KEY POINTS:
Goldman Sachs JBWere has added Sky TV to its "conviction list" after upgrading its recommendation and valuation on the stock.
It now rates the pay TV provider as a buy and has a target valuation of $7.33.
A conviction list, for the record, is the list of stocks
that brokers hold their most resolute views on.
Exiting the latest Goldman list are Fisher & Paykel Appliances and Nuplex. That's because of concerns of a deepening consumer slowdown in the United States, the risk of an oil price rebound and the recovery of the dollar.
Although those stocks have fallen off the conviction list, Goldman remains comfortable with both as long-term investments.
So, that leaves seven stocks on the Goldman conviction list - six with "buy" recommendations and one "sell". The "buys" are Sky TV, F&P Health, Infratil, GPG, CanWest MediaWorks and Pumpkin Patch.
The lone "sell" is Telecom - which Goldman hasn't liked for months, thanks to a few well-documented regulatory shenanigans this year.
Telecom shares closed down another 2c at $4.48. They have drifted back 5c since the start of the week to trade about where they were before the select committee recommendation that the company should be split into three divisions.
Sky TV shares have certainly soared since October when they traded as low as $5.41. They closed yesterday up 14c at $6.18.
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AIR NZ ON THE ROAD
Some legwork in the US may have paid off for Air New Zealand as its stock hit a new altitude this week. Okay, another lousy aviation pun - what the shares actually hit was a two-year high of $1.72.
And, yes, the price is being driven by the heady valuations on Qantas now it has found itself in the thick of the private equity, takeover madness.
But an investor roadshow to the US has also sparked some institutional interest for the New Zealand national carrier.
In the last week of November chief financial officer Rob McDonald and head of investor relations Abhy Maharaj took the airline's story of long-haul transformation to brokers in New York, Boston and San Francisco.
Key messages were around the 16 per cent rise in long-haul yields in the past year driven by rising sales of business class and new premium economy seats, the airline's strong balance sheet and the growing cash pile it is likely to have once it completes its last big aeroplane purchases in the next year.
Strong institutional buying out of the US indicates the message went down well.
Although the Government's 82 per cent stake means Air New Zealand can shift a fair way on low volumes, there has been some solid trading in the past two weeks as the shares have jumped from $1.48 on November 21.
The rally actually dates back to August when the price hit a record low of $1.08 and initially tracked falling fuel prices.
The New Zealand Day roadshow was organised by Macquarie (yes, the same crowd that are threatening to buy Qantas, so they're to blame for the jump, however you look at it) and also took representatives from Pumpkin Patch and Fisher & Paykel Appliances.
Judging by the trading patterns over the past couple of weeks, Pumpkin Patch may also have generated a bit of US interest. It had a big volume increase on November 28, the day after the New York presentation.
Air New Zealand shares closed down 1c at $1.71 yesterday. Pumpkin Patch closed down 10c at $4.20.
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WINE WOES
New Zealand's largest listed wine exporter, Delegat's, has taken a bit of a market hit in the past three weeks.
It hasn't been a great week for the New Zealand wine industry in general - with the Wither Hills controversy in the headlines - but it's a pretty safe bet it is just the curse of the rising dollar dampening enthusiasm for Delegat's. It closed at $2.34 yesterday.
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A RIPPING YARN
ABN Amro's Mark Benseman has lowered his net asset valuation on Guinness Peat Group by a subtle 2c a share - to $2.48 - and reduced its target valuation to $2.84 from $2.88.
The main reason for that change is a slight reduction in the value of GPG's main operating subsidiary Coats and the exchange rate. But Benseman retains his "buy" recommendation.
Coats, in which GPG holds a 100 per cent stake - is one of the world's largest thread and yarn businesses. The market has been pretty tough but last month Coats' biggest competitor in the yarn business (Spinrite) reported promising results for the September quarter.
Currency fluctuations play a big part in GPG valuations and although the kiwi has surged in the past couple of months, it is still forecast to fall later next year.
So Benseman estimates GPG's net asset value will rise by 36c a share in the next 12 months. Of that, 10c worth will be due to the forecast fall of the kiwi against the pound. Another 7c is attributed to a drop against the Aussie dollar. The rest is from improvements in valuation of its investments.
Those investments now include a 20 per cent stake in the Australian and New Zealand versions of Tower.
While Tower Australia has been booming, prospects for Tower NZ haven't been looking so good.
That's unless a takeover offer emerges.
GPG has insisted it isn't a seller but if the price is right ... well, we all know how it works.
A combination of growth and takeover talk means there is still potential for Tower to deliver good returns on both sides of the Tasman.
GPG shares closed up 1c at $2.41 yesterday.
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STRANGE FAXES
Who has been sending unsettling faxes - of what looks like damaging inside information - about Restaurant Brands to brokers and why?
And why, for that matter, are they using fax machines in this high-tech age?
The bemused brokers at one firm are taking the hand-scrawled note with a grain of salt and wonder whether it's someone who got caught shorting the stock prior to the good news about the sale of Pizza Hut in Victoria.
That has sent the share price up 16c in the past week. But who knows?
Ramping up (or down) stocks is pretty common in the cyberspace world of stockmarket chatrooms but using random faxes seems quaint.
One broker recalls the last stock subject to a fax-based campaign was Fletcher Challenge - prior to its breakup in the late 1990s.
Although, the dire predictions made by that mystery faxer - that the empire was about to be carved up - did prove to be spot on.
Restaurant Brands shares closed steady at $1.08 yesterday.
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DRAKE STAKE
US private equity group Drake & Associates has resumed its slow and steady building of a cornerstone stake in Tourism Holdings.
On Monday it confirmed to the NZX that it now had a 14.7 per cent stake in the local tourism investment group, which owns Kelly Tarlton's and operates the Waitomo Caves.
It was the seventh substantial security notice Drake has filed since May and showed an increase from 13 per cent.
Given the under-performance of Tourism Holdings in the past few years, there has been plenty of speculation (certainly plenty in this column anyway) that it may make a good takeover target.
The Business Herald rang the company this week on the off-chance it might reveal its intentions.
Our American friends didn't seem too keen to comment - telling our reporter to call back later, hanging up on him and then putting the phone on answer message half an hour later.
Tourism Holdings shares closed at $1.94 yesterday, up 1c.
