Reporting Season Review August 2020

About the author:

Andrew Tang
Author name:
By Andrew Tang
Job title:
Analyst - Equity Strategy
Date posted:
01 September 2020, 3:13 PM
Sectors Covered:
Equity Strategy and Quant

In our most recent analysis on the Reporting Season August 2020, we were able to identify three common trends that became evident throughout this last month.

1. Beating low expectations

With the lack of guidance going into Reporting Season August 2020, we saw a number of companies, particularly those cyclical companies beat FY20 guidance by some margin. This was commonly noted in the retail sector.

2. Income Scarcity

About 72% of companies decided not to pay forward a dividend, so income scarcity was certainly a theme… those companies who provided some form of certainty on income for FY21 or paid a dividend were certainly rewarded in the form of market support.  We believe this will become an increasing focus in the oncoming future.

3. Never waste a good crisis

With enormous operating leverage flowing through, we expect those who took the Covid situation as an opportunity to cut out costs, and stream line their businesses to reap the benefits in FY21.

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Disclaimer: 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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