How Are Consumer Discretionary Stocks Doing Today?

Consumer discretionary goods include apparel, durable goods, automobiles, and entertainment and leisure. The consumer discretionary sector is very sensitive to changes in interest rates. Generally, rise in interest rates is an indicator of strong economy, low unemployment and increase in consumers’ confidence about spending money. Increased lending and wage growth contribute positively to increased financial expenditure.

Consumer discretionary sector includes companies from several fields such as automobile manufacturers and component manufacturers. It also includes companies related to travel and vacation, like resorts, hotels, casinos and restaurants.

Let’s now have a look at six consumer discretionary stocks listed on ASX.

Noni B Limited (ASX: NBL)

Stock Performance on 22 November 2019

The stock of NBL was trading at $2.570 per share on 22^nd November 2019 (AEST 01:10 PM), up by 4.472% from its previous closing price. The company has a market capitalisation of $238.42 million as on 22^nd November 2019 with an annual dividend yield of 5.89%. The total outstanding shares of the company stood at 96.92 million, and its 52-week low and high is $2.290 and $3.400, respectively. The stock has given a total return of -3.53% and -9.89% in the time period of 3 months and 6 months, respectively.

About the Company

Noni B Limited is engaged in the business of retailing of women accessories and apparel. Some of the Company’s brands are Millers, W.Lane, Noni B, Rivers and Katies. The Company, which has operations in Australia and New Zealand, has a digital presence and a network of 1,379 stores.

The company is scheduled to hold its Extraordinary General Meeting (EGM) on Monday, 23 December 2019.

Highlights of AGM

After acquiring five brands from Specialty Fashion Group on 2^nd July 2018, revenue increased by 136.8% to $881.9 million in FY19 ended 30^th June 2019 from $372.4 million in the previous year, according to NBL Chairman Richard Facioni.

The Company is in a very good financial position, with positive operating cash flow of $23.5 million for the year and net cash of $7.1 million at year-end. Due to this strong financial position, the Company paid fully franked dividends totalling 14.5 cents per share for the year, up 11.5% over the previous year’s dividends of 13 cents.

The company remains confident with markets consensus of $75 million in EBITDA for the year to 30^th June 2020.

City Chic Collective Limited (ASX: CCX)

Stock Performance on 22 November 2019

The stock of CCX was trading at $2.645 per share on 22^nd November 2019 (AEST 01:15 PM), down by 1.306% from its previous closing price. The company has a market capitalisation of $515.19 million as on 22^nd November 2019 with an annual dividend yield of 1.49%. The total outstanding shares of the company stood at 192.24 million, and its 52-week low and high is $0.884 and $2.920, respectively. The stock has given a total return of 51.41% and 41.80% in the time period of 3 months and 6 months, respectively.

About the Company

City Chic Collective Limited operates within the women’s fashion retail sector in Australia, New Zealand, United States, Germany and the UK. The Southern Hemisphere, which comprises of Australia and New Zealand, represented 80% of revenue with the balance in the Northern Hemisphere markets of US, UK and Germany.

Key Highlights of AGM

The key highlights of the year FY2019 ended 30^th June 2019 are given below:

• Comparable sales growth of 12.2% and top line sales growth of 12.6%;
• Underlying EBITDA of $24.9 million, up 25% from $19.9 million in the year-ago period;
• EBITDA margin of 16.8%, compared with 15.1% in the prior corresponding period;
• Continuing operations reported profit before tax of $21.3 million;
• Continuing operations reported net profit after tax of $14.3 million (EPS of 7.4 cents);
• Group reported net profit after tax of $16.0 million (EPS of 8.3 cents);
• Fully franked final ordinary dividend of 1.5 cps.

Outlook for FY20

The company remains on track to deliver positive comparable sales growth for the financial year FY20 ending 30^th June 2020.

For the company, the period going into Christmas is always the most important for sales. Moreover, Black Friday and Cyber Monday are also of significant importance. The company is just about to enter that critical trading period, with the tale of H1 FY20 to be told over the next six weeks.

Ainsworth Game Technology Limited (ASX: AGI)

Stock Performance on 22 November 2019

The stock of AGI was trading at $0.760 per share on 22^nd November 2019 (AEST 01:20 PM), up by 0.662% from its previous closing price. The company has a market capitalisation of $254.28 million as on 22^nd November 2019 with an annual dividend yield of 3.31%. The total outstanding shares of the company stood at 336.79 million, and its 52-week low and high is $0.610 and $0.975, respectively. The stock has given a total return of 4.14% and -7.36% in the time period of 3 months and 6 months, respectively.

About the Company

Ainsworth Game Technology Limited is engaged in the development, leasing, production, sales and servicing of gaming machines and other related equipment and services. The company also executes strategies to expand and diversify its product offerings within both lands based and online gaming markets, including social gaming and licenced “Real Money” gambling markets.

The company is scheduled to hold its annual general meeting on 26 November 2019 to receive and consider the Annual Financial Report including the Directors’ and Auditor’s Reports in respect of FY19 ended 30^th June 2019.

Resolutions to be considered during the period are

• Resolution 1 – Re-election of Mr Colin John Henson, as Director
• Resolution 2 – Re-election of Mr Daniel Eric Gladstone, as Director
• Resolution 3 – Approval of Remuneration Report

McPherson’s Limited (ASX: MCP)

Stock Performance on 22 November 2019

The stock of MCP was trading at $2.360 per share on 22^nd November 2019 (AEST 01:26 PM), up by 0.426% from its previous closing price. The company has a market capitalisation of $251.08 million as on 22^nd November 2019 with an annual dividend yield of 4.26%. The total outstanding shares of the company stood at 106.84 million, and its 52-week low and high is $0.990 and $2.810, respectively. The stock has given a total return of 9.81% and 88.76% in the time period of 3 months and 6 months, respectively.

About the Company

McPherson’s Limited is a leading supplier of wellness, health and beauty products in Australasia. The company is boosting its operations in China, with holding processes in New Zealand, Australia and Asia. The company mainly markets and distributes hair care, skin care, beauty care and personal care items.

Recently, the company announced that the interest of one of its directors, Laurence McAllister, changed in MCP with the grant of 455,000 performance rights, which were approved by shareholders at the company’s AGM on 18 November 2019.

Elanor Investors Group (ASX: ENN)

Stock Performance on 22 November 2019

The stock of ENN was trading at $2.130 per share on 22^nd November 2019 (AEST 01:38 PM). The company has a market capitalisation of $244.51 million as on 22^nd November 2019 with an annual dividend yield of 7.54%. The total outstanding shares of the company stood at 114.8 million, and its 52-week low and high is $1.615 and $2.400, respectively. The year to date return of the stock is 19.66%.

About the Company

Elanor Investors Group is an ASX-listed Australian investment and funds management business concentrating on acquiring and releasing value in real estate assets that provide strong income and capital growth potential.

On 20 November 2019, the company unveiled a change of interest of substantial holder - Perpetual Limited and its related bodies corporate – from a voting power of 12.68% to 11.18%.

Recently, the company announced the successfully completion of an institutional placement of 15% of the fully paid stapled securities on issue at $2.10 per security. The placement, raising approximately $31.4 million, involved institutional, sophisticated and professional investors.

Schaffer Corporation Limited (ASX: SFC)

Stock Performance on 22 November 2019

The stock of SFC was trading at $14.290 per share on 22^nd November 2019 (AEST 01:41 PM), up by 0.14% from its previous closing price. The company has a market capitalisation of $196.07 million as on 22^nd November 2019 with an annual dividend yield of 4.91%. The total outstanding shares of the company stood at 13.74 million, and its 52-week low and high is $12.800 and $15.500, respectively. The stock has given a total return of 1.57% and 6.49% in the time period of 3 months and 6 months, respectively.

About the Company

Schaffer Corporation Limited is engaged in the business of automotive leather, concrete product manufacturing, property and equity investing and property leasing.

Highlights of AGM

The key points of FY2019 results were:

• Revenue from continuing operations of $203.6 million, a 10% decrease;
• Net profit after tax (NPAT) of $22.9 million, a 2% decrease;
• Underlying NPAT was $23.9 million, up 6%;
• Underlying earnings per share were $1.72 and annual dividends increased to 70 cps from 45 cps, a 56% uplift.

Company’s Outlook

SFC expects that in the first half of financial year 2020, profit would be significantly lower than the prior corresponding period due to lower forecast sales volumes for automotive leather. This reflects the challenging economic and geopolitical backdrop, as well as the delay in start of a material new program.

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