Retail Food Group Limited

 

   RFG Details

Acquisitions & International Expansion: Retail Food Group Limited (ASX: RFG) stock has been delivering an outstanding performance since the last three months and rallied over 36.85% (as of May 13, 2016) driven by solid first half of 2016 performance contributed from three significant acquisitions including Gloria Jean’s Coffee, coffee wholesaler Coffee Di Bella as well as New Zealand-based mobile coffee business Café2U.
 

 
Ongoing growth by RFG (Source: Company Reports)
 
Meanwhile, RFG guided that they would continue to deliver NPAT growth by 20% for fiscal year of 2016 and achieve more than 250 new outlets. RFG is appointing Andre Nell as the managing director effective from July 01, 2016 replacing the current managing director, A J (Tony) Alford. RFG also confirmed settlement of the purchase of its New Gold Coast Global Head Office, and resignation of its Joint Company Secretary. We give a “Hold” recommendation on this dividend yield stock at the current price of $ 5.70


RFG Daily Chart (Source: Thomson Reuters)
 
Vitaco Holdings Limited

 
  VIT Details          

Focusing on sports nutrition brand: Vitaco Holdings Limited (ASX: VIT) stock corrected over 34.17% (as of May 13, 2016) in the last six months partly due to the rising competition for the group’s products in China. Moreover, the group’s Healtheries Goats milk powder is impacted by the recent Chinese regulatory developments and are not allowed under the free trade zone. On the other hand, VIT launched Aussie Bodies Lo carb mini protein bars in UK via a distribution arrangement with Boots, which is a part of the Walgreen Boots Alliance, to leverage the huge demand in the region as the UK consumption of sports nutrition products per capita is over one-third the amount in Australia.
 

First half of 2016 performance (Source: Company Reports)
 
The company has also finished its integration with Musashi, a leading brand in Australian sports nutrition market which is going to give an EBITDA of $4 million from April 2016. Recently, the group also appointed Mr Jing Zhang as General Manager in China to boost its presence in the region. VIT has also been added in S&P/ASX 300 index as per the S&P Dow Jones Indices’ March quarter review. VIT stock already recovered over 13.18% in the last five days (as at May 13, 2016) and we believe this positive momentum in the stock would continue in the coming months. Based on the foregoing, we give a “Buy” recommendation on the stock at the current price of $1.925
 

VIT Daily Chart (Source: Thomson Reuters)
 
OZ Minerals Limited


  OZL Details

Leveraging high gold prices via hedging: OZ Minerals Limited (ASX: OZL) have been bullish in the last three months and was able to deliver returns of 18.98% (as of May 13, 2016) driven by its strong March quarter performance coupled with recovery in commodity prices. Recently, intensive data review at Minotaur Exploration indicated several copper gold targets in the Prominent Hill area while the group has selected four priority targets for joint work on the ground. Meanwhile, the Minotaur project chose four more targets for independent follow up.  The group also reported a solid Prominent Hill stockpile of over 370,000 ounces of gold. With the Australian gold price near 15 year highs, the group also leveraged this opportunity by hedging over 60 percent of the recoverable gold from this stockpile leading to 171,200 ounces which would generate an estimated $293 million of revenue realized from 2018 to 2021.
 

Separation of Carrapateena and CTP (Source: Company Reports)
 
OZL has increased the Pre-feasibility study scope to 4.0 Mtpa and a concrete treatment plant for Whyalla has also been proposed. OZL is also trading at a decent P/E while we give a “Hold” recommendation on the stock at the current price of $5.59

 
OZL Daily Chart (Source: Thomson Reuters)
 
Rural Funds Group

 
RFF Details

Strong dividend yield: Rural Funds Group (ASX: RFF) has entered into S&P ASX300 Index during March 2016. The group’s Tocabil development of 600ha almond orchard and Kerarbury development of 1,500ha almond orchard are on track. RFF expects to boost its pro forma adjusted total assets to $413 million boosted by its current development program.
 

Investment opportunities spectrum (Source: Company Reports)
 
Management reported that they would continue to pursue acquisitions of additional assets to grow the quantum and diversity of its earnings with the objective of ensuring the asset mix to fund distributions consistent with current levels. Having a solid dividend yield, we give a “Hold” recommendation on the stock at the current price of $1.505
 

RFF Daily Chart (Source: Thomson Reuters)
 
FlexiGroup Limited

 
FXL Details

Boosting business via acquisitions: FlexiGroup Limited (ASX: FXL) had acquired Fisher & Paykel Finance from Fisher & Paykel Appliances lately, which would contribute to its FY16 Cash NPAT guidance. Moreover, the group estimates its FY16 dividend within the range of 50% to 60% of cash NPAT. Recently, the group also announced the pricing of AUD260 million asset-backed securities supported by a pool of Australian unsecured, retail, “no interest ever” payment plans, which was originated by Certegy Ezi-Pay, a wholly owned subsidiary of FlexiGroup Limited. FXL is also trading at attractive valuations with a relatively cheaper P/E and has a decent dividend yield. We maintain our “Buy” recommendation on the stock at the current price of $2.45
 

FXL Daily Chart (Source: Thomson Reuters) 

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