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Joshua Stega, JAS Wealth

BUY RECOMMENDATIONS

CSL (CSL)

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

Develops and makes vaccines and plasma protein biotherapies. CSL is a widely known international brand for pharmaceutical products. It recently flagged its intention to acquire the Novartis influenza business for $US275 million. We believe management has the ability to turn this loss making business around in what could be a defining moment. While CSL was recently trading on a price/earnings multiple of around 21 times, we believe it’s a high quality international exposure and still has room for upside.

OceanaGold Corporation (OGC)

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

An Asia Pacific focused gold mining and exploration company. OGC is a company in transition, with New Zealand assets helping to fund delivery of the long life, low cost project in the Philippines. We believe OGC offers investors exposure to significant near term production growth, with potential expansion and exploration upside. We have a price target just above $3, which could easily move higher with any bounces in the gold price. If investors start to worry about the global economy, long suffering gold stocks will be a likely beneficiary. The shares were trading at $2.52 on November 27.

HOLD RECOMMENDATIONS

Commonwealth Bank (CBA)

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

The CBA is Australia’s largest bank by market capitalisation. The current forecast is for 3 per cent earnings per share growth in fiscal year 2015. But we are cautious about the outlook for the Australian economy and believe it will be difficult for CBA to continue producing ongoing outperformance. The banks will remain attractive for their dividend yield and CBA is no exception with a fully franked dividend yield of about 5 per cent.

Westfield Corporation (WFD)

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

A property trust that invests in, leases and manages retail shopping centres globally. While WFD isn’t cheap, recently trading on a P/E multiple of almost 20 times, it has a pipeline of potentially big profitable development projects being delivered at a time when investment demand for premium malls has never been stronger. We like WFD for its global exposure.

SELL RECOMMENDATIONS

Leighton Holdings (LEI)

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

LEI is the holding company for a range of project development and contracting services businesses. This one time market darling of resources investment is now suffering as the overall pipeline of Australian engineering and non-residential construction declines. In this environment, competitive tensions will build among contractors, pushing downward pressure on margins. We don’t see any reason to be invested in this sector at this time.

Woolworths (WOW)

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

While WOW has a strong earnings track record and healthy balance sheet, the medium term issues facing the company are softening consumer sentiment, generating growth in the home improvement division and increasing competition from Coles and ALDI. For long term investors, we recommend taking some profits with a view to buying back at lower prices in the future.

 

Janine Cox, Wealth Within

BUY RECOMMENDATIONS

Incitec Pivot (IPL)

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

An S&P/ASX50 stock, IPL has been trading between $2.70 and $3.20 this year. A strong close above $3.10 would signal a strong buying opportunity, with upside for 2015 between $3.50 and $4. Long term support at the lower level would underpin such a rise. This explosives and fertiliser company finished at $2.94 on November 26.

Cromwell Property Group (CMW)

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

CMW is an S&P/ASX200 stock. Despite being in a defensive sector of the market, CMW’s low liquidity makes it more suited for traders than investors. While CMW could still break either up or down, a strong break above $1.05 would suggest an initial target at around $1.20. The shares closed at 99.5 cents on November 26.

HOLD RECOMMENDATIONS

Seek (SEK)

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

This online employment classifieds company is yet to reap much of the rewards from its push into Asia. However, support is reflected by a strong share price. That said, the price must remain above $15.80 and break above $18 otherwise the sellers may gain the upper hand and force SEK lower to fill a price gap on the chart. The shares breached $18 on November 27.

Stockland (SGP)

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

Also in Australia’s defensive property sector, the stock this year traded to a new six year high. In the past few years, investors received good dividends and solid capital gains, a trend that should continue over the longer term.

SELL RECOMMENDATIONS

Sandfire Resources NL (SFR)

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

SFR is one of the many resource companies that was sold down heavily in the past two years. In November, SFR broke an important level at around $5, which means now isn’t the time to be holding. Although there’s support at around $4.50, the analysis indicates the fall may continue to between $3.50 and $4. This copper producer finished at $4.84 on November 26.

Slater & Gordon (SGH)

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

Many class actions in recent years have bought this law firm a lot of healthy press. Now’s the time to consider a plan to preserve profits. Should SGH fall below $5.70, it may be a good time to take some money off the table. The shares were trading at $6.14 on November 27.

 

Michael Heffernan, Lonsec

BUY RECOMMENDATIONS

CSL (CSL)

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

This world class blood plasma company recently agreed to acquire vaccine business Novartis at a good price ($US275 million) funded through surplus cash. It’s nice to have this sort of money in your back pocket. As it generates much of its revenue from the US, this should translate to increasing Australian dollar revenue.

Ansell (ANN)

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

Comments at the recent AGM were encouraging. It expects earnings per share growth this financial year of between 7 per cent and 15 per cent. Improving US economic growth, lower rubber prices and a stronger US dollar are bonuses.

HOLD RECOMMENDATIONS

Sydney Airport (SYD)

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

Continues to benefit from increasing air travel due to lower fares. Its bustling retail business and the rivers of gold from its car parking business are additional benefits. The lower Australian dollar will also attract international travellers.

Tatts Group (TTS)

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

This company has transitioned smoothly from a largely gaming to a lotteries and wagering business. Its increasing national footprint in the lotteries business places it in a very strong position with expected improvement in economic activity.

SELL RECOMMENDATIONS

Atlas Iron (AGO)

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

This mid tier iron ore producer has been adversely affected by the savage fall in iron ore prices. We don’t expect any immediate strong turnaround in iron ore prices. There are simply better options elsewhere.

Super Retail Group (SUL)

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

It’s still finding the going tough in the retail arena. It’s suffering financial indigestion from a series of acquisitions in the past few years. There are better options than the retail sector. Take advantage of the recent share price rise on takeover rumours.

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.