Stocks to watch: Air NZ, FPH, Telecom, THL

Tuesday 8th September 2009

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

Themes of the day: Shares rallied in Europe after Cadbury Plc rejected a 10.2 billion pound offer from Kraft Foods, an index of European sentiment improved and Germany factory orders rose. The kiwi climbed above 69 US cents overnight, to an 11-month high, and was recently at 69.24 US cents. A survey from UMR Research showed 36% of those polled say the worst of the recession is over. Markets were closed in the US for the Labor Day holiday.

Air New Zealand (AIR): The national carrier objected to a proposed tie-up between Virgin Blue and Delta Air Lines on flights between Australia and the US, now being considered by Australia’s antitrust regulator. Air NZ said the deal was similar to its own rejected plan to join forces with Air Canada, may force up fares and wouldn’t add capacity, the Age reported. Air NZ’s arguments “are without a sound factual, legal or economic basis,'' Virgin and Delta said in their submission. The regulator will report back next month. Air NZ’s shares rose 0.8% to $1.24.

Fisher & Paykel Healthcare (FPH): The New Zealand dollar climbed above 69 US cents overnight to an 11-month high, eroding the value of sales denominated in the greenback when they’re brought home. F&P Appliances, the breathing mask and respirator maker gets almost 80% of its sales in US dollars. The shares edged up 0.6% to $3.47.

GuocoLeisure (GLL): Third Avenue Management LLC reduced its stake in the investment group once known as Brierley Investments to 10.28% from 11.6%, according to a filing to the NZX today. The shares were unchanged at 44 cents yesterday and have gained 10% in the past week.

Infratil (IFT): Chief executive Marko Bogoievski said he expects more companies will exit the New Zealand market, creating opportunities for the investment group. “I'm personally quite concerned about this hollowing out of New Zealand but it actually presents quite good opportunities for local investors, like us,” he said, according to the NZ Herald. The shares rose 1 cent to $1.70 yesterday.

Telecom Corp. (TEL): Chairman Wayne Boyd plans to discuss chief executive Paul Reynolds’ performance targets ‘in a broad way’ at Telecom’s annual meeting on October 1 after unions griped about his annual $5.4 million salary package and the topic was seized upon by the media. "It's incumbent on us to give a broad picture of what we expect of Paul and what our expectations are looking into the future," Boyd said, according to BusinessDay. The shares fell 1 cent to $2.78 yesterday.

Tourism Holding (THL): The campervan rental company is rated ‘outperform’ by First NZ Capital analyst Jason Familton, according to the ShareChat website. Underlying earnings, a net loss of $1.4 million, was “slightly stronger than anticipated,” the analyst said. While there are few near-term positives, visitor numbers should have started to recover in 12 months time, in the run-up to the 2011 Rugby World Cup. The shares fell 1.8% to 56 cents yesterday.

Businesswire.co.nz

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