Mcgrath Ltd


MEA Details

Investing for Growth: Mcgrath Ltd (ASX: MEA) has achieved the FY 16 revenue and EBITDA guidance. The revenue grew 12% to $137m, but EBITDA is down 3% to $26.2m and the NPAT fell 7% to $14.6m. This is due to the fact that MEA has invested in costs to support future growth. In FY 16, the agent numbers increased by a total of 77 to 642.
 

FY 16 Financial Performance (Source: Company Reports)
 
Additionally, MEA is evaluating strategic acquisition opportunities and has successfully completed the acquisition of the Smollen Group (10 offices). MEA’s market share is growing in a highly fragmented market and expanding in all East Coast markets. Meanwhile, MEA stock has risen 4.6% in the last five days (as of August 26, 2016) post the 13.5% fall in last six months, and still we believe that there is more momentum left. Accordingly, we give a “Buy” recommendation on the stock at the current price of $1.185
 
MEA Daily Chart (Source: Thomson Reuters)
 
Spotless Group Holdings Ltd


SPO Details

Issues resolved: Spotless Group Holdings Ltd (ASX: SPO) has resolved the short-term issues outlined in the December trading update related with the resolution of the acquisition integration issues that impacted performance in FY16. The integration of acquisitions is complete. SPO’s contract renewal rates remain robust and the contract won rate is improving. SPO has completed a strategy reset which would deliver business growth through expanding the offerings to clients, winning new customers and entering additional markets. SPO announced for 17% and 6% growth in underlying revenues and EBITDA, respectively, for FY16.
 

FY 16 Financial Performance (Source: Company Reports)
 
For FY 17, the growth will be through the conversion of the current pipeline of more than $1.3 billion of opportunities and there are no significant upcoming contract renewals that will materially impact FY17. The stock has surged 3.27% in the last five days post the 9.43% fall in last six months (as at August 26, 2016). Meanwhile, we give an “Speculative Buy” recommendation on the stock at the current price of $1.105
 

SPO Daily Chart (Source: Thomson Reuters)
 
Shine Corporate Ltd


SHJ Details

Met the FY 16 guidance: Shine Corporate Ltd (ASX: SHJ) reported that there were accounting irregularities in the first half FY 16, and accordingly delivered a weak operating performance, but the company has reported improved performance in the second half FY 16. SHJ managed to meet its mid-year revised guidance and also managed to generate improved operating cash flow.
 

FY 16 Financial Performance (Source: Company Reports)
 
Moreover, SHJ expected to receive fees and disbursements from DePuy settlement in August 2016. SHJ’s underlying business recovery is continuing. The stock has risen 96.99% in the last six months (as at August 26, 2016). We give a “Speculative Buy” recommendation on the stock at the current price of $1.31
 

SHJ 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 currently hold positions in:  BHP, BKY, KCN, PDN, and RIO. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations.