GPT Strategy – Generates 10% cash flow

GPT reported 1H19 earnings which showed growth at 2% based on the same time last year.

Full-year guidance remains at +2.5% and DPS growth of +4.0%.

We consider GPT an attractive buy-write strategy where a combination of the dividend and the call option premium is generating 10% cash flow.

For more detail on the buy-write, please call our office on 1300 614 002.

 

 

COH – Algo Buy Signal

Cochlear is now under Algo Engine buy conditions and has been added into our ASX 100 model portfolio.

Whilst the FY19 result came in at the bottom end of guidance, the company upgraded the FY20 outlook. We now expect 10% EPS growth over the next 12 months.

The stock remains expensive at 40x FY20 earnings and trading on a 1.8% yield.

 

NCM – Valuation Review

Newcrest Mining is under Algo Engine sell conditions. Our preferred gold names have been EVN and NST, which remain in our ASX 100 model portfolio.

Whilst there’s upside risk to NCM, if the gold price continues
higher, we remain cautious following the latest earnings update.

FY19 EBITDA of US$1,670m was close to market consensus and FY20 production guidance is similar to FY19, with 2.35-2.5 million ounces.

Our base case is FY20 earnings are unlikely to top FY19 and with the stock trading on an FY20 forward dividend yield of 1.6%, we see better opportunities elsewhere.

We’ll continue to monitor NCM and will review further following the next Algo Engine buy signal.

 

 

 

 

 

 

Amcor – Buy “High Conviction”

Amcor and is under Algo Engine buy conditions and is a current holding in our ASX 100 model portfolio.

We move to a “high conviction” buy on the stock and see long term value.

Buy Amcor within the $14 – $14.50 range.

 

Invocare – Add to Watchlist

InvoCare comes onto our watchlist following the 1H19 result which showed 10% revenue growth and NPAT up 9%.

The stock is nearing our entry-level following recent retracement in price.

Look for the next Algo Engine buy signal.

 

Amcor – Buy Signal

Amcor is under Algo Engine buy conditions and is a current holding in our ASX 100 model portfolio.

The defensive earnings stream and the prospect of a share buyback next year will help to underpin any near-term share price weakness.

Buy Amcor within the range indicated below.