Computershare – Earnings Result 16th Aug

Posted on | by Leon Hinde | Leave a Comment on Computershare – Earnings Result 16th Aug

Computershare reports earnings on the 16th August.

At 20x forward earnings and 2.6% dividend yield, we feel CPU will likely disappoint and deliver earnings below market expectations.

Any bounce in CPU from these levels will provide an opportunity to consider building new short exposure.

Chart – CPU

James Hardie trades at 26x forward earnings with a 2.7% forward yield.

Again, we consider this name expensive and likely to disappoint investors when JHX report earnings on the 8th August.

A rally back towards $21.00 will provide an opportunity to reset short exposure.

Chart – JHXJHX

 

 

Algo Signal Update – GrainCorp

Posted on | by Leon Hinde | Leave a Comment on Algo Signal Update – GrainCorp

As an update to last week’s post on GrainCorp, we again remind readers that GNC is approaching an oversold level.

We expect support will likely develop at or near the current price level.

The trade in GNC is  likely to be a corrective move from oversold conditions.

The stock price is unlikely to develop into a meaningful uptrend.  We recommend a stop loss below the final pivot, or entry point. GNC

$8.50 – $9.00 is buying support with $9.50 is the profit target.

Chart – GNC

 

 

 

Google Shares Drop On Lower Income

Posted on | by Todd | Leave a Comment on Google Shares Drop On Lower Income

Shares of Alphabet, parent company of Google, are down over 3% to $967.00 in aftermarket trade.

After the close of trade today, the tech giant posted a 27.7% drop in quarterly profit compared to a year ago.

The company beat expectations on both the top and bottom line with earnings of $5.01 per share on $26 billion in revenue, compared to earnings of $4.49 per share on $21.5 billion a year ago.

However, a dip in net income from $4.88 billion a year ago to $3.50 billion this quarter offset the better-than-expected earnings.

Our ALGO engine triggered a buy signals on Alphabet on June 30th at $908.00. We will look for initial support at or near the $945.00 level.

Alphabet (Google)

 

Algo Buy Signal – Sonic Healthcare

Posted on | by Leon Hinde | Leave a Comment on Algo Buy Signal – Sonic Healthcare

On 12th July, our Algo Engine triggered a buy signal in Sonic Healthcare, at or near $22.20.

We see this as a level of price support and our base case is that Sonic trades sideways, at or near the current price.

Sonic reports earnings on the 16th of August and we expect underlying EPS growth of 8%, which will support a forward dividend yield of 3.8%.

When combining a covered call option, we’re generating 10 – 12% cash-flow per year.

Chart – SHL

 

 

 

 

Algo Buy Signal – Seek

Posted on | by Leon Hinde | Leave a Comment on Algo Buy Signal – Seek

Our Algo Engine triggered a buy signal in SEK back in mid-June, when the stock was trading at $16.15, since then the price action has rallied to $17.50.

We consider the current price level as full value and investors should consider either taking profit, or selling covered call options.

Seek reports their earnings on the 16th of August and the market is expecting underlying EPS growth of 10 – 15%, delivering NPAT of $192 million.

Chart – SEK

NCM Meets Gold And Copper Output Targets

Posted on | by Todd | Leave a Comment on NCM Meets Gold And Copper Output Targets

Shares of Newcrest have opened  1% higher at $19.80 as their quarterly production report reflected a uptick in production going into the second half of the year.

The company said that its Q4 gold production fell 7.7% from a year ago after the closure of its Cadia mine, but overall output was just enough to meet its full-year target.

Overall production of 551,815 ounces in the quarter helped the gold miner reach an annual output of 2.38 million ounces, which is at the lower end of their 2.35 to 2.60 million ounce forecast.

NCM also posted copper production of  83,900 tons, which is within the guidance of 80,000 to 90,000 for the year.

With spot Gold now trading at one-month high of $1255.00, we expect NCM to move back into the mid-June range of $21.50 to $21.75.

Newcrest

 

VIX Index Posts All-Time Low

Posted on | by Todd | Leave a Comment on VIX Index Posts All-Time Low

The VIX Volatility Index was introduced to investors in 1993. Today the index posted an all-time low weekly closing price of 9.31.

The price of the index reflects the market’s expectation of 30-day volatility in put and call options on the SP 500 stocks. It’s a widely used measure of market risk and often referred to as the “investor fear gauge”.

A price on the VIX greater than 30.00 is generally associated with high market volatility driven by investor uncertainty, while a value of 20.00 or lower corresponds to complacency in the market.

As a point of reference, the VIX has not posted a closing value above 20.00 in over 8 months.

With the SP 500 index trading near all-time highs on declining volume, it’s reasonable to expect a material increase in market volatility over the medium-term.

VIX Index