As with Taylor Swift’s performances, the corporate reporting season gig is not done and dusted but with only a few days to go we all know the playlist.
In common with the visiting diva, the repertoire has been a largely crowd-pleasing rendition of better-than-expected margins and tight cost controls.
IG Australia market analyst Hebe Chen says the largely positive share price movements were more a case of subdued expectations in the first place.
“We lowered our expectations for several sectors, such as consumer discretionary, which makes it easier to beat them,” she says.
Indeed!
Generous share price gains were awarded to laggard companies that didn’t do as badly as expected.
Look no further than basket case AMP (ASX:AMP) which has flagged a long-awaited capital return.
Other comeback kids included out-of-sorts Downer EDI (ASX:DOW), coal lugger Aurizon (ASX:AZJ) and utility Origin Energy (ASX:ORG).
Investors looking for definitive sectoral trends largely were unsatiated.
In the travel sector, for instance, Corporate Travel Management (ASX:CTD) shares on Wednesday tumbled 20 per cent on soft earnings pertaining (in part) to UK immigration rules.
Don’t assume the brace position: Helloworld Travel (ASX:HLO) on the same day reported a 900 per cent profit surge and is flying high.
In the consumer milieu, the cost of living crisis is not exactly being felt equally.
Look no further than shares in the online posh goods portal Cettire (ASX:CTT), which surged 25 per cent after reporting 89 per cent revenue growth and a 60 per cent profit hike.
Unlike poor Brad (see below) Cettire’s chiefs won’t be hauled before a Senate committee on profiteering.
The owner of Bunnings, Kmart and Officeworks, Wesfarmers (ASX:WES) says consumers are still spending, albeit with a keener eye on value.
“Kmart is perfectly positioned as shoppers look for bargains,” Chen says.
Online jobs house Seek (ASX:SEK) was punished 12 per cent after lowering full year revenue and earnings guidance. Local paid job ads fell 20 per cent – a sure sign that the interest rates medicine is working.
Much of the reporting season action related to off-piste developments, or pre-emptory trading updates.
CSL (ASX:CSL) shares plunged 5 per cent after announcing a major heart drug trial had failed.
Domino’s Pizza Enterprises (ASX:DMP) snuck in early with a monster earnings downgrade in January and its shares were whacked 31 per cent.
And with the takeover fervour sweeping the building materials sector, who said cement and bricks were boring?
Boral (ASX:BLD) shares soared 9 per cent on upgraded full year guidance – ahead of major holder Kerry Stokes lobbing a long-awaited takeover offer.
A few days later, French building group Saint-Gobain bid $4.3 billion for CSR (ASX:CSR).
Adbri (ASX:ABC) is already subject to an agreed takeover offer from CRH and the Barro Group.
Meanwhile, the CEO of the debt-laden Fletcher Building (ASX:FBU) quit, describing the move as ‘the right thing to do’.
And let’s not forget Woolworths (ASX:WOW) chief Brad Banducci and his shock resign-… er, retirement.
Arguably the worst performing sector, the real estate investment trusts (REITs) have accepted the pandemic happened.
The diversified GPT (ASX:GPT) reported a calendar year loss of $240 million after $819 million of valuation write downs amid “softening valuation metrics.”
On the same day the ever-messy Lend Lease (ASX:LLC) reported a $136 million loss after $125 million of devaluations, resulting in 14 percent share selloff.
Goodman Group (ASX:GMG), the biggest ASX-listed REIT, goes from strength to strength with a global focus on industrial property, notably data centres.
Overall, the results bode well for the current half, even if audiences have been left wanting for more.
But that’s showbiz.
This story does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.
The views, information, or opinions expressed in the interviews in this article are solely those of the interviewees and do not represent the views of Stockhead. Stockhead does not provide, endorse or otherwise assume responsibility for any financial product advice contained in this article.
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