ASX

Posted on | by Leon Hinde

ASX is one alternative for investors looking for a replacement for bank stocks within their portfolios. ASX offers 3.5% yield, (fully franked) and when combined with a covered call option, the cash flow is boosted to 10% p/a.

Our Algo Engine flagged a recent buy signal on the high low formation at $58.

ASX is also a current holding in the ASX100 model portfolio, up 38% since being added back in September 2016.

 

Crown Resorts Is Oversold

Posted on | by Leon Hinde

Crown Resorts is a current holding within our ASX100 model portfolio.

Following the recent sell-off on the back of global concerns about slower VIP growth, the stock has retraced from $14.50 to $11.75, which forms a “double bottom” pattern dating back to October 2017.

At $11.75 we believe Crown offers value and investors should look to accumulate the stock for a move higher.

 

 

Buy Medibank & Sell Call Options

Posted on | by Leon Hinde

Our Algo Engine shows Medibank remains under “buy conditions”.

With yesterday’s update at their AGM showing that the improved momentum in 2H18 had continued into 1Q19, we recommend accumulating the stock.

Buy Medibank and sell out of the money call options to enhance the income.

Medibank

 

 

XJO – The 5941 Level Is Technical Resistance

Posted on | by Leon Hinde

The XJO has formed a “lower high” pattern within the existing Algo Engine buy signal structure.

The market has rallied 6% from the recent buy signal but we’re now mindful of the recent break of the “higher low” structure, as circled on the chart below.

5941 is resistance for the XJO and whilst the market remains below this level, some caution is required.

Names that remain supported within today’s broad market sell off include, AGL, CTX, GPT, WES, SCG, TCL, HSO & WOW. We remain cautious on the banks and select resource names .

XJO

Healthscope – Takeover Offer At $2.45

Posted on | by Leon Hinde

Last month Healthscope’s shares jumped as much as 22% to $2.17 on the news BGH Capital-AustralianSuper consortium will offer $2.36 cash per share as an indicative takeover price. 

Since then, HSO shares have settled back at $2.05 – $2.10 and we feel value is now on offer and investors should look to accumulate the stock.

Healthscope runs 43 private hospitals across Australia and 24 pathology laboratories in New Zealand.

In May, Healthscope refused to open its books to a prior takeover offer, instead, saying they’ll look into the sale and lease back of its hospital assets.

Pressure is now mounting on the HSO board of Directors to engage and allow the acquiring entity access to the data rooms and due-diligence process.

NOTE: This morning a competing bid has been announced, Brookfield Capital has now Offered $245.5 per share.

Healthscope

Lendlease – $700 million problem

Posted on | by Leon Hinde

Lendlease’s engineering and services division announced a further $350 million write down last week, which brings the NorthConnex tunnel project write-offs to more than $700 million.

An extraordinarily large number on a project that offers a total revenue of $2 billion. As a result of this, the board of Directors are currently considering if the division is “core” to the Leanlease operation.

Currently the division, contributes less than 15% to LLC’s overall earnings.

The markets reaction has been brutal and with the stock down over 20% in the last two days.

At under $14.00, we consider this a unique long-term opportunity to accumulate LLC at a discounted valuation.

Lend Lease