Vocus Group Ltd

VOC Details

Shares of Vocus Group Limited (ASX: VOC) have moved up 2.1% after announcing the receival of a preliminary, indicative and non-binding proposal from Kohlberg Kravis Roberts & Co. L.P. (together with its affiliates, KKR) to acquire 100% of the shares in Vocus (on a fully diluted basis) at a price of $3.50 cash per share. The Indicative Proposal is subject to a few conditions, including due diligence to KKR's satisfaction; availability of financing; unanimous recommendation from the Vocus Board; and entry into a definitive scheme implementation agreement between the parties.  The proposal is also based on a number of assumptions including, no dividends to be paid or capital returns undertaken before implementation of the scheme, and it will not have less than a normalized level of working capital at completion. Further, net debt will not be greater than $1.1 billion, while EBITDA should be in-line with guidance of $365 million to $375 million for the twelve months ending 30 June and not driven by any material one-time or abnormal items. The stock has fallen 60.8% in the past twelve months as on July 05, 2017, placing them at lower levels. However, in the last one month, the stock has moved up 14.5% with slight improvement in sectoral sentiments. We maintain a “Hold” recommendation on the stock at the current price of $3.38


VOC Daily chart; Source: (Thomson Reuters)

Galaxy Resources Limited

GXY Details

High grade results at James Bay lithium pegmatite project: Galaxy Resources Limited (ASX: GXY) has announced first assays from its 2017 drilling campaign at James Bay lithium pegmatite project in Quebec, Canada. In late March, Galaxy’s James Bay team commenced a ~31,000m diamond drilling campaign to extend and develop the existing James Bay resource. Additionally, Phase-1 (20,245 meters) was completed and the drill program has shown the resource to be open at depths below -100m, while the existing recoverable resource was reported to an average of -110m (maximum -200m) below surface. Further, the Phase-2 drilling program is ongoing and expected to be completed by the end of July 2017.

The James Bay Pegmatite swarm is located at 2 kilometers south of the Eastmain River and 100 kilometers east of James Bay. The property is accessible by paved road from the James Bay Road (highway) which cuts through the property close to the 381km road marker on the highway Route/109 from Val d’Or, Quebec, Canada. The James Bay Lithium project is located 1,850 road kilometers from Montreal and 1,650 road kilometers from Québec City. Meanwhile, the stock has tumbled 38.0% in the last six months owing to low quality lithium concentrate at Mt Cattlin and concerns over the meeting production targets. However, we believe that the long-term demand prospects are still optimistic, and maintain a “Hold” recommendation on the stock at the current market price of $1.86


GXY Daily chart; (Source: Thomson Reuters)

Flight Centre Travel Group Ltd

FLT Details

Shares of Flight Centre Travel Group (ASX: FLT) zoomed 10.4%, after the company updated its 2017 fiscal year (FY17) guidance. FLT expects to achieve an underlying profit before tax (PBT) between $325million and $330million for the 12 months to June 30, 2017, after achieving record full year sales and solid second half profit growth. Total transaction value (TTV) is expected to top $20billion, in line with the company's expectations and comfortably above the $19.3billion result achieved during the previous corresponding period (PCP), despite significant airfare price deflation in several key markets. Underlying second half PBT is expected to surpass the PCP's result by 2.5%-4.9%, leading to an underlying full year PBT. The company's second half profit growth is underpinned by strong results in North America as the USA business on track for a record profit and the Canada business set to record significant year-on-year improvement coupled with better performance in Europe, the Middle East and Africa (EMEA). Despite the ongoing political uncertainty in the UK, FLT's UK operation will deliver another record profit in local currency, although the significant fall in the British pound's value during the past year will adversely affect translation into Australian dollars. Importantly, the average international airfare prices in Australia, which were 7% down during the first half as a result of widespread discounting are now closer in line with the PCP, leading to stronger revenue and TTV growth late in the year.  Meanwhile, FLT stock has moved up 39.0% in the last three months, while it is up 26.9% in the last one year as on July 05, 2017, owing to better performance across its business segments. We give a “Hold” recommendation on the stock at the current price of $44.1


FLT 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 do not hold positions in any of the stocks covered on the website. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations.