The S&P/ASX 200 index was up by almost 1% over the month of March 2012, moving from 4299 to 4335, following a 0.8% increase for February 2012. These five stocks below – all ASX 200 constituents – managed double digit gains over the month. The hot theme for the month was Oil and Gas exploration and production, with two companies in the top five coming from that sector. The one sector you didn’t want to be in over the month was Gold. Five of the Top Ten losers over the month were gold stocks. Everything old is new again QBE…
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The S&P/ASX 200 index was up by almost 1% over the month of March 2012, moving from 4299 to 4335, following a 0.8% increase for February 2012. These five stocks below – all ASX 200 constituents – managed double digit gains over the month.
The hot theme for the month was Oil and Gas exploration and production, with two companies in the top five coming from that sector.
The one sector you didn’t want to be in over the month was Gold. Five of the Top Ten losers over the month were gold stocks.
Everything old is new again
QBE Insurance Limited (ASX: QBE) was the biggest gainer, post a rise of of 21.6%, despite a capital raising at $10.70. At the end of trading on 31st March 2012, QBE was trading at $14.17. QBE is a stock we like here at the Motley Fool, and it looks like investors panicked and oversold the company in the previous few months. QBE reported a 45 per cent fall in net profit for 2011 compared to 2010, with dividends slashed from 128 cents to 87 cents, and the price fell to as low as $9.88. The fall in net profit appears to have been industry wide, not company specific, with many global insurers reporting large falls in net profit.
Despite the price rise, QBE is currently trading on a forecast P/E of 10.9, and forecast dividend yield of 6.5% (partly franked), and still appears cheap.
A rose by any other name
OneSteel Limited (ASX: OST) or ‘Arrium’ as it is to be soon called, rose 17%, and was trading at $1.24 on 31st March 2012. The company is exiting its Australian steel operations and expanding its resources based business.
Despite the stock trading at a price to book ratio of just 0.4, and transitioning from a steel manufacturer and producer to an iron ore miner, it’s a stock facing many headwinds as I explained in this article in February 2012.
AWE Limited (ASX: AWE) was up 16.3%, putting it into 3rd place. This oil and gas explorer and producer has risen thanks to reporting a net profit after tax of $29.7m for the six months to December 2011.
The company produced 2.9m BOE (Barrels of Oil Equivalent) in the six months and reported a cash position of $167m with no debt. The company has also recently announced the sale of 11.25% of its large holding in the BassGas project for cash of $80m. AWE still holds 46.25% of the project, so it could be worth a tidy sum. The market could be onto something, and AWE might be worthy of further research.
Goddess of gas
Apparently Aurora was the Roman goddess of dawn. It seems Aurora Oil & Gas Limited (ASX: AUT) may well be the goddess of gas. Aurora’s share price was up 16.3% over the month and almost 70% in the last six months.
Like AWE, Aurora is an exploration and production company, but is focused on the liquids-rich region of Eagle Ford Shale in Texas. The company has plans to increase the number of wells to 245 from 87 currently, and plans to ramp up production from 4,800 BOE per day to 18,000 BOE per day by the end of calendar year 2012. Reserves of oil and gas have also increased dramatically since December 2010, and the company expects further increases through continued drilling. If you know much about the Oil and Gas sector, Aurora could be a stock for you.
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Coming in at fifth place, was Computershare Limited (ASX: CPU). With its performance heavily influenced by the direction of the markets (globally), the stock is up 16.3%, trading on a P /E of 10, and P / B of 4.2. Since the beginning of the year, the Dow Jones Index is up 12.7%, and the S&P 500 up 17.7%, compared to the ASX 200 up just 6.6%.
Computershare reported a 10% fall in profits for the six months to December 2011 of $105m and flat revenues. Much of the price growth is likely due to its most recent acquisition – the BNY Mellon’s Shareowner Services business – creating the largest share registrar in the world’s largest stockmarket. Computershare has been struggling with a number of headwinds like the high Australian dollar, sluggish markets, and low US interest rates (the company has a float of client cash balances standing at $12.1 billion). Should any or all of these change direction, the company could see its performance improve markedly, and the share price will likely follow.
Other double digit gainers
Notable mentions include Industrea Limited (ASX: IDL) up 15.8%, Graincorp Limited (ASX: GNC) up 14.3%, Telecom Corporation of New Zealand Limited (ASX: TEL) up 14%, Energy World Corporation Limited (ASX: EWC) up 13.8%, and Imdex Limited (ASX: IMD) up 13.4%.
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Motley Fool contributor Mike King owns shares in QBE. The Motley Fool ’s purpose is to educate, amuse and enrich investors. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson. Click here to be enlightened by The Motley Fool’s disclosure policy.