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Janine Cox, Wealth Within

BUY RECOMMENDATIONS

Asciano (AIO)

Chart: Share price over the year versus ASX200 (XJO)

Following a strong rebound in the share price, important support between $5.30 and $5.40 is likely to hold, which means now is a better time to be in this freight and logistics giant.

Woodside Petroleum (WPL)

Chart: Share price over the year versus ASX200 (XJO)

Sectors that look interesting are energy, industrials and utilities. Energy giant Woodside Petroleum recently stood out after breaking above important long term support and resistance between around $39 and $40.50.

HOLD RECOMMENDATIONS

Fairfax Media (FXJ)

Chart: Share price over the year versus ASX200 (XJO)

The media giant has achieved some nice gains, but in recent months buyers and sellers reached agreement on price around $1. Provided the price remains above 90 cents, FXJ is likely to continue to the next level at around $1.30. The shares closed at $1.025 on May 14.

Telstra (TLS)

Chart: Share price over the year versus ASX200 (XJO)

Although Telstra hasn’t seen much share price growth for a while, it’s paid good dividends for those chasing income. That said, income or not, if the stock falls away strongly, my current view will change.

SELL RECOMMENDATIONS

Beach Energy (BPT)

Chart: Share price over the year versus ASX200 (XJO)

Has enjoyed a nice run and finally broke through the all-time high set in February 2012. However, recently it opened well above a prior week’s bar before it was sold off. Therefore a trailing stop loss has been set at $1.62. The shares closed at $1.71 on May 14.

Transurban Group (TCL)

Chart: Share price over the year versus ASX200 (XJO)

The toll road operator has been trading in a long term uptrend over the past few years. However, in the past 12 months the ascent has slowed, indicating direction may soon change. If the price falls below $6.96, it’s time to consider taking profits. The shares finished at $7.24 on May 14.

 

Joshua Stega, JAS Wealth

BUY RECOMMENDATIONS

Woodside Petroleum (WPL)

Chart: Share price over the year versus ASX200 (XJO)

The oil and gas giant generates strong free cash flow. Shareholders benefit from management distributing excess cash via dividends. WPL has been recently trading on an attractive price/earnings multiple of about 13 times and a dividend yield above 6 per cent. However, the growth pipeline is long dated and challenging.

Tabcorp Holdings (TAH)

Chart: Share price over the year versus ASX200 (XJO)

Offers a wide range of gambling and entertainment products. We believe TAH is a solid business with good potential for further growth. Since the start of calendar year 2013, TAH has underperformed some competitors, but its recent results confirmed a steady revenue growth outlook. We believe TAH offers value. It was recently trading on a dividend yield of about 5 per cent.

HOLD RECOMMENDATIONS

Bendigo and Adelaide Bank (BEN)

Chart: Share price over the year versus ASX200 (XJO)

BEN has a strong business model and offers franchise strength. We’re happy to hold this stock at current levels, but acknowledge that generating further growth will be a challenge amid more intense competition from the majors.

Cochlear (COH)

Chart: Share price over the year versus ASX200 (XJO)

Designs, makes and distributes hearing devices. Cochlear leads the competition in the bionic ear industry and invests heavily in product research and development. However, several new companies are emerging that may threaten its market share. We still like the business, but are taking a wait-and-see approach.

SELL RECOMMENDATIONS

Federation Centres (FDC)

Chart: Share price over the year versus ASX200 (XJO)

Federation Centres is the new vehicle formed from an amalgamation of Centro Properties (CNP) and Centro Retail (CER). Our analysis shows FDC was recently trading at a mild premium to net tangible assets. It’s more expensive than our REIT sector average discount of 9 per cent to price target. We would take profits and look for a more discounted property exposure.

Mineral Resources (MIN)

Chart: Share price over the year versus ASX200 (XJO)

While we like MIN’s underlying business, we’re concerned about broader market pressures, which increase competition for available construction work and mine support services. Margin pressure and increasing pressure from a contractual risk perspective may weigh on the group. Despite a recent price/earnings multiple of 9 times, we would take profits at these levels.

 

James Samson, Lincoln Indicators

BUY RECOMMENDATIONS

Infomedia (IFM)

Chart: Share price over the year versus ASX200 (XJO)

An international automotive software developer. We believe the company is on target to achieve profit growth guidance of between 10 per cent and 19 per cent this financial year. Expect stronger sales and perhaps more market share as a consequence of investing heavily in product development in recent years. Financial health is strong.

JB Hi-Fi (JBH)

Chart: Share price over the year versus ASX200 (XJO)

A consumer electronics giant expanding its footprint into whitegoods and appliances. Recent market updates suggest JB Hi-Fi Home has resumed a growth path. Further, the announcement of an on-market buy back (which will neutralise employee share issues) is a vote of confidence for cash flow and, more generally, the outlook.

HOLD RECOMMENDATIONS

Titan Energy Services (TTN) 

Chart: Share price over the year versus ASX200 (XJO)

Has a niche focus on high growth coal seam gas operations in Queensland’s Surat Basin. Full year EBIT guidance is between $21 million and $23 million. First half EBIT of $8 million suggests full year guidance may be a touch ambitious. Nevertheless, we expect earnings growth to continue in fiscal year 2015.

National Australia Bank (NAB)

Chart: Share price over the year versus ASX200 (XJO)

Despite reporting a marginally underwhelming financial result for the half year ending March 31, NAB is trading at a discount to the other three majors. With ongoing lower impairment charges, high dividend yield and the UK business conditions expected to improve, NAB’s outlook is stable. We believe NAB suits income investors who may benefit from the high yield and franking credits on offer at reasonable value.

SELL RECOMMENDATIONS

Aurizon Holdings (AZJ)

Chart: Share price over the year versus ASX200 (XJO)

The company’s operations traditionally focus on rail haulage, with a large exposure to east coast coal transport. While the company has performed reasonably well in the past few years, it recently announced it will take an equity stake in iron ore business Aquila Resources via a joint takeover bid with Baosteel Resources at $3.40 per AQA share. AZJ will take a 15 per cent equity stake in the company if the bid is successful and would gain exclusive rights to develop port and rail infrastructure for the iron ore export operations. While the project may be viable, we feel it adds significant risk to AZJ as the company funds a project outside its usual area of expertise.

Incitec Pivot (IPL)

Chart: Share price over the year versus ASX200 (XJO)

Despite taking strong strides this year, IPL’s financials released on May 12 indicate some weakness in the outlook. Notwithstanding reporting a healthy $115.7 million net profit for the six months to March 31, 2014, a potential oversupply in ammonium nitrates and shutdowns at Phosphate Hill may impact the second half. Given the market’s fragile supply and demand situation and waning explosives activity in the resources sector, we believe IPL bears risk into the future.

Please note that TheBull.com.au simply publishes broker recommendations on this page. The publication of these recommendations does not in any way constitute a recommendation on the part of TheBull.com.au. You should seek professional advice before making any investment decisions.

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