In today’s daily we have covered stock research on Computershare (Expensive).

To view 2 Internet Stocks To BUY click here

To listen to our latest podcast on QBE click here

To view our recent recommendation on CSL Click Here

To view our recent recommendation on Mineral Deposits Click Here

S&P 500 was up 13.09 points or 0.67%on Tuesday and closed at 1973.32. The Dow and the S&P 500 closed at record highs on Tuesday as manufacturing activity picked up in the United States and Asia and increased optimism about the global economy's health. A report from theInstitute for Supply Management showed its index of national factory activity was at 55.3, little changed from May's 55.4 reading.

Gold advanced to a three-month high as the U.S dollar sagged. Retail sales climbed 4.6 percent last week, ICSC data showed, with business up sharply at apparel, department, discount and wholesale club stores. Retailers rallied 1.5 percent and carmaker shares jumped 1.4 percent. Brent crude extended Monday’s fall by a further 7 cents to $112.29.



S&P 500 Daily Chart (Source – Thomson Reuters)
 
S&P ASX 200was down by 19.8 points or 0.37%on Tuesday and closed at 5375.9 points. Goodman fielder has entered into the scheme implementation deed with Wilmar & First Pacific subject to all conditions being met shareholders will receive $0.675 per share. Guildford Coal has announced that it has been granted the haulage permit by Mongolian Ministry of Roads and Transport. Senex Energy has released its drilling report for FY14 with the drilling program completed on schedule with 30 oil wells drilled.

Transpacific Industries has announced that following the successful sale of its NZ business it has finalized a $400 million debt facility with 8 banks. Carsales.com (CRZ) has announced the acquisition of Stratton Finance an innovative vehicle finance business. Karoon Gas (KAR) has announced that preemptive rights associated with browse basin permits (WA 315 + 398) have expired clearing the way for sale to Origin Energy.


ASX 200 Daily Chart (Source – Thomson Reuters)

The top gainers on ASX 200 were:-



Stock of the Day – Computershare (CPU)
 
Although hosting two investor briefings since reporting first half fiscal results in February, Computershare has not commented on previously guided earnings per share growth of 5% to 10% for fiscal 2014. With the fiscal 2014 finished we take this silence as comfort that Computershare will not disappoint. Commenting on trading conditions , management noted that markets in general have remained rational


CPU Revenue & EBITDA (Source – Company Reports)

Low interest rates remain a drag on margin income and Computershare continues to benefit from cost efficiencies. In May 2014 the acquisitive Computershare bought Registrar and Tranfer Company providing transfer agency, proxy advisory and printing services in the U.S. the price tag of USD 37 million and USD 19 million in revenue are small for Computershare but as the firm has done repeatedly it will derive value through cost synergies.


CPU Revenue Breakdown (Source – Company Reports)

Management cites large opportunities as being few and far between meaning a continuation of this small bolt on strategy is likely. We would expect Computershare to run the ruler over ASIC’s registry business if it is put on the market (as speculated). The acquisition price would obviously need to meet Computershare investment hurdles. ASIC’s registry business included the oversight of business registrations , company searches and other documents well within the capabilities of Computershare in data management and processing.


CPU Daily Chart (Source – Thomson Reuters)

Acquisitions have diversified Computershare’s earnings, but registry maintenance remains the largest revenue contributor at 40% of Computershare’s revenue. Corporate actions, communication services and part of the employee share plans business also benefit from registry operations. We believe the stock is expensive at its current price and would review the stock at a later date.

---

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.