Are these value stocks for 2016?

Flight Centre Travel Group Ltd

FLT Dividend Details
 
Expanding Penetration via acquisitions and Investments: Flight Centre Travel Group Ltd (ASX: FLT) is expanding its penetration via acquisitions and lately made an agreement with Professional Performance Systems Pty Ltd (PPS), owner and operator of BYOjet Group, to acquire 70% stake in PPS, with an option to increase its stake for entire ownership post FY18. BYOjet.com focuses on low cost airfares and even acquired JETMAX booking system. With this acquisition, FLT would be able to boost its product offerings into hotels and insurance, contracting, as well as establish business in new markets. Flight Centre Travel also acquired 98.66% of StudentUniverse.com for USD 28 million to expand its presence among student and youth groups in the United States as well as across the world.
 

Flight Centre Travel Group International performance (Source: Company Reports)
 
Flight Centre Travel sometime back also acquired 51% interest in AVMIN, a Brisbane based firm to strengthen its leisure and travel portfolio. Meanwhile, the shares of Flight Centre Travel Group rallied over 11.81% in the last one month (as of January 04, 2016) driven by its BYOjet Group acquisition news. We recommend to “HOLD” the stock at the current price of  $40.44
 
 
FLT Daily Chart (Source: Thomson Reuters)
 

Myob Group Ltd

MYO Details
 
Strong Cloud users growth: Myob Group Ltd (ASX: MYO) reported that its paying user base improved by 10% during first half of 2015, boosted by its outstanding cloud user growth of 65% from June 2014. The group is focusing on cloud solutions and investing over 13% to 16% of revenue to boost its innovation for SMEs and Accountants. As a result, its cloud users reached over 528k of paying users by the end of June 2015, which is well above the group’s estimates. MYO reported a revenue increase of 8% yoy to $161 million driven by SME solutions which rose by 12.4% yoy during the period.
 

MYOB’s investment cloud solutions over the last few periods (Source: Company Reports)
 
The Group also acquired Information Management Services Limited (IMS), a New Zealand-based payroll provider for 10,000 small and medium businesses for NZD $9.7 million to enhance its core business as well as leverage the booming online growth potential of the Payroll market in New Zealand. There are also some speculations being made about MYOB’s potential takeover of Reckon Limited. We remain bullish on the Myob Group and reiterate our “BUY” recommendation on the stock at the current price of  $3.20
 
 
MYO Daily Chart (Source: Thomson Reuters)
 

iShares S&P/ASX Dividend Opportunities ETF

IHD Dividend Details
 
Outstanding dividend yield: iShares S&P/ASX High Dividend Index Fund (ASX: IHD) have been under pressure and fell over 9.36% in the last six months (as of January 04, 2016). IHD total net investment income plunged to $3.48 million in fiscal year of 2015, as compared to $19.2 million in fiscal year of 2014 on the back of net losses of financial instruments of $7.5 million during the period against $9.9 million of gain in prior corresponding period. On the other hand, the index fund generated decent one year returns of 1.43% per annum and three year returns of 11% per annum while its net assets also enhanced to $234.68 million as at June 2015, against $219.53 million as at June 2014. Blackrock investment management reported a cash distribution of 28.85 cents per unit for iShares S&P/ASX High Dividend Index Fund and even announced a dividend reinvestment price of $13.59 for iShares S&P/ASX High Dividend Index. We believe that iShares S&P/ASX High Dividend Index can be leverage as a dividend stock. We maintain our “BUY” recommendation for the stock at the current price of $13.23
 
 
IHD Daily Chart (Source: Thomson Reuters)
 

Western Areas Ltd

WSA Dividend Details
 
Expanding resource potential: Western Areas Ltd (ASX: WSA) is building a strong potential resource base and recently started Diamond drilling at its potential bedrock conductive target within the Atomic Cafe area at the Western Gawler Craton Project. As per the latest update, Monax Mining Ltd will maintain a 10% interest in the aforementioned project while forming an unincorporated joint venture with Western Areas Ltd and having an option to co-fund exploration pro-rata. WSA is also improving production in its current projects which includes Odysseus, the Mill Enhancement Project and New Morning from its Flying Fox and Spotted Quoll assets. Meanwhile, Western Areas also delivered a solid NPAT growth of 37.5% for FY15, as its cost control efforts have paid off despite nickel prices pressure. The unit cash cost of production of nickel in concentrate (excluding smelting/refining charges and royalties) for the September quarter reached A$2.26/lb (or USD 1.64/lb) said to be slightly better than the lower end of the group’s estimated average full year guidance range of $2.30/lb to A$2.50/lb for fiscal year of 2016. WSA also delivered a debt free September quarter of 2015 post the repayment of $125 million of convertible bonds during July 2015 and has a cash at bank (including FinnAust Mining) of $60.3 million. The group deferred capital expenditure expenses by over $32.6 million as major part of the development work related to Flying Fox mine is finished to boost its cash flows.
 

Western Gawler Craton Project (Source: Company reports)
 
On the other hand, WSA stock plunged over 27.94% in the last six months (as at January 04, 2016) given the nickel prices pressure on the group’s top line. However, WSA continues to focus on maximizing its margins while the steady nickel prices are expected during FY16, which might lead to a positive QP adjustments. The company has also reached an agreement with the Australian and New Zealand Banking Group to minimize ongoing bank fees with regards to maintaining the current undrawn corporate loan facility. Overall, we believe that the shares of WSA would recover in the coming months. The stock is also trading at a reasonable valuation. Based on the foregoing, we give a “BUY” recommendation on this stock at the current price of  $2.20
 
 
WSA Daily Chart (Source: Thomson Reuters)

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