Stocks’ Details
WAM Capital Limited
Growth Momentum Continues: WAM Capital Limited (ASX: WAM) is the largest listed investment company run by Wilson Asset Management. Recently, the company announced that Wilson Asset Management Group, a substantial holder of Ask Funding Ltd.’s changed its holding from 11.68% of interest to 12.71%. On the other hand, the company registered operating profit before tax growth of 49.8% to $119.4 Mn in 1HFY18 from $79.7 Mn in 1HFY17. Operating profit after tax accounted to $87.4 Mn in 1HFY18 from $59.1 Mn in 1HFY17, marking a growth of 48% YoY. The profit for the period is reflective of the solid performance of the investment portfolio over the six months to 31 December 2017, as well as the growth in assets in comparison to the prior period. The investment portfolio returns increased 10.4% in the six months to 31 December 2017, outperforming the S&P/ASX all ordinary accumulation index which rose by 9.3%. Even the investment portfolio returns for one month as at February 2018 edged up to 0.7% outperforming the S&P/ASX all ordinary accumulation index by 0.5%. The investment portfolio performance was achieved with an average cash weighting of 27.6%. Besides this, WAM Capital’s investment provides investor with exposure to an actively managed diversified portfolio of undervalued growth companies with the objective of delivering fully franked dividends, providing capital growth and preserving capital.
The board of directors declared interim dividend of 7.75 cents per share with record date of April 13, 2018 and payment date of April 27, 2018, representing an annualised fully franked dividend yield of 6.3%. Further, the dividend reinvestment plan (DRP) is available to shareholders for the interim dividend and the DRP will operate at 2.5% discount rate. Given the steady flow of dividends, we maintain a “Hold” recommendation at the current price of $2.48
Relative Investment Performance Since Inception (Source: Company Reports)
Rural Funds Group
Reaffirmed FY18 AFFO and DPU forecast post half year result: Rural Funds Group (ASX: RFF) is one of the oldest and most experienced agricultural funds management firm in Australia. During 1HFY18, NPAT was down by 2.4% YoY to $16,749,000 from $17,159,000 in 1HFY 2017. However, the group has delivered 22% growth in adjusted funds from operations (AFFO) to $15,406,000 in 1H 2018 on the back of acquisition of three adjoining cattle properties in northern Queensland totalling 390,600 ha, referred to as Natal. We expect that the company will continue to develop and improve its existing assets. Further, the company will find the acquisition opportunity in both infrastructure and natural resource assets. Infrastructure predominant assets can provide immediate AFFO accretion due to high yields, while natural resources predominant assets can provide overall growth through productivity improvement. On this, RFF has reaffirmed FY18 AFFO and distribution forecasts of 12.7 cents per unit (cpu) and 10.03 cpu, respectively. The company expects FY19 distributions to total 10.43 cpu, which is a 4% increase on FY18. Going forward, the company will focus on the ongoing management of existing portfolio and expansion plan through acquisitions with the aim of raising earning, liquidity and lowering operating costs per units.
Moreover, the Board of Directors declared an interim dividend of 2.5075 cents per share to be paid on 30 April 2018.Meanwhile, RFF stock has been up 12.9% in last one month as on March 20, 2018 and by 0.89% in last five days. Trading at a higher level, we give a “Hold” recommendation on the stock at the current price of $2.29
Adjustment Property Asset Movements (Source: Company Reports)
Dicker Data Limited
Dividend Update and Guidance for FY18: Dicker Data Limited’s (ASX: DDR) stock edged up by 1.034% on March 21, 2018 while the company announced Director, Mary Stojcevski changing respective holdings from 1,69,779 shares of interest to 1,72,639 shares via allotment under the company’s dividend reinvestment plan. Moreover, Vladimir Mitnovetski also changed holdings from 161,118 shares of interest to 181,612 shares through open market.
Recently, the company announced that it will retain its current dividend policy of paying quarterly dividends to shareholders. In line with last financial year and to provide consistency and certainty for investors, the company proposed that each interim dividend for FY18 will be 4.40 cents per share fully franked. This would bring total proposed dividend to be paid in the FY18 year to 18.00 cents per share which is an increase of 9.8% from FY17 dividend of 16.40 cents per share. The Group has forecasted a revenue of $1.38 billion and a net profit before tax of $42.5m for FY18. The company is expecting consolidated revenue and profit growth of 6% for FY18 on the back of organic growth and contribution from new vendors in full year and taking into account the shortcomings at NZ. Meanwhile, DDR stock price was up by 14.62% in last six months and we give a recommendation to “Hold” the stock at the current market price of $2.93
Forecast for FY18 (Source: Company Reports)
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