James Hardie Industries PLC

JHX Details
Lower than expected performance for third quarter of FY17: James Hardie Industries PLC (ASX: JHX) stock fell over 5.1% in the last five days as on February 06, 2017. The group’s adjusted net operating profit fell 6% year on year (yoy) to US$52.6 million for the third quarter of 2017 while adjusted EBIT fell 10% yoy to US$73.5 million for the same period. Meanwhile, their net sales rose 10% yoy to US$453.8 million during the period. JHX North America Fiber Cement Segment volume for the quarter rose 10% while North America Fiber Cement Segment EBIT margin reached 21.5%. International Fiber Cement Segment EBIT margin reached 22.0% during the quarter.
 

Nine months ended December 2016 Performance (Source: Company Reports)
 
The group expects their net volume growth for the North America Fiber Cement segment to be in mid-to-high single digits while segment’s EBIT margin is expected to be in the range of 20% to 25% for fiscal year 2017. Net sales from the Australian business and New Zealand business are expected to be in line with the average growth. JHX stock fell over 11.46% in this year to date (as on February 06, 2017) and we believe the weakness in the stock to continue. We give an “Expensive” recommendation on the stock at the current price of - $ 19.13

 
JHX Daily Chart (Source: Thomson Reuters) 

Seven Group Holdings Ltd

SVW Details
Dividend player: Seven Group Holdings Ltd (ASX: SVW) stock rallied over 5.75% in last five days as on February 06, 2017. The group recently reported for a dividend rate for its Transferable Extendable Listed Yield Shares (TELYS4) of 4.7320% per annum, during the Dividend Period from 30 November 2016 until 30 May 2017 inclusive. TELYS4 dividends have been since 2002 and were included under the broadened version of the buy-back program that resulted in re-rating of the share price. Meanwhile, Seven West’s Olympic Games coverage was successful while Seven West’s acquisition of The Sunday Times and PerthNow will enable the West Australian to provide a seven day per week offering. The group’s revenue for FY16 was of the order of $2.8 billion that was up 2% on the prior year while underlying EBIT of $303 million was down 4% but 6% ahead of guidance. Statutory NPAT of $198 million represented a $557 million turnaround on the prior year. SVW worked on good management of working capital, and thus, reported for the underlying EBITDA cash conversion of 112% up from the 99% recorded in FY15 and FY14. The group expects their FY17 underlying EBIT to be in line with their fiscal year of 2016 performance. Continued group-wide cost management programs have helped SVW to take advantage of potential increased activity given the rebound in bulk commodity prices. SVW stock has a decent dividend yield. We give a “Hold” recommendation on the stock at the current price of – $ 7.80

 
SVW Daily Chart (Source: Thomson Reuters)

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