Daily Equity Report Sharenet Logo

Welcome to the Sharenet Daily Equity Report
 Issue: 24 January 2011 20:00

Recipe to bake a JSE income cake

Round up all shares on the JSE that have grown earnings-per-share and/or dividends per share on a consistent, ever increasing, basis for at least the last 5 years (10 reporting periods including interims.) This gives you about 45 shares. Discard all shares that do not trade at least 10 times per day on average, to ensure decent liquidity. This leaves 27 shares. Now show those remaining that have fallen at least 10% from a very recent high, to ensure we are getting a bargain (margin of safety) and/or high yields. That leaves about 10 shares. Buy any of these shares that we issue trough reversal signals for. Repeat during each small market correction (buy on the dips.) Hold shares until we issue sell signals or flag a bear market/recession. Smile as the superior market-beating capital gains and dividend cheques come in for duration of bull market.

Now the JSE has currently corrected a puny 2.5% recently, but that is not to say that under the surface there are not such bargains about. Have a look at the "income cake" we baked only yesterday:

The "HI" column shows how much lower each share is trading than its more recent 3-month high (in other words, how much it has recently "corrected".) This is an idea of how much of a "bargain" is currently presenting itself. Up to 15 to 17% in some cases! It is not often we see this many consistent dividend/EPS growers popping up in this type of "bargain" screen. In fact we are lucky to see any of these shares, as in most instances these quality shares are bid up to the heavens and too expensive. Some of these issues are not "bargain basement" yet (look at the Powerstocks Valuation Metric, or PVM scores). Only LEW and GRF are registering more than 1 on the PVM, so they are the "well priced" shares when one looks at P/E, Price/Book and Price/sales figures together as a whole. There are a lot of retailers in this list, obviously the foreigners have been taking profits.

We are not saying now is necessarily the right time to be buying these shares. We have other tools in our JSW program that will issue the appropriate BUY signals for these shares based on their price action and that of the market as a whole. But the point is nobody ever regretted buying quality stocks after a nice sell-off such as this. Buying on a dip, coupled with safety of consistency of these companies to grow earnings and dividends is the recipe to bake an income cake. The trick is to buy a small basket of them. Some will perform better than others but our research shows the basket as a whole will comprehensively out-perform the market on both capital appreciation and dividend income.

For more innovative uses of fundamental data coupled with timing tools to deliver superior investing and equities trading results, see our JSW Videos.

Dwaine van Vuuren
Founder, PowerStocks Equity Research

Mon, 24 Jan 2011

South African government bonds recouped some losses on Monday as a selloff last week after the central bank left rates unchanged looked overdone.  Full story
Brewers with big business in the southern hemisphere look better able to cope with commodity cost inflation due to their proximity to good barley harvests and strong pricing power in key beer markets.  Full story
South Africa expects to seal a deal with buyers in Saudi Arabia and India for about 100,000 tonnes of its surplus maize before the end of February, a senior government official said on Monday.  Full story
Japan's Kansai Paint said on Friday the board of Freeworld Coatings is intent on obstructing its takeover bid, the latest salvo in deal that looks likely to go hostile.  Full story

16h52 Anglo Platinum, the world's top platinum producer, on Monday halted operations at its Thembelani mine in South Africa after a worker. . .  Full story
14h16 South Africa expects to seal a deal with buyers in Saudi Arabia and India for about 100,000 tonnes of its surplus. . .  Full story
08h51 South Africa's rand firmed slightly against the dollar on Monday, recovering from near 8-week lows seen at the end of last. . .  Full story
South Africa's competition watchdog has given unions an additional 15 days to present more evidence against Wal-Mart's $2.3 billion bid for. . .  Full story

Trading Statistics


Major Moves Up
SharenameSaleMove% MoveVolume
1 AFEAGLE  180137.78.%5000
2 ELLIES   210105.00.%38584
3 DAWN  780304.00.%74789
4 UNIVERSAL  14553.57.%7000
5 IQUAD  310103.33.%2000
6 AFGRI  720202.86.%115939
7 ANOORAQ  1068292.79.%47565
8 URONE  40761012.54.%20072
9 IMPERIAL  113502702.44.%2746703
10 BATS  265275942.29.%359125
11 DELTA  950202.15.%20700
12 ASSORE  209004102.00.%41227
13 ARGENT  945151.61.%3040
14 ABIL  3800601.60.%3085540
15 REDEFINTL  640101.59.%33794
16 PINNACLE  690101.47.%52915
17 REINET  1139161.42.%3179939
18 OCEANA  3750501.35.%14400
19 HYPROP  5570701.27.%370874
20 OPTIMUM  3240391.22.%151331

Click here for more Major Moves...
Major Moves Down
SharenameSaleMove% MoveVolume
1 MVELARES  3840-1160-23.20.%423975
2 TELEMASTR  135-25-15.63.%1000
3 RANGOLD  280-30-9.68.%60397
4 FAIRVEST  110-10-8.33.%958
5 SABLE  1301-99-7.07.%1577
6 PLATMIN  630-40-5.97.%14592
7 CASHBIL  9001-491-5.17.%8529
8 CITYLDG  7375-325-4.22.%305405
9 ELBGROUP  1700-70-3.95.%5950
10 EQSTRA  730-29-3.82.%109552
11 METOREX  537-21-3.76.%2221823
12 BRAIT  2220-80-3.48.%415114
13 S-OCEAN  221-7-3.07.%10752
14 LONMIN  19533-586-2.91.%162909
15 CAPITEC  15850-455-2.79.%53651
16 CBH  350-10-2.78.%2724
17 FAMBRANDS  3975-104-2.55.%26528
18 EXXARO  14910-390-2.55.%2149605
19 BWI  117-3-2.50.%125000
20 AMA  200-5-2.44.%770694

Click here for more Major Moves...

New Highs
SharenameSaleHighMove% MoveVolume
1 AFEAGLE  180180137.78.%5000
2 ASSORE  20900209004102.00.%41227

Click here for more Major Moves...
New Lows
SharenameSaleLowMove% MoveVolume
1 KEATON   389389-1-0.26.%261935

Click here for more Major Moves...

Spot Prices
NameTimeRPMove% Move
JSE Overall17:0031869.06-270.95-0.84%
JSE Top 4017:0028545.01-263.73-0.92%
JSE Gold17:002571.04-23.72-0.91%
JSE Financial17:0021594.40-84.76-0.39%
JSE Industrial17:0031594.51-199.27-0.63%
JSE Indust 2517:0026200.77-162.75-0.62%
JSE Resource17:0056623.97-728.15-1.27%
DJ Futures19:5611908.0086.000.73%
DJ Ind19:4111960.2488.400.74%
SP 50019:061289.586.230.49%
FTSE 10018:355943.8547.600.81%
All Ords07:364888.1027.200.56%
NZSE 5006:263352.66-.06-0.00%
NameTimeRPMove% Move
Gold/R kg19:56302238-2458-0.81%
Brent Crude19:5696.50-.33-0.34%
Rand / Dollar19:597.0027-0.0768-1.08%
Rand / Pound19:5511.1602-0.1102-0.98%
Rand / Euro19:559.5496-0.0818-0.85%
Rand / NZD19:585.3486-0.0208-0.39%
Rand / AUD19:556.99980.00620.09%
Yen / Dollar19:5882.4200-0.2400-0.29%
Euro / Dollar19:550.7324-0.0022-0.30%
Dollar / Euro19:591.36440.00390.29%
Pound / Dollar19:400.62520.00020.03%

Click here for the Sharenet Spot Price page
Index Summary
Index NameRPMove% Move
Top 4028,545.01-263.73-0.92%
Mid Cap42,160.92-164.53-0.39%
Small Cap32,918.81-242.94-0.73%
Resource 2056,623.97-728.15-1.27%
Industrial 2526,200.77-162.75-0.62%
Financial 158,179.83-31.52-0.38%
Financial & Ind. 3029,626.34-161.15-0.54%
All Share31,869.06-270.95-0.84%
Oil & Gas 27,235.33-472.35-1.70%
Mining 37,239.82-454.16-1.20%
Gold Mining2,571.04-23.72-0.91%
Platinum Mining81.86-1.24-1.49%
Oil & Gas Producers 14,643.93-253.98-1.70%
Basic Materials 31,305.11-381.59-1.20%
Chemicals 13,551.36-46.22-0.34%
Forestry & Paper 12,915.98-289.97-2.20%
Industrial Metals 29,665.36-239.57-0.80%
Industrials 29,503.06-67.67-0.23%
General Industrials 77,155.65-198.52-0.26%
Consumer Goods 25,680.59-378.41-1.45%
Automobiles & Parts 2,807.93-45.29-1.59%
Household Goods147.12-2-1.32%
Health Care 32,370.68-5.28-0.02%
Beverages 80,423.56-1794.03-2.18%
Food Producers 48,385.09-395.76-0.81%
Index NameRPMove% Move
Personal Goods 387.22-2.50-0.64%
Consumer Services 51,799.71-110.15-0.21%
General Retailers 39,000.5823.510.06%
Travel & Leisure 4,097.96-40.80-0.99%
Media 84,719.07162.440.19%
Support Services 2,608.58-17.10-0.65%
Telecommunications 62,665.28151.340.24%
Financials 21,594.40-84.76-0.39%
Banks 40,697.59-228.82-0.56%
Non-life Insurance 30,796.35-181.87-0.59%
Life Insurance 15,695.94-75.98-0.48%
General Financial 2,360.24-7.83-0.33%
Technology 20,690.8024.540.12%
SHARIAH TOP40 3,212.33-34-1.06%
FTSE/JSE SHARIAH ALL3,278.61-34-1.03%
COAL MINING20,851.52-324-1.53%
FTSE JSE Fledgling 4,731.17-17-0.37%
FTSE/JSE Alt X 1,122.22-8-0.72%
CAPPED PROPERTY 311.03-0.13%
RESOURCE 31,152.53-400-1.27%
DIVIDEND PLUS173.60-0-0.26%
FTSE/JSE RAFI 406,644.87-58-0.87%
Capped Top 4014,832.18-131-0.88%
Capped All Share16,020.62-133-0.82%

Click here for the Sharenet Index Summary page
Latest Consensus Changes**
CodeCompany NameStatusUpdated
Results Expected**
ExpectedCompany NameFin. Date
26 Jan 2011CBHDecember 2010 (Interim)
28 Jan 2011HUDACONovember 2010 (Final)
31 Jan 2011CAPITALDecember 2010 (Final)
02 Feb 2011GIJIMADecember 2010 (Interim)
02 Feb 2011TOP FIXDecember 2010 (Interim)

Recent Dividends**
Share NameDec-DateLDTPay-DateAmount
FOORDCMPS11-01-2011-02-0411-02-14R 0.5385
DIALOGUE11-01-1311-02-1811-02-28R 0.1238
SBRJSEP1110-12-1511-03-0411-03-15R 1.4100
WINHOLD10-11-2911-02-1111-02-21R 0.1000
UCS10-11-2311-02-0411-02-14R 0.0500
Ex Div**
Share NameDec-DateLDTPay-DateAmount
CLICKS10-10-2111-01-2111-01-31R 0.7570
FREEWORLD10-11-2411-01-2111-01-31R 0.0700
NAMPAK 6.510-12-0911-01-2111-01-31R 0.0650
NAMPAK 6%P10-12-0911-01-2111-01-31R 0.0600
REUNERT5.511-01-0511-01-2111-01-31R 0.0550

Upcoming AGMs**
CodeCompany NameDateStatus
ABLPAfrican Bank Investments Ltd25/01/2011Confirmed
ABLAfrican Bank Investments Ltd25/01/2011Confirmed
NCANew Corpcapital Ltd26/01/2011Confirmed
SDHSecureData Holdings Ltd26/01/2011Confirmed
RINRedefine Properties International Ltd26/01/2011Confirmed

Stock Exchange News Service
24/01/201117:29 PSG Group Limited - Dealing in securities by the PSG Group Limited
24/01/201117:28OML - Old Mutual plc - Form 8.3
24/01/201117:10 Micromega holdings limited - Cautionary announcement
24/01/201116:49 Sanlam Limited - Resolution of Sanlam Health legal action
24/01/201114:54 Lonmin Plc - Sterling Dividend Rate
24/01/201114:41 Trustco - Voluntary Announcement
24/01/201114:06TOPDWC - Deutsche Bank AG - Notice of expiry Waves
24/01/201113:36 Premium Properties Limited - Rights Offer Finalisation Announcement
24/01/201113:35 Sea Kay Holdings Limited - Further Cautionary Announcement
24/01/201112:56 William Tell Holdings Limited - Trading Statement
24/01/201112:55 Tawana Resources NL - Notice of general meeting
24/01/201112:18BIPINF - Bips Inflation-X - Listing of Additional Bips Inflation-X Securities
24/01/201111:45 BSI Steel Limited - Director`s dealing in securities
24/01/201111:34 City Lodge Hotels Limited - Trading Statement
24/01/201111:30 Glenrand MIB Limited - Separation agreement with Andrew Chislett
24/01/201110:51 Netcare Limited - Change to the board of directors
24/01/201109:32GEN - Brikor - Halting of trading in securities
24/01/201109:00 Datatec Limited - Acquisition of Direct Visual
24/01/201107:48 Brikor Limited - Resignation as Designated Advisor of Brikor
24/01/201107:17 Coal of Africa Limited - New order mining right lodged for Makhado project
24/01/201107:17 Anglo American Plc - Treasury shares - transfers
24/01/201107:17 BHP Billiton Plc - Transaction in shares
24/01/201107:17 Famous Brands Limited - Voluntary sales update

Click here for more SENS news