Whitehaven Coal Ltd

WHC Details
· Bullish sentiment ahead of results: Whitehaven Coal Ltd (ASX: WHC) stock surged over 5.7% on February 16, 2017 ahead of their results. The group would be releasing their interim results on Friday, February 17, 2017. The group delivered a solid December quarter of 2016 with quarterly and half year metallurgical coal sales reaching 1.2Mt and 2.0Mt, respectively. WHC reported a quarterly ROM coal production of 5.5Mt. Quarterly saleable coal production rose 2% year on year (yoy) to 5.1Mt while managed quarterly coal sales enhanced 7% yoy to 5.3Mt as compared to the same period of last year. The group reported that their first half managed ROM coal production increased 17% yoy to 10.9Mt while managed saleable coal production rose 10% yoy to 10.2Mt. The group’s 400-meter wide panel expansion at Narrabri would start production by the June quarter FY2017. Further, a possible cut on coal output in China may give a boost to the company.

· Recommendation: WHC stock already generated over 641.3% in the last one year placing the stock at unreasonable levels. Despite temporary rise in the stock, we maintain our “Expensive” recommendation on the stock at the current price of – $ 2.94 

Managed Production and Sales (Source: Company Reports) 

Orora Ltd

ORA Details
· Strong results and acquisition agreements drove the stock higher: Orora Ltd (ASX: ORA) stock rallied over 5.1% on February 16, 2017 driven by positive sentiments and the solid half year of 2016 results. Net profit after tax (NPAT) performance was solid which rose over 12.3% to $92.1 million while sales revenue enhanced 4.1% to $1,975.4 million. As a result, operating cash flow improved to $157.5 million from $126.1 million. Orora made definitive agreements to acquire The Garvey Group and Graphic Tech businesses for US$54 million (approx. A$71 million) to enhance their North American Point of Purchase (POP) business. These acquisitions represent a multiple of 5.8 times last 12 month’s EBITDA. Moreover, the group is reimbursing the vendors for recent growth capital investments totaling US$5.0 million which would be finished by March 2017. For fiscal year of 2017, the group expects better earnings driven by organic growth and innovation efforts.

· Recommendation: ORA stock already rallied 33.2% in the last one year and with the recent increase the stock is at higher levels. It is also to be noted that the group’s net debt rose to $639 million, as compared to $593 million as at 31 December 2015. We give an “Expensive” recommendation on the stock at the current price of – $ 3.12
 

Australian EBIT growth (Source: Company Reports)

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 currently hold positions in:  BHP, BKY, KCN, PDN, and RIO. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations.