Stocks’ Details
 

TPG Telecom Limited

Positioning for next phase of growth: TPG Telecom Limited (ASX: TPM) enhanced their consumer broadband subscriber base by 68k in FY17 to 1.94 million subscribers, comprising 957k TPG and 979k iiNet subscribers. The group is positioning themselves for the next phase of growth by building infrastructure and customer bases. Their spectrum acquisition in Singapore opened doors for the group to tap the Singaporean mobile market potential.
 

TPG subscribers (Source: Company reports)
 
The group is aiming for a nationwide outdoor service coverage by December 2018. TPM stock delivered over 12.4% returns in the last four weeks (as of November 29, 2017) and we give a “Buy” recommendation on the stock at the current price of $5.95


TPM Daily Chart (Source: Thomson Reuters)
                               

BHP Billiton Limited

Ongoing cost control: BHP Billiton Limited (ASX: BHP) reported that their Australian mining operations would deliver US$1.6 billion of further productivity gains in the next two years. The group forecasts the Southern Mine Area to witness the copper grade rise to 3 per cent by financial year 2023. Their Brownfield Expansion option (BFX) at Olympic Dam, if approved, would enhance production capacity to 330 ktpa and move Olympic Dam into the first quartile of the cost curve. The stock generated over 15.9% in the last six months (as of November 29, 2017) and we give a “Buy” on this dividend yield stock at the current price of $27.30


BHP Daily Chart (Source: Thomson Reuters)
 

Boral Limited

Positive outlook: Boral Limited’s (ASX: BLD) Boral Australia segment expects that growth in infrastructure and pricing outcomes on East Coast would offset pressures in WA. The segment forecasts a better EBIT in FY2018 from FY2017 including property in both years, and excluding Property in both years. The group forecasts high single-digit EBIT growth in FY2018. For USG Boral, they forecast a high single-digit growth rate in FY2018 while Sheetrock® would deliver price, volume and cost benefits across all the markets. The group expects improving Indonesia and Thailand businesses, but the Australian and Korean residential construction markets would continue to face pressure.
 
             
Targeted synergies (Source: Company reports)
 
For Boral North America, the group forecasts a major growth in EBIT in FY2018 from the full year contribution of Headwaters coupled with US$30 to 35 million of year 1 synergies. Meridian Brick JV is forecasted to contribute an earnings uplift from market growth and synergies. We give a “Buy” on this high dividend yield stock at the current price of $7.52


BLD Daily Chart (Source: Thomson Reuters)
 

Scentre Group

Maintained full year guidance: Scentre Group (ASX: SCG) is confident to reach their funds from operations (FFO) growth of over 4.25% for fiscal year of 2017. They also expect to achieve a distribution guidance of 21.73 cents per security. The group started the $160 million redevelopment at Westfield Kotara and the $50 million redevelopment at Tea Tree Plaza. They opened the $80 million (SCG share: $40m) cinema and restaurants expansion at Westfield Whitford City in September.
 

September quarter performance (Source: Company reports)
 
Customer visitation in June 2017 rose 33% from opening of Chermside. SCG stock has a solid dividend yield and trading at a reasonable P/E. With on-going momentum, we maintain a “Buy” on SCG at the current price of $4.23       
    

SCG Daily Chart (Source: Thomson Reuters)
 

Woolworths Limited

Revamp efforts started to reap benefits: Woolworths Limited (ASX: WOW) reported that their second half of FY17 started to show improvements as their revamping efforts started to show benefits. WOW enhanced dividend by 9.1% and the final dividend rose 17c to 50c, indicating the strong cash flow generation during the year. The group made solid progress across their customer, team and supplier experience, and on track with their 3 to 5 years’ plan. For FY18, the group is changing their focus from ‘turnaround to transformation’. Their Australian Food, division would continue to witness improvement in their fresh food, store format, customer engagement, range and prices. New Zealand Food division indicated that FY18 would be a year of investment in service, fresh and online. WOW stock rallied over 6.6% in the last four weeks (as of November 29, 2017) and is expected for more upside in the pre-Christmas period. We remain bullish on the stock and give a “Buy” at the current price of $26.91


WOW Daily Chart (Source: Thomson Reuters)
 

Nearmap Limited

Commercializing technology: Nearmap Limited’s (ASX: NEA) HyperCamera 2 capture has more than 3 times accuracy than their earlier generation systems, and is currently generating products which address customer use cases for oblique imagery, and expanding the market to new cases for 3D reconstructions on an unprecedented scale. Nearmap Panorama and Nearmap Oblique products to Australian customers have been forecasted for commercial launch by the first quarter of 2018. The group’s ACV portfolio is generating in excess of $50M, offering an exciting opportunity for Nearmap. The group continues to leverage their technology leadership, and accordingly is launching products like digital surface models, textured 3D mesh and 3D point clouds. We rate the stock a “Buy” at the current price of $0.62


NEA Daily Chart (Source: Thomson Reuters)
 

zipMoney Limited

Solid potential market opportunity: zipMoney Limited.’s (ASX: ZML) target markets are said to be associated with more than $300 billion of expenditure annually, and currently, only 0.1% of this market (in TTV) has been captured. The group expects to be cashflow breakeven on a monthly basis by FY18.
 
x
Quarterly Cash Operating Margin (Source: Company reports)
 
Accordingly, they are aiming for major retail wins in Q2. During the first quarter, Black Friday and Cyber Monday were the major Zip days which delivered transaction volumes of $2.4m and $2.2m, respectively. The Receivables book has hit $200 million. We give a “Buy” recommendation on the stock at the current price of $0.67


ZML Daily Chart (Source: Thomson Reuters)

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