Macquarie Group is a current holding in the ASX100 model portfolio.
Macquarie upgraded their earnings guidance for FY19 profit to be up 15% from a previous estimate of 10%.
Now that the ACCC has given the green light for Santos to acquire Quadrant Energy, MQG stands to collect about $500 million for their 22% stake in Quadrant.
Macquarie Group
Our Algo Engine generated a buy signal in Wesfarmers into the ASX close on Friday at $44.40.
This “higher low” pattern is referenced to the intraday low of $43.70 posted on May 10th.
We see value for investors emerging in the $44.50 range.
Following the spin-off of Coles, look to sell covered call options to enhance the income return.
Wesfarmers
CYB reports their earnings on Tuesday and we recommend buying the stock ahead of the announcement.
We believe the combined CYB and Virgin Money business provides a strong platform for growth.
CYB
The IZZ iShares ETF provides broad exposure to China Large-Cap stocks.
Recent price action has found medium-term support at $55 and stop losses should be consider on a break back below this level.
IZZ China ETF
We suggest buying AZJ and selling a June 2018, $4.40 strike call option for an additional $0.15 credit.
AZJ goes ex div $0.14 on the 26th Feb 2019.
ASX is one alternative for investors looking for a replacement for bank stocks within their portfolios. ASX offers 3.5% yield, (fully franked) and when combined with a covered call option, the cash flow is boosted to 10% p/a.
Our Algo Engine flagged a recent buy signal on the high low formation at $58.
ASX is also a current holding in the ASX100 model portfolio, up 38% since being added back in September 2016.
The price of West Texas Intermediate (WTI) Crude oil surged to a 4-year high of $76.90 just over a month ago.
Since then WTI prices have plummeted almost 30% and reached a low of $54.70 this week.
It’s clear that the market overestimated the impact of Iranian sanctions, increases in Non-OPEC production and the forecasts for lower oil demand in 2019 from the EIA.
Aside from the technically oversold conditions, the OPEC producers have hinted that they will take measures to shore up crude oil prices when they meet in Vienna on December 6th.
After trading to 18-months lows earlier this week, both WPL and OSH are now under ALGO buy signals.
We consider a price reversion to higher levels a likely outcome with initial resistance for WPL at $35.05 and OSH at $8.15.
Woodside Petroleum
Oil Search
Shares of RHC have been edging higher as investors respond favorably to their recent AGM on Tuesday.
With respect to their Capio AB acquisition, management continues to target overall positive core growth of up to 2% in FY 2019.
With the share price at 22X present earnings, we would have liked to seen a higher rate of expected core growth to sustain a rally from current levels.
RHC remains under an ALGO sell signal but we expect the $51.00 level to show solid support and an ALGO buy signal in the medium-term.
Ramsay Health
Crown Resorts is a current holding within our ASX100 model portfolio.
Following the recent sell-off on the back of global concerns about slower VIP growth, the stock has retraced from $14.50 to $11.75, which forms a “double bottom” pattern dating back to October 2017.
At $11.75 we believe Crown offers value and investors should look to accumulate the stock for a move higher.
Our Algo Engine shows Medibank remains under “buy conditions”.
With yesterday’s update at their AGM showing that the improved momentum in 2H18 had continued into 1Q19, we recommend accumulating the stock.
Buy Medibank and sell out of the money call options to enhance the income.
Medibank
Level 17 Chifley Tower
2 Chifley Square
Sydney, NSW 2000
1300 614 002
Investor Signals Pty Ltd
ABN 44 143 555 453