Investors eye modest REIT return in 2019: Citi

January 24, 2019roymorgansocial Leave a comment

Original article by Nick Lenaghan
The Australian Financial Review – Page: 32 : 24-Jan-19

Citigroup has forecast a total return of five per cent for Australian real estate investment trusts in 2019. The sector delivered an overall return of 2.9 per cent in 2018, although Citi analysts note that the spread between the best and worst performers was the widest since the global financial crisis. Citi is bearish about the outlook for retail REITs, although the firm has upgraded its rating on several residential REITs to a ‘buy’.

CORPORATES
CITIGROUP PTY LTD, DEXUS – ASX DXS, STOCKLAND – ASX SGP, LEND LEASE GROUP LIMITED – ASX LLC, ABACUS PROPERTY GROUP – ASX ABP, GOODMAN GROUP – ASX GMG, CHARTER HALL GROUP – ASX CHC, WESTFIELD CORPORATION, UNIBAIL-RODAMCO

Runaway train set to derail BHP earnings

January 23, 2019roymorgansocial Leave a comment

Original article by Perry Williams
The Australian – Page: 15 & 16 : 23-Jan-19

BHP has advised that it produced 135 million tonnes of iron ore in the first half of 2018-19, with output falling by four million tonnes due to a train derailment in the Pilbara in early November. BHP’s copper output in turn was affected by problems at the Olympic Dam mine in South Australia and the Spencer mine in Chile. Shaw & Partners says BHP can still meet its full-guidance provided it has a strong second half. BHP shares closed 1.3 per cent lower at $32.77 on 22 January.

CORPORATES
BHP GROUP LIMITED – ASX BHP, SHAW AND PARTNERS LIMITED, MORGAN STANLEY AUSTRALIA LIMITED, VERTIUM ASSET MANAGEMENT PTY LTD, ORD MINNETT GROUP LIMITED

CBA dividend cut on the cards as sell-offs create an earnings hole

January 22, 2019roymorgansocial Leave a comment

Original article by Misa Han
The Australian Financial Review – Page: 21 : 22-Jan-19

Richard Wiles of Morgan Stanley suggests that the Commonwealth Bank of Australia may have to reduce its dividend payout ratio following a series of asset sales. CBA exited the life insurance sector in 2018 and secured a deal to sell Colonial First State Global Asset Management. It also proposed to spin-off its wealth management and mortgage broking operations. CBA paid a fully franked full-year dividend of $4.31 per share in fiscal 2018, an increase of $0.02.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, MORGAN STANLEY AUSTRALIA LIMITED, COLONIAL FIRST STATE GLOBAL ASSET MANAGEMENT, COLONIAL FIRST STATE GROUP LIMITED, COUNT FINANCIAL LIMITED, FINANCIAL WISDOM LIMITED, AUSSIE HOME LOANS LIMITED, COUNTPLUS LIMITED – ASX CUP, MORTGAGE CHOICE LIMITED – ASX MOC, SOCIETYONE AUSTRALIA PTY LTD

Rio Tinto eyes cash returns, record tonnage

January 22, 2019roymorgansocial Leave a comment

Original article by Melissa Yeo
The Australian – Page: 16 : 22-Jan-19

Glyn Lawcock of UBS says Rio Tinto could potentially expand its share buyback program and pay a special dividend in 2019 using the proceeds of asset sales. He estimates that the resources group still has about $U4.4bn on hand from asset sales that could be returned to shareholders. Meanwhile, UBS forecasts that Rio Tinto will produce 353 million tonnes of iron ore in 2019, compared with the miner’s own guidance of 338 million to 350 million tonnes.

CORPORATES
RIO TINTO LIMITED – ASX RIO, UBS HOLDINGS PTY LTD, JP MORGAN AUSTRALIA LIMITED

Whitehaven on track for record profit in 2019

January 18, 2019roymorgansocial Leave a comment

Original article by Luke Housego
The Australian Financial Review – Page: 21 : 18-Jan-19

Whitehaven Coal has advised that it still expects to meet its 2018-19 production guidance of 22-23 million tonnes. Production rose by 11 per cent year-on-year in the December quarter, although sales were seven per cent lower than previously. Whitehaven has indicated that its full-year costs are expected to increase by 4.7 per cent to $67 per tonne. Whitehaven shares closed 3.7 per cent higher at $4.71 on 17 January.

CORPORATES
WHITEHAVEN COAL LIMITED – ASX WHC, MORGANS FINANCIAL LIMITED

Looming federal election puts a dampener on dealmaking

January 17, 2019roymorgansocial Leave a comment

Original article by Scott Murdoch
The Australian – Page: 13 & 18 : 17-Jan-19

Data from Acuris shows that mergers and acquisitions activity in Australia totalled $US88.5bn ($123bn) in 2018, compared with $US85.6bn previously. Joe Fayyad from Bank of America Merrill Lynch notes that the upcoming federal election will affect inbound M&A activity in 2019, which will boost local companies’ ability to transact deals. Meanwhile, Aidan Allen of UBS expects M&A activity in 2019 to be dominated by private equity firms and Australian companies making offshore acquisitions.

CORPORATES
ACURIS, BANK OF AMERICA CORPORATION, MERRILL LYNCH AND COMPANY INCORPORATED, UBS HOLDINGS PTY LTD, MACQUARIE CAPITAL PTY LTD, JP MORGAN AUSTRALIA LIMITED, AMCOR LIMITED – ASX AMC, BEMIS MANUFACTURING COMPANY, REECE AUSTRALIA LIMITED – ASX REH, MORSCO, WORLEYPARSONS LIMITED – ASX WOR, JACOBS ENGINEERING GROUP INCORPORATED, GOLDMAN SACHS AUSTRALIA PTY LTD, CREDIT SUISSE (AUSTRALIA) LIMITED

Health insurers’ poor prognosis

January 15, 2019roymorgansocial Leave a comment

Original article by Sarah-Jane Tasker
The Australian – Page: 17 & 19 : 15-Jan-19

HBF CEO John Van Der Wielen says that affordability concerns remain an issue for the health insurance sector. Members Own Health Fund CEO Matthew Koce warns that even a small fall in private health insurance membership could have a big impact on the public hospital system, given that 40 per cent of medical procedures are carried out in private hospitals. Dwayne Crombie of Bupa notes that not everyone understands the community-rated health system under which health insurers operate; the system means that costs are spread across all fund members.

CORPORATES
HBF HEALTH LIMITED, MEMBERS OWN HEALTH FUNDS LIMITED, BUPA AUSTRALIA PTY LTD, MEDIBANK PRIVATE LIMITED – ASX MPL, THE HOSPITAL CONTRIBUTIONS FUND OF AUSTRALIA LIMITED, NIB HOLDINGS LIMITED – ASX NHF

Which industries can expect pay rise in 2019

January 11, 2019roymorgansocial Leave a comment

Original article by Lucas Baird
The Australian Financial Review – Page: 8 : 11-Jan-19

Information and communications technology is one of just three areas that 1st Executive director Andrew Thoseby says people wanting to change career paths to get a pay rise should switch to. He says the other two areas are insolvency accounting and sales. Executive headhunter Kylie Hammond is advising job applicants to seek out industries she describes as "recession-proof", including aged-care and health. Touchstone Executive Search MD Chris Kliengbeil does not expect much growth in fixed remuneration in the fast-moving consumer goods and retail sector in 2019.

CORPORATES
1ST EXECUTIVE PTY LTD, TOUCHSTONE EXECUTIVE SEARCH

Industry super roars to the lead

January 9, 2019roymorgansocial Leave a comment

Original article by Joanna Mather
The Australian Financial Review – Page: 1 & 4 : 9-Jan-19

Rice Warner forecasts that industry superannuation funds will hold assets worth $800m in 2020, displacing self-managed super funds as the sector’s largest asset managers. Rice Warner also estimates that industry funds’ assets will top $1bn in 2024 and $1.7trn in 2033. Industry funds will boast a 37 per cent share of the market in 2033, ahead of SMSFs (30 per cent) and retail funds (23 per cent). Industry experts note that employers are becoming more willing to embrace industry funds, while the fallout from the financial services royal commission is expected to accelerate the shift from retail funds to industry funds.

CORPORATES
RICE WARNER ACTUARIES PTY LTD, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, DELOITTE TOUCHE TOHMATSU LIMITED, INDUSTRY SUPER AUSTRALIA PTY LTD, AMP LIMITED – ASX AMP, AUSTRALIANSUPER PTY LTD, HOST-PLUS, CONSTRUCTION AND BUILDING UNIONS’ SUPERANNUATION FUND, TELSTRA CORPORATION LIMITED – ASX TLS, VANGUARD INVESTMENTS AUSTRALIA LIMITED

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