Perpetual – Add to the “short list”
Perpetual is under Algo Engine sell conditions and we now add exposure to the short side.
We see downside risks for PPT in the months ahead.
Caltex – Buy Write Income Generation
Caltex Australia is under Algo Engine buy conditions and is a current holding in our ASX 100 model portfolio.
Buy CTX at $33.75 and sell the $34.50 April call for $0.55 credit.
CTX goes ex div $0.61 on the 1st March.
NOTE: Downside risks are somewhat mitigated by the fresh indicative bid of $35.25 per share.
Amcor – Buy
Amcor is under Algo Engine buy conditions and is a current holding in our ASX 100 model portfolio.
Buy AMC at $15
Computershare – Earnings Downgrade
Computershare has been on our “high conviction” shortlist for the past few months and today’s 1H20 earnings result helps to support our bearish case.
EPS fell 17% on the same time last year. Lower margin income, weaker corporate actions and pressure in the UK mortgage business all weighed on earnings.
We’re skeptical of the company’s reassurance that 2H earnings will improve.
GPT – FY19 Earnings
GPT has increased earnings by 2.6% growth, which is in line with the recently lowered guidance.
The FY20 outlook is for similar underlying growth of around 2%.
Office and logistics are clearly the stand-out performers, whilst retail exposure remains a potential drag.
With GPT trading on a 4.5% yield and low levels of growth over the next 1 to 3 years, we consider the stock full value.
Newcrest – Finding Support
Newcrest Mining is under Algo Engine buy conditions and is a current holding in ASX 100 model portfolio.
We see upside potential to $32.00.
Oz Minerals – Buy Signal
OZ Minerals is under Algo Engine buy conditions and is a current holding in ASX 100 model portfolio.
We see value at $9.90
Aurizon 1H20 Earnings
Aurizon Holdings reported 1H20 earnings which were mostly in-line with market forecasts.
1H20 EBIT of $456 million with underlying EPS of $0.136cps. The company continues to payout 100% of earnings in dividends.
Full-year 2020 EBIT guidance remains unchanged at $880m – $930m and the share buy-back program has increased to $400m in FY20.
JB Hi-Fi 1H20 Earnings
JB Hi-Fi delivered 1H20 NPAT of $174m, which represents 9% growth vs the same time last year.
JB Hi-Fi issued FY20 NPAT guidance of $265 to $270 million, which implies 1.0% to 6% growth, slightly below market consensus.
Alacer Gold – Further Detail…
Alacer Gold provides an interesting growth opportunity. The company holds a significant portfolio of highly prospective exploration land holdings across Turkey (totaling approximately 125,000 hectares), some of which are progressively advancing to prospective projects.
The release of the CY19 financials show NPAT beat on a one-off tax adjustment, whilst revenue was in line. EBIT of US$171m was also broadly in line with market expectations.
The company has recent exploration success at Çakmaktepe & Ardich sites. We see scope for a material pickup in earnings from FY21.
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