Transurban Group
Toll Revenues Increased YoY: Transurban Group (ASX: TCL) had recently published the results for H1 FY 2019 and the company posted toll revenue amounting to $1.29 billion which implies the rise from $1.13 billion in the half-year ended December 2017 which was on the back of traffic growth throughout Australian as well as North American networks. The company’s CEO stated that, with respect to Sydney, it achieved financial close on WestConnex as well as integration program happens to progress on track.
Also, after the construction of WestConnex is wrapped up, it would be a crucial component to broader Sydney road network, and it would also be making a significant contribution when it comes to easing the congestion as well as improvement in the travel times.The company’s net margin at the end of December 2018 was 6.9% while its EBITDA margin stood at 46.7%. However, the company’s return on equity, at the end of December 2018, stood at 1.7%.
Focused Towards Delivery of Committed Projects:As per the release, Transurban Group has been working towards the delivery of 9 committed projects safely and successfully in the time span of next 5 years. Moreover, the company would be focusing on enhancing customer as well as community offerings. Also, for FY 2019, the company had reaffirmed the distribution guidance of 59.0 cps.
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1HFY19 Statutory Results (Source: Company Reports)
Stock Recommendation: On the monthly chart of Transurban, Exponential Moving Average or EMA has been applied and default values were used for the purposes. After observation, it was noticed that the stock price has crossed the EMA and had trended in the upward direction. This implies the bullish momentum. As a result, there are expectations that the company’s stock might witness an upward momentum moving forward.
Also, the company’s focus towards the delivery of the committed projects might also support its growth prospect. Based on the above-mentioned factors, we maintain our “Buy” rating on TCL at the current market price of A$12.160 per share (down 0.491% on 13 February 2019).
Westpac Banking Corporation
WBC’s View on Royal Commission’s Final Report: Westpac Banking Corporation (ASX: WBC) had recently stated that it had become a substantial holder of Simble Solutions Limited with voting power of 5.01% on 11 February 2019. Also, the bank’s top management had given their views on the final report from The Royal Commission which was released earlier. The CEO of Westpac Banking stated the release of the final report which would be a turning point in the ongoing rebuild of community trust in the industry. He added that the recommendations which have been developed via significant inquiry would be guiding the decision making in the financial services moving forward.
The release stated that the bank had already adopted the steps so that some matters which are referred in a report can be addressed which also includes the bank’s approach when it comes to dealing with the customer complaints as well as leading industry in moving away from the grandfathered commissions. WBC would be working with the policy makers as well as regulators on the best path forward for the customers as well as industry. As depicted in Westpac’s FY 2018 results presentation, the bank happens to possess a robust balance sheet.
Common equity Tier 1 (Source: Company Reports)
Focused on Making Deployments: Westpac Banking Corporation had earlier stated that they have been making deployments in the technology with a focus on improving service to the customers. The bank stated that they are focused on helping the customers over long-term and they also have confidence in their service-led strategy. Also, there are expectations that the bank would be largely supported by its robust balance sheet moving forward. Its common equity Tier 1 has also witnessed an improvement from September 2012 to September 2018 (as shown above).
Stock Recommendation: On the daily chart of WBC, Moving Average Convergence Divergence or MACD has been applied and default values were used for the purposes. After careful observation, it was noticed that the MACD line has crossed the signal line and had trended in the upward direction which reflects bullishness. Therefore, there are expectations that the bank’s stock price might witness an upward momentum.
Moreover, the bank might be helped by the deployments and by the strong balance sheet. Based on the aforementioned facts, we maintain our “Buy” rating on the WBC at the current market price of A$26.380 per share (up 0.687% on 13 February 2019).
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