Icarus Signal Update: Banks, Amcom And Invocare

This story features ANZ GROUP HOLDINGS LIMITED, and other companies. For more info SHARE ANALYSIS: ANZ

Update on share prices and consensus price targets.

By Rudi Filapek-Vandyck

Investors in the Australian share market are yet again being taught a valuable lesson: not all equities are equal during a market correction.

I am not making this observation to highlight the damage that can stem from companies issuing profit warnings. online accommodation provider Wotif.com ((WTF)) providing the latest such example (shares down more than 28% as I write this story), but FNArena's Icarus Signal is highlighting some interesting developments, to say the least.

The share market does look a whole lot different when viewed through the prism of consensus price targets.

Remember the banks? Earlier in the year there was no two ways about it: everybody wanted to be on board and the result was that share prices for all Big Four kept on surging above their respective consensus targets.

But now… final dividends have been paid and funds managers have re-positioned for a more growth oriented focus leading into 2014… all share prices are now well below those price targets. Typically, CommBank shares are the only one that have remained within reach of consensus target (circa 2% below) while ANZ Bank ((ANZ)), Westpac ((WBC)) and National Bank ((NAB)) are by now staring at a gap of 8% or more.

What the ongoing pull back in local equities also has achieved is that several other over-achievers have now weakened to levels below target, including Navitas ((NVT)), ARB Corp (ARP)), Amcom Telecom ((AMM)) and Invocare ((IVC)).

Meanwhile, there are no less than 76 stocks trading above target and some of the names will surprise many: Forge Group ((FGE)), Metcash ((MTS)), Cabcharge ((CAB)), ASX ((ASX)), Matrix Composites and Engineering ((MCE)) and Monadelphous ((MND)). Not one of these names has this year been associated with good capital returns for shareholders. This, of course, doesn't exclude that one day that might change for the better.

As has been the case for a long while now, the Bottom Fifty of stocks trading the farthest from targets is being populated by small biotechs and small mining stocks, as well as mining services providers such as Boom Logistics ((BOL)) and Mastermyne Group ((MYE)). There is a very good reason why the more speculative market participants cast their eye over this part of the share market. Be warned, however, because ultra-cheap does by no means imply that all the associated risk has now evaporated.

Investors should consider the information and data are provided for research purposes only.

Stocks <3% Below Consensus

Stocks Above Consensus

Top 50 Stocks Furthest from Consensus

To see the full Icarus Signal, please go to this link

Technical limitations

If you are reading this story through a third party distribution channel and you cannot see charts included, we apologise, but technical limitations are to blame.

Find out why FNArena subscribers like the service so much: "Your Feedback (Thank You)" – Warning this story contains unashamedly positive feedback on the service provided.

Click to view our Glossary of Financial Terms