Stocks to watch: March 19

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

European equities eased overnight, while US stocks were mixed, as European nation’s remained at odds over a rescue for Greece, prompting the fiscally wobbly country to warn it may seek help from the international Monetary Fund.

Data in the US showed applications for jobless benefits are abating only gradually while there’s little sign of inflation. The kiwi dollar edged up to US71.50c.

Locally, data out today includes migration figures for February and central bank figures on credit cards.

Stocks to watch:

Air New Zealand (AIR): The Auckland-based airline says it has 36 per cent of the traffic on trans-Tasman routes, or about 2.1 million passengers a year and it intends to retain its market share by lowering fares, reducing check-in times and reducing its Airbus A320 planes to a single class.

The shares were unchanged at $1.32 yesterday.

Kathmandu Holdings (KMD): The outdoor equipment retailer which listed in November yesterday released its first results since listing, posting a first-half profit that beat its forecast prospectus by $3 million. The shares rose 8.7 per cent to $2.38 yesterday, the biggest gain on the NZX50.

Port of Tauranga (POT): The nation’s biggest export port yesterday said it has agreed to buy Tapper Transport, which operates a freight hub and warehouse system adjacent to the port’s MetroPort site in south Auckland, for $15 million.  

The acquisition would lift per-share earnings immediately, it said. The shares climbed 1.3 per cent to $7 yesterday.

SmartPay (SPY): The EFTPOS company yesterday confirmed it has signed a seven-figure contract with home improvement chain store Mitre 10. The shares jumped 7.9 per cent to 4 cents yesterday.

Telecom  (TEL): The phone companyational telco has pointed out that its reported Wednesday lowest share price ever of $2.14 wasn’t the case; its all-time low was April 1992 at $1.76.

But problems with its XT network and rural broadband funding changes have analysts predicting a dividend cut.

Deutsche Bank analyst Sameer Chopra reckons it will drop to 18 cents from 21, while Craigs Investment Partners Geoff Zame picks a fall to 22 cents from 24 cents according to the NZ Herald. Its shares were unchanged yesterday at $2.15.

Warehouse Group (WHS): The nation’s largest retailer’s stationery division’s first-half $3 million EBIT was about $1 million ahead of Forsyth Barr analyst, Guy Hallwright’s forecast according to ShareChat.

Though he expected a recovery in the division, the sales trends were even more positive. Hallwright has cut his Red Shed 2010 full-year forecast slightly to $86 million from $86.9 million, and his share valuation to $3.87 from $3.91. Its shares rose one cent yesterday to $3.86.

- BusinessDesk