1. What is your opinion about Ramsay Health Care (RHC) and Blackmores (BKL) (hold/sell/or buy)?
I think that Ramsay (RHC) is a first class operator, but the outlook for private hospitals is a little clouded. Around $63, I am fairly neutral on the stock (this is also in accordance with broker valuations, where the target price is $64.20). The share purchase plan at $56 looks like reasonable value and I intend to apply for shares.
Blackmores (BKL) remains out of favour with the market. According to FNArena, it has 4 neutral recommendations and 2 sell recommendations (no buys), and its target price of $67.47 is somewhat lower than its last traded price of $72.55. Interestingly, it has been on “radio silence” over the impacts of Covid-19 – it has said nothing! Pass.
2. In the lead up to the 2019 Federal Election, Scott Morrison promised an age increase for retirees wishing to make a Non-Concessional Contribution. The current age limit is 65 years old and the election promise was to increase the age limit to 67 for Non-Concessional Contributions. My wife turns 67 in FY21 and we’re hoping to make an NCC through our SMSF. Do you have any updates on this proposal?
The proposal is that 65 and 66 year old’s will be able to make super contributions, including accessing the bring-forward rule for non-concessional contributions, without having to meet any work test. This was due to start from 1 July 2020 (i.e. for the 20/21 financial year).
I am unable to confirm whether the necessary legislative changes have been made to enable this. When I search the legislative data base (SIS Act Regulation 7.04), I can’t see any amendments.
3. How long has ANZ deferred its dividend for? Will ANZ’s decision have any impact on Westpac?
ANZ has said that it has deferred the payment of its interim dividend. It will assess the situation over the coming months and provide an update to the market in August when it releases its Pillar 3 capital report. Typically, this is due in the first or second week.
Will this impact Westpac, which is due to announce its first half profit on Monday? Possibly, but I guess that the banks have shown that they are capable of acting quite independently. Westpac has already told the market that it will book a provision of $1.6bn for Covid-19. Analysts have lowered their forecast for an interim dividend to 25c per share (assuming they decide to pay rather than defer).
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