Are These 3 Stocks Priming For More Growth – ASX: CSL, ASX: WEB And ASX: REH?

  • Nov 19, 2018 AEDT
  • Team Kalkine
Are These 3 Stocks Priming For More Growth – ASX: CSL, ASX: WEB And ASX: REH?

CSL Limited (ASX: CSL)

CSL Limited (ASX: CSL) is a global biotechnology leader involved in the development and delivering of innovative medicines that protect public health and help people with life-threatening medical conditions. CSL’s total operating revenue reached to US$7.9 billion in FY 2018 which is an increase of 11% on a constant currency basis when compared to the prior comparable period. The company’s net profit after tax increased by 29% on a constant currency basis to US$1.7 billion. At the end of Financial year 2018, the Net debt to Earnings Before Interest Taxes Depreciation and Amortization was at 1.3x. The board declared a final unfranked dividend of US 93 cents per share or approximately A$1.28 for the 2018 financial year which was paid on 12 October 2018. In FY 2019, the company is expecting its underlying NPAT to reach ~$1,880m to $1,950m which is ~10% - 14% up on FY18. The company is expecting its revenue to grow around 9 percent in FY 2019. The company is planning to make a capital expenditure of ~$1.2 - $1.3 billion in FY 2019 to support further growth. In the last six months, the share price of the company increased by 2.99 percent as on 16 November 2018. CSL’s shares traded at $182.300 with a market capitalization of circa $83.19 billion as on 19 November 2018. 

Webjet Limited (ASX: WEB)

Digital travel business company, Webjet Limited (ASX: WEB) recently announced 1 for 9 accelerated non-renounceable pro-rata entitlement offer for new Webjet ordinary shares at an issue price of $11.50 per New Share to raise approximately $153 million. The net proceeds of the Entitlement Offer will be applied principally to the acquisition of DOTW Holdings Limited (Acquisition) which is a market leading B2B travel business that operates across the Middle East, Europe, Asia Pacific and the Americas. As per the recently announced FY 2019 guidance, the company is on track to generate around AUD$110 million underlying EBITDA for the existing businesses for FY19. In addition, Webjet is expecting that DOTW will contribute incremental EBITDA of around AUD$10 million in FY19, pre-synergies and therefore it is expecting the total FY19 EBITDA to be around AUD$120 million. In the last six months, the share price of the company decreased by 0.16 percent as on 16 November 2018. WEB’s shares traded at $11.770 with a market capitalization of circa $1.52 billion as on 19 November 2018.

REECE Limited (ASX: REH)

REECE Limited (ASX: REH) is Australia's most successful supplier of plumbing and bathroom products and currently the company is having 450 stores across Australia and over 4,000 staff and thousands of products. In FY 2018, the sales revenue increased by 10.7% to $2.7bn and net profit after tax increased by 6.1% to $225m as compared to the last year. During FY 2018, the company finalized the acquisitions in Australia, New Zealand, and the United States and completed a well-supported debt and equity raising. In the first quarter of FY 2019, the sales revenue for Reece Australia and New Zealand increased by 12.3 percent to A$732m compared to the same period last year (A$652m). The company recently acquired US-based plumbing, waterworks and HVAC business, MORSCO. The EBITDA of the company for the six months to December is forecast between A$250m to A$260m, excluding transactional cost. In the last six months, the share price of the company decreased by 13.17 percent as on 16 November 2018. REH’s shares traded at $10.850 with a market capitalization of circa $5.99 billion as on 19 November 2018.

While the above stocks seem to be witnessing some level of growth, the stock prices are at higher levels relative to many peers.


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