AMP Limited
AMP Details
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Huge wealth protection experience losses dragged the stock:AMP Limited (ASX: AMP) stock fell over 4.7% on August 18, 2016 as the group’s first half of 2016 underlying profit fell 10% as compared to the same period of last year. This weak performance was mainly due to heavy wealth protection experience losses leading to fall in Australian wealth protection earnings by 53% on a year on year basis. Moreover, tough investment market conditions hurt operating earnings in Australian wealth management which lost over 6% while Australian mature lost over 14%. Even the cost to income ratio of 45.5% rose 2.4 percentage points against 1H 15 while Australian wealth management net cash flows during the period plunged to A$582m, against net cash flows of A$1,152m in prior corresponding period.
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Recommendation:We believe that the pressure in the stock would continue in the coming months and give an “Expensive” recommendation at the current price of $5.52
Weak first half 2016 performance (Source: Company Reports)
Select Harvests Limited
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SHV Details
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Rising competition: Select Harvests Limited (ASX: SHV) stock plunged 4.9% on August 18, 2016. The stock has been under pressure this month and already fell over 8.5% (as of August 17, 2016) as investors were concerned over the rising supply of almonds from California coupled with falling prices.
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Recommendation:We remain bearish on the stock and reiterate our “Expensive” recommendation at the current price of 6.52
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