Iress Ltd

IRE Details

Weak trading update: Iress Ltd.’s (ASX: IRE) stock plunged about 4.9% on November 13, 2017 while the group forecasted a softer segment profit result for the full year in the range of $123m and $128m on a constant currency basis. Rising costs coupled with investments made during 2017 were highlighted to be hurting the performance of the financial services software firm. Moreover, due to the timing of client decisions, the group is not expecting to deliver revenue over and above their guidance range. The group had forecasted a full year 2017 revenue in the range of $435m and $440m (on a constant currency basis), which represents 12-13% growth on 2016.

While the group has some leading products, the on-going shortcomings led IRE stock lose over 11% in last three months. We give an “Expensive” recommendation on the stock at the current price of $10.95

 

Westpac Banking Corp

WBC Details

Rising EAD: Westpac Banking Corp (ASX: WBC) traded ex-dividend on November 13, 2017 and slipped by about 2%. WBC had reported that their exposure at default (EAD) rose 2.1% to $20.5 billion during the September 2017 half period on the back of growth in residential mortgage exposures of $14.4 billion and sovereign exposures related with liquid assets of $2.3 billion. On the other hand, they enhanced common equity Tier 1 (CET1) capital ratio by 59 basis points to 10.56% as at 30 September 2017, as compared to 31 March 2017. Meanwhile, Westpac group chief executive Brian Hartzer has announced the appointment of a new chief risk officer, David Stephen. With the overall banking sector challenges, we maintain our “Expensive” recommendation on the stock at the current price of $32.45

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