Investment Watch

Our latest Investment Watch was published last week and includes changes to our Preferred Stock Picks.  Highlights below... Read the full report.

Main features:
Reporting season
•    It was a really good one perhaps overlooked due to current market volatility.
•    21% earnings growth almost doubled consensus expectations earlier this year .
•    More importantly outlook very solid.
•    The number of companies with a negative outlook halved compared to the Feb reporting season.
•   Cash on balance sheets is a record $54 billion - capital management and takeover activity should remain supportive.

Dividends - you haven't missed all of them, we have listed the upcoming dividends in September, October and November.

Preferred Stock Picks:

Core Stocks – Westpac and CBA our two bank picks. This is not a sell or switch call on NAB or ANZ. Remain overweight this sector.

Income – Tabcorp no longer core holding in the short term until operational risk becomes clearer due to the horse flu.

Cyclical:
-    AWC switched to OXR - more diversified.
-    DXL to BLY- not a sell on DXL obviously hold for IPL play but more risk at current levels to buy.

Small Cap:
-    Growth – Look at CAB, IRE and MOC - all had big share price pullbacks making them more attractive to BUY but all are growth stories.

 Resources - added KZL, AWE and JBM as current picks.