Stocks to watch: NZOG, Hellaby, Air New Zealand, Telecom

Monday 6th July 2009

The following stocks may be active on the New Zealand exchange after developments since the close of trading Friday.

Themes of the day: Figures from Europe on Friday showed the region’s services industry remained in contraction last month, while retail sales fell, adding to concern the global economy will take longer to climb out of its slump. Crude oil tumbled and prices of metals fell. The New Zealand Institute of Economic Research releases its quarterly survey of business opinion tomorrow. The survey will give an early snapshot of whether companies remained in a slump in the second quarter, ahead of the earnings season that kicks of next month.

Air New Zealand (AIR): Jetstar chief executive Bruce Buchanan accused Air New Zealand of trying to `sabotage’ the Qantas unit during its launch in New Zealand, APN News & Media reported. Buchanan said many rumours about Jetstar, including those concerning poor pilots and old, unserviced planes, had been circulated by Air New Zealand, according to the report. Air New Zealand was unchanged at 90 cents on Friday.

Fisher & Paykel Healthcare (FPH): AMP Capital Investors (New Zealand) on Friday disclosed it had reduced its holding in the company to 5.15% from 6.31%. The shares fell 0.3% to $2.90.

Hellaby Holdings (HBY): The diversified group’s debt reduction is ahead of the company’s guidance at its first half results, said Jason Familton, analyst at First NZ Capital, who rates the stock ‘underperform.’ Still, core debt of $51 million, combined with its $50 million of capital notes, leaves Hellaby too highly geared, Familton said, according to the ShareChat website. The shares fell 3 cents to $1.29 on Friday.

Infratil (IFT): Energy Developments, the Brisbane-based renewable energy company that’s 32% owned by Infratil, invited Archer Capital to begin due diligence after the private equity firm revised its takeover offer. Energy Developments jumped 14% to A$2.27 on Friday, valuing Infratil’s stake at about A$99 million. Infratil slipped 0.6% to $1.70 on Friday.

New Zealand Oil & Gas (NZO): Crude oil dropped below US$66 a barrel on concern the global economy will remain weaker for longer than expected. US crude dropped US$1.22 to US$65.51 a barrel in lighter than normal volumes due to the Independence Day holiday. The shares fell 0.6% to $1.55 on Friday.

PGG Wrightson (PGW): The nation’s largest rural services company may have to tap the market for more capital if cost cuts and asset sales aren’t sufficient to meet debt payments and trading conditions deteriorate, the Independent reported, citing Aspect Huntley analyst Nachiket Moghe. The company on June 24 said normalised net profit in the year ended June 30 was $30 million to $32 million, lower than it had forecast, and predicted profit of $33 million to $39 million for the current year. The shares were unchanged at $1.07 on Friday and have dropped 19% in the past month.

Telecom (TEL): TelstraClear will resell mobile services via Vodafone, ruling out the possibility it would migrate to Telecom's new XT network, the Dominion Post reported. TelstraClear signed a three-year deal with Vodafone allowing it to offering 3G mobile services in the last quarter of this year. The shares rose 3 cents to $2.69 on Friday.

Businesswire.co.nz

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