Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Fletcher stock upgraded by First NZ on NZ, Aust building

Fletcher stock upgraded by First NZ Capital on NZ, Australia building, cost cutting

Feb. 18 (BusinessDesk) – Fletcher Building, the biggest company on the NZX 50 Index, was upgraded by First NZ Capital because of a pickup in the building sector in Australia and New Zealand and the benefits of its cost cutting programme.

The brokerage lifted its price target to $10.25 from $9 and raised its rating to ‘neutral’ from ‘underperform’. Auckland-based Fletcher is scheduled to release its first-half results on Thursday and First NZ Capital is forecasting a 16 percent increase in earnings before interest and tax to $304 million.

“Our expectation is for a more positive trading outlook commentary since its AGM guidance four months ago,” analysts at the brokerage wrote in a report.

At the annual meeting last October, Fletcher chairman Ralph Waters said conditions in the Australian market were expected to remain flat, with some pickup in New South Wales, offset by subdued demand in Victoria and a decline in investment in the mining sector.

The First NZ Capital research says building approvals jumped 23 percent in the second half of 2013 and the recent acceleration in value of residential work approved “promises considerable pent-up growth in the next 12 months.” Non-residential approvals had also increased.

In New Zealand, a pickup in net migration would help underpin growth in new house and apartment building consents, with “some signs of activity spreading beyond Auckland and Christchurch.”

Infrastructure work is expected to pick up in late 2014 or early 2015 and there are expectations the Treasury’s estimated $40 billion cost to rebuild Christchurch will be exceeded, the brokerage said.

“It would not surprise us if the next estimate reaches $45 billion to $50 billion,” it said.

The shares rose 0.5 percent to $9.59 and have gained about 12 percent this year.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Auckland Port Study: Port To Ship Out – No Departure Date

Interest groups in Auckland and its waterfront chose a group of representatives to determine the future of the port. Their consensus is that the Port is going to have to move but not before a credible location is confirmed... More>>

ALSO:

Tax: GST Threshold For Online Purchases Won't Lower Before 2018

The government wants to lower the threshold on online purchases which qualify for GST from mid-2018, but says more work is needed and there will be no change without public consultation. More>>

ALSO:

North Canterbury: Government Extends Drought Classification

The government has extended a drought classification for the eastern South Island until the end of the year, meaning the area will have officially been in drought for almost two years, the longest period for such a category. More>>

ALSO:

Negotiations Fail: Christchurch Convention Centre Build To Proceed Without PCNZ

After protracted negotiations, the government has ditched the construction consortium it picked to build Christchurch's replacement convention centre, which it now anticipates delivering at least two years behind the original schedule. More>>

ALSO:

Other Centres' Convention Centres:

Ruataniwha: Greenpeace Launches Legal Challenge Against $1b Dam Plan

Greenpeace NZ is launching a legal challenge against a controversial plan to build a dam that’s set to cost close to $1 billion and will pollute a region’s rivers. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news