Stocks to watch: Air NZ, ANZ, NZ Refining

Tuesday 17th August 2010 1 Comment

Air NZ looks set to benefit from the departure of Pacific Blue from local business, ANZ is going through due diligence in its potential purchase of a stake in Korea Exchange Bank, while NZ Refining releases earnings results today which are expected to be significantly down.

Air New Zealand (AIR): The national carrier rose 1.8% to $1.16 yesterday on news that Pacific Blue, the local unit of Richard Branson’s Virgin Airlines, is quitting New Zealand’s domestic routes in October. Qantas’s Jetstar unit has responded by saying it will add service and Air NZ also expects to pick up any slack left by Pacific Blue’s departure.

ANZ Banking Group (ANZ): The dual-listed bank said today it is participating in a due diligence process in relation to the potential sale of a 57.27% shareholding in Korea Exchange Bank (KEB). The bank said in a statement it is looking to buy into KEB as it explores strategic growth opportunities, though cautioned that the process is still subject to considerable uncertainties. Shares were unchanged at $28 yesterday.

New Zealand Refining (NZR): The nation’s only oil refinery is set to release its half year result to June 30 today. Earnings are expected to be significantly down in line with the reduction in refining margins with no dividend expected as the company builds its cash reserves, according to a forecast by First NZ Capital. The shares were unchanged yesterday at $3.

NZ Farming Systems Uruguay (NZS): Olam International, trumped in its takeover offer for NZ Farming Systems Uruguay, plans to wait for the target company’s annual results and an independent assessment of its offer before responding it said yesterday. Union Agriculture Group offered 60 cents-a-share cash for Farming Systems, topping Olam’s 55 cents bid. Farming Systems rose 8.6% to 63 cents yesterday, suggesting investors are betting on another counterbid.

PGG Wrightson (PGW): The shares yesterday rose 3.8% to 54 cents buoyed by takeover activity around Farming Systems. Wrightson manages Farming Systems’ operation. Olam previously signed an agreement with Wrightson to buy its 11.5% stake in Farming Systems for $15.5 million, well below the 60 cents offer.

Pyne Gould (PGC): The financial and rural services company announced yesterday that earnings in its latest year were about 5% higher than forecast despite increased impairments. Profit was $22 million for the year ending 30 June, up from $20.9 million previously, boosted by a $17 million surge in net operating income, the financial and rural services company said in a statement. The stock rose 4.9% to 43 cents yesterday.

Sky City Entertainment Group (SKC): The casino and hotel company is set to release its annual earnings in what’s expected to be a flat operating performance. A sluggish Auckland gaming result will be offset by international business growth and modest gains from its Australian properties, according to an analysis by Forsyth Barr’s Jeremy Simpson. Shares were unchanged at $2.99.

Themes of the day: Stocks in Europe and the US were mixed as investors remained concerned about the global economic outlook after reports showed Japan's economy grew at the slowest pace in three quarters and that manufacturing in the New York region expanded less than forecast in August.

The Reserve Bank of Australia will release the minutes from its August meeting today and investors will be looking for any movement on the central bank's tightening track.

Businesswire.co.nz

Comments from our readers

On 17 August 2010 at 10:27 am kev said:

Well Forbar got their assessment (The casino and hotel company is set to release its annual earnings in what's expected to be a flat operating performance) wrong with Sky City didn't they ?? Record profit !!