Aurizon Holdings Ltd
QCA publishes UT5 Draft Decision:Aurizon Holdings Ltd (ASX: AZJ) stock fell 5.9% on December 18, 2017 after the Queensland Competition Authority (QCA) has published its Draft Decision on Aurizon Network’s 2017 Draft Access Undertaking (Draft Decision) for the regulatory period 1 July 2017 – 30 June 2021. As per the Draft Decision, AZJ’s overall Maximum Allowable Revenue (MAR), including a Weighted Average Cost of Capital (WACC) of 5.41%, for the regulatory period of the Undertaking is $3.893 billion. The company is of the view that the QCA has made fundamental errors and miscalculations in its assessment, particularly related to its determination of the maintenance allowance and WACC. The Draft Decision, if implemented, would have significant implications for the operational efficiency, volume capacity and reliability of the Central Queensland Coal Network (CQCN). Further, there would be an overall deterioration in performance of the export supply chain, that serves the Queensland coal industry. Meanwhile, the stock had risen 6.92% in last one month as on December 15, 2017. With these issues at hand, the weakness might prevail for some time; and accordingly, we give a “Sell” recommendation on the stock at the current price of $5.09
Disclaimer
The advice given by Kalkine Pty Ltd and provided on this website is general information only and it does not take into account your investment objectives, financial situation or needs. You should therefore consider whether the advice is appropriate to your investment objectives, financial situation and needs before acting upon it. You should seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice. Not all investments are appropriate for all people. Kalkine.com.au and associated pages are published by Kalkine Pty Ltd ABN 34 154 808 312 (Australian Financial Services License Number 425376). The information on this website has been prepared from a wide variety of sources, which Kalkine Pty Ltd, to the best of its knowledge and belief, considers accurate. You should make your own enquiries about any investments and we strongly suggest you seek advice before acting upon any recommendation. Kalkine Pty Ltd has made every effort to ensure the reliability of information contained in its newsletters and websites. All information represents our views at the date of publication and may change without notice. To the extent permitted by law, Kalkine Pty Ltd excludes all liability for any loss or damage arising from the use of this website and any information published (including any indirect or consequential loss, any data loss or data corruption). If the law prohibits this exclusion, Kalkine Pty Ltd hereby limits its liability, to the extent permitted by law to the resupply of services. There may be a product disclosure statement or other offer document for the securities and financial products we write about in Kalkine Reports. You should obtain a copy of the product disclosure statement or offer document before making any decision about whether to acquire the security or product. The link to our Terms & Conditions has been provided please go through them and also have a read of the Financial Services Guide. On the date of publishing this report (mentioned on the website), employees and/or associates of Kalkine Pty Ltd do not hold positions in any of the stocks covered on the website. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations.