Seek is under Algo Engine buy conditions and is a current holding in our ASX 100 model portfolio.
The company reported its FY19 earnings yesterday and provided strong guidance and a positive outlook for FY20.
F19 was in line with consensus with revenue up 18% and EBITDA up 8%.
FY20 guidance has been upgraded to 15 – 18% revenue growth and profit growth of 10%+. Seek now trades on a 2.8% forward yield.
Buy Seek and sell out of the money covered calls to enhance the yield.
Seek is a current holding in our ASX 100 model portfolio. The stock goes ex-div $0.24 on the 25th of March and adding a covered call option will boost the annualized cash flow to 10%+.
Seek delivered recent earnings slightly ahead of market consensus and we consider the stock an attractive income contributor to client portfolios.
For more detail on the covered call strategy, please call our office on 1300 614 002.
We consider the 2019 recovery rally in the below names, as now largely complete.
The post below is from the 14th of November.
GARP is an acronym which is referenced to “growth at a reasonable price”.
This is how we now view ALL, TWE, CAR and SEK.
Shares of SEK have extended this week’s gains and have reached a two-week high of $18.55 in early trade today.
The online job search engine has been under an ALGO buy signal since August and is part of our ASX Top 100 Model Portfolio.
We consider much of the recent downside price action technical in nature and see solid chart support in the $17.50 area.
The next key resistance level is near $19.60 with a longer-term target above $20.25.
SEEK
Our Algo Engine generated a buy signal in Seek and we’re now watching the $17.50 support level as a pick up in buying interest begins to occur.
CAR is another name to watch for increased buying activity following the recent sell-off.
TWE, SEK and CAR are all displaying current Algo Engine buy signals and are therefore a holdings within our ASX100 model portfolio.
We recommend accumulating TWE stock within the $14.50 – $15.50 price range.
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Seek is another name where above average EPS growth is likely to be achieved in FY19 & FY20. We recommend accumulating the stock within the $17 – $18 price range.
CAR delivered a disappointing earnings update earlier this month, however, with the stock price correcting 25%, we now see value emerging.
Our Algo Engine generated a buy signal in Seek at $19.70 back in July.
With the current share price finding support, (at a new higher low formation), we see this as a viable buy-write opportunity.
June $22.50 call option will generate an additional $0.75 per share of income. Seek goes ex-dividend $0.24 on the 26th of March.
Following a recent Algo Engine buy signal, Seek has been added to our ASX100 & ASX50 model portfolios.
We see buying support near $20.50.
Seek
SEEK has yet again pushed out the timing of its earnings growth, committing to another huge uplift in operational and capex spending to grow market share in China, South East Asia and Australia.
The market has downgraded earnings forecasts to reflect the FY18 result and the guidance for FY19. This now leaves FY20 and 21 as the growth opportunity with forecast EPS set to accelerate to 20%+ p/a.
With the stock now on 2% dividend yield and questions over short-term growth and large capital expenditure, we feel investors should be patient and wait for our next ALGO buy signal.
SEEK offers investors exposure to the global hiring cycle and increasing migration of employment advertising to the online market.
SEEK
Seek has been triggered as an Algo Engine buy signal.
With a weak broader equity market backdrop, we’re in no hurry to buy today.
However, should we see Seek trade closer to $18.50 in tomorrow’s session, we’ll revisit the buy-side idea.
Keep this one on your watch list.
SEK
Level 29 Chifley Tower
2 Chifley Square
Sydney, NSW 2000
1300 614 002
Investor Signals Pty Ltd
ABN 44 143 555 453
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