BXB’s 1Q18 sales trading update was slightly better than market expectations with robust 6% constant currency revenue growth for the first quarter.
Underlying FY18 earnings will likely grow at 5 – 6% and increase to $1bn.
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On the back of increase to earnings, our target price range for BXB is $9.25 support and $10.00 resistance. BXB is a strong business with dominant global market positions, we’re comfortable running a buy write strategy on BXB.
FY18 forecast dividend yield is 4%, we allow for moderate capital growth and cap the gains with a covered call option to boost the annual cash flow to 10%+.
Brambles
