Aristocrat Leisure Limited

A Look at ALL’s FY 2018 Results: Aristocrat Leisure Limited (ASX: ALL) had earlier issued the FY 2018 results. As depicted by the results presentation, the company’s NPATA amounted to $729.6 million in FY 2018 which implies the rise of 34.3% on the YoY basis on the back of North American as well as ANZ results. However, transformative and positive contribution with respect to the digital (which also includes new acquisitions) has also supported the growth in NPATA.


ALL’s Results Summary (Source: Company Reports)

The company posted normalised operating cash flow of $987.9 million in FY 2018 representing the rise of 23.6% on the YoY basis which implies robust cash generating fundamentals. Also, the company is having a decent position with regards to its key margins. Its net margin stood at 15.3% in FY 2018 which is higher than the industry median of 10.5%. However, the company’s EBITDA margin, in FY 2018, was 37.2% which is also higher than the industry median of 21%.

Rise In digital Bookings in FY 2019: Aristocrat Leisure Limited is expected to witness favourable momentum in FY 2019. There are expectations that the company might witness a rise in the Digital bookings which would be aided by the new game releases with the substantial rise in the user acquisition investment as the company drives diversified Digital portfolio as well as it plans to utilize potential with regards to Digital footprint. 

Stock Recommendation: On the daily chart of ALL, Exponential Moving Average or EMA has been applied and default values were used for the purposes. After careful observation, it was noticed that the stock price has crossed the EMA and had trended upwards after the crossover. This reflects bullish momentum. However, the stock price has started moving towards the EMA and if this crossover occurs, the stock price might witness downward momentum. Give the backdrop of mixed updates, we have a watch stance on the stock at the current market price of A$24.410 per share (down 0.893% on 1 February 2019).
 

Bravura Solutions Limited

Analysing Bravura’s FY 2018 Results: Bravura Solutions Limited (ASX: BVS) ended FY 2018 by generating Wealth Management revenues amounting to $155.1 million which implies the rise of 26% on the YoY basis while EBITDA witnessed the rise of 52% YoY thanks to the continuing project work, new client wins as well as higher demand with regards to existing clients. Additionally, the company witnessed the rise in the corporate costs because of the deployments towards corporate as well as governance functions so that higher demand and geographic coverage can be supported.

Bravura’s corporate costs amounted to $34.4 million in FY 2018 which implies the rise of 17% on the YoY basis.


FY 2018 Results (Source: Company Reports)

What Might Support BVS Moving Forward: Bravura Solutions Limited had stated that it is in the strong position to reap the benefits of the robust demand which happens to be in Australia, United Kingdom, South Africa as well as New Zealand. Moreover, in FY 2019, there are expectations that Funds Administration as well as Wealth Management might witness growth.

Stock Analysis: On the daily chart of BVS, Exponential Moving Average or EMA has been applied and default values were used for the purposes. After careful observation, it was noticed that stock price has crossed the EMA and is trending in the upward direction. This reflects bullish momentum. 

However, the stock of BVS is trading slightly towards the higher range. Based on the mentioned factors, we suggest that the market players need to carefully watch the stock at the current market price of A$4.260 per share (up 1.429% on 1 February 2019).  
 

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