It looks like it's going to be another busy month for investors and the ASX 200 index.
Three ASX 200 stocks that I will be watching like a hawk this month are named below. Here's why they could be worth keeping a close eye on in May:
Brainchip Holdings Ltd (ASX: BRN)
This struggling semiconductor company will be an ASX 200 stock to watch this month (before it is likely kicked out of the index in June). I've been warning people off this meme stock for some time, and with its shares down 60% over the last 12 months, I'm feeling somewhat vindicated. Though, it still appears wildly overvalued, but that's a story for another day.
On 23 May, BrainChip will be holding its annual general meeting. I will be watching very closely at the shareholder votes on the remuneration report and the proposed issue of stock to its executives and directors.
In respect to the latter, despite its share price decline, the company's admittance that its Akida platform was not good enough, and its pitiful cash receipts (US$40k in Q1), the $700 million company wants shareholders to approve the issue of 2,264,493 restricted stock units to its CEO, Sean Hehir, for nil cost. I'm interested to see if disgruntled shareholders will approve this and other generous share issues.
REA Group Ltd (ASX: REA)
Another ASX 200 stock that I will be watching closely is realestate.com.au owner and operator REA Group.
There's no disputing the fact that the cash rate hikes have put pressure on the housing market. However, REA has managed to overcome this so far in FY 2023 and delivered solid top line growth during the first half.
On 12 May, we will be able to see if this positive form has continued for the ASX 200 stock. That's because REA is scheduled to release its quarter results before the market open on that day.
Westpac Banking Corp (ASX: WBC)
Australia's oldest bank will be an ASX 200 stock to watch this month. That's because it is one of three big four banks that will be releasing their half-year results in May.
Westpac will be the third of the three to report, but arguably has more to look out for than its peers.
For example, the market will be looking for an update on its cost reductions plans. There are a lot of doubts that it will be able to cut costs as much as hoped in the current inflationary environment. If it can prove the doubters wrong, it could be a big boost to its share price.
In addition, its margins will be a key focus for investors. Goldman Sachs recently revealed what it is watching out for. It said:
WBC's 2H22 NIM was up 5 bp hoh to 1.90% (ex Treasury & Markets at 1.80%) and we note that WBC's exit NIM (ex Treasury & Markets) for the month of Sep-22 was 1.85%. WBC expects the 1H23 NIM (ex-Treasury and Markets) to be higher than the Sep-22 exit and higher again in 2H23 albeit with a moderating hoh increase.
With deposit competition currently being a key area of focus, we will be keen to get an update on how current levels of deposit repricing have impacted mix shifts, and what WBC's expectations are around competition going into 2H23. We currently forecast 1H23E NIMs to increase +13 bp hoh to 2.03%
