WAM Leaders Limited (ASX: WLE)

WAM Leaders Limited (ASX: WLE) is an investment company. The Company’s investment objectives are to deliver a stream of fully franked dividends, provide capital growth over the medium-to-long term and preserve capital. The Company provides investors with diversified exposure to a portfolio of undervalued growth companies within the Standard &

Poor’s/Australian Securities Exchange (S&P/ASX) 200 Index and exposure to market mispricing opportunities in large-capitalization companies. The Company invests in listed equities, short portfolio, and fixed interest and cash. Wilson Asset Management is the investment manager of the Company. (Profile source: Reuters)


From the Company Reports

FY2019 results

WAM Leaders achieved an operating profit before tax of $90.1 million for the year (FY2018: $100.5 million) and an operating profit after tax of $71.5million (FY2018: $74.6million), it was announced on 22 August 019.

The operating profit for 2019 was reflective of the performance of the investment portfolio and the growth in assets over the period. The investment portfolio increased by 10.9% and was achieved with an average cash weighting of 10.3%. The return on the equity portion of the portfolio was 12.0% for the year. The S&P/ASX 200 Accumulation Index rose 11.5%.

The investment performance has been delivered with less volatility than the market, as measured by the standard deviation.

The Board declared a record fully franked final dividend of 5.65 cents per share, an increase of 13% on the previous year, with the record fully franked final dividend being 3.0 cents per share. Since inception, WAM Leaders has paid 10.65 cents per share in fully franked dividends to shareholders. At 31 July 2019, the Company had 15.0 cents per share available in its profits reserve, before the payment of the fully franked final dividend of 3.0 cents per share.

(Chart Source: TradingView)


The company currently offers an annual dividend of 4.96%, fully franked. The company has a P/E ratio of 12.5. The EPS stands at $0.091. The stock has a market cap of 893.64m and a Share volume of 783.89m. The stock has a 52-week price range of $1.015-$1.25 (Data Source – Company Reports).

Veye’s Take

WAM Leaders Limited declared a 20% increase in the fully franked final dividend to 3.0 cents per share. This record dividend was achieved after a strong 19.4% increase in the investment portfolio in the six months to June 2019. The WAM Leaders’ investment portfolio delivered a 10.9% increase in the 12 month period, climbing 7.2% in the final quarter. The stock after a brief correction has stabilised. Veye recommends a “Buy “on “WAM Leaders Limited” at the current price of $1.13

Cromwell Property Group (ASX: CMW)

Real estate investor and manager Cromwell Property Group (ASX: CMW) (Cromwell) on 29 August 2019 reported a full-year (FY19) statutory profit of $159.9 million (FY18 $204.1 million). 

(Chart Source: TradingView)

FY19 Highlights And Strategy Update

  • Statutory profit of $159.9 million (FY18 $204.1 million);
  • Operating profit up 11.1% to $174.2 million (FY18 $156.8 million);
  • NTA of $0.97 (FY18 $0.96) post a 12.7% increase in the number of securities on an issue;
  • Gearing of 35.0% with look-through gearing of 42.3% (Performa gearing of 23.9%);
  • Weighted Average Lease Expiry (WALE) of 6.9 years;
  • Total AUM of $11.9 billion up to $400 million;
  • FY19 operating profit 0.21 cps ahead of guidance at 8.21 cps (FY18 8.36 cps); and
  • FY19 distributions per security met guidance at 7.25 cps (FY18 8.34 cps). (Data Source – Company Reports).
(Chart Source: Company Reports)
  • Veye’s Take

    Cromwell Property Group reported a full-year (FY19) statutory profit of $159.9 million (FY18

    $204.1 million). Operating profit was up 11.1% from the prior year to $174.2 million (FY18 $156.8 million). Post Cromwell’s institutional and retail capital raisings during the year, distributions met guidance at 7.25 cps. Security holders benefit from stable long term cash flows, demonstrated asset enhancement capabilities and transactional profits, and low-risk exposure to Asian capital flows and European economic growth. Cromwell maintains a strong and secure balance sheet and long-dated Australian property portfolio which enables it to recycle assets and reinvest into its property investment and fund management businesses. The stock is moving in an ascending triangle. Veye had given a buy on the “Cromwell Property Group” price of $1.075 on 19 Feb 2019. We are Bullish on “Cromwell Property Group” and give it a “Buy” recommendation at the current price of $1.235

    FlexiGroup Limited (ASX: FXL)

    FlexiGroup Limited (ASX: FXL) on 27 August 2019 reported its results for the financial year ended 30 June 2019 (FY19).

    Flexigroup Announces 2019 Full Year Results

(Chart Source:TradingView)
  • Highlights

    • 76 million active customers, up 8% on prior year
    • 65,000 retail partners, up 8% the prior year
    • $2.56 billion in transaction volume, up 12% on prior year 
    • $2.64 billion in receivables, up 11% on prior year 
    • Cash NPAT in line with revised guidance of $76.1 million 
    • Three new products: bundll, wiired lease, and wiired money announced
    • New card brand, cartt, consolidating five card brands into one consumer-facing offering
    • Significant investment and progress made in simplifying product suite and business systems  

    Commenting on the announcement, Rebecca James, Chief Executive Officer at flexigroup said that he was incredibly proud of the progress made over the last twelve months. flexigroup has delivered strong customer, retailer, transaction and receivables growth while executing against their four strategic pillars. Their new buy now pay later offering, humm, has gone from strength to strength, reporting robust customer, retailer and volume growth since launch. (Data Source – Company Reports).

    Veye’s Take

    FlexiGroup believes they have created a category killer with the launch of bundll. FlexiGroup’s partnering with Mastercard will for the first time allow consumers to buy everything, everywhere, and pay later. In FY19, flexigroup attracted 134,000 new customers to its products, resulting in an active customer base of 1.76 million. The Group also added 5,000 new retail partners to its network, increasing its valued partnerships with retailers across Australia and New Zealand to 65,000. This growth in customers and retailers is supported by FY19 transaction volume which increased 12% to $2.56 billion, with total receivables of $2.64 billion – an increase of 11% on the prior year. The Group delivered a Cash Net Profit after Tax (NPAT) of $76.1 million, in line with revised guidance.  After having undergone some correction, the stock has resumed its upward journey. We are Bullish on “Flexigroup Ltd” and had given it a “Buy” recommendation at the price of $1.770 on 9 May 2019. Veye maintains a “Buy” on

    “Flexigroup Ltd” at the current price of $1.825

    Cedar Woods Properties Limited (ASX: CWP)

    Cedar Woods on 22 August 2019 confirmed purchase of the site in Subiaco, WA

    The acquisition of 133 Salvado Rd, Subiaco by Cedar Woods Properties Limited (ASX: CWP) (‘Cedar Woods’ or ‘the Company’) for $15.05m, (plus GST) is now unconditional with settlement to take place in July 2020.

    As notified in May 2019, Cedar Woods conditionally contracted to buy the site. Due diligence on the landmark, 1.4ha development site had been completed and the Company had elected to proceed with the acquisition. The focus will now turn to complete the design and obtaining planning approvals.

    Managing Director Nathan Blackburne said that the acquisition was consistent with the Company’s track record of securing development sites in sought-after suburbs at favourable points in the property cycle.

(Chart Source:TradingView)

This was an inner suburban site with excellent credentials, being close to the city, train stations, retail and parks. The company will deliver a quality housing development comprising of townhouses and apartments said, Mr. Blackburne.

Cedar Woods has around 2,700 townhouses and apartments within its national development pipeline of 9,600 lots, making it one of the larger built form residential developers in the country.

The proposed development also supports State and Local Government efforts to improve housing diversity and deliver on new housing targets in established areas. He thought it was an optimal time to buy sites, based both on the extent of policy support and the point they are at in the property cycle, according to Mr. Blackburne. (Data Source – Company Reports).


Veye’s Take

Cedar Woods has been delivering over 300 apartments and townhouses a year and has a proven methodology for generating strong returns from these projects and in creating a product that our buyers are very satisfied with. Around the country, there is an increasing demand for new housing options in long-established areas. Cedar Woods with a strong balance sheet and ready access to capital would seek to leverage this position to build its business at a time when many developers are struggling to secure development finance. Cedar Woods delivered a bottom-line expansion of 54% in the prior year, with its most recent earnings level surpassing its average level over the last five years. CWP outperformed not only its past performance; its growth also surpassed the Real Estate industry. We had recommended Cedar Woods Properties Limited as a buy at the price of $5.70 .on 27 May 2019. It has already delivered more than 19% returns in about three months. Veye recommends “Buy” on Cedar Woods Properties Limited at the current price of $6.81


Medibank Private Limited (ASX: MPL)

Medibank Private Limited (ASX: MPL) on 22 August 2019 announced its results for Full Year 2019

The results are summarised as follows: 

    • Health Insurance premium revenue increased by 2.4% or $151.2 million to $6,470.7 million.
    • Medibank Health revenue increased 24.0% or $35.8 million to $185.1 million.
    • Net investment and other income increased 1.0% or $1.1 million to $109.2 million.
    • Profit from continuing operations increased by 3.2% or $13.5 million to $437.7 million.
    • Net profit attributable to shareholders increased 3.1% or $13.6 million to $458.7 million
(Chart Source:TradingView)

Dividend information

 A fully franked final ordinary dividend of 7.40 cents per ordinary share was declared on 22

August 2019 in respect of the six months ended 30 June 2019. A fully franked special dividend

of 2.50 cents per ordinary share was also declared on 22 August 2019. These dividends are payable on 26 September 2019 to shareholders on the register at the close of business on 5 September 2019. A fully franked interim ordinary dividend of 5.70 cents per ordinary share was declared on 15 February 2019 in respect of the six months ended 31 December 2018, paid on 28 March 2019 to shareholders on the register at the close of business on 6 March 2019. (Data Source – Company Reports).


Veye’s Take

The ongoing strong recovery of the Medibank brand has seen policyholder growth in all four quarters of the financial year for the first time in four years. Medibank’s market share has grown 5 basis points over the year, driven by its dual-brand strategy and improved customer acquisition and retention. This is the first time in a decade they have grown market share over a full year. The stock, after a shallow correction, is ready to bounce back. We maintain a “Buy” recommendation on “Medibank Pvt Ltd” at the current price of $3.540



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