AZJ FY16 Earnings Result

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

AZJ reported FY16 EBIT of $870 (down 10%).  AZJ has a challenging outlook on the revenue front (9% decline to $3.45b) and their 100% payout ratio means that dividends are likely to be cut in the near future. The company remains focused on cost cutting and $130m in savings were achieved in the past 12 months, helping to reduce the impact of softer haulage volumes.  

FY16 NPAT of $510m (down 16%) was impacted by higher interest expenses. Dividends per share (DPS) of $0.24.  

FY17 EBIT guidance of $900m.

We’ve been on the short side of this trade and we now look to lock in profits.

AZJ

Global Macro

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

The US Dollar ended last week mixed as Friday’s Retails Sales and Inflation data disappointed to the downside. This saw the Greenback offered across the G-7 pairs at the NY open. However, the unexpected drop of .1% in consumer spending along with the -.4% reading in the Producer Price Index were shaken off by the NY close setting up some interesting chart patterns as we start the new week.  

The AUD/USD, in particular, looks vulnerable to further downside range extension. After posting a .7755 high on Thursday, the AUD/USD finished the week with two consecutive losses for the fist time in almost two months and the first close below the five-day moving average since July 25th. Technically, the pair has been in a strong uptrend over the last three weeks but the RSI, along with the MACDs, are looking stretched.  

With Tuesday’s RBA minutes likely to include a warning about the risks of currency appreciation derailing the sluggish post-mining economic recovery, a break of the key support level at .7630 is a reasonable bet. Further, the preliminary forecasts for Thursday’s Australian Employment report are looking for a softer reading in the key metrics in what has become a volatile data series.

James Hardie 1QFY17 Earnings Update

Posted on | by Leon Hinde | Leave a Comment on James Hardie 1QFY17 Earnings Update

At the end of last week, James Hardie (JHX.ASX) management provided FY17 NPAT guidance for $US260 – $290m which implies growth within our expected target range of 12 – 15%.  These numbers reaffirm our buy on the dip strategy with JHX and  FY17 EBITDA of US$500m, NPAT $275m, dividends per share (DPS) of US$0.45 places the stock on a forward yield of 2.8%.

 

 

 

Telstra FY16 Earnings Result

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

Telstra (TLS.ASX) released its FY16 result with total income up 2.3% to $26.5bn and EBITDA down 3.9% to $10b, final dividend of $0.155 taking the full year dividend to $0.31 FY17 outlook is for 5% income growth and 3 – 5% EBITDA growth.  Capital management of $1.5bn in the form of a share buyback will be welcomed by investors. 

We have been buyers of Telstra since the $5.20 low in June and again on this pullback it’s worth looking for an entry point.   

TLS

Computershare FY 16 Result

Posted on | by Leon Hinde | Leave a Comment on Computershare FY 16 Result

CPU.ASX reported FY16 earnings of US$0.55 per share in line with guidance and down almost 8% on the same time last year. The result was impacted by a higher tax rate which masked what looks to be a moderate improvement in the underlying business and this is reflected in managements FY17 guidance of a return to 1 – 3% EPS growth.  

Based FY17 expected earnings it places CPU.ASX on a 3.6% dividend yield and we still have questions around certainty of earnings growth out into FY18 and FY19.

CPU