RIO – $3bn Share Buy-Back

Posted on | by Leon Hinde | Leave a Comment on RIO – $3bn Share Buy-Back

RIO has confirmed that Yancoal remains the preferred bidder of Coal & Allied post a revised and improved offer from Yancoal yesterday.

We expect material free cash-flow (FCF) to be passed through to shareholders despite iron ore falling from its February peak.  In FY18, RIO could return up to $3billion  through share buy-backs.

We remain cautious on the outlook for spot iron ore prices. However, the low levels of debt, low cost of production and aggressive capital management undertaking by RIO will help to provide share price support.

FMG, RIO & BHP will likely see a minor rally from the current oversold conditions,  before turning lower.

Chart – RIO

Take Profit – Ramsey Healthcare

Posted on | by Leon Hinde | Leave a Comment on Take Profit – Ramsey Healthcare

After buying Ramsey Healthcare on the recent pullback to $68.50, we now look to take profit at today’s price levels.

Within the healthcare space, we continue to like SHL, RMD, CSL and Ramsey Healthcare. Although, they’re starting to look a little expensive from a PE perspective.

Trimming profits with a view to buying back in on a pullback makes sense, or selling tight covered call options at current price levels.

Chart – RHCASX:RHC

 

Algo Buy Signal – Origin

Posted on | by Leon Hinde | Leave a Comment on Algo Buy Signal – Origin

Our Algo Engine has flagged a second buy signal within the uptrend on Origin that started back in January 2016.

The first “buy on the dip” signal occurred  in March 2017 at $6.25 and now a new Algo Engine buy signal has been triggered at $6.90.

WPL, OSH and ORG are all likely to find support and trade higher from the current price levels.

Chart – ORG

 

 

Chart Watch – Goldman Sachs

Posted on | by Leon Hinde | Leave a Comment on Chart Watch – Goldman Sachs

We’re watching the rebound in US financials as a leading indicator for momentum in the Australian banking shares.

The chart below of Goldman Sachs shows the minor bounce that’s recently taken place. However, it looks like selling pressure is now building and the short term momentum indicators have turned lower.

Unless, Goldman Sachs can trade back up through the $230 resistance, it looks like the rebound higher, could now be completed.

Chart – Goldman Sachs

 

QBE – $1billion Share Buy-Back

Posted on | by Leon Hinde | Leave a Comment on QBE – $1billion Share Buy-Back

On account of heightened claims activity in QBE’s Emerging Markets (EM) division, QBE has downgraded its FY17 guidance.

However, we remain optimistic regarding the QBE turn-around and feel the cycle is bottoming for QBE and the outlook is encouraging.

With the stock trading 10x forward earnings and 6% yield, along with a 3-year A$1bn buy back, which was announced in February, QBE is worth adding to your watchlist.

QBE is likely to commence their share buy-back program by late August 2017 and buying ahead of this time should be rewarded with higher prices into 2018.

Chart – QBE

 

 

Recent Signals – WOW & SOL

Posted on | by Leon Hinde | Leave a Comment on Recent Signals – WOW & SOL

Our Algo Engine triggered buy signals in both WOW and SOL; both opportunities are worth further consideration. Buying support is likely to increase at or near the current entry levels.

Reminder: We now have a new tutorial video in the help menu which explains the navigation of the watch-list feature, this includes reviewing the recent algo signals and customising your own watch-list.

If you need more help, please call our dealing/help desk on 1300 614 002

Chart – WOW
Chart – SOL

 

Algo Sell Signal – General Electric

Posted on | by Leon Hinde | Leave a Comment on Algo Sell Signal – General Electric

Our Algo Engine generated a “short” or sell signal in General Electric back in mid December, when the stock was trading $32. In last nights sell-off in the US, GE was the worst performing stock within the Dow Jones index.

The overnight selling is a continuation of the downtrend that has been in place since the December high.

Chart – GE

 

 

Tabcorp & Tatts Merger Approved

Posted on | by Leon Hinde | Leave a Comment on Tabcorp & Tatts Merger Approved

The Australian Competition Tribunal has approved the proposed merger of TAH and Tatts Group (TTS),  on the basis that they are satisfied that the merger will result in substantial public benefits and on the condition that TAH divests its Odyssey gaming business.

We see scope for upside in TAH share price as a result of synergy cost savings and the prospect of a large scale share buy back program in 2018.

Chart – Tabcorp