Confession season

So far, the May “confession season” feels slow.

RHC and AMC downgraded, OML the outdoor advertising company downgraded, City Chic (CCX) also downgraded.

CCX has been in downgrade mode for a while, and most of the advertising companies have been doing it tough (e.g. NEC) given that there are few sectors more cyclical than ads (metal bashing, maybe).

The commodity producers moving with commodity prices doesn’t really count, as such, but S32 (South 32) production woes does.

PolyNovo (the burns people) disappointed, but it isn’t a high profile stock these days, arguably no-one is/was watching.

Today, SkyCity ticked down guidance, noting the increased cost of compliance, and the ongoing overhang of investigations (everything from AUSTRAC to suitability), although the size of the downgrade is fairly modest.

The bank reporting season contained relatively few surprises, to our mind, NAB “disappointed the most”, but that is more a function of a higher relative valuation meeting much the same set of industry wide economics.

QBE experienced a more severe cat claims environment in the US, which perhaps rounds us out.

I guess, as I reread my own note, that is a few names, but for the most part they all have reasonably different (idiosyncratic) drivers, rather than a more obvious, overt, macro thematic.

Update:

Can add UNI (Universal, the discretionary clothing retailer) to that list, based on today’s update.

FY23 EBIT consensus was at $46m. $39-41m guided below is, well, a lot less.

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