Tabcorp Trades Lower On Weaker H1 Earnings

Posted on | by Todd | Leave a Comment on Tabcorp Trades Lower On Weaker H1 Earnings

Shares of Tabcorp have dropped over 5% in early trade as H1 results were dampened by Tatts acquisition costs and weaker earnings from their UK start-up, Sun Bets.

The wagering giant posted a statutory net profit of $102 million, which was down 16% from a year ago. This included a $25.5 million charge in significant items related to the Tatts merger costs.

All together, the Tatts acquisition costs represented a one-off $59.3 million drag to the bottom line.

The company announced a fully franked interim dividend of 11¢ cents per share, payable on March 13.

We expected a much better H1 result for TAH and still believe the merger will prove profitable this year.

As such, we see value in the stock in the $4.80 area and expect the previous high price of $5.70 to be challenged over the medium-term.

Tabcorp

 

Morning Report – Opportunities in Review

Posted on | by Leon Hinde | Leave a Comment on Morning Report – Opportunities in Review

Welcome to our Morning Review video report.

We look at the impact the recent market volatility has had on our ASX 20 and 50 model portfolio.

Buy ideas include ASX, AGL, AMC, SGP, TAH, TCL and GPT

Sell ideas include CPU & BEN

The video runs for 6 minutes and if you’d like to discuss the ideas presented,  please call our office on 1300 614 002.

 

 

WES continues To Fall On UK Bunnings Venture

Posted on | by Todd | Leave a Comment on WES continues To Fall On UK Bunnings Venture

Shares of Wesfarmers have lost over 7% this month and posted a six-month low of $40.50 yesterday.

The main drag to the share price has been the growing losses and poor outlook for their UK-based Bunnings hardware stores.

After writing off close to $1 billion on Monday, analysts have estimated that WES may have to invest another $540 million into the venture for a chance to break-even by 2022.

Over the last three years, the share price has traded in a broad range with resistance near $45.00 and investor support coming in near $39.00.

In the January 9th daily blog, we suggested selling a $45.00 June call for $1.02 to increase cash flow and keep exposure to the $1.03 dividend on February 20th.

WES has been in our ASX Top 50 model portfolio since January 2016 from $39.05. We continue to view WES as a range-bound stock and will use the derivative overlay strategy to enhance returns.

Wesfarmers

 

 

 

 

CBA Slips On Top-Line Profit Miss

Posted on | by Todd | Leave a Comment on CBA Slips On Top-Line Profit Miss

Shares of CBA  have traded in a wide range today as the bank’s cash profit, including provisions, was posted at $4.87 billion on expectations of $5.2 billion.

The bank announced that it would set aside $575 million to address the AUSTRAC AML accusations and costs related to the Banking Royal commission.

Our ALGO engine triggered a sell signal on CBA at $80.90 on November 13th.

Considering the headwinds facing the domestic banking industry in general, we see the next key support level for CBA at $75.80.

Commonwealth Bank

 

 

HOW TO PROTECT YOUR PORTFOLIO

Posted on | by Leon Hinde | Leave a Comment on HOW TO PROTECT YOUR PORTFOLIO

HOW TO PROTECT YOUR PORTFOLIO

Welcome to our Morning Review video report. We look at the inverse ETF by Betashares “BBUS” which is now up 20% from the lows last week.

The Dow Jones is down over 2000 points and the selling is likely to accelerate.

On Monday we recommended that investors put in place portfolio hedging, stop-losses on high PE and cyclical names and trim gains to raise cash.

The video runs for 6 minutes and if you’d like to discuss the ideas presented,  please call our office on 1300 614 002.

HOW TO PROTECT YOUR PORTFOLIO

Posted on | by Leon Hinde | Leave a Comment on HOW TO PROTECT YOUR PORTFOLIO

Welcome to our Morning Review video report. We look at the inverse ETF by Betashares “BBUS” as a way investors can profit from a down move in US equities.

With the Dow Jones trading down 666 points on Friday night we encourage investors to start building portfolio hedging positions, place stop-losses on high PE and cyclical names and trim gains to raise cash.

 

The video runs for 5 minutes and if you’d like to discuss the ideas presented,  please call our office on 1300 614 002.

Buy And Hold Telstra

Posted on | by Todd | 2 Comments on Buy And Hold Telstra

Over the course of the last six months, TLS shares have been beaten down as the company purges its liabilities to the NBN and re-calibrates other assets.

As part of that process, the telecom giant announced that it will be writing down the value of its Ooyala video streaming firm to zero.

This will result in an impairment charge of $273 million in the half year numbers.

Technically, TLS shares have been building a solid base in the $3.50 to $3.60 area and we expect to see the stock trade back into the $4.00 handle over the medium-term.

With an annual dividend yield just under 8%, we suggest investors look to accumulate TLS shares in this price area.

Telstra

 

 

US Payroll Data Triggers Wall Street Rout

Posted on | by Todd | Leave a Comment on US Payroll Data Triggers Wall Street Rout

U.S. stocks fell sharply on Friday after a stronger-than-expected Non-farm payroll report pushed interest rates higher.

The U.S. economy added 200,000 new jobs in January versus expected growth of 180,000. Weekly average earnings rose 2.9% on an annualized basis and the unemployment rate was unchanged at 4.1%.

The Dow 30 index dropped 665.75 points (2.8%) to close at 25,520, which is the index’s sixth-largest points decline ever.

The broad-based SP 500  fell 2.1% and finished at 2,762, with energy as the worst-performing sector.

The NASDAQ 100 plunged 1.96% to 7,240 as declines in Apple and Alphabet offset a strong gain in Amazon shares.

The combination of extreme valuations and increased leverage in the market could see US equities extend today’s losses into next week.

We suggest cutting high PE names from portfolios and looking for “stock specific” opportunities on the long side. SP 500 Index

 

 

Morning Report – Opportunities in Review

Posted on | by Leon Hinde | Leave a Comment on Morning Report – Opportunities in Review

Welcome to our Morning Review video report. We look at buy signals in CIMIC, REA Group, Dexus Property Trust and the “close” in Sonic Healthcare following the removal from the ASX 50 Model Portfolio.

Also covered in the report…

Analysts upgrade TLS…buy Tab Corp…WOW vs WES & 3 ETF’s to start watching.

The video runs for 5 minutes and if you’d like to discuss the ideas presented,  please call our office on 1300 614 002.

 

Look For A Pull Back In TWE

Posted on | by Todd | Leave a Comment on Look For A Pull Back In TWE

Since hitting an intra-day low of $14.55 on January 16th, shares of TWE have rallied over 20% to a high of $17.75 yesterday.

Upgrades from several analysts combined with lower tax rates in the USA have given the shares a strong boost.

However, in a recent preview to their half-yearly results, CEO Mike Clarke suggested that there will be a major overhaul to their US distribution network.

Early estimates are that these changes could lower earning by $47 million to $655 million in 2018.

In addition, internal momentum indicators are now showing an overbought condition above $17.00.

We suggest looking to buy TWE on a pull back into the $15.30 area.

Treasury Wine