Best calls to action: 28 August 2015
About the author:
- Author name:
- By Andrew Tang
- Job title:
- Analyst - Equity Strategy
- Date posted:
- 28 August 2015, 11:19 AM
- Sectors Covered:
- Equity Strategy and Quant
Happy to Buy today
Ramsay Health Care (RHC) - Strong sustainable growth
FY15 underlying results were above expectations, underpinned by broad divisional performance, operating leverage and strong cashflow generation. While acknowleding cost pressures and affordability issues, we view guidance as conservative, as growth drivers remain intact, capacity expansion/efficacy gains remain supportive, with the strategic acquisition of Générale de Santé expected to realise synergies. We retain our Add recommendation.
RCG Corporation (RCG) - It's only the beginning
RCG's result stole the show, with the recently acquired Accent business delivering 37% like-for-like sales growth in the first seven weeks of FY15. TAF and RCG brands have also started the year nicely. Management's guidance will prove highly conservative if AGL comp sales continue anywhere near current rates. We see strong earnings upside in FY16 and cost synergies likely in FY17. We retain our Add recommendation.
IPH Limited (IPH) - Asian earnings growing strongly
A very strong FY15 result not only supported by FX movements but better performance in both Australia and Asia. IPH remains a stock which will continue to deliver low double digit organic growth + FX benefits + acquisitions. As such, in our view it justifies its current multiple and we maintain our Add recommendation.
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Disclaimer(s): An Analyst or Analysts in the Morgans Research Team may own shares in some or all of these companies.
The information contained in this report is provided to you by Morgans Financial Limited as general advice only, and is made without consideration of an individual's relevant personal circumstances. Morgans Financial Limited ABN 49 010 669 726, its related bodies corporate, directors and officers, employees, authorised representatives and agents ("Morgans") do not accept any liability for any loss or damage arising from or in connection with any action taken or not taken on the basis of information contained in this report, or for any errors or omissions contained within. It is recommended that any persons who wish to act upon this report consult with their Morgans investment adviser before doing so.
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