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Aristocrats

(ASX:ALL) Staying above 200SMA for couple of weeks> Always enjoying going to my fav place and had an eye on this company for some time. > Aristocrat Leisure Limited (ASX: ALL) designs, develops and distributes gaming content, platforms and systems, including electronic gaming machines, casino management systems and digital social games. The Company's land-based products are approved for use in more than 300 licensed jurisdictions and are available in over 90 countries. The Group also operates within the online social gaming and real money wager markets. > Starting nibbling a bit from last couple of weeks. > Consistent dividend-paying company that to increasing every year. > due to COVID business is impacted but long term story remains intact as consumer behaviour will not change. > An opportunity for me to add this in long term portfolio.
ASX:ALL
by Peaceful-Weekend-Investing
Low annual EPS could create optimal buying opportunityPPG Industries has a history of stable EPS growth (with some outliers such as the EPS during the FC in 2008); the Corona lockdown and the stop of production is very likely to affect the EPS of the company in 2020 and maybe its the consecutive year’s growth. Looking at the reduction of EPS during the Finanacial Crisis, two year’s (2008 and 2009) EPS were falling significantly by 35% and 37% respectively. Adopting the relatively pessimistic perspective that the companies current EPS are subject to the same decreases as they were in 2008, annual EPS would be expected to be 3.40 in 2020 and 2.14 in 2021. Therefore, given historical evidence that the company’s share price is not significantly affected by short-term reduction of earnings, a favourable entry price for this business is $3,4*20 = $68, and take profit price when future estimated EPS of $5.24 are plausible ($5.24*20=$104.8). Investment Idea Option 1 , Option 2 Entry price: $74 , $68 Take profit or hold: $96.2 , $104.8 Max expected holding period: 18 months , 24 months Profit: 30% , 55% I`ll buy the stock as soon as it crosses $68. Good luck!
NYSE:PPGLong
by PeterLang_7
A.O. Smith; awaiting Q1 EPS results to enter a long positionA.O. Smith corp. has a history of stable EPS growth; however, the Corona lockdown is likely to affect the EPS in 2020 and maybe the consecutive year’s expected growth. In FY 2009, the company traded at a P/E ratio of 13 in average. Taking a very pessimistic perspective, one could argue that the economy will experience a recession similar to the one in 2008, that the P/E ratio will fall as the future growth perspectives turn negative. At the same time yearly EPS fall to $1.7, which would justify the stock price falling to $1.7*13 = $22.1. Shortly after the recession as future prospects get better and the company is able to generate higher EPS, we could expect both annual EPS and P/E ratio to recover and the share price to bounce back to $2.6*19 = 49.4$. This is an extreme perspective and a more realistic movement of the share price could be: share price falling to $1.5*19 = $28.5 (within April 2020) and bouncing back to $2.23*19 = 42,3 $ by the end of 2021. Buying idea Option 1 Option 2 Entry price $28.5 $22.5 Take profit $42.75 $49.5 Max expected holding period 18-months 18-months Profit 50% 220% I`ll buy the stock as soon as it hits $28.5. Good luck!
NYSE:AOSLong
by PeterLang_7
GWW; awaiting right moment to enter long-term positionGWW was trading at an average P/E ratio of 20-21 between in the last three years. Extremely high EPS of $15.46 in 2019 were the reason for a relatively low P/E ratio (around 19). Now, it is dangerous to determine the forward-looking P/E using the EPS of the FY 2019. Rather, should be estimated by how much the lockdown will influence the EPS of the FY 2020. Additionally, GWW is likely to recover fast because of its industry. For this reason, I expect EPS to recover fully to its upwards trend in 2021. Especially Q2’s earnings will be reduced since the lockdown forces production and GWW’s clients to shut down its activity. I expect annual EPS of 2020 to be lower than $10. If this is reflected in the share price and the P/E ratio remains on average the same as it was over the last three years, the share price could easily fall to 20*$10=$200. In a pessimistic scenario, EPS 2020 could reach lower levels such as $7, which could justify a momentary share price of 20*$7=$140. I believe that both scenarios are equally likely and that GWW will soon recover after the Corona lockdown and the annual EPS will bounce back to pre-corona levels and growth. Expecting the EPS to rise to 13 by FY 2022, the stock price is likely to reach levels around 13*$20=$260 by the end of 2021. Trading idea Entry price $173.3 Take profit (or hold 😉) $260 Max expected holding period 18 months Profit 50% I`ll buy the stock as soon as it hits $173.3. Good luck!
NYSE:GWWLong
by PeterLang_7
Buying Pepsico; Fitch just affirmed credit rating "A" EPS FY 2019 = 5,228 EPS FY 2018 = 8,84 EPS FY 2008 = 3,26 EPS FY 2009 = 3,81 Pepsico; stable EPS over the last 20 year with a positive drift PepsiCo was trading at an average P/E ratio of 12,5 between the announcement of FY 2018 and FY 2019 earning reports. High EPS of $8,84 in 2018 were the reason for a significatly low P/E ratio. The final earnings report 2019 brought EPS down to $5,28, leading to a rise of the P/E ratio towards 25. The stock price fell by 22% recently as a result of the COVID-Crisis, turning the P/E ratio to levels of 21-22. It is unlikely that FY 2020 reported EPS will beat FY 2019 EPS, therefore I’ll buy the stock at it’s historical average P/E ratio of 20 at 20*5,228 = $104.56, expecting that demand defensive dividend earning stocks will increase. Invesment idea Entry price $108 Take profit (or hold 😉) $129,6 Max expected holding period 6 months Profit 20% I`ll buy the stock as soon as it hits $108. The financial outlook of PEP remains stable because of a very stable FCF.
NASDAQ:PEPLong
by PeterLang_7
1
18-month from now perspective; I'll buy at $25Hi guys, check this out Long-term prospects of EPS In 2008 the stock reached a P/E ratio low of 5; with EPS of $6.01 in FY 2008 the stock price reached a low of 5*$6.01=$30. Today we are expecting the similar outcome to due a negative economic outlook for the short-term. In FY 2019 the company reached EPS of $4.14. Comparing to 2008 we expect the stock to reach a P/E ratio of 5, indicating that the stock price could tumble to 5*$4,14 = $20.7 and stabilize at that level. As the economic prospects rise, the P/E ratio is likely to reach the company’s average level around 12. Under the assumption that EPS growth back to previous levels (>$4.0) the stock price should bounce back to 12*$4 = $48. Trading idea Entry price: $25 Take profit: $40 Max expected holding period: 18-month Profit: 60% I`ll buy the stock as soon as it hits $25. The financial outlook of NUE looks decent and should sustain the COVID-crisis.
NYSE:NUELong
by PeterLang_7
3