G8 Education Ltd

GEM Details
·         UBS ceased to be a substantial holder: G8 Education Ltd (ASX: GEM) stock fell about 4.3% on April 05, 2017 owing to some volatility. It has been noted that UBS group AG and its related bodies corporate recently ceased to be a substantial holder of group’s securities. On the other side, GEM had reported a 10.2% growth in the revenue to $778 m in fiscal year of 2016. The underlying net profit grew 7.1% and the company had 510 owned centers in Australia and Singapore. In fact, underlying EBIT surged up 10.5% at the back of good organic growth in H2 and acquisitions performing in line with expectations. EPS growth improved from (2.5%) in H1 to 6.8% in H2. The group had further reported that its January trading performance was slightly ahead of budget and better than last year. However, occupancy challenges prevailed in ACT, North Queensland and WA. The occupancy has otherwise been broadly in line with last year. The group will be paying interim dividend of AUD 0.06 on April 07, 2017.
 
·         Recommendation: GEM stock rose 30.07% in the last six months (as of April 04, 2017), and we give a “Hold” recommendation at the current price of – $ 3.81
 

Strategic Framework (Source: Company Reports)

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