BHP Bumps Dividend As Earnings Slip

Posted on | by Leon Hinde | Leave a Comment on BHP Bumps Dividend As Earnings Slip

BHP’s 1H FY18 earnings result was below market expectations.

Despite the cost pressures, BHP has stepped up cash returns to shareholders, with the US$0.55 interim dividend a positive surprise in the 1H FY18 result.

FY19 revenue and underlying profit is forecast to remain flat, placing the stock on a forward yield of 4.2%.

We own BHP at lower levels and sold the $29.50 March calls for a $0.60 credit to enhance the cash flow. We continue to remain exposed to the March dividend.

BHP

 

 

QANTAS Firms Into H1 Earnings

Posted on | by Todd | Leave a Comment on QANTAS Firms Into H1 Earnings

Since trading as low as $5.00 last week, shares of QAN have gained some altitude to reach $5.37 in early trade today.

The airline is scheduled to release H1 results on Thursday with the preliminary numbers showing a NPAT of $690.4 million and a DPS of 12.5 cents.

From a technical prespective, the internal momentum indicators look positive and the next key resistance level is near the December high of $5.81.

QAN was added to our Model portfolio on July 24th at $5.25, and we prefer the long side from these lelvels.

QANTAS

 

Tabcorp – Value Opportunity

Posted on | by Leon Hinde | Leave a Comment on Tabcorp – Value Opportunity

The recent drop in Tabcorp shares provides a low risk entry level where future earnings are underpinned by the $110 million synergy cost savings after the Tatts merger.

The FY19 revenue is forecast to be $5.4billion, EBIT $850 milion, EPS, $0.28 and DPS $0.23, placing the stock on a forward yield of 4.9%, (fully franked).

Our ALGO engine triggered a buy signal in TAH on February 13th at $4.47.

TAH shares have reached a high of $4.74 in early trade and we see the next resistance level near $4.90

TabCorp

 

 

Medibank Delivered 1H18 earnings

Posted on | by Leon Hinde | Leave a Comment on Medibank Delivered 1H18 earnings

Medibank delivered 1H18 NPAT of $245 million, which is an increase of 6% versus the same time last year.

Operating conditions are expected to remain largely unchanged and we expect revenue and underlying profit to remain flat in FY19.

With the stock trading 20x earnings and 4.1% yield, investors should add an at-the-money-call option to strip out the maximum cash flow from dividends, call option premium and franking credits.

Medibank