We suggest accumulating Medibank near the $2.85 support level.
Medibank is a current holding in the ASX 50 model portfolio from may 30th at $2.73.
Following the correction from the January high of $3.30, the stock now trades on a forward yield of 4.5%.
We expect a rally from the current $2.85 level back towards $3.00. We will then add a covered call option, which will help further enhance the annualised cash flow.
Medibank Private
We suggest accumulating IPL shares at current levels following the recent Algo Engine buy signal at $3.30.
The stock is a current holding within the ASX 50 model portfolio.
This week IPL announced the mitigation to a recent a contract loss, through a new contract with Fortescue.
IPL stated that the FMG contract would mitigate ~50% of the financial impact associated with previously announced contract losses in Western Australia.
We forecast FY19 EPS growth of 10%, placing the stock on a forward yield of 4.3%.
IPL
Following the recent sell-off in Link, the stock has found support near the $7.00 range.
We feel Link provides good upside potential and recommend accumulating the stock with a stop-loss below $6.90.
Link Holdings
We’ve been advising our readers to buy Tabcorp following the Algo Engine buy signal at $4.20. Although TAH is now trading $4.52, we continue to recommend the stock.
Our upside price target is $5.20 over the medium-term.
Tabcorp
After falling 10% from the January highs, the leading US indices are again exhibiting strong technical momentum, largely supported by bullish earnings outlook and PE expansion for the large technology names.
In Saturday’s post, we looked at the “higher low” formation in the Dow Jones and the need to stay long the index whilst the low of 24,247 remains in place.
We now include an up trending support line and re-affirm the long side positioning, with a trailing stop loss below the up trending support.
Our Algo Engine recently generated a buy signal in CIMIC and the stock is held in our ASX 50 model portfolio.
We recommend buying CIMIC within the $38 – $41 range, with an upside target to $52.
Clydesdale & Yorkshire Bank was spun-off by National Australia Bank in 2016 and has since become a leaner-meaner banking machine. CYB is further bulking up through the acquisition of Virgin Money in the UK.
Overnight CYB announced a 7% increase to its preliminary offer to acquire Virgin Money, and extend the final bid deadline to the 18th June.
Whilst a key to holding CYB long-term is the impact of Brexit-related
macro-economic risks, we see scope for a rally back to $6.00 following the take-over.
Our Algo Engine generated a buy signal recently in IPL and the stock is currently held in the ASX top 50 model.
The stock price has pulled back to form a “higher low” at $3.30 and we see forward earnings surprising to the upside, due to the finalization of the Gibson Island gas agreements and the recent recovery in global nitrogen prices.
IPL is also set to recommence a $300m share buyback.
Our Algo Engine triggered a sell signal in Mirvac at the recent “lower high” formation.
We note the difficulties residential REITs are likely to face in a falling house price environment. Tighter credit conditions will impact Mirvac’s core customer, the investor.
Resistance within the $2.30 – $2.45 range.
The S&P/ASX 200 Index finished the week to Friday down 0.7%.
The best performer was the Utilities sector, up 1.5% with APA Group rising by 4.9%. The worst performer was the Telecoms sector, down 2.9% with Telstra falling 3.1%.
XJO short-term support is 5964
The chart below of the Dow Jones shows the consolidation phase between 23,360 and 25,086.
Dow Jones short-term support is 24,247
Dow Jones
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