Stocks to watch: March 18

The following stocks may be active on the New Zealand exchange after developments since the close of trading yesterday. All prices are in New Zealand dollars unless specified.

Themes of the day

Global markets lifted on news that the US Federal Reserve expects to retain low interest rates for at least three months, along with confirmation that America’s inflation still has a firm lid on it.

The Dow Jones rose 0.74 per cent , NASDAQ was up 0.83 per cent , while the Chicago Board Options Exchange Volatility Index, or VIX, known as Wall Street’s ‘fear gauge’, plunged 6.2 per cent  to 16.59, the lowest since May 2008.

Stocks to watch:

Auckland International Airport (AIA): New Zealand’s busiest gateway’s first half earnings showed retail and property rental revenue was down, while passenger service charge and car-parking revenue was higher than expected said Florian Burch, an analyst at ASB Securities in ShareChat.

He remains confident passenger number growth for the full year will be between 2.5 and 3 per cent  “unless Australian visitors cease gracing us with their presence in such vast numbers.”

Visitor numbers from Australia in January were up 17.25 on January 2009. The shares dropped 0.5 per cent  yesterday to $1.95.

Delegat’s Group  (DGL): The maker of Oyster Bay brand wines has limited balance sheet flexibility, Adrian Allbon of Goldman Sachs JBWere said in ShareChat.

Delegat’s expects its full-year profit to be down between 30-40 per cent  on last year’s record $30 million, and key catalysts on this number will be the NZ dollar versus the pound, currently at a post-float high, and the NZ harvest announcement in mid-June, Allbon said. “If the industry harvest is flat to modestly down year-on-year, as NZ Wine is currently predicting, then the industry bulk wine surplus should start to normalize in 2011 and improve future prospects,” he said.

Its shares were unchanged yesterday at $1.90.

Diligent Board Member Services (DIL): The online provider of services to boards of directors said it has secured a US$1 million line of credit from Spring Street Partners LP for the next 18 months.

The shares have soared 370 per cent  in the past 12 months. They rose 2.1 per cent  to 49 cents yesterday.

New Zealand Refining (NZR): The nation’s only oil refinery has climbed 7 per cent  in the past two days after announcing that its refining margin recovered to US$6.85 per barrel in the first two months of the year, from as little as US$1 in December. The stock edged up 0.8 per cent  to $3.64 yesterday.

Port of Tauranga (POT): The nation’s biggest export port today announced it has agreed to buy tapper Transport, a business adjacent to its MetroPort inland hub in south Auckland for $15 million.

The shares fell 9 cents to $6.91 yesterday.

Steel & Tube Holdings (STU): The steel building products company said in its interim report that there are “early signs that conditions may be slowly improving but the key issue is the uncertainty around the extent and timing of the recovery.”

It expects minimal benefit from any pickup in the economy this year, while predicting its second half performance will exceed first-half results. Short-term market conditions “are expected to be difficult.”

The shares rose 0.8 per cent  to $2.62 yesterday.

Telecom (TEL): The nation’s biggest phone company sank 1.4 per cent  to a record low $2.14 yesterday, hurt by its projection that the government’s rural broadband initiative will cut earnings by $168 million over the next three years. 

“They have got a lot of headwinds and not just in this area,” said James Lindsay, who helps manage $450 million at Tyndall Investment Management. 

- BusinessDesk