Stocks to watch: Cavotec, Cue Energy, Fletcher Building

Thursday 14th October 2010

Cavotec says order intake has risen 49%, oil is now flowing from Cue Energy's Manaia well, while Fletcher Building still faces a patchy outlook despite the significant rebuilding needed in Canterbury in the wake of the September earthquake.

Cavotec MSL Holdings (CCC): The owner of Christchurch-based MoorMaster said order intake rose 49% to 42 million euros in the third quarter, compared to the same period previously. The company's order book now stands at 72.5 million euros for the three months, an increase of 57% on 2009, although 7.1% softer than the second quarter of this year. Shares were unchanged yesterday at $2.70.

Cue Energy Resources (CUE): The gas and oil company announced oil is now flowing from its Manaia well. The company said its next milestone is to determine recoverable reserves before moving into commercialisation. The process is expected to take "several months". Shares were unchanged yesterday at 57 cents.

Fletcher Building (FBU): New Zealand's biggest construction company still faces a patchy outlook despite the significant rebuilding needed in the wake of the Canterbury earthquake, according to Aegis Equities Research analyst Nachiket Moghe, quoted on the ShareChat website. He said end market demand remains fragile in New Zealand and has the potential for downside surprises. Shares rose 1.2% yesterday to $8.19.

Investment Research Group (IRG): The investment advisory firm will resume trading at 10am after being halted in June for failing to file its annual accounts on time. The shares last traded on June 9 at 1.1 cents.

SmartPay (SPY): Managing director Ian Bailey said he is "very comfortable" that EBITDA will at least reach the bottom of the company's $7 million to $10 million forecast range. SmartPay is likely to seek a dual-listing with the Australian Stocks Exchange to help fund its expansion across the Tasman, he said. The shares were unchanged at 3.5 cents yesterday.

Telecom (TEL): Communications Minister Steven Joyce announced yesterday that the government will waive requirements on Telecom to migrate its existing broadband customers to the new wholesale broadband service and made other concessions over requirements Telecom had called onerous. New Zealand's biggest telephone company was unchanged at $2.02 yesterday.

Themes of the day: Optimism from better-than-expected corporate earnings and encouraging business confidence and trade data from China buoyed share markets in Europe and on Wall Street. The Standard & Poor's 500 rose 1.08% to 1,181.41 in early afternoon trade, while Europe's Stoxx 600 rose 1.4% to 266.25. The New Zealand dollar soared to near a 27-month high against the greenback. Gold surged to a record high, bringing the precious metal's gains this year to 25%. Spot gold rose to a record US$1,374.15 an ounce earlier. Government will release its retail trade survey for August.

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