Yovich & Co. Weekly Update - 10 March 2014
Mar 10, 2014 | Commentary
March 10th 2014
This Week’s Themes
- The end of reporting season saw investors push the NZ market to record highs with six consecutive up days.
- It was the best reporting season in Australia in three years, causing their market to reach post GFC highs.
- Strong jobs numbers out of the U.S. reiterated the strengthening of the U.S. economy and saw the Dow reach another all-time high.
- The Aussie and Kiwi both rallied against the U.S. Dollar with positive sentiment globally improving as traders take the bet that the conflict in the Ukraine will not worsen and end in war.
Current Preferred Bonds:
ANBHA - ANZ - Perp Subordinated Bonds
FNZC Investment View: We expect redemption to occur in 2018. Based on this redemption date assumption, the estimated yield to redemption is 5.7%pa which is around 0.4% above similar rated securities with a 5 year fixed term to maturity. Credit rating BBB+ (Standard & Poors).
ZEL010 - ZEL 15/10/16 7.35 - Z Energy Ltd Bonds
FNZC Investment View (August 2013) - Current Pick for bonds rated Triple B. This Bond is unrated although FNZC assess that the credit rating would be BBB-, BBB or BBB+ if they were.
IFT160 - IFT 15/06/17 8.50% - Infratil Limited Infrastructure
FNZC Investment View (August 2013) - Current pick for the unrated bonds given a yield of around 6.3%. This Bond is unrated although FNZC assess that the credit rating would be BB-, BB or BB+ if they were.
FBI070 - FBI 15/05/2016 7.75% Fletcher Building Industries - Capital Notes
Yovich & Co Investment View - Although not offering the best value, we believe that a yield of 5.5% is fair. This Bond is unrated although FNZC assess that the credit rating would be BB-, BB or BB+ if they were.
APM010 - APM 15/03/16 7.86% - APN Media
Yovich & Co Investment View: These bonds are now trading back at fair value and we are looking to buy any time they are over 8%. There continues to be uncertainty surrounding the Media industry and how companies will transition cash flow from print media to online media; APN is cutting costs and have a strategy in place. These bonds are unrated by a credit agency.
Weekly Update Investment Shares Bonds Market Commentary ANBHA ZEL010 IFT160 FBI070 APM010