Stocks’ Details
 

WAM Capital Limited (ASX: WAM)

Overall performance stays healthy: WAM Capital is the listed investment group that provides exposure to an actively managed diversified portfolio of undervalued ASX listed growth companies. The group has been able to deliver well on its commitment of good fully franked dividends. The group’s performance has been up 17.7% since August 1999. In the month of December 2017, the group’s portfolio returns were 1.6% against S&P/ASX All Ordinaries Accumulation Index returns of 2%, whereas the year to date return of 10.4% outperformed the index by 1.1%. While the performance of the portfolio over 2017 was anticipated to be below expectations owing to retail headwinds with Amazon’s entry in Australia, the latest investment performance was a mixed one and the long-term potential still stays strong. Meanwhile, the group’s ROE has slipped a bit over the years given the performance trend based on slight volatility. On the other hand, WAM’s top 20 portfolio holdings include Afterpay Touch Group and Macquarie Group Ltd, which have performed well recently. We maintain a “Hold” on WAM at the current price of $2.45
 

AVJennings Ltd (ASX: AVJ)

Key projects expected to drive growth: AVJennings has had a mixed FY17 with contracts for 1,843 lots up on the prior year while there was a 28.6% rise in work-in-progress to 2,161 lots. The group’s average share of revenue per contract also grew by 18.7% to $292,000. Low interest rate environment and overall macro landscape looks favourable while residential property prices have come under some pressure lately. With few shortcomings, group before tax profit of $51 million was down 13.2% on last year at the back of project timings and changes to production mix highlighted earlier. The group’s projects, Lyndarum North project in Melbourne and joint venture project at Jimboomba in South East Queensland have now been highlighted to be key to maintain continued growth in earnings in FY18. The group also expects contract signings of 1,900 to 2,100 lots. Based on settlements, positive momentum is signalled to be skewed to second half while the group expects to have dividend payout ratio of 40 to 50%. We maintain a “Speculative Buy” at the current price of $0.725
 

Schedule for Projects (Source: Company Reports)
 

Telstra Corporation Ltd (ASX: TLS)

Regaining lost strength while becoming only carrier in Australia to offer Narrowband and Cat M1 IoT technologies: Telstra stock edged up a bit on January 12, 2018 with the news that it launched a new technology, Narrowband, for sending small volumes of data at low power through Internet of Things (IoT) across many devices on mobile network in major Australian cities and many regional towns. This technology seems to be beneficial to industries ranging from transport and logistics, mining, manufacturing to agricultural based on data required to be handled; and is in addition to the approximately three million square kilometres of Cat M1 IoT coverage. The stock that got hammered lately owing to revised FY18 guidance based on the nbn delays on sales of hybrid fibre co-axial technology and overall challenges in telecom industry, expects to benefit from the latest nbn updates and delays, and above initiatives. Although TLS had slashed its FY18 dividends last year, the recent reaffirmation on paying 22 cents per share fully franked total dividend has reinforced some level of confidence. Looking at the price scenario and ability to manage the challenging environment, we have a “Buy” recommendation on the stock at the current price of $3.74

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. On the date of publishing this report (mentioned on the website), employees and/or associates of Kalkine Pty Ltd do not hold positions in any of the stocks covered on the website. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations.