Stock of the week - Shares and funds - Money

Shares and funds

You are here: > > >

Stock of the week

Provided by Aspect Huntley

Wesfarmers Limited (WES)

Recommendations

Accumulate

Investment ratings

WES is one of the major Australian corporate success stories and one of our Best Business selections. From a collection of basically unrelated operations WES has created an efficient cash generating machine that funds expansion of the asset base without recourse to shareholders while maintaining a high payout ratio. A premium multiple results from the combination of strong cash flow generation, solid NPAT growth and a focus on the creation of shareholder wealth over the long term. The balance sheet is actively managed to maintain capital efficiency. The EPS and DPS track record is solid. The acquisition of Coles Group has the potential to underwrite solid earnings growth over the next decade although there is hard work ahead to maximise returns to shareholders. WES is an ideal stock for patient long term growth and income investors.

Recent Analysis

Impact of Varanus Island Gas Disruption

Previous close	52 week high	52 week low
$32.90	$43.10	$31.72
Sector
Food & Staples Retailing
Market cap
$21,292 Million

Total shareholder return (avg annual rate)
1yr	3yr	5yr	10yr
-9.2%	-0.1%	12.8%	18.2%

Earnings and dividends forecast (cents per share)
	2008	2009	2010
EPS (c)	203.1	193.2	271.7
PE Ratio (x)	16.2	17.0	12.1
DPS (c)	219.6	195.2	215.0
Div Yield (%)	6.7	5.9	6.5

The stock of the week is provided by Aspect Huntley, a market leader in sharemarket investment newsletters. For more detailed stock of the week information and expert recommendations, simply click here for a four week FREE trial to Huntleys newsletters.

© Copyright Huntleys' Investment Information Pty. Limited (HII) (a wholly owned subsidiary of Aspect Huntley Pty Limited), 2004. All rights reserved. Australian Financial Services Licence no. 240892. No material may be reproduced, except as allowed by the Copyright Act, without the prior written approval of HII. Some of the material provided by HII is copyright and is published under licence from ASX Operations Pty Limited ACN 004 523 782 ("ASXO"). Consensus forecast data is copyright Thomson Financial
DISCLAIMER: While the above-mentioned advice and information are based on information, which HII consider reliable, its accuracy and completeness cannot be guaranteed. This report is made without consideration of any specific clients investment objectives, financial situation or particular needs. Those acting upon such information do so entirely at their own risk. For a copy of HII’s Financial Services Guide please go to http://www.aspecthuntley.com.au/FSG or phone HII on (02) 9256 8000 to request a copy.
DISCLOSURE: The directors and associated persons or entities of HII may have an interest in the securities discussed in this report.