MARKET CLOSE: NZ shares fall ahead of earnings season 28 Jul 2014
Related articles
- NZ consumers grow more upbeat, may resume spending Business
- Knowles quits as CEO of KiwiBank Business
- NZ migration bolstered by British invasion Migration
- NZ manufacturing activity reaches highest since 04 Business
- NZ dollar hits 22-month high vs euro Business
- OceanaGold finds new gold deposits at Fraser mine Business
- Transpower gets go-ahead for $170m SI upgrade Business
- NZ home sales creep up in March, still subdued Property
- NZ economy expands at fastest pace in two years Business
- New Zealand food prices fall in February Business
MARKET CLOSE: NZ shares fall ahead of earnings season; Air NZ drops to 3-month low
By Suze Metherell
July 28 (BusinessDesk) - New Zealand stocks fell, snapping six days of gains, as investors mulled stock valuations ahead of earnings season. National carrier Air New Zealand dropped to a three-month low, pacing the decline.
The NZX 50 Index fell 7.126 points, or 0.1 percent, to 5187.142, from a six-week high close on Friday. Within the index 19 stocks fell, 21 rose and 10 were unchanged. Turnover was $82.3 million.
The benchmark index reached an all-time record in the first-half of 2014 and has advanced 9.5 percent this year, leading some investors to question whether the market is fully priced and to seek validation for the high stock prices as earnings season kicks into full-swing next month. Air New Zealand dropped 2.6 percent to $1.87, its lowest since March. The airline is due to report full-year earnings next month, and Forsyth Barr analysts expect the company to lift profit 29 percent.
"All eyes are very closely focused on the earnings season, and particularly the outlook," said Rickey Ward, New Zealand equity manager at JBWere New Zealand Equities. "People are saying you're trading on a multiple which we're not used to and, secondly we need to earnings to come through to justify that multiple we're not convinced the earnings will justify that multiple."
Telecom fell 0.3 percent to $2.94, from the highest level its been since it demerged with network operator Chorus in November 2011. New Zealand's largest telecommunications provider has gained some 28 percent this year making it the second best performer on the benchmark Index. As one of the larger companies on the bourse, Telecom typically attracts interest from foreign investors seeking exposure to New Zealand's markets. Fletcher Building, the country's biggest listed company, fell 0.7 percent to $9.19. Ryman Healthcare slipped 0.3 percent to $8.04.
JBWere's Ward said an improving world economy was seeing some foreign investors repatriating funds back to their economies while local interest rate hikes had domestic investors eyeing alternative asset classes with a potentially better yield and some were raising funds ahead of upcoming initial public offers.
Pacific Edge led the benchmark index lower, dropping 5.4 percent to 70 cents.
Units in Fonterra Shareholders' Fund were unchanged at $6.00. Tomorrow Fonterra Cooperative Group's board meets and is largely expected to cut its forecast 2015 milk price payout after a 38 percent drop in dairy prices this year. Economists at ASB expect Fonterra to revise down its milk price payout for the 2014/15 season to about $6.20 per kilogram of milk solids, from its initial estimate of $7/kgMS. The fund's units give holders access to the dairy exporter's dividend stream.
Outside the benchmark index, Abano Healthcare, the medical investor which earlier this year fended off a hostile takeover from its biggest shareholder, rose 1.5 percent to $6.15 after it posted a 75 percent jump in full-year profit to $6.1 million in the year ended May 31, beating guidance and allowing it to maintain dividend payments for a sixth straight year. Sales climbed 2 percent to $274 million.
Dorchester Pacific rose 6.8 percent to 23.5 cents after it said it plans to offer $3 a share in cash, shares and notes for Turners Auctions, valuing the auction company at $82 million, after winning support from chairman and major shareholder Michael Dossor. Turners climbed 11 percent to $3.05, above the offer price.
Acurity Health Group soared 25 percent to $6.58, after the three biggest shareholders launched a cash takeover bid, offering $6.50 per share, for the 29 percent they don't own, valuing the private hospital operator at $112.2 million, saying the firm faces a big struggle lifting its flagship Wellington hospital up to earthquake code.
"Balance sheets are pretty healthy, so if you struggle to get organic growth you tend to look for acquisitive growth, and I think it is nothing more complicated than that." Ward said of the two takeovers.
SLI Systems, the search engine software developer, rose 6.9 percent to $1.39 after it said full-year revenue missed its prospectus forecast, using its preferred measure, although it will report a smaller loss because of delays in building a sales team. Annualised recurring revenue rose about 29 percent to $25 million in the 12 months ended June 30, compared to a forecast in last year's offer documents of $25.9 million. The company is due to report its audited earnings on Aug. 26.
(BusinessDesk)
News
Hilary Timmins' Award-Winning UK Documentary Series To Inspire NZ Students
29 Jun 2020 Education
Dream Catchers, produced and directed by Hilary Timmins, celebrates the success stories of more than thirty inspirational New... more
New Zealand reaffirms support for Flight MH17 judicial process
7 Mar 2020 News
Ahead of the start of the criminal trial in the Netherlands on 9 March, Foreign Minister Winston Peters has reaffirmed the need to... more
Business
NZ Government's Economic package to fight COVID-19
17 Mar 2020 Business News
The Coalition Government has launched the most significant peace-time economic plan in modern New Zealand history to cushion the... more
NZ Government announces aviation relief package
19 Mar 2020 Business News
Transport Minister Phil Twyford today outlined the first tranche of the $600 million aviation sector relief package announced earlier... more
Living
Diversity was Key at New Zealand Trade Tasting in London
6 Jun 2022 Food & Wine
New Zealand Winegrowers Annual Trade Tasting was recently held in London, on Wednesday 4 May, in Lindley Hall.
It was the first... more
Kiwi author stuns Behind the Butterfly Gate
12 Jan 2022 Arts
Hidden behind the Butterfly Gate is where the secret has been kept for 76 years...
New Zealand writer Merryn Corcoran’s... more
Property
Fairer rules for tenants and landlords
17 Nov 2019 Property
17 NOVEMBER 2019
The Government has delivered on its promise to the over one million New Zealanders who now rent to make it fairer... more
New Zealand Government will not implement a Capital Gains Tax
17 Apr 2019 Property
The Coalition Government will not proceed with the Tax Working Group’s recommendation for a capital gains tax, Jacinda Ardern... more
Migration
Boosting border security with electronic travel authority – now over 500,000 issued
19 Nov 2019 Migration
19 NOVEMBER 2019
We’ve improved border security with the NZeTA, New Zealand Electronic Travel Authority, which helps us to... more
Christchurch reinstated as refugee settlement location
18 Aug 2018 Migration
18 AUGUST 2018
HON IAIN LEES-GALLOWAY
The announcement that Christchurch can once again be a settlement location for refugees... more
Travel
Gallipoli Anzac Day services cancelled
19 Mar 2020 Travel & Tourism
The New Zealand and Australian Governments have announced this year’s joint Anzac Day services at Gallipoli will be cancelled... more
New Zealanders advised not to travel overseas
19 Mar 2020 Travel & Tourism
New Zealanders advised not to travel overseas
more
Sport
The Skipper's Diary: Sir Richard Hadlee honouring his father and NZ's Forty-Niners
27 Oct 2019 Cricket
NZNewsUK London Editor Charlotte Everett spoke to Sir Richard Hadlee about why he’s chosen to publish his father’s... more
PREVIEW: All Blacks v England semi-final
26 Oct 2019 Rugby
The two most convincing quarterfinals winners are set to square off in a semifinal showdown for the ages when the All Blacks meet old... more
Columns
Gordon Campbell on the Gareth Morgan crusade
11 Nov 2016 Opinion
Gordon Campbell on the Gareth Morgan crusade
First published on Werewolf
The ghastly likes of Marine Le Pen in France and Geert ... more
Gordon Campbell on the US election outcome
10 Nov 2016 Opinion
Column - Gordon Campbell
Gordon Campbell on the US election outcome
Well um.. on the bright side, there (probably)... more
Kiwi Success
Congratulations to Loder Cup winner
26 Sep 2018 People
25 SEPTEMBER 2018
The Loder Cup, one of New Zealand’s oldest conservation awards, has been awarded to Robert McGowan for 2018... more
Appointments to New Zealand National Commission for UNESCO
16 Aug 2018 Appointments
16 AUGUST 2018Appointments to New Zealand National Commission for UNESCO
HON JENNY SALESA
Associate Education Minister Jenny Salesa is... more
Recruitment
Historic pay equity settlement for education support workers
14 Aug 2018 Recruitment
14 AUGUST 2018Historic pay equity settlement for education support workers
RT HON JACINDA ARDERN
HON CHRIS HIPKINS
Prime Minister
The... more
Historic pay equity settlement for education support workers
22 Aug 2018 Recruitment
14 AUGUST 2018Historic pay equity settlement for education support workers
RT HON JACINDA ARDERN
HON CHRIS HIPKINS
Prime Minister
The... more