Stock Update
Blue Chip
Australia

Wesfarmers Limited (WES:ASX)

19 Feb 2020
By
As one of the longest standing companies within the Blue Chip strategy, todays earnings announcement released by Wesfarmers Limited (WES) confirms its position for the foreseeable future…

WES is a long-term hold within our Blue Chip strategy and has been the best performer in the strategy consistently in recent years. WES reported its interim numbers this morning which, demonstrated the strength of the company and its conglomerate model. It also announced the sale of roughly $1bn worth of Coles Group Limited (COL) stock at the same time, which leaves WES with a remaining 10% holding and a cashed-up balance sheet.

In particular, strong performances from its biggest businesses in Bunnings and Kmart as well as pleasing numbers from Officeworks and its Chemicals, Energy and Fertilisers division were enough to see net profit after tax (NPAT) grow 5.7% over the previous corresponding period (pcp).

The stock is up 3.5% in early trading this morning and is now up 11.5% since the beginning of the year. WES will pay a $0.75 fully franked dividend which will bring total dividends over the past twelve months to $1.53 fully franked. The stock remains a ‘hold’ as part of the Blue Chip portfolio.

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