Growth Focus: ClearView Wealth Ltd (CVW)

by Patrick Taylor

Date of Data Capture: 19/10/2016


Classification: Investment Management

Current Price: $1.13

Market Capitalisation: $747M

Forecast EBIT Growth: 21.21%

Gross Yield: 2.63%

Consensus Price Target: $1.29

# Covering Analysts: 3

Discount at Current Price: 14.16%

Price Target Trend: Increasing

Signal Time Frame: Quarterly-Monthly

Trend Bias: Up-Flat Long-Short

Short-term: Positive
Medium-term: Positive Neutral
Long-term: Positive

Recommendation: Buy
Focus: Capital Growth

Set up Notes:
• CVW has historically made steep jumps in value followed by periods of sideways-ranging consolidation before making more steep jumps in value.
• Another jump looks likely again now with good momentum and signalling across most timeframes and are backed by strong fundamental forecasts and performance.
• They have just cleared through some resistance structure at $1.10 and should have blue skies in front of them once past $1.15 and have good support layered down at $1.10, $1.00 and $0.90.

Growth Focus: ClearView Wealth Ltd (CVW)

Our primary focus here is capital gain, we will select our stocks from the ASX top 500 All Ordinaries Index.

Sometimes it can be hard to see a good opportunity in the market while at other times a company will seem to stand out in stark contrast from the crowd - that is what we see here with Clearview Wealth Ltd (CVW) coming out of consolidation and beginning to step forward once more into the open. Many strongly performing stocks will momentarily pause for breath along their climb in price, ranging down and sideways before eventually resuming their climb. This seems to be the case with Clearview, and with an excellent fundamental outlook and important resistance breaking just last week we think they have further growth in their sights.

Beginning operations in Sydney 1976, Clearview is a wealth management, life insurance, and integrated financial services company that has been seeing remarkable growth, particularly in life insurance and financial advice. Favourable future financial forecasts follow already impressive results, with almost panoramic growth seen continuing across sales, income, profits, earnings and margins. Their 2.63% dividend is not to be overlooked, but our view is that investors should primarily be attracted to the capital growth prospects CVW presents right now and that this potential remains barely hidden in plain sight.

This opportunity is probably best viewed from a medium-term timeframe where we can witness their strong uptrend going through its first steps and entering the landscape back in July 2012. From that vantage point around $0.50 we watched them rally almost 120% over two years to reach its multi-year summit of $1.14 by September 2014.

Since then the price has been taking the scenic route back down south to touch important dynamic support around 85c before heading north once again. Aggressively advancing back through linear and structural resistance we find them standing in front of a vista capped only with blue sky overhead as they have risen above their 2014 peak in just the last few days.

The technical picture looks extremely promising with excellent correlation observed in the longer-term signalling and timeframes, with fresh strength becoming more obvious in the shorter-termed views. That said, we need to remain on the lookout for (and expect) volatility around these kinds of breaks, but we can also observe good support layered down between$1.10 to $1.00 with some decent residual backing stretching down to 90c if things go from spectacular to just plain spectacle.

Strong price action is attractive and should be seen as a good thing - this is what we are following here, though that strength is also supported and clearly flanked by strong fundamentals and technical signalling. With everything now coming into focus, we fully envision Clearview to keep climbing and continue being a scene stealer.


This report was produced by Taylor Securities Pty Ltd, which is a Corporate Authorised Representative (Number 414063) of Bespoke Portfolio Pty Ltd (AFSL 341991). Taylor Securities and Patrick Taylor (Representative number 414064) have made every effort to ensure that the information and material contained in this report is accurate and correct and has been obtained from reliable sources. However, no representation is made about the accuracy or completeness of the information and material and it should not be relied upon as a substitute for the exercise of independent judgment. Except to the extent required by law, Taylor Securities and Patrick Taylor does not accept any liability, including negligence, for any loss or damage arising from the use of, or reliance on, the material contained in this report. This report is for information purposes only and is not intended as an offer or solicitation with respect to the sale or purchase of any securities or financial products. The securities or financial products recommended by Taylor Securities and Patrick Taylor carry no guarantee with respect to return of capital or the market value of those securities or financial products. There are general risks associated with any investment in securities or financial products. Investors should be aware that these risks might result in loss of income and capital invested. Neither Taylor Securities and Patrick Taylor nor any of its associates guarantees the repayment of capital. WARNING: This report is intended to provide general financial product advice only. It has been prepared without having regarded to or taking into account any particular investor’s objectives, financial situation and/or needs. Accordingly, no recipients should rely on any recommendation (whether express or implied) contained in this document without obtaining specific advice from their advisers. All investors should therefore consider the appropriateness of the advice, in light of their own objectives, financial situation and/or needs, before acting on the advice. Where applicable, investors should obtain a copy of and consider the product disclosure statement for that product (if any) before making any decision.

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