Buy Downer EDI – Algo Signal Update

Posted on | by Leon Hinde

Our Algo engine generated a recent buy signal in Downer EDI and we’re encouraged by the fundamentals supporting solid future earnings growth.

The outlook for DOW’s base business is positive, with a favorable
backdrop across virtually all of Downer EDI’s markets including infrastructure, renewables,  resources, health & government projects.

FY18 guidance to be achieved with 10%+ eps growth expected in FY19.

Based on FY19 forecasts we anticipate $11.5b in revenue, EBIT $500m and  DPS $0.29, placing DOW on a forward yield of 4.1%.

ASX:DOW

 

Buy Link Administration

Posted on | by Leon Hinde

Link Administration has attractive long-term fundamentals and is likely to deliver consistent high single digit earnings growth.

At present, the market is failing to look through the shorter-term impacts from changes to recent superannuation legislation. Should broad market weakness force a retest of the $7.00 price range, we’d consider this a good entry level.

Link

ALGO Update: Stay Long Cimic Group

Posted on | by Todd

Shares of Cimic Group have started the week over 4% higher and have reached a 2-month high of $44.75 in early trade.

Investors are reacting to the recent news that CIM was awarded a 4-year, $480 million contract by QCoal to continue mining services operations at QCoal’s Bowen Basin Mines.

Our ALGO engine triggered a buy signal for CIM on June 1st at $40.73 and the stock has been part of our ASX Top 100 portfolio since June of 2016.

From a technical perspective, we see solid support near $42.50 with an initial upside target at $47.50.

Cimic Group

Tabcorp – Strong Buy

Posted on | by Leon Hinde

Our Algo Engine generated a recent buy signal in Tabcorp at $4.20 and we again reaffirm our “strong buy” position in the stock.

Last week, the Australian Federal Government passed legislation which will prohibit the use of ‘synthetic lotteries’ like Tabcorp’s main lottery competitor, ‘Lottoland’.

TAH effectively has a monopoly on lottery activity, as the company holds the licence in every state, with the exception of Western Australia, which is state-run.

We feel Tabcorp’s defensive earnings are being undervalued by the market and the August earnings result will be a catalyst to drive the share price higher. 

Tabcorp goes ex-div $0.125 on the 11th August.

Tabcorp