Likes
This week, equities strategist at Bell Direct, Julia Lee, likes Mayne Pharma Group Ltd (MYX) after some positive results.
“When looking at full year results, it’s always encouraging to see the second half of the year speeding up,” she says.
“It points to growth yet to come and that is the case for Mayne Pharma. In its core business of generic medicines, it saw revenue growth of 26%, underlying generic product margin expansion.”
She also likes that new products are potentially being launched in the current financial year, which would further add revenue streams.
Any risks are on the regulatory side, and around concerns the US has increasing regulation in this area.
Michael McCarthy from CMC markets likes Biotron (BIT), with a couple of caveats.
Firstly, from an investment point of view, BIT is highly speculative, and secondly he is also a shareholder.
“BIT is developing a molecule which, if successful, will work in combination with other drugs to treat HIV infection,” he explains.
While not a “cure”, this could be a potentially important co-treatment.
“The results of an independent assay of BIT225 are due at the end of the month. If it works, it could have a significant place in the global treatment of HIV. If it fails, the company may be worth nothing,” he says.
Dislikes
Michael still doesn’t like Insurance Australia Group (IAG), despite a 14% pullback in share price.
“I see significant risk for insurers as the Royal Commission turns its attention to the sector. A “head and shoulders” formation on the charts that triggered around $7.80 adds to the bearishness,” he says.
Julia also continues to be cautious on Nufarm (NUF), given the ongoing drought in Australia.
“In addition, heightened competition from imports is likely to impact on margins,” she says.
“With glyphosate and the safety of the herbicide in focus, after a US case that ruled Monsanto liable for causing cancer through its glyphosate based weedkiller, there is the risk of loss of contracts and sales related to the court case.”
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