APN Outdoor Group Ltd
APO Details
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Downgrade to EBITDA Guidance: APN Outdoor Group Ltd (ASX: APO) stock heavily corrected over 35.3% on August 22, 2016 as the group’s interim results could not meet analysts’ expectations. The group’s decreased guidance also contributed to the fall, as APO now expects full year EBITDA to be in the range of $79m to $84m for fiscal year of 2016, as compared to their earlier guidance of $84m to $88m. APN Outdoor reported that they witnessed a major impact in market activity in recent weeks for the September to November period, due to extended national election process closely followed by the Olympics. The group reported a revenue rise of 10% to $150.6 million in the first half of 2016 while EBITDA and NPATA rose 31% and 46%, respectively.
· Recommendation: We have been bearish on APO and with recent weak guidance, we reiterate our “Expensive” recommendation on this dividend yield stock at the current price of $5.33
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APN first half performance (Source: Company Reports)
Regis Healthcare Limited
REG Details
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Concerns over government funding hurt the stock sentiment: Regis Healthcare Limited (ASX: REG) fell over 7% on August 22, 2016 as the group’s competitor Japara Healthcare Ltd (ASX: JHC) reported that government has decreased spending for Aged Care. Regis stock has already corrected over 16.5% during this year to date (as of August 19, 2016) and we believe this pressure would continue as Japara cautioned investors that the Aged Care Funding Instrument growth would be subdued next year.
· Recommendation:We give an “Expensive” recommendation on the stock at the current price of $4.56
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