Boeing Soars After Strong Earnings Report

Posted on | by Todd | Leave a Comment on Boeing Soars After Strong Earnings Report

Shares of Boeing  rallied to their highest-ever level Wednesday, contributing 117 points to the Dow Jones 30 Index on the heels of a second-quarter earnings beat and improved profit outlook.

The stock shot up more than 8%, its largest percentage gain since August 2009, to a high of $230.43, its highest intra-day price ever.

The dollar gain of nearly $17 was the best daily point rise on record.

Boeing shares have posted gains in four straight sessions, tacked on nearly 10% over that period and are up more than 45% for the year.

The company reported $2.89 per share, compared with the street’s estimate of $2.58 per share.

Boeing

 

Evolution Posts Record Production

Posted on | by Todd | Leave a Comment on Evolution Posts Record Production

Evolution Mining (EVN) posted a record quarterly production result of 218,000 ounces at a sustained cost of  AUD$825.00 per ounce.

The strong Q4 number places the FY 2017 production at the upper end of forward guidance near 844,000 ounces, and below the lower end of the cost guidance of AUD$906.00.

We see near-term technical resistance in the $2.48 area with a longer-term price target near $2.60.

However, a stronger AUD/USD above .8000 will have a dampening effect to EVN’s bottom line going forward.

Evolution Mining

 

AZJ – Selling Pressure

Posted on | by Leon Hinde | Leave a Comment on AZJ – Selling Pressure

AZJ has recognised an A$526m impairment to its Bulk assets, and continues its Inter-modal review.

AZJ noted continues to face challenging market conditions and we feel investor sentiment will be negative leading into the FY17 results on 14 August 2017.

AZJ has previously guided towards FY17 EBIT within A$800-850m range.

Regular viewers of the ASX top 50 video market report, will recognise AZJ as a stock we’ve been warning about, in 2017. Our concern relates to the sustainability of the high dividend payout ratio and the probability of the company being forced to announce a cut at the August result.

Chart – AZJ

 

 

Has The AUD Reached The RBA’s Pain Level?

Posted on | by Todd | Leave a Comment on Has The AUD Reached The RBA’s Pain Level?

At the start of the year, the market consensus was for the Aussie Dollar to fall against the major currency pairs during 2017. So far this year, the AUD/USD has climbed 10% and almost touched .8000 last week.

At 1pm today, RBA chief Philip Lowe will be giving a speech in Sydney. Since many exporters look at .8000 as a pain level, it’s reasonable to expect Mr Lowe to comment about the level of the Aussie.

The strengthening AUD/USD has created a headwind for domestic companies with earnings exposed to the softening USD.

Four companies that we follow which have seen their share prices dampened due to a stronger Aussie are: BXB, CPU, ANN and JHX.

Australian Dollar

Algo Update – BHP & WOW

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

Recent Algo Engine buy signals in BHP and WOW continue to perform strongly.

An overnight rally in metal and oil prices will support BHP in today’s trading   and investors may wish to consider selling covered calls into November, at or near the $26 strike price.

Chart – BHP

Woolworths reports earnings on the 23rd August and the market will be looking for underlying EPS growth of 8% to support the 22x earnings multiple.

With WOW now trading on forward yield of 3% and a relatively high multiple, we encourage investors to sell $28 Dec call options to boost the annual cash flow return.

Chart – WOW

 

Computershare – Earnings Result 16th Aug

Posted on | by Leon Hinde | Leave a Comment on Computershare – Earnings Result 16th Aug

Computershare reports earnings on the 16th August.

At 20x forward earnings and 2.6% dividend yield, we feel CPU will likely disappoint and deliver earnings below market expectations.

Any bounce in CPU from these levels will provide an opportunity to consider building new short exposure.

Chart – CPU

James Hardie trades at 26x forward earnings with a 2.7% forward yield.

Again, we consider this name expensive and likely to disappoint investors when JHX report earnings on the 8th August.

A rally back towards $21.00 will provide an opportunity to reset short exposure.

Chart – JHXJHX

 

 

Algo Signal Update – GrainCorp

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

As an update to last week’s post on GrainCorp, we again remind readers that GNC is approaching an oversold level.

We expect support will likely develop at or near the current price level.

The trade in GNC is  likely to be a corrective move from oversold conditions.

The stock price is unlikely to develop into a meaningful uptrend.  We recommend a stop loss below the final pivot, or entry point. GNC

$8.50 – $9.00 is buying support with $9.50 is the profit target.

Chart – GNC