Insights for June 2017

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Tesco Plc. is an avoid at the current level for the time being as the stock has been falling continuously for the last few days and we expect the correction to continue. Traders or investors are not adviced to initiate fresh positions or fresh longs in Tesco Plc., till the stock starts consolidating. The stock finished trading on the London stock exchange at 166.1p on 24th June, down by 0.27% compared to the previous close. A few days back, the stock has formed ‘Bearish engulfing’ candle and the next day the bears took the charge by piercing a day before low as well and the stock continued to fall. Therefore, in terms of technical analysis or charting the trend looks weak. The stock has been trading on the lower side of the Bollinger band, which is another sign of a bearish trend. The momentum oscillators like RSI and MACD also points out towards the downside. Although, the RSI is at 27 which also indicates that the stock is in oversold zone now and shall bounce back soon. Hence, investors shall wait for a strong trend reversal sign before building any fresh long positions. The stock is likely to have a support at 165p, but if it is not able to sustain the support zone of 165p as well, the stock may test the lows of up to 154p.

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Topics: Analysis
Other Insights on Related Shares: TSCO.L
Related Shares: Tesco Share Price
Posted by MaxMarioni on 25 June 2017, 9:58 AM

Glencore Seeks Rio Tinto's Mines

In continued negotiations for a deal that would see considerable upheaval in the global mining market, Glencore (GLEN:LN), the biggest coal miner in the Australasian region, has upped the ante in its pursuit of Rio Tinto's (RIO:LN) Hunter Valley mines. The Swiss commodity trading colossus has tabled an offer in the region of $225 million in excess of another offer, by Chinese firm Yanzhou Coal mining, which was already unofficially accepted by Rio Tinto's board. In addition to the raised bid, Glencore offered new incentives, such as a large deposit and hedges against regulatory delays, as well as clarifying issues concerning funding. (Read more)

Other Insights on Related Shares: GLEN.L, RIO.L

Aveva Group plc. is a holding company. The Company provides engineering, design and information management software. It operates in three segments: Asia Pacific, Americas, and Europe, Middle East and Africa (EMEA). Its engineer products include Aveva Diagrams, Aveva Electrical, Aveva Engineering and Aveva Instrumentation. Its design products include Aveva Bocad Steel, Aveva Bocad Onshore, Aveva Bocad Offshore and Aveva Bocad Tower. Its manage products include Aveva Catalogue Manager, Aveva Clash Manager, Aveva Engage, Aveva Material, Aveva Planning and Aveva Global. Its build products include Aveva Assembly Planning, Aveva Automated Plate Nesting and Aveva Bocad NC. Its operate products include Aveva Activity Visualisation Platform, Aveva Change Manager, Aveva Control of Work and Aveva WorkMate. It solution suites comprise integrated combinations of solutions and applications for enterprise-level requirements, such as integrated engineering and design and enterprise resource management.

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Topics: Analysis
Other Insights on Related Shares: AVV.L

Cobham plc. is a technology and services provider in commercial and defense and security markets. It operates in four segments. The Communications and Connectivity segment provides equipment and solutions to enable connectivity across a range of environments in aerospace, avionics, satellite and radio, wireless and mobile connectivity markets. The Mission Systems segment provides safety and survival systems for extreme environments, aerial refueling systems and wing-tip to wing-tip mission systems for fast jets, transport aircraft and rotorcraft. The Aviation Services segment delivers outsourced aviation services, including military training, special mission flight operations and outsourced commercial aviation. The Advanced Electronic Solutions segment provides solutions for communication on land, at sea, in the air and in space through off-the-shelf and a range of products, including radio frequency, microwave, and microelectronics, antenna subsystems and motion control solutions.

Cobham Plc is a compelling buy at the current level. The stock finished trading on the London stock exchange at 139.9p a share, up by 0.87% compared to the previous close. The stock has had its share of correction as it has corrected from 141p a share to the low of 126p a share. However, we expect the stock to start its northward journey and continue it’s up move. On 19th June, the stock had made a marubozu candle which implies the start of bullish trend. The stock has also been trading above its 20 day moving average (DMA), 50 DMA and 100 DMA of 135p, 133p and 122p respectively. A stock trading above its respective moving averages is a bullish sign as well. Also, the momentum oscillators like RSI and MACD also points out that stock is likely to move up. Therefore, we advise traders or investors to initiate long positions in Cobham Plc at the current level with a short term target of 144p and 150p respectively. The time to achieve these targets could be 20 days to one month. However, the immediate resistance of the stock is at 143p and any breakout above that would take the stock to new highs. Hence, traders or investors are advised to keep an eye at the respective levels and accordingly hedge their positions. (Read more)

Topics: Analysis
Other Insights on Related Shares: COB.L
Related Shares: Cobham Plc Share Price

Premier oil Plc. shall be avoided at the current levels. The stock finished trading on the London stock exchange at 50.95p a share on 15th June, down by 3.3% compared to the previous close. In our last article on Premier oil plc. we had mentioned that if the stock would break the support zone of 60.0p, it would test new lows and fresh longs shall be avoided till the stock is done with its consolidation. However, the stock couldn’t sustain the support of 60p last month and had tested the lows of 48.40p.  Currently, the stock has been trading below its 20 day moving average (DMA), 50 DMA and 100 DMA of 56.0p, 59.0p and 66.60p respectively. In terms of technical analysis or charting, the stock has been in downward trend and has been forming lower lows and lower highs. The next support zone for the stock would be 47.0p and any breach below that level would further increase the selling pressure and stock could be seen making new fresh lows. Hence, premier oil plc shall be avoided till we witness some sort of trend reversal. As of now beers seem to be in full charge so we have to wait for the sign of reversal. We would advise traders or investors to avoid Premier oil Plc for the time being. The weekly chart of the stock also depicts the bearish trend of the stock.

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Topics: Analysis
Other Insights on Related Shares: PMO.L
Related Shares: Premier Oil Share Price

National Grid is a ‘Hold’ at the current levels as the stock still seems to have some scope of upside. The stock finished trading on the London stock exchange at 1025p a share on 7th June, down by 0.21%,compared to the previous close. The stock had given a Gap down, a few days back on 31st May and the stock has been falling since then!  The stock has been trading below its 20 day moving average (DMA), 50 DMA of 1056p, 1031p and above 100 DMA of 995p respectively. The immediate support for the stock is at 1012p and 1000p respectively. However, if the stock won’t be able to sustain 990p also and goes below that, it might continue its southward journey and would fall more and make fresh lows. However, if the stock would be able to sustain the support of 990p-1000p, then traders or investors can even initiate fresh buying or else the stock has to be avoided till it’s done with its consolidation. Thus, traders or investors need to keep a close watch at the respective levels and accordingly hedge their positions. However in terms of valuation or fundamental analysis, we see national grid plc. going up in the long term.

The company announced its financial year 2017 results a few days back on 16th May. Let’s throw a light on the results of the company. As per the management, the company reported strong performance and significant strategic progress. The company also completed the sale of a UK distribution business and also announced £4bn return to shareholders. The company reported FY’17 operating profit up by 14% year on year at £4.66bn versus £4.096bn in FY’16. The reported EPS was also up by 16% compared to one year ago. However, the company’s return on equity fell slightly to 11.7% in FY’17 compared to 12.3% in FY’16. The company continued maintaining strong balance sheet and also recommended full year dividend of 44.27p. Also, the company announced the potential sale of a further 14% equity interest in NGGD at the option of National Grid or the consortium on broadly similar terms. (Read more)

Topics: Analysis

Marks and Spencer group plc. is a ‘Hold’ at the current level as the stock still has a lot of scope of upside. The stock finished trading on the London Stock exchange at 382.5 p a share on 31st May, down by 1.14% compared to its previous close. The company announced its financial year 2017 results on 24th May. However, post the announcement of the results,  the stock has been seen in a correction mode. However, investors or traders shall wait for the stock to consolidate at its support levels and can even initiate fresh buying from the respective support zone. As per the charting or technical analysis, the medium term or long term trend of the stock looks bullish only as the stock has been firmly trading on the upward trend line and has also been making higher highs and lower lows.  Currently, the retail giant has been trading above its 20 day moving average (DMA), 50 DMA and 100 DMA of 380p, 359p and 347p respectively.  The immediate support for the stock is at 380p and 370p respectively. If the stock would be done with its correction or consolidation around 377p-380p, then investors or traders can initiate fresh buying and could hold the stock for the higher targets. The resistance for the stock is at 395p. Therefore, traders or investors shall keep a close eye at the respectively levels and accordingly initiate fresh positions in the stock.

Now let’s throw light on the financial year 2017 results of the company. The company’s  fiscal 2017 revenue grew  by 0.6% year on year to £10,622.0m versus  £10,555.4m in FY’16. However, the company reported adjusted profit before tax was down by 10.3%, year on year in FY’17. The profit before tax decreased because of the expected decrease in clothing and home sales and increased costs of new space. Revenue from clothing  and home was down by 2.8% due to planned reduction in promotion and clearance sales. However, food revenue grew by 4.2% because of new stores. The good news for the investors is that the net debt reduced by £204m because of strong cash generation. (Read more)

Topics: Analysis
Other Insights on Related Shares: MKS.L