Yovich & Co. Market Update - 15 February 2019

Feb 15, 2019 | Commentary

New Zealand Equities

Market News

 

 

 

In summary, the NZX50 had 10 companies on the downside, 2 remained unchanged and 38 companies were on the upside. No material change in the NZD/AUD exchange rate; closing at 0.9515. The NZD/USD has weakened slightly over the week, which will help NZ exports.

 

 

 

  • Pushpay reached $3.74 per share when it announced that it had reached a goal of break-even cash flow at the end of 2018. Since then the price has pulled back to $3.34 per share.

  • Westpac along with the other Australian Banks has seen a positive response since the release of the Hayne Royal Commission enquiry. Share price moved from $25.84 on 4 February to $28.00 at close on 8 February.

Investment News

ASB Capital Limited

The Buy-Out of the ASBPA and ASBPB (ASB Capital Limited Perpetual Preference Shares), has been announced at NZ$1 for each Perpetual Preference Share and will be paid to shareholders on 15 May 2019. This has resulted in some good capital gains for investors who invested below 90c in the dollar.

Australia Banks

Have reacted positively after the Royal Commission final report on the 4 February.

ANZ up $1.95 (6.27%) at $27.95.                                                   Westpac up $1.705 (6.55%) at $27.65.

Commonwealth Bank up A$3.48 (4.95%) at A$73.60.              National Australia Bank up A$0.27 (1.12%) at A$24.30.

Contact Energy

Tax paid profit for the six months ending December is up $218m (376%) at $276m, this includes realising the gain on the sale of Rockgas and AGS of $172m. Operational costs were down $4m (4%) compared to last year. Due to a robust balance sheet the Board is changing its distribution policy, to distribute ordinary dividends targeting a pay-out of 100% of Operating Free Cash Flow. In line with the new policy the targeted FY19 dividend is 39 cents per share, up 7 cents on FY18 dividends.

An interim dividend of 16 cents per share is payable 9 April, at current share price of $6.34 the gross yield is 8.52%.

Briscoe Group Limited

Has announced record sales of over $206m in the final quarter ending 27 January 2019. The expected tax-paid profit for the FY18 is to be a new high at around $63m up 2.7% on last year.

The current share price is $3.36 and expected gross dividend yield is to be 8.05%.

 

PGG Wrightson

Has been given the clearance from the New Zealand Commerce Commission regarding the sale of its seed business to DLF Seeds. The sale had received overwhelming support with 96% of shareholders in favour of the proposed transaction. The Commerce Commission approval has seen the share price increase in value from 47.5 cents to 56 cents per share, a 17.89% rise.

Skellerup  

Tax paid profit for the HY19 ending December is up $1.7m (15%) at $13.4m. The Interim dividend payable 21 March is up 1.5 cents at 5.5 cents per share. Forecast full-year net profit in the range of $29-$31m. With current share price at $2.09, the gross dividend yield is 6.2%.  

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Nathanael McDonald



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