What's on at Eureka Report and model portfolio updates

One of the big exercises we have carried out in recent weeks at Eureka Report has been the special report '"Making Money in 2016". I've managed a range of special reports here at Eureka and I'm comfortable in saying this was the best report of its type we have ever done. (hmmm...sounds a bit like a recording artist with a new album you say... but it's absolutely true).  

As a Eureka subscriber you will receive this report by email later this week. 

Once you've digested the 'Making Money in 2016" report we invite you to join us for a webcast on the same theme this FRIDAY morning December 18 at 10.30 -11.15 am.

Note the unusually early timeslot here; we know a lot of people might have social commitments the last Friday before Xmas so we are allowing for that.

Also remember that Eureka Report will be publishing right up to Xmas week with our final edition for the year on Monday December 21. 

In the studio this week Alan Kohler will be hosting two very interesting CEO interviews. On Tuesday December 15 Alan will the talking live to Bob Vassie of St Barbara Mines. You might recall that St Barbara has pulled off a Lazarus-like recovery this year to become one of the best performing companies on the entire ASX.

How did Vassie rescue this gold miner from the edge? Tune in to hear just how it all happened.

Later in the week Megan Boston, the CEO of Omni Market Tide will be talking live in the studio at 2pm on Wednesday (Dec 16) with Alan. Omni Market Tide is the recently listed investor relations 'app' manufacturer, and Boston will have the intriguing investor relations challenge of being our final CEO interview of the year! 

Income First model portfolio

This week the income first model continued to perform as expected. Steadfast Group (SDF) was added at a 6 per cent weight to the portfolio, taking the overall portfolio to around 67 per cent invested. In terms of stock specific news, the portfolio has been relatively quiet as the holiday season nears.

The one pleasing update for the week was G8 Education (GEM)'s announcement on Friday that it will again pay a 6 cent quarterly dividend with an ex-dividend date of Wednesday December 16. It is expected that Arena REIT (ARF) will also announce its quarterly distribution amount in coming days. 

-James Samson

LIC model portfolio

There are no changes to the LIC model portfolio this week. As the portfolio has been set for a few weeks, I do not anticipate many material changes as we let the portfolio managers navigate these markets for us. Keep an eye out for the monthly NTA statements from each LIC, as it is about this time each month they start to come out. These are particularly useful because each manager likes to put market and portfolio commentary together for shareholders. 

It is also important to note for those who have been looking to purchase the LIC model stocks to keep an eye on the NTA. Buying the LICs at a discount or in line with NTA is always preferred but you do not want to overpay. When holding I am happy to let them run up in share price above NTA during short-term fluctuations.  

-Mitchell Sneddon

Growth First model portfolio

The companies in the Growth portfolio have continued to defy broader weakness in the market. Our stocks closed out the week up an average of 0.4 per cent, against an S&P/ASX 200 index that slid by nearly 2.4 per cent.

A positive trading update from Vita Group (VTG), up 15 per cent, offset some weakness in AMA Group (AMA), down nearly 10 per cent ahead of its sale of Perth Brake Parts.

This week we are digging into the Growth First model portfolio war chest and initiating a five per cent weighted position in Pental (PTL). We will take Tuesday morning's opening level as our entry price.

We are upgrading Pental from ‘hold' to ‘buy' today as we see the group on the cusp of a return to meaningful growth. Pental has multiple shots on goal that could materially boost revenue, and with costs still to drop out of its structure, margins and profits should grow healthily. The stock is cheaply valued today relative to its expansion prospects and compared to its peers. There is significant upside to our new valuation of 72 cents per share. Click here to read our note on Pental here.

We have also ceased coverage today on two formerly covered stocks: Global Health (GLH) and eServGlobal (ESV). Our ‘sell' call on Global Health has been vindicated by the firm's inability to retain revenues the market had assumed were recurring. We downgrade eServGlobal to ‘sell' as its core business is making inadequate market share inroads and its HomeSend stake is an expensive risk. You can read our update on GLH and ESV here.

-Tim Dohrmann