Reporting Season Wrap: Services Sector
A diverse sector with the traditional companies exposed to Australian construction mostly showing weakness during reporting season, particularly influenced by weak construction activity in the December quarter. Key points:
- Huge variance opened up between Bingo Industries (ASX:BIN) and Cleanaway (ASX:CWY), the latter of which reporting very strong earnings while the former suffered a poor end to CY18 - a big downgrade which led to a ~50% drop in the share price.
- We used that weakness to buy BIN ahead of the ACCC ruling on their Dial-a-Dump acquisition, the stock subsequently rallied following ACCC approval
- NearMap (ASX:NEA) which provides aerial imagery was a standout during February reporting better sales and less churn of customers. While the stock has run too far too fast, momentum in the business is clearly building
