Whitehaven Coal Ltd
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WHC Details
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Delivered a solid June quarter performance: Whitehaven Coal Ltd (ASX: WHC) stock rose 12.54% on July 15, 2016 driven by the better than estimated June quarter performance by the group. The company’s full year ROM coal production is up 30% to 20.5Mt against same corresponding period (pcp). Saleable coal production reached 19.7Mt while shipments were over 20.1Mt for the year. For June quarter, Maules Creek operations reached over 9.0Mtpa rate, while Narrabri and Tarrawonga established the new ROM coal production records. Second longwall change-out at Narrabri was finished as estimated and solid ROM coal production was delivered from the Gunnedah open cuts which reached 5.8Mt (up 5% over pcp) for the year.
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Recommendation: We maintain our “Speculative Buy” recommendation on the stock at the current price of $1.66
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Guidance for FY 2016 (Source: Company Reports)
BlueScope Steel Limited
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BSL Details
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Better than estimated second half performance: BlueScope Steel Limited (ASX: BSL) stock rose 5.1% on July 15, 2016 while the company reported for increased preliminary unaudited underlying EBIT expectation of around $570 million for the year ending June 30, 2016. This upgrade in guidance is mainly due to a better second half FY 16 estimated performance with underlying EBIT expected to reach over $340 million against the earlier forecasts of $270 million. The improved performance was on the back of better margins across the international businesses in North Star and Steelscape and turnaround of Asian region steel prices.
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Recommendation: We give a “Hold” recommendation on the stock at the current price of $8.25 ahead of their FY 16 results in August 2016.
Senetas Corporation Limited
SEN Details
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Positive guidance: Senetas Corporation Limited (ASX: SEN) stock rocketed 22.22% on July 15, 2016 after the company reported a strong June quarter and gave a positive guidance for FY 16. SEN now expects to have a Net Profit before Tax (NPBT) in the range of $6.8 million and $7.1 million for FY 16 which is significantly higher than the $5 million NPBT guidance. This upgrade is on the back of better than expected sales in the month of June. The first half of 2016 performance grew due to the integration of Senetas’ former global distributor SafeNet with Gemalto and the growing market awareness on the need for high assurance encryption hardware to protect data in transit. In addition, the new 100Gbps high assurance encryptor would start customer testing in August while the certification process has started.
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Recommendation: We give a “Speculative Buy” recommendation on the stock at the current price of $0.11
Objective Corporation Ltd
OCL Details
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Building contracts: Objective Corporation Limited (ASX: OCL) stock rose 6.11% on July 15, 2016. OCL recently signed $10 million contract with IBM for delivering a component of the Australian Department of Defense’s End User Compute (EUC) Program. In addition, OCL has also acquired Onstream Systems Ltd, which specializes in the capture, collaboration and manipulation of large documents, complex drawings, maps and plans. Despite falling over 15.03% in the last six months (as on July 13, 2016), we believe that the stock has the potential to recover further in the coming months.
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Recommendation: We give a “Speculative Buy” recommendation on the stock at the current price of $1.65
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