Viewpoint: Bullish
Chemical and explosive business ORI has endured a shocking 18-months but this month’s half-year results suggest things are slowly improving post COVID. We like his is an aggressive recovery play targeting $18 while stops can be run under $12.50 providing excellent risk / reward.
Imaging business PME has been a strong performer post COVID with its strong half-year result delivered in March confirming the business is kicking goals – revenue was up almost 8% to $31.6m while profit was just shy of $20m. We think PME is very likely to test $50 over the next 12-months but the risk / reward is only compelling under $40.
Investment platform provider NWL has struggled through 2021 after their interest margins on deposits took a hit which worried investors that it could ultimately impact funds under administration (FUA).
In the US the story hasn’t been as pronounced with the tech sector continuing to scale new heights. We like both indices at least through until 2022 with our preference biased towards value but it’s not as pronounced as it is domestically.
Stock markets have ground higher through 2021 but the real action has been under the hood on the stock and sector level as rising bond yields has seen a strong pick up in banks & resources, especially on the ASX.
US stocks traded mixed overnight with the small caps and the Dow noticeable solid performers, the bull market clearly remains intact. The twists and turns of indices over the short-term are largely guess work where the effort / stress is rarely adequately compensated.
Yesterday was a very rare day when not only was AMP up but also it was the ASX200’s best performing stock rallying over 8%. The out of character gain appeared to be triggered by the likes of Lend Lease, GPT and Mirvac lodging submissions to take over AMP’s $7bn office fund.
On-line accountancy business XRO caught my eye yesterday as it rallied another +2.7% taking its 2-week recovery to almost 19% illustrating the wall of buyers looking for bargains when quality businesses get sold off on news.
Aussie Broadband (ABB) provides communication services. The Company offers internet, mobile data, and other telephony services. Aussie Broadband serves customers in Australia.
The banks are major beneficiaries of rising bond yields as it enables them to increase margins hence it should be no great surprise that yesterday CBA joined the illustrious $100 club, we’ve called it all year.
