5 Stocks that weathered the storm in May 2020: OCA, VGL, KMD, THL, PPH

  • Jun 04, 2020 NZST
  • Team Kalkine
5 Stocks that weathered the storm in May 2020: OCA, VGL, KMD, THL, PPH

Summary

  • New Zealand could shift to Alert Level 1 earlier than expected, investor sentiment on a high.
  • Pushpay was the top performer of the month with significant sales growth driven by surging use of digital tech solutions.
  • Vista Group signed an Enterprise Agreement with Pathé Theatres, an extension to its agreement with Pathé’s parent Company leading to a growth in top-line figures.
  • Kathmandu witnessed a substantial increase in online sales and benefitted from reopening of stores.
  • Oceania profited from government support for aged care services while demand for Tourism Holdings’ motorhomes shot up for COVID-19-related usage.

The New Zealand Prime Minister announced that the country is expected to come to Alert Level 1 ahead of schedule if everything goes well. As on 2 June 2020, the island nation has reported no new reported cases in the past 11 days and has only one active case in the country. Earlier Alert Level 1 was expected by 22 June, but now considering the favourable scenario at present, the Cabinet might consider moving to Level 1 earlier than planned.

This is good news for investors as well as most of the business will be entirely operational with minimal or no restrictions. While the economy has been getting back on track, there are a few stocks that have performed well in these testing times.

Let us look at five such stocks that weathered the storm in May 2020.

Oceania Healthcare Limited (NZX:OCA)

Auckland-headquartered, healthcare services company Oceania Healthcare Limited owns and operates retirement villages across New Zealand.

On 28 April 2020, the Company had notified that none of its retirement villages or aged care centres reported any cases of coronavirus. Also, Oceania Healthcare had authorised applications and completed Care Suites sales during the lockdown. OCA had mentioned that it expected to gain from the Government’s recently announced increase in funding to address aged residential care.

The stock of OCA closed the day’s trading at $0.940 per share on 3 June 2020, up 4.44% compared to its previous closing price. The Company has a market capitalisation of $577.998 million. OCA’s 52-week high and low prices are $1.39 and $0.38, respectively (as on 2 June). The stock has generated a return of 28.77% in the last month.

Vista Group International Limited (NZX:VGL)

Vista Group offers software and new tech solutions across the film industry sectors worldwide including exhibition, distribution, and consumer.

On 25 May 2020, The Company announced that it had signed an Enterprise Agreement with Netherlands-based Pathé Theatres.  The deal is an extension of Vista’s agreement with the parent Company of Pathé Theatres, Les Cinémas Pathé Gaumont (Pathé) after installing the Company’s system at Pathé’s circuits in Belgium, France, and Switzerland.

  • The operation in the Netherlands will consist of almost all Vista Cinema suite elements in a Cloud environment. This would be entirely managed by the Company and is expected to finish in early 2021.
  • Pathé Theatres is Netherlands’ biggest cinema circuit managing 31 Cinemas that also includes Amsterdam-based Tuschinski Theatre.

The stock of VGL closed the day’s trading at $1.990 per share on 3 June 2020, up 21.34% compared to its previous closing price. The Company has a market capitalisation of $454.943 million. VGL’s 52-week high and low prices were $5.96 and $0.86, respectively (as on 2 June). The stock has generated a return of 65.25% in the last month.

Kathmandu Holdings Limited (NZX:KMD)

Kathmandu Holdings Limited is a marketer, designer, wholesaler and retailer of footwear, clothing, and equipment for travel and adventure.

Strong Growth in Online Sales

During April, the online sales of KMD saw massive growth and increased by 2.5 to 3 times as compared to last year. The highest growth rate was witnessed in the Australian market, which is the Company’s largest market.

The Company was financially stable, having recently raised $207 million via equity raising. KMD continues to work on cost management measures to bolster its financial position further.

The stock of KMD closed the day’s trading at $1.070 per share on 3 June 2020, up 0.94% compared to its previous closing price. The Company has a market capitalisation of $758.631 million. KMD’s 52-week high and low prices were $2.54 and $0.49, respectively (as on 2 June). The stock has generated a return of 44.00% in the last month.

Tourism Holdings Limited (NZX:THL)

Tourism Holdings Limited has started its consultation process throughout parts of its NZ business, with the aim of fitting crew numbers to present activity levels and anticipations for the coming months.

  • An estimated 140 people will be affected with proposed modifications in these businesses.
  • The consultation process will comprise of the workforce from Kiwi Experience, Waitomo, and group support.

The Company’s rental businesses in Australia, New Zealand, and the US, were considered as an essential service to provide motorhomes for COVID-19 related usage. The Company is serving its customers worldwide that are in lockdown situations in its vehicles. However, operations of the Waitomo Group and Kiwi Experience are temporarily halted. Many employees have been placed on discretionary leave, been furloughed, left the business or similar. The implemented change is the staff is expected to provide an approximately 60% reduction in labour expenses over the next 12 weeks.

The stock of THL closed the day’s trading at $2.170 per share on 3 June 2020, up 10.15% compared to its previous closing price. The Company has a market capitalisation of $321.192 million. THL’s 52-week high and low prices were $4.26 and $0.55, respectively (as on 2 June). The stock has generated a return of 66.41% in the last month.

Pushpay Holdings Limited (NZX:PPH)

Pushpay offers a church and donor management system across non-profit organisations, primarily in the US.

For the year ended 31 March 2020, the Company reported total revenue of US$129.8 million, up by 32% and Operating revenue stood at US$127.5 million, up by 33%. Pushpay provided the following guidance, which it managed to achieve or even exceed.

FY20 guidance achieved (Source: Company’s Report)

Pushpay increased its gross margin by five percentage points, from 60% to 65% for the year ended 31 March 2020. The EBITDAF increased by US$23.5 million to US$25.1 million, an increase of 1,506%.

Future Outlook

In the coming future, the Company anticipates further strong growth as it continues to implement its strategy to gain the market share. The Company is expecting to achieve EBITDAF of between US$48.0 million and US$52.0 million for the full year ending 31 March 2021. In the long term, the Company is expecting to achieve more than 50% of the large and medium church segments - A market representing more than US$1 billion in annual revenue.

The stock of PPH closed the day’s trading at $7.500 per share on 3 June 2020, down 4.34% compared to its previous closing price. The Company has a market capitalisation of $2.067 billion. PPH’s 52-week high and low prices were $2.54 and $0.49, respectively (as on 2 June). The stock has generated a return of 75.58% in the last month.

 

NOTE: $ denotes New Zealand Dollar unless stated otherwise.

 

 


Disclaimer
The website has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. The above article is NOT a solicitation or recommendation to buy, sell or hold the stock of the company (or companies) under discussion. Kalkine does not in any way endorse or recommend individuals, products or services that may be discussed on this site.

 

   
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