– Algo Sell Conditions

Carsales.Com is under Algo Engine sell conditions following the lower high formation at $13.50.

Earnings guidance provided by Carsales for FY19  are for EBITDA of $210mn and  NPAT of A$131mn. Revenue guidance was a little weak, indicating full year profits are being supported by cost out initiatives.

We will review CAR on the price retracement & Algo Engine buy signal. – Technical Bounce

CAR is one of the “GARP” (growth at a reasonable price), names that we’ve been tracking.

With the stock bouncing off the $11.00 price level, we suggest running a tight stop-loss below the recent “pivot low” and giving the upside momentum a chance to develop.

Within the back drop of market volatility, it is difficult to know how this trade plays out in the short-term. Therefore, we highlight the need to run a stop loss.

We consider ALL & TWE as similar technical opportunities.

TWE, SEK & CAR – Above Trend EPS Growth

TWE, SEK and CAR are all displaying current Algo Engine buy signals and are  therefore a holdings within our ASX100 model portfolio.

We recommend accumulating TWE stock within the $14.50 – $15.50 price range.

Seek is another name where above average EPS growth is likely to be achieved in FY19 & FY20.  We recommend accumulating the stock within the $17 – $18 price range.

CAR delivered a disappointing earnings update earlier this month, however, with the stock price correcting 25%, we now see value emerging.