Nufarm Limited

 
NUF Details
·         Turnaround result and positive progress on omega-3 canola: Nufarm Limited (ASX: NUF) stock rallied over 3.2% on March 22, 2017 as the group reported for a turnaround half year result with 15% growth in revenue over the prior corresponding period to $1,360 million. The underlying earnings before interest and tax surged 19% to $85 million while underlying net profit after tax jumped up 67% to $19.8 million. NUF also reported that the group’s subsidiary, Nuseed finished preparation for regulatory approvals of their long-chain omega-3 canola. The group has proceeded with submissions for Australia while expects to file United States and Canadian submissions this month. After these regulatory milestones, the group would have a solid potential opportunity for commercialization which they are expecting by 2018 or 2019. The group even reported commercial brands for leading oil product, specific to major end use markets - Aquaterra™for aquaculture feed uses, and Nutriterra™ for human nutrition application. The group aims to grow up to 4,000 acres of omega-3 canola in the US during 2017 for pre-commercial production under the stewardship of the USDA notification process.
 
·         Recommendation:NUF stock surged over 5% (as of March 21, 2017) in the last four weeks but is now trading at a high level and seems to be about fully valued. We give an “Expensive” recommendation on the stock at the current price of – $ 9.67 

Half Year Performance (Source: Company Reports)

Premier Investments Limited

PMV Details
·         Decent performance drove the stock sentiment: Premier Investments Limited (ASX: PMV) stock rose 4.06% on March 22, 2017 driven by their strong performance. The group’s underlying net profit before tax (NPBT) enhanced 9.7% year on year (yoy) to $100.6 million in the first half of 2017 while their Retail’s underlying earnings before interest and tax (EBIT) surged 10.6% yoy to $93.0 million during the period. Underlying EBIT margin improved 50bps to 15.8%. The group reported a net profit after tax (NPAT) of $71.9 million. Premier Retail’s sales increased 7.1% to $588.6 million even though they witnessed major events during the period like Hobart stores collapsing in August 2016, unseasonably cold October and New Zealand Earthquake in November 2016. The group’s Smiggle’s global sales surged 26.4% during the first half and 26 new stores were opened in the UK, while the group opened seven new stores in Asia. With regards to Peter Alexander segment performance, the sales surged 13.8% as compared to the first half of 2016 drive by LFL growth and the opening of three new stores during the period.  
 
·         Recommendation: PMV stock fell over 16.4% in the last six months (as of March 21, 2017) but we believe that the stock is trading at high levels given the prospects. We maintain our “Expensive” recommendation on the stock at the current price of - $ 14.35 

Premier Retail Performance (Source: Company Reports)

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