Energy Names – Best Buy-Side Opportunities

Posted on | by Leon Hinde | Leave a Comment on Energy Names – Best Buy-Side Opportunities

Within the ASX 50,  OSH, STO, WPL, ORG & BHP are the names investors consider when looking for exposure to Oil and LNG.

Currently WPL, ORG and BHP remain in our ASX50 model following a series of structural “higher low” formations.

OSH is not currently in our model portfolio.

The negative we see in the stock relates to market concerns surrounding their stretched balance sheet.

Oil Search has committed to substantial projects in PNG and Alaska and should oil prices fail to hold $60 – $80 per barrel, Oil Search may need to raise capital.

This week, Oil Search reported solid 4Q17 production at the upper end of their guidance range, with revenue of US$389mn.

Our preference remains adding long exposure on any pullback in BHP, WPL & ORG.

We are also watching for the next Algo Engine buy signal in the oil ETF OOO.AXW.

 

 

Origin Energy – Hits Profit Target

Posted on | by Leon Hinde | Leave a Comment on Origin Energy – Hits Profit Target

Our Algo Engine has triggered a number of buy signals in ORG, as the two year downtrend reversed and a new uptrend of “higher lows” commenced in early 2016.

The recent buy signal at $6.75 means the stock is still in our ASX 50 Model Portfolio, however, shorter-term investors may wish to consider taking profit, as the stock now looks fully valued.

Origin – Reaffirmed FY18 Guidance

Posted on | by Leon Hinde | Leave a Comment on Origin – Reaffirmed FY18 Guidance

 ORG indicated it’s targeting a Crude Oil price of US$40 per barrel distribution break-even for FY20.

ORG hosted its 2017 investor day,  this week, at which time they reaffirmed their FY18 guidance with respect to capital expenditure, debt management and APLNG.

The market is encouraged by the potential for up-to $500m in cost savings,  ($110m OPEX and $400m CAPEX), over the next 2 – 3 years.

ORG will likely reinstate dividend distributions, building to $0.40 per share in FY19 and $0.50 in FY20.

These targets have ORG trading on a FY19 forward yield of 5%.

We continue to see ORG as a buy on the dip opportunity and look to keep exposure to the name in portfolios over the next 3 to 5 years.

Origin Energy

 

 

 

 

 

WPL And ORG Are Looking Good, Technically

Posted on | by Todd | Leave a Comment on WPL And ORG Are Looking Good, Technically

Over the last several months, there have been many questions asked about the likely direction of energy-related stocks.

The fundamentals in the Crude Oil market are difficult to forecast and the political climate, domestically, may impact the future revenue of electricity markets.

However, from a technical perspective, both ORG and WPL look like they may be setting up for a move higher.

We currently see reasonable upside targets at $30.75 in WPL and $8.00 in ORG.

Woodside Petroleum

Origin Energy

 

Algo Update – WOW & ORG

Posted on | by Leon Hinde | Leave a Comment on Algo Update – WOW & ORG

As the Algo Engine identified the “higher low” price pattern in both Woolworths and Origin Energy, we’ve regularly highlighted these as preferred buying opportunities.

We’ve remained buyers of ORG and WOW throughout the past 12 months but now feel that we’re approaching a level where we see full value.

Resistance in ORG will likely be found at or near  $8.00 and WOW is likely to experience selling based on valuation grounds at or near $27.50.

Chart – WOW
Chart – ORG

 

 

 

 

 

 

ALGO UPDATE: ORG Shares Firm On NT Gas Discovery

Posted on | by Todd | Leave a Comment on ALGO UPDATE: ORG Shares Firm On NT Gas Discovery

On June 23rd, the ALGO engine triggered a buy signal on ORG at $6.90.

Shares of ORG got a boost today as news of a multi-billion dollar gas resource was found in the Northern Territories.

Origin estimates that up to 6.6 trillion cubic feet of gas is in the area based on a 57-day production test. That volume is enough to cover Australia’s domestic gas needs for over five years.

We have a medium-term upside target of $8.00 and would consider ORG as a good buy/write strategy to add value to investor’s portfolios.

Origin