have JHX trading on a 4.2% yield.
Ansellis a current holding in our ASX 100 model portfolio and we continue to see value as a “buy-write” strategy.
ANN goes ex-div $0.26 on the 16th of Feb. We suggest adding a $24 strike May call option. This will generate an additional $0.70 per share of income.
ANN reports half year 2019 profit on the 18th of Feb.
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