Stocks to watch: Charlie's, Genesis Research, Infratil

Wednesday 15th 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 gained after better-than-expected earnings from Goldman Sachs Group and Intel Corp. stoked investors’ risk appetite and helped lift higher-yielding currencies. The kiwi dollar climbed above 64 US cents. Crude oil slipped on concern US government figures this week will show expanding stockpiles of fuel. Reserve Bank Governor Alan Bollard yesterday said New Zealand’s economic recovery could be “ahead of the pack.”

Charlie's Group (CHA): The juicemaker yesterday forecast a bigger-than-expected full-year loss as a drop-off in New Zealand sales outweighs growth in Australian markets. It expects a net loss of between $1.8 million and $1.95 million this year, with domestic sales declining 2%, rising costs of raw materials, and increased discounts on some items. The stock was unchanged at 10 cents yesterday.

Genesis Research and Development (GEN): The biotech company developing gene silencing technology will make an offer under a share purchase plan to sell up to 7.8 million shares at 6 cents apiece, raising as much as $470,000. The shares traded unchanged at 9 cents yesterday.

Hellaby Holdings (HBY): The shares jumped 5.5% to $1.16 yesterday after the diversified holding company was raised to ‘accumulate’ from ‘hold’ by Forsyth Barr analyst John Cairns. Hellaby has made "excellent progress" in reducing debt though trading conditions in its four divisions remain challenging, Cairns said, according to the ShareChat website.

Infratil (IFT): The Accident Compensation Corp. increased its holding in the investment group to 6.59% from 5.04% after exercising warrants and buying shares on market, according to a filing to the NZX. The shares rose 3 cents to $1.69 yesterday.

New Zealand Oil & Gas (NZO): Crude oil fell to an eight-week low US$59.52 cents a barrel on speculation US Energy Department figures this week will show rising gasoline stockpiles. Crude oil for August delivery slipped 0.3% on the New York Mercantile Exchange. The shares rose 1 cent to $1.53 yesterday.

Steel & Tube Holdings (STU): The steel building products company rose 4.3% to $2.90 yesterday, the highest since June 25. The shares are trading at 7 times earnings, less than Fletcher Building’s P/E of 8.17. Steel & Tube has “significant earnings risk” and its illiquid stock gets pushed around, said Paul Robertshawe, who manages $250 million of equities at Tower Asset Management. Still, it’s “perhaps cheaper than Fletcher right now and is a more focused exposure without Laminex, North America or Europe.”

Businesswire.co.nz

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