Our ALGO engine triggered a sell signal in SHL on February 5th at $24.85.
In the company’s recent earnings report, their 2018 guidance expects growth in the 6% to 8% range.
This places SHL at 22.5 times earnings, which is considerably higher than its industry peers.
Technically, the next key support level is found at the February 15th low of $23.10.
Sonic Health
Our ALGO engine triggered a sell signal for NAB into yesterday’s ASX close at $30.40.
This “lower high” pattern is relative to the November 8th high of $31.85.
NAB posted an 18-month low of $28.05 on February 8th. The banking sector, in general, has had a respectable recovery over the last three weeks.
However, the internal momentum indicators now suggest that the local banking names will trade lower over the near-term, taking out the February lows.
NAB
SGR was recently triggered as an Algo Engine buy signal and we now look to accumulate the stock within the value range marked on the chart below.
Star Group
Shares of NCM are down over 2% in early trade as Spot Gold prices traded 1% lower to $1317.00 in the NY session.
Selling in Spot Gold was triggered by comments from new FED chief Jerome Powell who said that the US central bank could lift rates up to 4 time during 2018.
We added NCM to our model portfolio on December 13th at $22.10.
Technical indicators suggest solid support levels in the $20.80/90 area.
We estimate that price in NCM will correspond to Spot Gold near $1300.00 per ounce and will look to enter long positions near $20.80.
Newcrest Mining
Caltex FY17 earnings came in at the top end of the estimated range, at $620 million.
Caltex will announce the outcome of their asset review at the end of June.
We expect to see commentary around divestment of station freehold land, which should be a net positive for share holders.
FY19 outlook for revenue is 2% growth to $23 billion, EBIT $930 million , EPS $2.40 and DPS $1.20, placing the stock on a forward yield of 3.5%.
We consider CTX fully- valued at the current price range.
After buying at lower prices and selling the May $36 calls for $1.00 credit, we’ll be pleased to collect the upcoming dividend of 61 cents on March 12th, and then deliver the stock in May.
The price rebound in the regional banks has likely played out and the chart below illustrates the “lower high”pattern, along with the $11.60 (price gap) resistance level.
Bendigo is our preferred short position within the sector. We expect to see the next support level in the $10.90 area
Stockland was added to our ASX 50 model in January and we’ve continued to accumulate the stock in recent trading sessions.
The latest earnings result continued to show strong momentum in residential property sales which should help support a move back to $4.40
SGP is forecast to pay $0.13 dividend in June which places the stock on a 5.5% annualised yield.
Stockland Corporation
Australian banks have been oversold, and over the past two weeks we’ve seen capital flows reallocated towards the sector.
NAB has now rallied $2.00 or 6% since the beginning of February.
Limited revenue growth has created a “shrink to grow” strategy among all of the major banks, along with a renewed focus on cost control.
Due to the delay in benefits from the strategy being passed through to shareholders, we believe the current share price rebound will be limited.
The NAB chart below perfectly illustrates the range where we expect selling pressure is likely to build.
NAB
AGL shares are oversold and investors should buy the stock and look for a recovery into the $23.50 range.
Selling covered call options into May or June will help to enhance the yield, whilst waiting for the next $0.50 forecast divided payment in August.
AGL
At $4.75, GPT looks oversold and should rally back to the $5.25 range in the near term.
GPT will pay $0.125 dividend on the 29th of June.
GPT
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