Facebook
Twitter
LinkedIn
Instagram
Youtube

2 ASX stocks to hold – Medibank and Qantas Airways

Team Veye | 18 Jul 2018 ASX - MPL, QAN, QAN
2 ASX stocks to hold – Medibank and Qantas Airways

Medibank Pvt Ltd (ASX: MPL)

The company had published its H1 FY2018 results on 16th Feb’18 highlighting that the Group’s Net Profit after Tax (NPAT) during the period stood at $245.6m up 5.9%.  The company had cash in hand of $610m as on 31st Dec’18, up 16.3% on PCP.

 

As part of its outlook, the company expected similar underlying revenue trends to the first half adjusted for the 3.88% rate change on 1st Apr’18. The company didn’t expect any material change in hospital utilization growth in the second half and ancillary utilization growth was expected to be moderately lower (Data Source – Company Reports).

 

Veye’s Take     

The stock price of the company had slipped 16% between Feb’18 and mid-Apr’18 but is already on its way to a slow recovery. We reckon that the stock has an upside potential and is likely to recover and grow further. We maintain a “Hold” on “Medibank Pvt Ltd” at the current price of $3.06

 

Qantas Airways Ltd (ASX: QAN)

On 22nd Feb’18, the Qantas Group announced delivering its highest-ever first half Underlying Profit before Tax of $976 million for the six months ending 31st Dec’17. The result surpassed the previous record of $921 million achieved in the first half of FY16 and comes despite recent increases in fuel costs and continued international capacity growth. Both Underlying and Statutory profit before tax were significantly higher (15% and 20% respectively) than the first half of FY17. Net debt continued to fall and remain towards the bottom of the range, at $5.1 billion.

As part of its Outlook, the company was very positive and stated that the Group expected healthy consumer demand growth consistent with an improved global outlook. The Group’s current operating expectations were: - Total Qantas Group capacity is expected to increase by ~1% in H2 FY2018 (Data Source – Company Reports).

 

Veye’s Take

The stock price of the company has grown an exceptional 31% YTD 2018 and touched an all-time high of $6.71 on 21st Jun’18 and still seems to have a lot of upside potential. We give a “Hold” to “Qantas Airways Ltd” at the current price of $6.52

Disclaimer

Veye Pty Ltd(ABN 58 623 120 865), holds (AFSL No. 523157 ). All information provided by Veye Pty Ltd through its website, reports, and newsletters is general financial product advice only and should not be considered a personal recommendation to buy or sell any asset or security. Before acting on the advice, you should consider whether it’s appropriate to you, in light of your objectives, financial situation, or needs. You should look at the Product Disclosure Statement or other offer document associated with the security or product before making a decision on acquiring the security or product. You can refer to our Terms & Conditions and Financial Services Guide for more information. Any recommendation contained herein may not be suitable for all investors as it does not take into account your personal financial needs or investment objectives. Although Veye takes the utmost care to ensure accuracy of the content and that the information is gathered and processed from reliable resources, we strongly recommend that you seek professional advice from your financial advisor or stockbroker before making any investment decision based on any of our recommendations. All the information we share represents our views on the date of publishing as stocks are subject to real time changes and therefore may change without notice. Please remember that investments can go up and down and past performance is not necessarily indicative of future returns. We request our readers not to interpret our reports as direct recommendations. To the extent permitted by law, Veye Pty Ltd excludes all liability for any loss or damage arising from the use of this website and any information published (including any indirect or consequential loss, any data loss, or data corruption) (as mentioned on the website www.veye.com.au), and confirms that the employees and/or associates of Veye Pty Ltd do not hold positions in any of the financial products covered on the website on the date of publishing this report. Veye Pty Ltd hereby limits its liability, to the extent permitted by law to the resupply of services.