Morning Report Friday 20 February 2015
Another six companies with interesting reports yesterday
As the ASX200 continues to rally and make fresh 2015 highs, it’s no longer the “yield play” pulling the market up but individual stocks playing aggressive catch up.
In the last week we have witnessed some simply explosive moves:
• Crown (CWN) +12.7%, Challenger (CGF) +9%, Macquarie (MQG) +8.7%, Worley Parsons (WOR) +12.2% and Amcor +10.4%.
I believe this stock specific strength will continue to dominate the market over the next few months as the yield play currently feels tired.
1. AMP Ltd (AMP) $6.66 – AMP rallied hard yesterday as investors got very optimistic with the serial underperformer. This is a leveraged play to equities and on a valuation basis and currently does not look cheap. I could buy a pullback towards $6.30 with stops under $5.90 – chart 1.2. Crown Resorts (CWN) $15.88 – Long term, Crown looks to have aggressively turned the corner and is headed back towards $19-$20. Unfortunately no decent risk / reward entry at present – chart 2.3. Fairfax (FXJ) 91c – Technically good risk / reward buying remains, buy here with stops under 85c targeting $1.10 – chart 3.4. iiNET (IIN) $6.41 – IIN fell 11% yesterday after disappointing the market, the stock looks oversold and aggressive players can buy around $6 with stops under $5.50 – chart 4.5. Magellan Financial Ltd (MFG) $20.25 – I believe MFG is overpriced especially when compared to some of its piers. I am looking for a 8-10% pullback from this $20 region – chart 5.6. Origin Energy (ORG) $12.75 – Unfortunately remains boring and neutral – chart 6.
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