Three stocks up on ASX - BlueScope Steel, Incitec Pivot and Yowie Group

BlueScope Steel Limited

BSL Details
· Expects FY2017 underlying net finance costs to decrease: BlueScope Steel Limited (ASX: BSL) stock surged over 4.8% on October 24, 2016 driven by the recovering commodity prices. BlueScope has been positioning itself even to withstand the subdued metal prices environment. The group cut operating costs at Port Kembla, and forecasts the underlying EBIT to be over 50 per cent higher for first half of 2017 as compared to the second half of 2016 which was at $340.4 million. First half of FY2017 underlying net finance costs are also projected to decrease against the earlier half period on the back of lower average borrowings, coupled with higher underlying tax rate while profit attributable to non-controlling interests is expected to be similar to the second half of FY2016. BSL stock generated over 74.6% this year to date (as of October 21, 2016).

· Recommendation: We maintain our “Hold” recommendation on the stock at the current price of – $ 8.14

 

Underlying EBIT (Source: Company Reports) 

Incitec Pivot Ltd

IPL Details
· Finished performance testing process for its ammonia plant: Incitec Pivot Ltd (ASX: IPL) stock surged over 1.8% on October 24, 2016. The group recently finished the performance testing process for its ammonia plant at Waggaman, Louisiana and took over the ammonia plant on October 19, 2016. IPL’s ability to maintain the project within the original budget of US$850 million indicates their operational efficiency. The ammonia plant is expected to operate at an average of over 80% of capacity in the coming twelve months as it ramps up to full annual production rates.

· Recommendation: IPL stock started recovering by 3.7% on the last four weeks and we maintain our “Hold” recommendation at the current price of - $ 2.88

Yowie Group Ltd

YOW Details
· Growing US penetration led to outstanding September quarter performance: Yowie Group Ltd (ASX: YOW) stock surged over 1.6% on October 24, 2016 driven by the solid September quarter sales which rose 104% to USD$4.9 million as compared to the first quarter of last year. Net operating cash outflow reached USD $1.7 million during the September quarter wherein cash receipts of USD$4.4 million were offset by raw material purchases and operating costs of USD$3.5M, marketing costs of USD$891K, and staff, administrative and corporate costs of USD$1.8M. But, these investments have been paid off as Yowie North America continued to penetrate the market during the quarter and continued to add in store merchandising and also new accounts. Nielsen market share data (for the 52 week ending October 8, 2016) for xAOC (™eXtended All Outlet Combined), which includes Food, Drug, Mass, Dollar, Club and excludes Convenience, indicated that the group has 0.7% share. The group continues to tap this opportunity and added new accounts including 2 divisions of Kroger, Food for Less, Brookshire’s Grocery and Winco Foods.

· Recommendation: We recommend a “Buy” on the stock at the current price of - $ 0.65



Yowie Group solid sales revenue (Source: Company Reports)

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