Stocks’ Details
 

Kogan.com Ltd

Strong outlook for FY18: Kogan.com Ltd (ASX: KGN) stock rose 12.6% on November 17, 2017 after the company gave positive and strong outlook for FY 18 in the Annual General Meeting. KGN would extend the partnership with Vodafone in order to launch Kogan Internet in the second half of FY18 and scale into FY19. KGN has basically announced an expanded partnership with Vodafone to offer fixed-line NBN plans from 2018. NBN is a major opportunity for KGN as current NBN activations are of 2 million premises, which are not even a third of the projected 7.6 million activations by 2020. Moreover, KGN has partnered with leading global insurer Hollard to offer value for money insurance products through Kogan Insurance and is targeting the $30.8 billion Australian insurance market.
 
KGN has also shown a strong start to FY18, and is expecting a revenue growth of 35.9% and EBITDA growth of 37.7% when compared to the same period last year. The company will continue to achieve increase in the gross margin. KGN in FY 18 till the end of October from July has reported revenue growth of 36.2%, gross margin of 18.4% and EBITDA growth against prior year’s pro-forma EBITDA of 58.3%. These numbers show an increase in the year-to-date growth trend, after a strong trading performance in October. In addition, KGN expects strong revenue growth in future and the EBITDA margin is expected to continue to increase as the company is expanding the Kogan Portfolio of businesses. The group has lately joined Zip platform offered by Zipmoney. Meanwhile, KGN stock has risen 65.65% in last three months as on November 16, 2017, and seems to be trending well towards its 52-week high level. We give a “Hold” recommendation on the stock at the current price of $4.29    

     

Market and products scenario (Source: Company Reports)
 

Afterpay Touch Group Ltd

Established New Zealand funding facility and expanded NAB Warehouse Facility: Afterpay Touch Group Ltd (ASX: APT) has established the New Zealand funding facility with ASB Bank Limited, which is a part of the Commonwealth Bank Group, to further expand the Afterpay business into that region (the ASB Facility). The ASB Facility is a NZ$20 million Revolving Cash Facility that can be drawn to fund customer receivables and the initial term of the ASB Facility is for a period of 18 months. This arrangement will provide APT with an efficient funding model and the company’s plan to grow in the New Zealand’s market. Moreover, APT has received the approval to increase the existing NAB warehouse funding facility from $200m to $350m. The term of the new facility will be 24 months and the new facility represents the improvement with respect to both pricing and advance rates and covers all lines of business that APT currently undertakes in Australia. However, the implementation of the new facility is subject to documentation. Meanwhile, APT stock has risen 82.72% in last three months as on November 16, 2017 and ended edging a little low post an initial rise on November 17, 2017. We give a “Hold” recommendation on the stock at the current price of $5.46
 

Mesoblast Ltd

Responded to the ASX Aware Letter query: Mesoblast Ltd (ASX: MSB) has responded to the ASX Aware Letter query related with the announcement on ‘RA Phase 2 Trial Results Presented at ACR Annual Meeting’ on November 10, 2017 and has confirmed that the company is in compliance with the Listing Rules. On the other hand, MSB is looking forward to reporting on the Phase 3 results of the cell therapy for the most devastating complication of bone marrow transplants in children with blood cancers. Further, the company expects to report about Board renewal in 2018. Meanwhile, in the first quarter of FY 18, the net loss attributable to ordinary shareholders was US$7.0 million compared with US$19.8 million for the first quarter of FY2017, i.e. narrowed by about 57%. MSB stock was found to be rising by 7.7% on November 17, 2017. We give a “Speculative Buy” recommendation on the stock at the current price of $1.325

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