We have an interesting trend in our Super Stock Selectors list of likes this week – BHP has got at least two mentions and that’s after Peter mentions it in his article today too.
Like Switzer Super Report expert Paul Rickard, Peter suggests that it’s one for the thrill seekers. Volatility in commodity prices will mean some more falls in the short term but Paul points out it’s now yielding over 6.5% pa, fully franked.
“There is more short term pain to come – however for a medium to long term play, it is getting into buy territory,” he says.
Chief market specialist at CMC Markets Michael McCarthy also likes BHP and believes it is cheap at these prices.
“The commodity cycle wheels on, and it is now four years since the peak in commodity prices. BHP’s upcoming earnings report will be a shadow of last year’s according to consensus. For me, this is all in the price, and buying close to $25 is a long-term investment opportunity,” he says.
One of the few bright lights in the economy lately has been ongoing growth in vehicle sales – particular SUVs – and one company that will benefit from this trend is Elio D’Amato’s preferred company this week – AP Eagers.
AP Eagers operates motor vehicle dealerships in Australia. It covers the sale of new and used vehicles, service, parts and finance. AP Eagers is expecting a record strong revenue and profit number in the coming reporting period.
“We believe that APE will benefit from a number of factors including support from the federal budgets small business tax write offs, strong new vehicle sales numbers and vehicles becoming cheaper and brands compete for market share,” Elio says.
The rout in commodities obviously is not good for all companies and Fortescue Metals is Raymond Chan’s ‘disliked’ company this week. And IG Markets Evan Lucas doesn’t like copper producers. I am concerned for copper producers
“China data currently is showing sustained signs of slowing and the effect on copper is becoming abundantly clear,” he says.
And for the chartist’s view Gary Stone says G8 Education tested its resistance zone last week between $3.30 and $3.45.
“There is a high probability that GEM will now head towards its next support zone around the $2.80 level,” he says.
Our Super Stock Selectors is a survey of prominent analysts, brokers and fund managers. Each week we ask them to name a stock they like, and one they don’t like. We purposely ask for ‘likes’ and ‘dislikes’ instead of recommendations, so it provides an idea of what the market is looking at, rather than firm buys or sells.
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