Stocks to watch: Delegat's, Fletcher, OceanaGold, Sky City

Tuesday 21st July 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 on Wall Street rallied after CIT Group Inc. secured US$3 billion in emergency funding from bondholders including Pacific Investment Management Co., buying the lender more time to restructure its debt and avoid bankruptcy. Shares also rose on optimism corporate earnings are less disappointing than was feared. Prices of metals and oil gained. The kiwi dollar rose above 65 US cents. Investors are awaiting government figures on migration and credit card spending today, while the Reserve Bank of Australia releases the minutes of its last policy meeting.

Delegat’s Group (DGL): The maker Oyster Bay brand wines jumped 4.9% to $2.15 yesterday after the company said full-year profit climbed at least 58%, reflecting a pick-up in sales in the fourth quarter and adjustments to the fair value of currency hedge contracts. Net profit was $30 million to $31 million in the 12 months ended June 30, up from $19.1 million a year earlier, the company said in a statement, citing unaudited figures.

Fletcher Building (FBU): The nation’s biggest construction company today announced a change in management at its distribution business, with the departure of David Edwards on August 31. John Beveridge, currently manager of the company’s Pacific Steel Group has been named as replacement. The shares fell 1 cent to $6.82.

OceanaGold Corp. (OGC): Shares of the Macraes gold mine operator were halted today for a bookbuild on a placement of ordinary shares, according to a statement to the NZX today. The shares rose 5 cents to $1.45 yesterday and have soared 420% this year.

Sky City Entertainment Group (SKC): The casino and hotel chain is rated a ‘buy’ by Jeremy Simpson, an analyst at Forsyth Barr, who says its gaming machines are out-performing those in pubs, helping it increase market share. "Sky City is well-placed for medium-term operational upside from successfully leveraging off a refurbished Auckland casino that has the worst impact of full smoking bans and regulatory changes behind it," Simpson said, according to the ShareChat website. The shares rose 2.9% to $2.86 yesterday.

Speirs Group (SGL): The finance and food group yesterday said it has established a new subsidiary, Speirs Investments, which will issue $1.7 million of secured stock to some investors and $300,000 of unsecured stock to the company, maturing in 2013. The investment unit will then buy $2 million of perpetual bonds issued by Allied Nationwide Finance, helping settle the sale of the finance division last year. Speirs last traded at 36 cents and is up 44% in the past six months.

Wakefield Health (WFD): The hospital operator released an investor briefing yesterday, saying the sector’s long-term demographics are “very favourable” though the economic downturn may curb self-funded patients and trim some insured work in the near term. The immediate outlook is “uncertain,” it said. The shares last traded at $9.50 and are up 3.3% in the past week.

Businesswire.co.nz

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