Two stocks that slipped – Blackmores Ltd and Beach Energy Ltd

Blackmores Limited


BKL Details

·       First quarter of 2017 result is expected to be subdued:Blackmores Limited (ASX: BKL) stock slipped by 3.7% on 19 September 2016 as investors were worried over the stock performance, while management reported that they estimated a lower growth for the first quarter of 2017 as compared to the last year. BKL Group sales delivered an outstanding growth of 52% to $717 million in FY 16 as the sales in Australia are boosted by over $200 million in China influenced sales. However, the Australian wholesale market is volatile and has softened in recent weeks due to the retailers destocking and some exporters changing the channels through which they acquire products. Moreover, BKL stock has fallen over 23.9% in the last six months (as on 16 September, 2016), and still trading at a higher P/E.
·       Recommendation:We give an “Expensive” recommendation on the stock at the current price of $124.16
 

FY16 Financial Performance (Source: Company Reports)
 
Beach Energy Ltd


BPT Details

·       Hanson?4 and Callawonga?12 development wells are expected to be brought online in Q2 FY17:Beach Energy Ltd (ASX: BPT) stock fell 2.3% on 19 September 2016. On the other hand, based on the August drilling report, BPT has started its FY17 operated drilling program with the Hanson?4 development well and the well is expected to be brought online in Q2 FY17. The Stunsail?3 development well is being drilled to develop oil bearing reservoirs in the Namur and Mid?Namur Sandstone in the Stunsail Field. The well was spudded in August 2016 and is awaiting clearance of the wet weather conditions before drilling ahead. Moreover, the Callawonga?12 development well is drilled after a comprehensive review of the Callawonga Field.  Callawonga?12 was cased and suspended as a future oil producer and forecasted to be brought online in Q2 FY17. Additionally, in South Australian Gas Project, the five?well appraisal and development campaign progressed on the central flank of the Big Lake Field. Big Lake?134, was cased and suspended as a future Permian gas producer.  The remaining wells are being drilled from a single pad.  In addition, for FY 16, BPT reported a 6% increase in the production and had a 90% drilling success rate from 51 wells. BPT’s revenue has fallen 23% to $727.7 million and the underlying NPAT fell 61% to $90.7 million in FY 16.
·       Recommendation:We maintain a “Buy” recommendation on the stock at the current price of $0.5625
 

FY16 Financial Performance (Source: Company Reports)

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