Bendigo Bank – 1H19

Bendigo reported earnings slightly below market consensus.

1H19 cash profit came in at $220m, however, we continue to see challenging conditions for the regional banks.

BEN and BOQ both display lower high formations and are under Algo Engine sell signals.


Earnings Calendar

Amcor reports on Monday, we expect the earnings result to support the  current share price rally. AMC has been a high conviction call, expressed on the blog and in the “Opportunities in Review webinar”.

Bendigo Bank, (BEN)  reports on Monday, we’re cautious of this name and see the money being made on the short side.

Origin Energy (ORG) reports next Friday, we feel the LNG related income will surprise on the upside.

For more detail on the earnings season, register for Monday’s Opportunities in Review webinar.





Sell Signal In Bank Shares

All four major banks, and the regional names, are now displaying Algo Engine sell signals. Currently we have no bank long holdings within our model portfolio.

Within the financial sector our preference remains for ASX and IAG. Both offer a fully franked dividend yield, and when combined with a covered call, we’re generating 10 – 12% annualized cash flow.

Our concern about the low ROE for the domestic banks is driven by weak housing loan growth and the rising cost of funds. These conditions keep us cautious on the banks, especially when combined with the present group of ALGO sell signals.