Wesfarmers Ltd (ASX:WES) Trading Outlook

Wesfarmers Ltd (ASX:WES) Trading Outlook

Wesfarmers Ltd (ASX:WES) Trading Outlook

Wesfarmers Ltd -:FY net profit attributable to members $2.873 billion versus $407 million.FY revenue $68.44 billion versus $65.98 billion.Final dividend 120 cents per share.”Group remains generally optimistic in its outlook”.”Sales and margin pressures in coles are expected to persist”.”Target will progress its transformation plan”.”Within home improvement outlook for BANZ is particularly positive”.”Sales momentum in energy is expected to remain solid despite increased competition in natural gas retailing market.

 

WESFARMER FPO SE closed up 0.170 at 41.520. Volume was 8% above average (neutral) and Bollinger Bands were 8% wider than normal.

Open          High        Low          Close                      Volume___
41.600     41.705    41.210      41.520                     2,468,010

Technical Outlook
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bearish

Moving Averages:            10-period         50-period                   200-period
Close:                                    41.56                40.87                            42.08
Volatility:                              21                       17                                     18
Volume:                          2,486,054        2,209,988                      2,230,470

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Institutional Holders

% Shares Owned: 18.09%
# of Holders: 309
Total Shares Held: 205,095,657
3 Mo. Net Change: 9,693,521
# New Positions: 6
# Closed Positions: 10
# Increased Positions: 70
# Reduced Positions: 49
# Net Buyers: 21

Summary

WESFARMER FPO SE is currently 1.3% below its 200-period moving average and is in an upward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. Our volume indicators reflect volume flowing into and out of WES.AX at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on WES.AX and have had this outlook for the last 32 periods.

Valuation Ratios

Company industry sector
P/E Ratio (TTM) 16.26 57.36 19.77
P/E High – Last 5 Yrs. 110.84 117.21 34.04
P/E Low – Last 5 Yrs. 15.78 23.37 13.28
Beta 0.94 0.87 1.31
Price to Sales (TTM) 0.69 5.06 4,357.77
Price to Book (MRQ) 1.96 9.48 2.34
Price to Tangible Book (MRQ) 9.37 10.85 2.84
Price to Cash Flow (TTM) 11.33 34.57 487,476.35
% Owned Institutions 1.88 0.23

Dividends

Company industry sector
Dividend Yield 5.39 1.28 2.14
Dividend Yield – 5 Year Avg 5.47 1.38 2.29
Dividend 5 Year Growth Rate 5.58 17.29 7.11
Payout Ratio(TTM) 40.52 56.03 29.66

Momentum

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 32.7338. This is not an overbought or oversold reading. The last signal was a sell 4 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 53.67. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 1 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 22. This is not a topping or bottoming area. The last signal was a sell 1 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 18 period(s) ago.

Summary

The current market condition for WESFARMER FPO SE is:

Bearish

The close is currently Below it’s 200 period moving average.
The close is currently Below it’s 90 period moving average.
The close is currently Above it’s 30 period moving average.

Wesfarmers Limited is engaged in various business operations, such as supermarkets, liquor, hotels and convenience stores; home improvement; office supplies, and an industrials division with businesses in chemicals, energy and fertilizers, industrial and safety products and coal.

The Company’s segments include Coles; Home Improvement; Department Stores, which includes Kmart and Target; Office Works; Industrials, which includes Resources, WIS and WesCEF, and Other. Coles is a supermarket retailer, which operates over 770 supermarkets.

Bunnings is a retailer of home improvement and outdoor living products in Australia and New Zealand.

Kmart is a retailer with approximately 210 stores throughout Australia and New Zealand. Target operates a network of over 300 stores and sells a range of products for the contemporary family, including apparel, homewares and general merchandise. Officeworks is a retailer and supplier of office products and solutions for home, business and education.

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S. Jack Heffernan Ph.D. Funds Manager at HEFFX holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reach a peak market cap of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services.

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