As with anything we try to do in trading, we attempt to buy the strongest looking prospect and sell the weakest looking prospect. In pairs trading however, we do the above on two highly correlated securities.
The idea is to look within sectors, correlated currency crosses, even correlated commodities, and identify the best looking prospect for a long and the best looking prospect for a short. Then we will look to execute a long and short trade respectively at the same time.
The idea is that each trade will provide a natural hedge against the other. We are not so much interested in the performance of each position in isolation, but rather the performance of each position as part of a single, combined trade.
Let’s look at an example.
One of the best ways to do a pairs trade is to look at a specific sector in the market, let’s say the Healthcare Sector (XHJ). We note two stocks in the XHJ that are experiencing very different fortunes in the market.
CSL Ltd (CSL) is in a nice uptrend, whilst Cochlear (COH has endured a rough time over the past five months.
This would be an option for a “pairs trade”. We would look to go long the stronger stock (CSL) and simultaneously go short the weaker stock (COH).
To read more visit Carl at the Australian Stock Report How To Buy Shares blog
October 15, 2013
October 1, 2013
Buy, Sell, Hold Recommendations 29/9/2013
As featured in the Herald Sun on September 29th 2013, here are the latest buy, sell and hold recommendations from Geoff Saffer Equity Analyst & Educational Facilitator at the Australian Stock Report.
Australian Shares To Buy
Lend Lease (LLC) – Expect LLC to build on solid FY13 performance, underpinned by strong project pipeline, infrastructure activity. Balance sheet allows for possible acquisitions.
Empired Ltd (EPD) – Expanding IT Services company looks set to continue fast-paced growth on back of recent strategic acquisition. Expect earnings to almost double in FY14.
Australian Shares To Hold
Medusa Mining (MML) – We remain wary of the gold sector, but MML’s production is now ramping up, costs remain extremely low and valuation is more appealing than its peers. Australian
Agricultural (AAC) – Has just undertaken a massive capital raising, shoring up its balance sheet. Needs to successfully shift sales overseas to achieve higher beef prices.
Australian Shares To Sell
SCA Property (SCP) – Property trust offers solid yield and surety of Woolworths tenancy. But more than offset by lack of growth and underlying weakness in specialty store occupancy.
Oroton Group (ORL) – Has some growth prospects, but lucrative Ralph Lauren contract has ended, highly-regarded CEO has left and stock trades at too high a premium to sector.
Australian Shares To Buy
Lend Lease (LLC) – Expect LLC to build on solid FY13 performance, underpinned by strong project pipeline, infrastructure activity. Balance sheet allows for possible acquisitions.
Empired Ltd (EPD) – Expanding IT Services company looks set to continue fast-paced growth on back of recent strategic acquisition. Expect earnings to almost double in FY14.
Australian Shares To Hold
Medusa Mining (MML) – We remain wary of the gold sector, but MML’s production is now ramping up, costs remain extremely low and valuation is more appealing than its peers. Australian
Agricultural (AAC) – Has just undertaken a massive capital raising, shoring up its balance sheet. Needs to successfully shift sales overseas to achieve higher beef prices.
Australian Shares To Sell
SCA Property (SCP) – Property trust offers solid yield and surety of Woolworths tenancy. But more than offset by lack of growth and underlying weakness in specialty store occupancy.
Oroton Group (ORL) – Has some growth prospects, but lucrative Ralph Lauren contract has ended, highly-regarded CEO has left and stock trades at too high a premium to sector.
September 16, 2013
Buy, Sell, Hold Recommendations – Herald Sun 8/9/2013
As featured in the Herald Sun on August 4th 2013, here are the latest buy, sell and hold recommendations from Geoff Saffer Equity Analyst & Educational Facilitator at the Australian Stock Report.
Geoff has over 10 years’ experience researching and analysing Australian shares, with a passion for fundamental analysis and specialty in identifying undervalued companies – particularly at the smaller end of the market.
Buy Shares
Credit Corp (CCP) – Debt collection business boasts robust margins, high ROE yet trades @ 13x P/E. Low interest rates and strong balance sheet will allow more debt ledger purchases.
Pura Vida Energy (PVD) – Speculative energy play is high risk, but Moroccan project offers huge upside. Capital raising and $15m farmout fee provide funding for exploration efforts.
Hold Shares
JB Hi-Fi Limited (JBH) – FY13 results beat expectations, highlighted by same store sales growth in 2H. With 14 new stores set for FY14, JBH looks to be in for solid year ahead.
Santos Limited (STO) – High energy prices have helped cushion dips in production and sales volumes. LNG production in PNG on track for second half of 2014.
Sells Shares
Treasury Wine Estate (TWE) – We see more trouble ahead in the US, where a wine glut led to writedowns. TWE still trades on high multiples and will struggle to boost profit margins.
Paladin Energy (PDN) – Recently raised capital but operations are still leaking cash as prices plummet. Outlook for uranium sector remains bleak, highlighted by failed asset sale.
Geoff has over 10 years’ experience researching and analysing Australian shares, with a passion for fundamental analysis and specialty in identifying undervalued companies – particularly at the smaller end of the market.
Buy Shares
Credit Corp (CCP) – Debt collection business boasts robust margins, high ROE yet trades @ 13x P/E. Low interest rates and strong balance sheet will allow more debt ledger purchases.
Pura Vida Energy (PVD) – Speculative energy play is high risk, but Moroccan project offers huge upside. Capital raising and $15m farmout fee provide funding for exploration efforts.
Hold Shares
JB Hi-Fi Limited (JBH) – FY13 results beat expectations, highlighted by same store sales growth in 2H. With 14 new stores set for FY14, JBH looks to be in for solid year ahead.
Santos Limited (STO) – High energy prices have helped cushion dips in production and sales volumes. LNG production in PNG on track for second half of 2014.
Sells Shares
Treasury Wine Estate (TWE) – We see more trouble ahead in the US, where a wine glut led to writedowns. TWE still trades on high multiples and will struggle to boost profit margins.
Paladin Energy (PDN) – Recently raised capital but operations are still leaking cash as prices plummet. Outlook for uranium sector remains bleak, highlighted by failed asset sale.
September 3, 2013
Terms Of Trade - Share Market Education
Every Sunday Carl Capolingua who often appears on Sky Your Money Your Call, features an article around trading strategy in the Herald Sun.
Below are a couple of excerpts from these articles to help guide the way through the share market and hopefully assist in your own individual trading strategy.
The Power Of Three – Japanese Candlestick Patterns
Today we will look at two of the better known Japanese candlestick patterns on a chart; the Three White Soldiers and the Three Black Crows.
Three White Soldiers Like many Japanese candlestick formations, the ‘Three White Soldiers’ owes its name to the nature of Japanese society in the 1600s, which was saw continuous battles between feudal lords, as well as the emergence of the Dojima Rice Exchange in Osaka.
The Three White Soldiers is a bullish reversal pattern, which is characterised by three consecutive, advancing large white (or green) candles. Like all reversal patterns, we need to see a decent downtrend first, otherwise there would be nothing to reverse.
Click here to read the full article
Fibonacci Retracements In Identifying Support And Resistance
Much has been written about Leonardo Fibonacci, the gifted thirteenth-century Italian mathematician. Born in Pisa around 1170, Fibonacci not only introduced the modern use of decimal points, but also discovered the so-called Fibonacci sequence. The sequence begins with 0 and 1, and then adds the previous two numbers to produce a third, e.g. 0, 1, 1, 2, 4, 5, 8, 13, 21 etc.
The sequence then continues onwards to infinity. These numbers are seen as the “key” to nature, with the reproduction cycles of rabbits, branching patterns seen in plant life, and the “golden mean” used in art and architecture all corresponding to this mathematical sequence. Fibonacci discovered that the ratios in this sequence not only recur in nature but can also be seen in markets to indicate likely retracement levels.
Click here to read the full article
Below are a couple of excerpts from these articles to help guide the way through the share market and hopefully assist in your own individual trading strategy.
The Power Of Three – Japanese Candlestick Patterns
Today we will look at two of the better known Japanese candlestick patterns on a chart; the Three White Soldiers and the Three Black Crows.
Three White Soldiers Like many Japanese candlestick formations, the ‘Three White Soldiers’ owes its name to the nature of Japanese society in the 1600s, which was saw continuous battles between feudal lords, as well as the emergence of the Dojima Rice Exchange in Osaka.
The Three White Soldiers is a bullish reversal pattern, which is characterised by three consecutive, advancing large white (or green) candles. Like all reversal patterns, we need to see a decent downtrend first, otherwise there would be nothing to reverse.
Click here to read the full article
Fibonacci Retracements In Identifying Support And Resistance
Much has been written about Leonardo Fibonacci, the gifted thirteenth-century Italian mathematician. Born in Pisa around 1170, Fibonacci not only introduced the modern use of decimal points, but also discovered the so-called Fibonacci sequence. The sequence begins with 0 and 1, and then adds the previous two numbers to produce a third, e.g. 0, 1, 1, 2, 4, 5, 8, 13, 21 etc.
The sequence then continues onwards to infinity. These numbers are seen as the “key” to nature, with the reproduction cycles of rabbits, branching patterns seen in plant life, and the “golden mean” used in art and architecture all corresponding to this mathematical sequence. Fibonacci discovered that the ratios in this sequence not only recur in nature but can also be seen in markets to indicate likely retracement levels.
Click here to read the full article
September 2, 2013
Reporting Season - The Banks
With reporting season almost over we have a look the big 4 banks and their results. It was another bumper period for the banks as they continue to be a leader in the Australian share market.
Commonwealth Bank Australia - reported the biggest profit ever by an Australian bank for the period ended 30 June 2013. Net profit for the year rose by 8% to 7.68 billion with cash profit, a measure that strips out nonrecurring items, up 10% to $7.82 billion, beating the $7.62 billion estimate by analysts.
Click for more info on Commonwealth Bank shares
ANZ Banking Group - Recently released a trading update, showing revenue and profit growth while downplaying fears about a slowdown in China. Australia’s third-largest bank announced a $4.8 billion cash profit for the first nine months of its financial year, up 11% on the year before.
Click for more info on ANZ Bank shares
Westpac Banking Corp - Westpac, like the other big four banks, is sitting in a sweet spot at the moment. The company reported a $6.6 billion cash profit for FY12 – it’s largest ever result and 5% higher on a year earlier. Headline profit dropped by 15%, but this was due to a one-off tax benefit the year before.
Click for more info on Westpac Bank shares
National Australia Bank NAB - NAB has had solid 2013, with its recent quarterly statement evidence of this. Net profit for the three months through June was $1.70 billion, a 42% increase from the same period last year with cash profit increasing by 7% to $1.5 billion for the same period.
Click for more info on NAB shares
Post reporting there has been a slight shift away from the banks and towards the commodity market, but will solid dividend returns the banks are still a solid investment.
Commonwealth Bank Australia - reported the biggest profit ever by an Australian bank for the period ended 30 June 2013. Net profit for the year rose by 8% to 7.68 billion with cash profit, a measure that strips out nonrecurring items, up 10% to $7.82 billion, beating the $7.62 billion estimate by analysts.
Click for more info on Commonwealth Bank shares
ANZ Banking Group - Recently released a trading update, showing revenue and profit growth while downplaying fears about a slowdown in China. Australia’s third-largest bank announced a $4.8 billion cash profit for the first nine months of its financial year, up 11% on the year before.
Click for more info on ANZ Bank shares
Westpac Banking Corp - Westpac, like the other big four banks, is sitting in a sweet spot at the moment. The company reported a $6.6 billion cash profit for FY12 – it’s largest ever result and 5% higher on a year earlier. Headline profit dropped by 15%, but this was due to a one-off tax benefit the year before.
Click for more info on Westpac Bank shares
National Australia Bank NAB - NAB has had solid 2013, with its recent quarterly statement evidence of this. Net profit for the three months through June was $1.70 billion, a 42% increase from the same period last year with cash profit increasing by 7% to $1.5 billion for the same period.
Click for more info on NAB shares
Post reporting there has been a slight shift away from the banks and towards the commodity market, but will solid dividend returns the banks are still a solid investment.
August 12, 2013
Buy Sell & Hold's From Geoff Saffer
These were the weekly buy sell and hold recommendations from Geoff Saffer of the Australian Stock Report that were in the Herald Sun August 4th 2013.
Australian Buy Shares
Infomedia Ltd (IFM) – Experiencing strong demand for its car dealer software, including expansion in key European market. Offers decent value at 5% yield and FY14 P/E of 15x.
Blue Energy (BUL) – Expect to see further reserve upgrades from this small oil developer. Has plenty of cash, operates and owns 100% of its key acreage in QLD.
Australian Hold Shares
ANZ Bank (ANZ) – The banking sector looks fully priced, with added uncertainty from bank deposit levy. Of the majors, ANZ currently offers the best value.
Telstra Corp (TLS) – We see some modest profit growth ahead for Telstra, but valuation looks stretched trading on significant P/E premium to market and yield approaching 5%.
Australian Sell Shares
Qantas Airways (QAN) – Despite recent share price falls, outlook remains bleak. A weak AUD, higher relative oil prices, falling margins and negative free cash flow suggest more pain ahead.
Troy Resources (TRY) – Recent quarterly report shows cash costs rising, with recent takeover of AZH proving to be poor timing with gold in the doldrums.
If you would like more info on Australian Shares, visit the Australian Stock Report today.
Australian Buy Shares
Infomedia Ltd (IFM) – Experiencing strong demand for its car dealer software, including expansion in key European market. Offers decent value at 5% yield and FY14 P/E of 15x.
Blue Energy (BUL) – Expect to see further reserve upgrades from this small oil developer. Has plenty of cash, operates and owns 100% of its key acreage in QLD.
Australian Hold Shares
ANZ Bank (ANZ) – The banking sector looks fully priced, with added uncertainty from bank deposit levy. Of the majors, ANZ currently offers the best value.
Telstra Corp (TLS) – We see some modest profit growth ahead for Telstra, but valuation looks stretched trading on significant P/E premium to market and yield approaching 5%.
Australian Sell Shares
Qantas Airways (QAN) – Despite recent share price falls, outlook remains bleak. A weak AUD, higher relative oil prices, falling margins and negative free cash flow suggest more pain ahead.
Troy Resources (TRY) – Recent quarterly report shows cash costs rising, with recent takeover of AZH proving to be poor timing with gold in the doldrums.
If you would like more info on Australian Shares, visit the Australian Stock Report today.
July 8, 2013
Five Key Factors For Short-Term Trading
Brett Steenbarger, one of the world’s most-renowned experts on the interplay between psychology and trading, outlined five guiding principles of trading psychology, concepts that attempt to delve inside the minds of traders.
These principles – outlined below – are important concepts when it comes to understanding trends in short-term trading.
Number One: Markets are guided by their largest participants.
Number Two: Trends are created by shifts in supply and demand, and generated by global or macro relationships.
Number Three: Market movements on strong momentum will persist in the short run, whilst moves on weak momentum tend to reverse.
Number Four: There are only three kinds of trades, and these are breakout trades, trend-following trades, and reversal trades.
Number Five: It is useful to track market activity at the bid and offer in detecting shifts in short-term demand and supply.
If you would like to read the full article you can do so by visiting the Australian Stock Report how to buy shares blog.
These principles – outlined below – are important concepts when it comes to understanding trends in short-term trading.
Number One: Markets are guided by their largest participants.
Number Two: Trends are created by shifts in supply and demand, and generated by global or macro relationships.
Number Three: Market movements on strong momentum will persist in the short run, whilst moves on weak momentum tend to reverse.
Number Four: There are only three kinds of trades, and these are breakout trades, trend-following trades, and reversal trades.
Number Five: It is useful to track market activity at the bid and offer in detecting shifts in short-term demand and supply.
If you would like to read the full article you can do so by visiting the Australian Stock Report how to buy shares blog.
June 21, 2013
Buy, Sell, Hold Recommendations – Herald Sun 9/6/2013
As featured in the Herald Sun on June 9th 2013 here are the latest buy, sell and hold recommendations
Buy Shares
Next DC (NXT) – Data-centre company is now approaching profitability. The sale-leaseback of its properties will provide NXT with the cash to pursue opportunities in this high-growth industry.
Ardent Leisure Group (AAD) – Expect FY13 results to surprise to the upside, driven by strong growth and margins in the US and at its local Health Clubs division.
Hold Shares
Regional Express (REX) – Facing rising costs, but this solid performer remains the pick of the airline sector. Trades on a P/E of just 8x and a div yield of almost 6%.
Iluka Resources (ILU) – Experiencing a tough FY13, with demand and pricing soft. However potential sale of iron ore royalties a positive and will strengthen the company’s financial position.
Sell Shares
Beach Petroleum (BPT) – Mid-tier energy producer is struggling under increasing costs. Potential stagnation by Chinese economy could overshadow BPT’s recent supply deal with Origin Energy.
Invocare Limited (IVC) – Acquisitions have driven growth and investment portfolio has appreciated but stock looks significantly overvalued at current prices.
You can visit the Australian Stock Report for all their current trading ideas and Australian share tips, get the help you need in this volatile market.
Buy Shares
Next DC (NXT) – Data-centre company is now approaching profitability. The sale-leaseback of its properties will provide NXT with the cash to pursue opportunities in this high-growth industry.
Ardent Leisure Group (AAD) – Expect FY13 results to surprise to the upside, driven by strong growth and margins in the US and at its local Health Clubs division.
Hold Shares
Regional Express (REX) – Facing rising costs, but this solid performer remains the pick of the airline sector. Trades on a P/E of just 8x and a div yield of almost 6%.
Iluka Resources (ILU) – Experiencing a tough FY13, with demand and pricing soft. However potential sale of iron ore royalties a positive and will strengthen the company’s financial position.
Sell Shares
Beach Petroleum (BPT) – Mid-tier energy producer is struggling under increasing costs. Potential stagnation by Chinese economy could overshadow BPT’s recent supply deal with Origin Energy.
Invocare Limited (IVC) – Acquisitions have driven growth and investment portfolio has appreciated but stock looks significantly overvalued at current prices.
You can visit the Australian Stock Report for all their current trading ideas and Australian share tips, get the help you need in this volatile market.
June 19, 2013
What are contracts for difference?
As a trader have you ever wondered what contracts for difference are? A contract for difference (or CFD) is a contract between two parties, typically described as "buyer" and "seller", stipulating that the seller will pay to the buyer the difference between the current value of an asset and its value at contract time.
CFDs were originally developed in the early 1990s in London as a type of equity swap that was traded on margin. The invention of the CFD is widely credited to Brian Keelan and Jon Wood, both of UBS Warburg, on their Trafalgar House deal in the early 90s.
So to look at some of the benefits and potential drawbacks of using CFD's we have attached a couple of links below to give a better explanation of CFD's. Please bear with the technical side of things as you will gain a real appreciation on how this type of trading can be very lucrative.
Resource 1 - What are contracts for difference http://www.australianstockreport.com.au/trading-advice/what-are-contracts-for-difference.html
Resource 2 - Contracts for difference https://en.wikipedia.org/wiki/Contract_for_difference
CFDs were originally developed in the early 1990s in London as a type of equity swap that was traded on margin. The invention of the CFD is widely credited to Brian Keelan and Jon Wood, both of UBS Warburg, on their Trafalgar House deal in the early 90s.
So to look at some of the benefits and potential drawbacks of using CFD's we have attached a couple of links below to give a better explanation of CFD's. Please bear with the technical side of things as you will gain a real appreciation on how this type of trading can be very lucrative.
Resource 1 - What are contracts for difference http://www.australianstockreport.com.au/trading-advice/what-are-contracts-for-difference.html
Resource 2 - Contracts for difference https://en.wikipedia.org/wiki/Contract_for_difference
June 4, 2013
Iinet Limited - One To Keep Your Eye On
IIN has built its own network (the iiNetwork), boasts the largest Voice over IP network in the country, abolished monthly phone line rental with Naked DSL and has released wireless modem-and-phone-in-one BoB to the world.
The firm was included in the ASX 200 in 1999 and employs about 2,000 people at present.
The group’s strategy to increase its value is to grow organically and inorganically. IIN recently acquired TransACT in 2011 and Internode in 2012.
These acquisitions are expected to deliver considerable synergies to the firm in the coming years.
Recent Results
In its 1H13 report, the firm’s NPAT increased to $31.9 million, 122% higher compared to the prior corresponding period.
Aside from the aforementioned, one of the main highlights of the recent report is the significant 73% increase in the firm’s EBITDA compared to the 1H12. This translates to a 35% improvement in the firm’s EBITDA margin from the prior corresponding period.
The solid results were primarily due to the strong organic growth and synergies realized from its acquisitions.
Despite the recent rally IIN’ share price, the company stacks up rather well when compared to its peers. IIN is trading on a forward P/E of 16.8x.
This compare to peers Amcom (AMM) and TPG Telcom (TPM) which are trading 22.1x and 19.6x next year’s earnings. IIN’s forecast dividend yield is around 3.8% more or less in line with AMM’s and higher than the 2.5% forecast for TPM.
Outlook
As previously mentioned, the firm’s recent acquisitions are expected to deliver synergies to the firm.
More importantly, both TransACT and Internode has a solid customer base, which will translate to higher potential earnings growth in the coming financial years.
Some of the benefits from the acquisitions have already manifested in the firm’s recent 1H13 results.
We expect the firm to realize the full benefits from the aforementioned in the medium to long term.
Moreover, the firm has been successful with increasing its market share on the back of competitive rates, attractive combination of services, and its acquisitions.
For more information on australian shares to buy in 2103 vist the Australian Stock Report.
May 28, 2013
Monthly buy, hold and sell share tips from the Herald Sun on the 19th of May.
Buy Shares
Slater & Gordon (SGH) – Major capital raising has allowed company to expand its footprint in the UK market. We expect to see further consolidation in the UK, driving profit growth. Vision Eye
Institute (VEI) – Eye surgery clinic company is an exciting growth story. Capital raising has allowed VEI to pay down debt, expect dividends to start soon.
Hold Shares
Macquarie Group (MQG) – MQG recently jumped on FY13 results. Turnaround story still in play, but offers poorer value compared to buy recommendation back in December.
Carsales.com (CRZ) – Great business with strong margins but will have to continue acquisition march in order to justify current valuation multiples.
Sell Shares
Boart Longyear (BLY) – BLY’s exposure to gold and copper mining could lead to protracted pain. At real risk of announcing a profit warning, following peers SDM, ASL and EHL.
ERA Limited (ERA) – Uranium sector still in doldrums and flagship Ranger mine has halted production. Funds generated from processing ore stockpiles are needed for mine rehabilitation.
Buy Shares
Slater & Gordon (SGH) – Major capital raising has allowed company to expand its footprint in the UK market. We expect to see further consolidation in the UK, driving profit growth. Vision Eye
Institute (VEI) – Eye surgery clinic company is an exciting growth story. Capital raising has allowed VEI to pay down debt, expect dividends to start soon.
Hold Shares
Macquarie Group (MQG) – MQG recently jumped on FY13 results. Turnaround story still in play, but offers poorer value compared to buy recommendation back in December.
Carsales.com (CRZ) – Great business with strong margins but will have to continue acquisition march in order to justify current valuation multiples.
Sell Shares
Boart Longyear (BLY) – BLY’s exposure to gold and copper mining could lead to protracted pain. At real risk of announcing a profit warning, following peers SDM, ASL and EHL.
ERA Limited (ERA) – Uranium sector still in doldrums and flagship Ranger mine has halted production. Funds generated from processing ore stockpiles are needed for mine rehabilitation.
May 24, 2013
Expectations & Share Trading
The latest article on how to buy shares for the beginner in the market looking to start trading;
Expectation is a factor that new traders must seriously consider and have under control before they embark upon their trading careers. Unfortunately, these days trading has been hijacked by the many and varied ‘operators’ on the internet who promise quick and easy riches.
You will be bombarded with tag lines such as “we will give you a simple strategy which can make you big profits in around 30 minutes per day and anyone can learn it quickly” and “Trading for Profit – Make Money Fast” and “Learn how to create consistent monthly income trading stocks and options like a Wall Street Pro”.
The simple fact of the matter is that trading is a difficult pursuit and that the clear majority of retail traders end up leaving the game with less money than when they started. If it were so easy, everyone would be doing it and everyone would be making money.
To read the entire article click the link http://www.australianstockreport.com.au/how-to-buy-shares/stock-market-education/share-trading-expectations/
Expectation is a factor that new traders must seriously consider and have under control before they embark upon their trading careers. Unfortunately, these days trading has been hijacked by the many and varied ‘operators’ on the internet who promise quick and easy riches.
You will be bombarded with tag lines such as “we will give you a simple strategy which can make you big profits in around 30 minutes per day and anyone can learn it quickly” and “Trading for Profit – Make Money Fast” and “Learn how to create consistent monthly income trading stocks and options like a Wall Street Pro”.
The simple fact of the matter is that trading is a difficult pursuit and that the clear majority of retail traders end up leaving the game with less money than when they started. If it were so easy, everyone would be doing it and everyone would be making money.
To read the entire article click the link http://www.australianstockreport.com.au/how-to-buy-shares/stock-market-education/share-trading-expectations/
May 17, 2013
News Corporation
News Corporation (NWS) is a blue chip diversified media conglomerate with interests all over the world and in most facets of media.
NWS is broken up into five main segments:
>>Cable Network Programming
>>Filmed Entertainment
>>Television >>Publishing
>>Director Broadcast Satellite
Television NWS’ 2Q13 results were solid and we expect more of the same in the upcoming 3Q results.
We expect the publishing division to perform strongly with independent data released showing NWS’s flagship product, The Wall Street Journal, maintaining its position as the USA’s largest newspaper by average weekday circulation.
The paper had an average weekday circulation of 2.4 million, including print and digital subscribers, as of March 31, up 12% from a year earlier.
If you would like to learn more about News Corporation or other Australian Shares visit the guys at
ASR
http://www.australianstockreport.com.au/share-tips/
NWS is broken up into five main segments:
>>Cable Network Programming
>>Filmed Entertainment
>>Television >>Publishing
>>Director Broadcast Satellite
Television NWS’ 2Q13 results were solid and we expect more of the same in the upcoming 3Q results.
We expect the publishing division to perform strongly with independent data released showing NWS’s flagship product, The Wall Street Journal, maintaining its position as the USA’s largest newspaper by average weekday circulation.
The paper had an average weekday circulation of 2.4 million, including print and digital subscribers, as of March 31, up 12% from a year earlier.
If you would like to learn more about News Corporation or other Australian Shares visit the guys at
ASR
http://www.australianstockreport.com.au/share-tips/
May 9, 2013
Monthly Buy Sell Holds
As featured in the Herald Sun on May 5th 2013 here are the latest buy, sell and hold recommendations from the Australian Stock Report
Shares To Buy -
The Reject Shop (TRS) – Recent capital raising to fund expansion a positive. Same store sales growth running ahead of targets. Expect outperformance to continue.
Energy Action (EAX) – Small energy services kicking goals with its energy management services and novel energy auctions. Company on track for fifth straight year of revenue and profit growth.
Shares To Hold -
Seek Limited (SEK) – High quality company enjoying strong domestic and international growth. ROE and margins remain very high, but valuation looks stretched at current levels.
James Hardie (JHX) – US property market continues to turn around and there is room for fibre cement to increase market share, but sales growth looks more than priced in.
Shares To Sell -
Matrix Engineering (MCE) – Embattled engineering company’s recent quarterly results showed some signs of life but we still expect FY13 results to underwhelm investors.
Elders Limited (ELD) – Still faces a bleak future despite selling off assets to reduce debt. Chances of a bailout via takeover look stymied by existence of hybrid securities.
To keep up with the latest asx trading ideas sign up for a free trial.
Shares To Buy -
The Reject Shop (TRS) – Recent capital raising to fund expansion a positive. Same store sales growth running ahead of targets. Expect outperformance to continue.
Energy Action (EAX) – Small energy services kicking goals with its energy management services and novel energy auctions. Company on track for fifth straight year of revenue and profit growth.
Shares To Hold -
Seek Limited (SEK) – High quality company enjoying strong domestic and international growth. ROE and margins remain very high, but valuation looks stretched at current levels.
James Hardie (JHX) – US property market continues to turn around and there is room for fibre cement to increase market share, but sales growth looks more than priced in.
Shares To Sell -
Matrix Engineering (MCE) – Embattled engineering company’s recent quarterly results showed some signs of life but we still expect FY13 results to underwhelm investors.
Elders Limited (ELD) – Still faces a bleak future despite selling off assets to reduce debt. Chances of a bailout via takeover look stymied by existence of hybrid securities.
To keep up with the latest asx trading ideas sign up for a free trial.
May 6, 2013
How To Begin Trading
When someone who is new to the industry contemplates the query how do I start trading, they are really asking to different questions;
1. What is the procedure I need to go through to be able to actually buy shares?
and, far more importantly…
2. Which stocks should I buy or which organizations should I spend in?
The response to the first query is easy enough. Everyone who wants to buy stocks must either do so
› From the organization itself in the very first example of the stocks being provided in a flow. The phrase flow is used when a organization looks for to increase cash by providing its stocks to the community for initially.
› Following the flow, stocks are purchased from other traders via the sharemarket. This is most likely the methos you will commonly utilise.
Whatever the procedure, you will need to set up an consideration with a agent. Establishing an account is not particularly challenging and most individuals basically set up an account with their significant financial institution.
To learn more visit our blog that features articles on how to buy shares on the asx and start today with a free trial
http://www.australianstockreport.com.au/how-to-buy-shares/
1. What is the procedure I need to go through to be able to actually buy shares?
and, far more importantly…
2. Which stocks should I buy or which organizations should I spend in?
The response to the first query is easy enough. Everyone who wants to buy stocks must either do so
› From the organization itself in the very first example of the stocks being provided in a flow. The phrase flow is used when a organization looks for to increase cash by providing its stocks to the community for initially.
› Following the flow, stocks are purchased from other traders via the sharemarket. This is most likely the methos you will commonly utilise.
Whatever the procedure, you will need to set up an consideration with a agent. Establishing an account is not particularly challenging and most individuals basically set up an account with their significant financial institution.
To learn more visit our blog that features articles on how to buy shares on the asx and start today with a free trial
http://www.australianstockreport.com.au/how-to-buy-shares/
May 2, 2013
Myer Holdings - Retail Improving
Myer Holdings (MYR) is one of Australia’s biggest retailers, focusing on a wide variety of customers.
Myer has a nationwide network of stores, promoting designer fashion and outfits for the whole family
as well as home wares.
MYR concentrates on its retail store existence and performance, and also functions a customer commitment program.
MYR has been working in an extremely tough customer atmosphere recently, but circumstances look to be reducing.
In the first four months of 2013, the Westpac Consumer Assurance Catalog has increased to its maximum level since Dec 2010. Since last Oct, customer confidence has increased 11.5%.
It appears interest rate reductions are beginning to have a recognizable effect on confidence, resulting in enhanced working circumstances for suppliers like MYR.
The encouraging signs lend weight to making Myer a share to buy. If you would like more information on Myer visit our friends today at the Australian Stock Report
April 29, 2013
In late Jan, KCN exposed a 13.4% slide in 2Q13 gold outcome comparative to the same period the season before. In comparison to 1Q13, gold outcome increased a little bit by 4%.
Production was affected by the short-term closing of the Chatree Northern Development Location (Plant 2) and disruptions at Challenge following the organization of two new exploration methodologies.
The greatest frustration with the outcome was another rise in the group’s money expenses. Cash expenses increased 37% from 1Q13 to US$975/oz. However, in comparison to 2Q12 expenses increased 60%.
KCN linked the cost press to reduced ore qualities at Chatree and ore procured from an area of Chatree’s Pit A that was known to have reduced recoveries.
The poor 2Q13 development outcome provided to a 76% slip in 1H13 net profit to $8.1 million. Income was up 10% on-year, however the development was motivated mainly from more powerful silver sales. Sluggish outcome from Opposition and a reduced noticed average silver price level detracted from the development in revenue.
If you would like to learn more about KCN visit us today - http://www.australianstockreport.com.au/share-tips/
April 26, 2013
The company has been able to grow its revenue over the last 5 decades in what can only be described as one of the most difficult dealing circumstances for suppliers in over 20 decades.
JBH’s techniques for development are simple: improve the variety of shops, improve revenue, and through that, improve benefit.
JBH’s advancement is not only in the Australia industry, but also in New Zealand. Since coming into the New Zealand industry in early 2007, it has started out 14 shops.
Learn more about JBH and other financial news with free share tips
April 24, 2013
Fairfax Media Group
Fairfax media is a multi-platform media company with a wide variety of business such as news, enteratinment, radio and advertising through nedia sources both printed and online.
FXJ performs its primary actions throughout Australia and New Zealand. Its significant paper brands are The Age and Financial Review. Additionally, FXJ operates a variety of company publications, websites, and local and community publications.
Organisational restructure
Last week, FXJ declared some changes to its organisational framework in addition to a significant shakeup of its management team. Australian print media companies will be combined under the Australian Publishing Press department in an effort to generate effectiveness and make simpler FXJ’s company framework.
Also, the Sector and Digital Projects companies will function as separate sections. This will allow the team to spend improved resources and management attention to areas of the company likely to generate its future development.
Advertising poor, but benefit increases amongst resource sales
In Feb, FXJ declared a 300% increase in 1H13 net benefit to $386.3 thousand. The benefit leap came mainly on the back of resource income, such as the business's 51% share in NZ-based promotion website, Trade Me, as well as its US farming media companies.
The result assisted cover up a 7% decrease in income, with FXJ experiencing a downturn in promotion income across its significant sections amongst economic doubt. On a positive note costs dropped 3% on-year, whilst the team says it is on track to achieve $251 thousand in total benefits by FY15. The balance piece was also in much more powerful shape, with a net debt to value rate of just 5.1% at the end of 1H13.
Outlook
In its 1H13 results, FXJ suggested that a continual enhancement in customer feeling is required to see a turn-around in promotion circumstances. In the first four months of 2013, the Westpac Consumer Assurance Catalog has improved to its maximum level since Dec 2010. Since last Oct, customer confidence has improved 11.5%.
It appears the RBA’s 2012 interest rate reduces are beginning to have a recognizable impact on confidence, resulting in enhanced managing circumstances for promoters and media companies as well. Taking into account its resource income, organisational rebuild and focus on cost control, FXJ is putting itself in a position where it can be more successful in a slow development environment.
For further tips on the market visit www.australianstockreport.com.au/share-tips/
January 8, 2013
Stock Tip: SP Ausnet (SPN) Electrifying Gains
SP Ausnet (SPN) is an energy infrastructure company, operating mainly in Victoria. It also operates a gas distribution network in WA. The group has three energy networks, electricity transmission, electricity and gas distribution. All networks are 100%-owned and located in Victoria, operating as regulated natural monopolies given the high barriers of entry.
1H13 results SPN’s 1H13 results were a significant improvement on 1H12, mainly driven by an increase in regulated tariffs. Net profit climbed 15.6% on-year to $169.0 million, which came on the back of a 6.5% increase in revenue. EBITDA over the half grew an impressive 6.5% to $525 million. SPN’s balance sheet also improved in the half, with net gearing ratio dropping from 60% to 56% and interest cover increasing form 2.6x to 2.7x. On the funding front, the group has $775 million debt maturing in March 2013. While the company does have the ability to pay this from current cash (approx. $427 million) and $625 million in undrawn committed bank debt facilities, we wouldn’t be surprised given the current low interest rate environment if SPN refinanced the loan at a significantly lower rate. Distributions SGN’s monopoly-like business gives it a stable and predictable income stream in which to pay distributions. This saw the company pay a 4.1 cent distribution in 1H13, a 2.5% increase on the prior corresponding half. The groups also reaffirmed its full-year guidance of 8.2 cents a security. Based on a closing share price of $1.045, this represents an attractive yield of approximately 7.5%, or a gross yield of 8.5% if franking stays consistent at 33.3%. In the 1H13, 89% of SPN’s revenue was regulated and essentially inflation protected. SPN’s yield makes it extremely attractive to income-seeking investors, especially given the recent RBA rate cut and the fact that interest rates are at their lowest since the GFC. Outlook SPN is forecasting capital expenditure for 2013 to be around 24% higher than 2012. This investment should help the company continue to grow its earnings and distribution. SPN has not only forecasted for FY13 distribution growth of 2.5%, but also for FY14 growth of 2%. SPN will continue to deliver stable and predictable revenue growth over the coming years and we think investors chasing yield will continue to drive the share price higher.
- The Electricity Transmission Network carries electricity from power stations to electricity distributors around Victoria
- The Electricity Distribution Network carries electricity from the transmission grid to customers throughout eastern Victoria
- The Gas Distribution Network carries gas from the transmission grid to customers mainly located in western Victoria
1H13 results SPN’s 1H13 results were a significant improvement on 1H12, mainly driven by an increase in regulated tariffs. Net profit climbed 15.6% on-year to $169.0 million, which came on the back of a 6.5% increase in revenue. EBITDA over the half grew an impressive 6.5% to $525 million. SPN’s balance sheet also improved in the half, with net gearing ratio dropping from 60% to 56% and interest cover increasing form 2.6x to 2.7x. On the funding front, the group has $775 million debt maturing in March 2013. While the company does have the ability to pay this from current cash (approx. $427 million) and $625 million in undrawn committed bank debt facilities, we wouldn’t be surprised given the current low interest rate environment if SPN refinanced the loan at a significantly lower rate. Distributions SGN’s monopoly-like business gives it a stable and predictable income stream in which to pay distributions. This saw the company pay a 4.1 cent distribution in 1H13, a 2.5% increase on the prior corresponding half. The groups also reaffirmed its full-year guidance of 8.2 cents a security. Based on a closing share price of $1.045, this represents an attractive yield of approximately 7.5%, or a gross yield of 8.5% if franking stays consistent at 33.3%. In the 1H13, 89% of SPN’s revenue was regulated and essentially inflation protected. SPN’s yield makes it extremely attractive to income-seeking investors, especially given the recent RBA rate cut and the fact that interest rates are at their lowest since the GFC. Outlook SPN is forecasting capital expenditure for 2013 to be around 24% higher than 2012. This investment should help the company continue to grow its earnings and distribution. SPN has not only forecasted for FY13 distribution growth of 2.5%, but also for FY14 growth of 2%. SPN will continue to deliver stable and predictable revenue growth over the coming years and we think investors chasing yield will continue to drive the share price higher.
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