Brambles – Add Call Option

Brambles remains under Algo Engine buy conditions.

FY20 earnings were in-line with market consensus with EBIT flat on the same time last year. On a constant currency basis, EBIT increased 4%, which was in-line with management guidance for 3 – 5% growth.

BXB generates a large percentage of its revenue from consumer
staples and grocery supply chains, making it a relatively safe harbor for investors. At 22X forward earnings and a 2.2% yield, there’s not much upside in the share price on a 12-month outlook.

We suggest investors add a covered call option to enhance the income return.