Stock Spotlight
Articles do not constitute advice to any person. The views expressed here are those of the author and do not necessarily reflect those of ABN AMRO Morgan's Limited. Advisers in this office may own shares in the companies named here. Please read disclaimer page.
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Tuesday
23Sep
Visa Inc
September 23, 2008 | Share Article
This research material has been prepared by Matthew Smith through independent research facilities and contains an independent view to ABN AMRO Morgans Limited.
Debit & Credit Please?
By Matthew Smith
Visa Inc. Summary of Key Points
The Company has three business operations: transaction processing services, product platforms and payments network management. In October 2007, the Company completed the series of transactions, in which Visa U.S.A., Visa International, Visa Canada and Inovant became direct or indirect subsidiaries of Visa Inc.
Visa was floated on 18th March 2008; its IPO price was $44.00. When Visa opened it traded at approximately $60.00, an instant gain of 36% for shareholders.
Visa managed to reach highs of $89.00 in May this year and has since dropped back to initial levels around the $65.00 mark.
Visa first two earnings announcements have beaten analyst's expectations and the Q4 earnings announcement is to be released after market close on the 29th October, analysts expect Visa to be on par once again.
Why Visa? Because Visa has the world's largest payment network, in which banks and businesses are eager to participate. Because Visa just processes payments, rather than acting as a lender in transactions, it's nicely insulated from the credit crunch. Paperless payments are projected to surge from a bit more than 40% now to 70% of total payments in 2010. Visa is riding the crest of that wave and you should too.
Please call us and talk to your adviser if you wish to take advantage of this opportunity.
Phone 07 4771 4577
*This article does not constitute advice to any person. The views expressed here are those of the author and do not necessarily reflect those of ABN AMRO Morgans Limited. Advisors in this office may own shares in the companies named here.
Matthew Smith, B Com | Equities & Derivatives [Authorised Rep # 327 246]
ABN AMRO Morgans Limited | ABN 49 010 669 726 | AFSL 235410
Level 2, 105 Denham Street, Townsville, Qld 4810
Ph +61 7 4771 4577 | Fax +61 7 4771 4527 | msmith@abnamromorgans.com.au
Debit & Credit Please?By Matthew Smith
Visa Inc. Summary of Key Points
- World Leader in the industry
- Monopolistic operating environment
- Easy to understand business
- Strategically positioned from global point of view
- Looking to BUY on price weakness
- Looking to hold Visa as a core holding indefinitely
The Company has three business operations: transaction processing services, product platforms and payments network management. In October 2007, the Company completed the series of transactions, in which Visa U.S.A., Visa International, Visa Canada and Inovant became direct or indirect subsidiaries of Visa Inc.
Visa was floated on 18th March 2008; its IPO price was $44.00. When Visa opened it traded at approximately $60.00, an instant gain of 36% for shareholders.
Visa managed to reach highs of $89.00 in May this year and has since dropped back to initial levels around the $65.00 mark.
Visa first two earnings announcements have beaten analyst's expectations and the Q4 earnings announcement is to be released after market close on the 29th October, analysts expect Visa to be on par once again.
Why Visa? Because Visa has the world's largest payment network, in which banks and businesses are eager to participate. Because Visa just processes payments, rather than acting as a lender in transactions, it's nicely insulated from the credit crunch. Paperless payments are projected to surge from a bit more than 40% now to 70% of total payments in 2010. Visa is riding the crest of that wave and you should too.
Please call us and talk to your adviser if you wish to take advantage of this opportunity.
Phone 07 4771 4577
*This article does not constitute advice to any person. The views expressed here are those of the author and do not necessarily reflect those of ABN AMRO Morgans Limited. Advisors in this office may own shares in the companies named here.
Matthew Smith, B Com | Equities & Derivatives [Authorised Rep # 327 246]
ABN AMRO Morgans Limited | ABN 49 010 669 726 | AFSL 235410
Level 2, 105 Denham Street, Townsville, Qld 4810
Ph +61 7 4771 4577 | Fax +61 7 4771 4527 | msmith@abnamromorgans.com.au
Monday
12May
New Floats – Suncorp Pref Shares Paying 11.2%.
May 12, 2008 | Share Article When markets fall, like they have over the past 6 months, they are usually followed by some very good quality floats. Why? Because the markets will no longer support any suspect capital raisings. We have seen Wesfarmers come out with a rights issue at a 20% discount and now Suncorp with the Pref share. This is one to be in if you have a long term investment time frame and are looking for a secure high yielding investment.
Suncorp Converting Preference Share Offer
Suncorp is one of Australia’s top 25 companies and is Queensland’s biggest listed corporation with a market value of $13 billion. The Suncorp Group’s primary businesses are general insurance, banking and wealth management.
The proceeds from the CPS offer will be used to repay existing debt, finance new loans and for other general corporate purposes.
Investment in this opportunity will offer you:
• Attractive fully franked yield
• Exposure to one of Australia's top 25 companies
• The security of an "A-" credit rating from Standard & Poor's
• Quarterly floating dividend payments
• Yield will be 3.2% above the bank bill rate, current this is 11.2%
• Distributions will be fully franked.
This is a great investment for Self Managed Super Funds especially if they are in pension phase or for funds currently sitting in term deposits.
For more information click on the below link to take a look at the prospectus, if you are interested contact us to place an application. As senior Co-Managers to this float we can look to offer you some firm stock. Please call (07) 4771 4577.
Suncorp Convertible Preference Shares Offer (Click the link and you will be taken to the Suncorp website, where you will need to click on the Continue button. A new page will open in the suncorp site asking for your Sate and Postcode so you can then download the prospectus.)
Tuesday
29Apr
1300SMILES...This Week’s Stock Pick
April 29, 2008 | Share Article 
This week I am once again looking at the small end of the market. I believe that it is now a good time to look at accumulating some 1300SMILES shares. Below I have attached my latest email alert on the stock. But here are three reasons why I like this stock.
1. In the current market conditions no one is focused on this end on the market. As such 1300 Smiles is good value at $2.60.
1. In the current market conditions no one is focused on this end on the market. As such 1300 Smiles is good value at $2.60.
2. 1300SMILES has continued to expand through acquisition with out borrowing or issuing new shares, the company has a very low gearing ratio and will not be caught up in the credit crunch.
3. Recent acquisitions will be earning accretive to the bottom line, the dividend is currently 2.8% fully franked, however, I expect that this will increase steadily in the coming years.
This is a good long term story, not a short term play as such I am looking to slowly build holdings in this stock.
For the full story please download the PDF 1300SMILES
If you are interested in topping up your holding please let me know ASAP so I can arrange. Phone: (07) 4771 4577
Tuesday
01Apr
Pick of the Week - Seminar: How to Make Money in This Market
April 1, 2008 | Share Article Experience the most Powerful Wealth Creation Strategies
Attend for Free. Limited Spaces.
At this two hour seminar you will learn:
- The basics of options
- How to use two easy strategies
- Learn how to earn rent from your shares
- How to create a passive income stream from the stockmarket
- learn how to make money when the market is going up, down or sideways
Attend this semiar at:
Venue: 105 Denham Street, Townsville
Date: April 2nd
Time: 6:00 to 8:00pm
To reserve your place call ABN AMRO Morgans 07 4771 4577
Email: townsville@abnamromorgans.com.au
Tuesday
26Feb
Pick of the week – 1300SMILES
February 26, 2008 | Share Article By Jason Fittler
Last Friday 1300SMILES released its interim results. Below is a snap shot of the result?
86% increase in revenue to $6,991,049 for the half year
67% increase in cash flow from operations, to $1,602,295 for the half year
27% increase in profit before tax to $1,651,484 for the half year
22% increase in net profit after tax to $1,136,234 for the half year
22% increase in earnings per share to 5.66c for the half year
18% increase in interim dividend to 4.0c per share, fully franked
This is a great result in a period when the boarded market has come across tough times. A key to the 1300 Smiles result is no debt and acquisitions for cash. There are no fancy financial models or gearing strategy. This is good old fashion business.
If you are interested in topping up your holding please let me know ASAP so I can arrange. Phone: (07) 4771 4577
Last Friday 1300SMILES released its interim results. Below is a snap shot of the result?
86% increase in revenue to $6,991,049 for the half year
67% increase in cash flow from operations, to $1,602,295 for the half year
27% increase in profit before tax to $1,651,484 for the half year
22% increase in net profit after tax to $1,136,234 for the half year
22% increase in earnings per share to 5.66c for the half year
18% increase in interim dividend to 4.0c per share, fully franked
This is a great result in a period when the boarded market has come across tough times. A key to the 1300 Smiles result is no debt and acquisitions for cash. There are no fancy financial models or gearing strategy. This is good old fashion business.
If you are interested in topping up your holding please let me know ASAP so I can arrange. Phone: (07) 4771 4577
Monday
11Feb
Pick of the week – Fair value of our market 6300.
February 11, 2008 | Share Article The word recession has been used abundantly over the past 6 months, at present our Chief Economist is of the opinion that the US is indeed in a recession. Do not get confused with recession and depression. A recession is the slowing of the economy and at this point in time there is no doubt that the US has slowed down, brought about by the unchecked lending policies of the banks over the past decade.
What does this mean for the US? The Feds will continue to cut rates and the Government will continue to look to stimulate the economy. Combined, these efforts will work, but it will take time. At this point we should see the US start to recover in 2009.
Now compare this to the Aussie market, we are in a situation of high inflation, meaning that the Reserve Bank will continue to raise interest rates in an effort to slow spending and reduce house hold debt. Again there’ll be a lag time before we see the effects of the interest rate raise, at this point I wouldn’t expect to see spending slow down until the start of 2009.
What does this mean for our market?
What does this mean for the US? The Feds will continue to cut rates and the Government will continue to look to stimulate the economy. Combined, these efforts will work, but it will take time. At this point we should see the US start to recover in 2009.
Now compare this to the Aussie market, we are in a situation of high inflation, meaning that the Reserve Bank will continue to raise interest rates in an effort to slow spending and reduce house hold debt. Again there’ll be a lag time before we see the effects of the interest rate raise, at this point I wouldn’t expect to see spending slow down until the start of 2009.
What does this mean for our market?
First our market is undervalued, second our economy is still strong, third we can expect to see these Australian companies continue to produce good income, growth and dividends for some time. And finally I would expect that due to the issues in the US we can expect to see our market trade below its fair value of 6300 for at least a couple more months.
Tuesday
05Feb
Woolworths - Pick of the Week
February 5, 2008 | Share Article There is an opportunity at present to turn back the clock and pick up Woolworths at September 2007 prices. Woolworths reported last week, and although growth was positive it was below expectations, as such the price of stock has fallen. In my book this has provided us with an opportunity to pick up the stock at yesterday prices. See below chart and attached research.
Sunday
06Jan
Stock Spotlight - Suncorp (SUN)
January 6, 2008 | Share Article This week I am going against the trend, Suncorp (SUN) has been sold down on the back of concerns over insurance claims due to storms in Sydney. This is within the normal business cycle for the company, there was also a rumour SUN was going to do a share buy back and now a new rumour they won’t do the buy back due to the above insurance claims.
The facts are the stock is looking oversold and is currently trading at $16.64 and paying 6.3% fully franked dividend. Grossed up this is a 9% return on a blue chip stock. Our price target is also 20% above the current price. So unless you think SUN is about to fold I think that this is great long term stock. I would look to BUY now and hold for the dividend until the latest storm blows over.
The facts are the stock is looking oversold and is currently trading at $16.64 and paying 6.3% fully franked dividend. Grossed up this is a 9% return on a blue chip stock. Our price target is also 20% above the current price. So unless you think SUN is about to fold I think that this is great long term stock. I would look to BUY now and hold for the dividend until the latest storm blows over.
Tuesday
18Dec
Stock Spotlight - Bradken Ltd. (BKN)
December 18, 2007 | Share Article Heavy machinery manufacturer Bradken Ltd. (BKN) warned Thursday that after profit growth during its first quarter was below market expectations, it now expects net profit for the six months to Dec. 31 to be "relatively flat". This news caused a drop of 40% in the share price last Thursday with a bounce of 3% on the following Friday. I am not recommending to buy this stock but certainly place it on your watch list. Although the profit is expected to be flat, the company is still making a good profit and for the year will still have some profit growth.
This is one to watch as the story unfolds over the coming months and look to buy on some more positive news.
Tuesday
11Dec
Stock Spotlight - Storm Financial
December 11, 2007 | Share Article Storm Financial will not be floating due to lack of institutional support; the news report is below.
-By Lyndal McFarland, Dow Jones Newswires; 61-2-8235-2957;
-By Lyndal McFarland, Dow Jones Newswires; 61-2-8235-2957;
Australian financial advisory group Storm Financial said Friday it has abandoned plans for an initial public offer due to volatility in global financial markets, but it may reconsider plans for listing after conditions improve. "The decision to not proceed is the result of current market conditions and the likelihood of the offer proceeding at terms deemed unacceptable to the shareholders of Storm Financial," the company said in a statement.
The company had expected to raise up to A$172.8 million and list on Dec. 11, according to the Australian Stock Exchange.