New High Close For Treasury Wine Estates

Posted on | by Todd | Leave a Comment on New High Close For Treasury Wine Estates

Shares of TWE posted a new all-time high of $16.22 on the ASX close last Friday.

Our ALGO engine triggered a buy signal on TWE back in July at $12.55.

The stock is trading at 40X earnings with the 12 month EPS currently expected at just over 23%.

The internal momentum indicators look good and we would look to take profits on a move into the $16.90 to $17.00 area.

Treasury Wine Estates

Aussie Dollar Drops On Weaker Trade Balance Report

Posted on | by Todd | Leave a Comment on Aussie Dollar Drops On Weaker Trade Balance Report

The Aussie Dollar dropped close to 1% overnight as yesterday’s domestic trade balance numbers showed a steep contraction for the month.

The AUD/USD hit a six-month low at .7500 as the trade surplus fell to $105 million from $1.6 billion the month before. The street had expected a surplus of $1.4 billion……10 times higher than the actual print.

The sharp drop was driven by a 3% fall in exports and a 2% increase in imports. Details of the report showed much lower levels of exports of Iron ore and coking coal.

There are several names on the ASX that earning revenue overseas and will benefit from the falling Aussie Dollar.

These include QAN, RHC, TWE and NCM.

QANTAS

Ramsay Health Care

Newcrest Mining

Treasury Wine Estates

ALGO Update: Treasury Wine Estates

Posted on | by Todd | Leave a Comment on ALGO Update: Treasury Wine Estates

Our ALGO engine triggered a buy signal on TWE back in early July at $12.55.

Since then the share price has added close to 20% closing Friday just over $15.80.

The company, with a market cap of $11.11 billion, recently declared a final dividend of 13 cents per share, 50% franked, bringing the total dividend for FY17 to 26 cents per share, a yearly increase of 30%.

TWE has a portfolio of more than 70 brands, including Penfolds, Pepperjack and Lindeman’s, with sales operations in more than 70 countries.

French wine growers have suffered recently on the back of unfavorable weather which has resulted in vineyards in wine-growing regions such as Bordeaux and Champagne being damaged by frost.

As a result, the French Agricultural Ministry has reported wine production will fall by about 20%, leading to the lowest level of output in more than 60 years.

In addition to the strong sales growth in Asia, we consider the lower European wine production as a bullish development for TWE and expect further share appreciation into the end of the year.

Treasury Wine Estates

 

 

 

 

TWE Is Looking To Expand

Posted on | by Todd | Leave a Comment on TWE Is Looking To Expand

Treasury Wine Estates has been in acquisition  talks over the past week with premium winemaker, Robert Mondavi, in the United States

Robert Mondavi Wines, which celebrated its 50th anniversary last year, was bought by beverage giant Constellation Brands for about $US1 billion in 2004.

While it is unclear how progressed the talks with Treasury are, there’s no question that Robert Mondavi would be an excellent fit. The company has plenty of contracted grape supply in the ultra-premium Napa Valley wine region.

Shares of TWE found support just above $13.50 and closed the week 2.5% higher at $14.08.

We see scope for reasonable price appreciation in TWE above $14.50 and will look for an ALGO buy signal at lower levels.

Treasury Wine Estates

Look To Buy TWE Below Current Levels

Posted on | by Todd | Leave a Comment on Look To Buy TWE Below Current Levels

Shares of TWE have dropped about 6% since posting an all-time high of $14.64 on September 11th.

There’s no question that TWE is one of the most solid performers on the ASX  and we have bought and sold it successfully for client accounts several times this year.

With the company making an accelerated push into the US premium wine market, we feel this pullback will offer another good buying opportunity in the near-term.

In addition, TWE is only $100 million into their $300 million stock buyback scheme, which should also offer price support at lower levels.

We see scope for a move back to $13.10 and will update when an ALGO buy signal is triggered.

Treasury Wine Estates

 

Algo Signal – TWE

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

Our Algo Engine flagged a recent buy signal in TWE at or near $12.30.

The recent share pullback creates an attractive entry point.  Asia demand looks strong and FY18 earnings should see underlying profit increase over 20% to $360 million.

We believe TWE is still in the early stages of building a significant business across Asia, which will help to support the “buy on the dip” approach.

Chart – TWE

Take Profits On TWE

Posted on | by Todd | Leave a Comment on Take Profits On TWE

Back on February 15th, TWE announced that their first half net profit doubled to $136 million. Since then, the share price has traded from $11.20 to an all-time high of $13.63 yesterday.

We suggest taking profits in this price area or writing at-the-money covered calls to enhance the portfolio returns.

There’s no question that TWE has been a well-managed, success story in the beverage space and we’ll follow the ALGO engine to buy back in at lower levels.

Treasury Wine Estates

 

Treasury Wine Estates – 1H17 Earnings

Posted on | by Leon Hinde | Leave a Comment on Treasury Wine Estates – 1H17 Earnings

TWE has reported its 1H17 EBITS of $227m, underlying NPAT was $136m  and an interim dividend of$0.13

Assuming 2H17 is in-line with the first half, we expect a full year result slightly above consensus, which currently sits at $440m

FY18 revenue $2.6b, EBIT $490m, EPS $0.42 and DPS of $0.28, places the stock on a  forward yield of 2.4%

Chart – Treasury Wines

 

 

Higher Low Pattern Stocks to Add to Your Watchlist

Posted on | by Leon Hinde | Leave a Comment on Higher Low Pattern Stocks to Add to Your Watchlist

The following group of stocks are in either established uptrends or, in recent months they’ve broken downtrends to begin building the early stages of a bullish “higher low” formation.

Many of these names have been mentioned previously in the blog and/or the monthly strategy video report. It’s worth loading these codes into your watch list and considering rebalancing your portfolio to include allocations towards some, or all of these names:

JHX, LLC, MQG, SHL, TWE, ANN, ANZ, ASX, CCL, CIM, COH, QUB, TAH, WOW & WPL.

With the lower growth names within the above basket, such as WOW & CCL, we compliment the position now with tight covered calls to enhance the yield to 10%+ per annum. With some of the other names, we give a little more breathing space as we expect 5 to 10% price appreciation before selling the call option overlay.