Amcor FY16 Earnings Result

Posted on | by Leon Hinde | Leave a Comment on Amcor FY16 Earnings Result

Amcor (AMC.ASX) NPAT US$670m, EPS of $0.57 and final dividend of $0.22 CPS was inline with consensus. The numbers reflect a flat result on the same time last year, however, FY17 should see a return to underlying growth in the range of 5 – 7%.

FY17 revenue forecast of US$10b on EBIT of US$1.1b. EPS US$0.60 & DPS of US$0.55 placing AMC on a forward yield of 3.8%

We continue to see this as a buy on the dip story. Where we own AMC in the model from lower levels, we’ve been selling call options to enhance the yield.

AMC

 

 

Qube Holdings FY16 Earnings Result

Posted on | by Leon Hinde | Leave a Comment on Qube Holdings FY16 Earnings Result

Qube Holdings (QUB.ASX) released FY16 earnings with EBIT of $250m, slightly below consensus.  We see QUB as an FY18 & FY19 growth story.

Buy on any pull-back in price into the following range, $2.40 – $2.55. Our algorithm engines will be tracking this name and I’ll update you on our next entry point, once it’s triggered.

QUB

Boral FY16 Earnings Result

Posted on | by Leon Hinde | Leave a Comment on Boral FY16 Earnings Result

Boral (BLD.ASX) FY16 earnings of $400m was slightly ahead of market expectations.

Fy17 dividend yield of 3.4% based on DPS of $0.25 with underlying profit growth or around 5 – 7%. Housing and construction data, both domestically and in the  US, remain supportive for Boral and James Hardie. We continue to like these names as a “buy on the dip” story over the  next 12 months.

Our algorithm engines will continue to track these name and alert us to lower risk entry levels, should we see a pull-back in price.

BLD

 

 

Wesfarmers FY16 Earnings Result

Posted on | by Leon Hinde | Leave a Comment on Wesfarmers FY16 Earnings Result

Wesfarmers (WES.ASX) reported NPAT of $2.25b and announced a final dividend of $0.95. Coles delivered total sales growth of 3.5%, whilst Bunnings was again the standout with 10%+ in underlying growth year on year.

FY17 forecast dividends of $2.10, places the stock on a forward yield of 5%.

We own WES in the model from lower price levels and we’ve sold covered calls into December to enhance the return.

WES

 

Westfield 1H16 Earnings Result

Posted on | by Leon Hinde | Leave a Comment on Westfield 1H16 Earnings Result

Westfield (WFD.ASX) reported 1H16 earnings of $715m at the EBIT line and FFO of $342m or $0.165 cents per share.  FY16 guidance remains around $0.34 cps

WFD trades on a high multiple and a forward yield into FY17 of 3.4%. For this reason, we see the stock fully valued but attractive due to it’s high quality asset base and $7b+ development pipeline.

Add a Dec covered call to enhance the yield.

 

Global Macro

Posted on | by Leon Hinde | Leave a Comment on Global Macro

The biggest monetary event of the US calendar is set to take place at Jackson Hole, Wyoming over the next two days. From an interest rate policy perspective, the main event will be the speech from Federal Reserve Chief Janet Yellen, who could use her speech to indicate a more or less aggressive policy position from the FED going into the end of the year.

Considering the recent upbeat reports on the US labor market, inflation, wages and household spending, Ms Yellen may use the opportunity to signal the FOMC’s growing optimism in the general outlook for US economic activity.

With the US Treasury Yield Curve flattening over the last month, the impact of Ms Yellen’s comments will likely have an asymmetrical impact US Credit markets as a hawkish tone will steepen the curve more than dovish comments will push yields lower.

USYieldcurve

 

Caltex 1H16 Earnings Result

Posted on | by Leon Hinde | Leave a Comment on Caltex 1H16 Earnings Result

Caltex (CTX.ASX) delivered 1H16 NAPT of $252m which is in line with market expectations. FY17 growth is likely to be around 8%, placing the stock on a forward yield of 3.7%, assuming $1.25 in dividends.

FY17 revenue forecast of $16b on EBIT of approximately $900m.

We like CTX as a value and yield story. The stock could trade to $36.50 over the next 12 months.

CTX

 

 

Scentre Group 1F16 Earnings Result

Posted on | by Leon Hinde | Leave a Comment on Scentre Group 1F16 Earnings Result

SCG reported 1H16 NPAT of $1.15b on $0.116 cps up 2%+ on the same time last year. FY17 forecast growth of 3% or $0.23 cps places the stock on a forward yield into FY17 of 4.4% on a 90% payout ratio.

Potential for added growth from the development pipeline into FY17 and FY18 along with low interest rates underpin SCG. The stock is close to full value and a sideways consolidation is the most likely price action. Buy at $5.00 and sell at $5.45

SCG

Global Macro

Posted on | by Leon Hinde | Leave a Comment on Global Macro

The Euro area economy, as measured by the regional Purchasing Manger’s Index (PMI) inched up a seven month high at 53.3; slightly better than the 53.2 reading from July. However, the headline number belied slowing in growth in manufacturers order books and a lower rate of new jobs in the Eurozone’s dominate services sector.

The overall PMI, which is closely watched by ECB policymakers, suggested both growth and inflation could fade over the third quarter and into year-end. Inflationary pressures remained muted as the sub-index of selling prices fell for the third consecutive month. The overall inflation reading in the Eurozone printed at 0.2%, which is much lower than the ECB’s target of just under 2%.

On balance, today’s PMI report shows that the Eurozone has remained somewhat resilient to the expected post-Brexit slump, but does little to alter the view that the ECB will increase the pace of its asset purchase program at its next meeting on September 8th.

EuroPMI