Lovisa Holdings Ltd

LOV Details

Ongoing bullish momentum: The shares of Lovisa Holdings Ltd (ASX: LOV) are continuing to witness positive momentum with the stock rising over 3.2% on September 08, 2017 following a rally of over 11.8% in last one month (as of September 07, 2017). The group reported a strong fiscal year of 2017 results, wherein the revenue enhanced 16.5% year on year (yoy) to $178.7 million. Gross margin rose 480 basis points to 78.8% while gross profit enhanced 24% yoy to $140.8 million. Same store sales rose 10.3% on a yoy basis driven by retail prices coupled with contribution from some major trends in the fashion jewelry sector throughout the year.
 

FY17 performance (Source: Company reports)
 
The Cost of Doing Business (CODB) as a percentage of sales fell to 53% reaping the benefits from their efforts of cost efficiency. The group has indicated for a positive start to 2018 with same store growth exceeding their long-term target in the range of 3% and 5%. They intend to open 20 and 30 stores for the 2018 financial year. We give a “Hold” recommendation on this dividend yield stock at the current price of $ 4.80

 

LOV Daily Chart (Source: Thomson Reuters) 

Dicker Data Ltd

DDR Details

FY17 guidance reaffirmed: Dicker Data Ltd (ASX: DDR) had reported a revenue growth of 7.1% yoy to $632.5 million in six months ended at 30 June 2017. Revenue for current vendors surged 9.4% against prior corresponding period (pcp) with Australia revenue rising 7.7% yoy to $40.8 million while New Zealand reported a revenue growth of 3.3% yoy to $1.9 million. The group has parted ways with Cisco in New Zealand and announced to cease distribution of Cisco products in the later part of this year. Accordingly, DDR forecasted a flat New Zealand revenue for second half of 2017.

 

Six months’ performance (Source: Company reports)
 
The group expects their Hybrid IT would continue to dominate consumption and see the change in the way their partners consume technology. The group intends to continue to get recurring revenue streams with SaaS and IaaS. The group intends to continue to focus and invest in Cloud Computing, IoT, Big Data Management and Datacentre and Hyperconverged Infrastructures. They reiterated their guidance of $40.0m in pre-tax operating profit for FY17. Dicker paid $13.4 million of dividends and has an outstanding dividend yield. We give a “Hold” on the stock at the current price of $ 2.52

 

DDR Daily Chart (Source: Thomson Reuters) 

Smartgroup Corporation Ltd

SIQ Details

Bumper half year performance: Earlier this year, Smartgroup Corporation Ltd (ASX: SIQ) announced about a key acquisition of a salary packaging firm, the AccessPay Group for $15 million. Integration of acquired businesses and focusing on operational excellence led SIQ report a profit after tax, as measured by NPATA increase of 63% yoy to $30.3 million for the half year ended 2017. Revenue surged to $95.2 million and the group declared a fully franked interim dividend of 16.5 cents per share, which is a rise of 68% over pcp.

 

Growing business (Source: Company reports)
 
Smartgroup has also continued to focus on operational excellence in order to retain and grow their client base. The shares of SIQ rallied over 27.3% in the last three months (as of September 07, 2017) and are trading at high levels. We believe there is some more upside potential, and hence, give a “Hold” rating on the stock at the current price of $ 8.74

 

SIQ Daily Chart (Source: Thomson Reuters) 

Villa World Ltd

VLW Details

Built a strong pipeline: Villa World Ltd (ASX: VLW) reported their underlying gross margin to 27.3% for FY17, exceeding their forecasted range of 24%-26%, driven by improving sales prices and cost savings. The group’s ventures delivered $5.4 million in fee income and share of profit during the year from $4.6 million in pcp, again exceeding their forecasts of $3.4 million driven by sales and settlements at the Rochedale joint venture project. Projects at various points in the lifecycle led to 1,207 sales during FY17, up from 1,185 in pcp. VLW released eight new projects for sale mostly in the second half of 2017 and aims to start selling of nine projects in mid FY18 across key growth corridors of northern Brisbane, Logan, north and north-east Melbourne and south-east Melbourne. This comprises their major products like The Meadows (Strathpine), Chambers Ridge (Park Ridge), Covella (Greenbank), Wollert and Clyde. The group is planning more than 15 major projects selling during FY18, and accordingly, is targeting to achieve at least 1400 sales. The group is carefully choosing acquiring projects for beyond FY19 pipeline and forecasts a cash outflow for acquisitions of $110 million to $130 million in FY18 funded from existing debt facilities and working capital and $45 million in capital lite transactions. We maintain our “Hold” recommendation on the stock at the current price of $ 2.38

 

VLW Daily Chart (Source: Thomson Reuters) 

Sunland Group Ltd

SDG Details

Benefitted from project settlements: Sunland Group Ltd (ASX: SDG) delivered a decent statutory net profit after tax of $35.3 million for fiscal year of 2017, up from $31.5 million in prior corresponding period.
 

Improving performance (Source: Company reports)
 
Earnings per share enhanced 17% to 23.1 cents. The group achieved 524 property sales and 597 project settlements during the year against 426 sales and 443 settlements in prior corresponding period. They had a total of about $534 million contracted lots in hand. The group made $65.5 million worth of new site acquisitions. The group is expected to continue with its upside run-up given the performance in terms of project settlement, portfolio enhancement, and capital management initiatives. We give a “Hold” on this dividend yield stock at the current price of $ 1.73

 

SDG Daily Chart (Source: Thomson Reuters)

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.