Wesfarmers share price climbs to all-time high of $39.02 at the open

With no news out on the company, investors have likely bid the shares of Wesfarmers higher in anticipation of next months full-year results.

The share price of Wesfarmers Ltd rose 1.07% during Tuesday’s trading session, closing the day out at an all-time high of A$38.89 per share.

The stock continued to rise after the market opened today, hitting A$39.02 per share just after 10am.

With no news out on Wesfarmers, investors may be gearing up for the release of the company's full-year results – set to be released on August 28.

New opportunities in focus

Though the company has come under pressure from analysts in recent months, investors have nonetheless bid the share price 23% higher YTD.

A string of yet to be finalised acquisitions are likely to have contributed to this recent investor enthusiasm.

For example, Wesfarmers Ltd recently made headlines when it entered into an agreement to acquire Catch.com for A$230 million.

As Wesfarmers continues to expand its digital footprint, the acquisition of Catch.com will likely help accelerate the company’s online offerings and fulfillment capabilities.

Kmart’s group director, Ian Bailey said of the deal:

‘We are excited to work with the Catch team and look forward to leveraging our capabilities to grow the business and accelerate the customer-driven, omni-channel initiatives across Kmart and Target.’

Other planned acquisitions, such as an agreement to acquire lithium developer Kidman Resources also speak to Wesfarmers’ desire to expand into markets of ever-growing importance.

If approved by shareholders, Wesfarmers expects the Kidman deal to be finalised by September.

Key business segments remain stable in HY2019

Wesfarmers Ltd 2019 half-year results underscore the company’s appeal as a stable, blue-chip stock to investors.

All up, the group’s profit after tax (NPAT) from continuing operations grew 10.4% during the first-half of the 2019 fiscal year.

Officeworks saw impressive top-line growth of 8.2% in the first-half – driven by in-store and online sales growth.

The company’s Kmart Group – which includes both Kmart and Target – saw more modest revenue growth, up less than 1% for the half. Even still, the company recorded double-digit growth in digital sales – primarily driven by the implementation of buy now pay later services and click and collect services.

Wesfarmers industrials also posted good top-line growth, seeing its total revenue increase by 7.2%. In this area Wesfarmers remains positive, maintaining that data and digital transformation will help improve supply chain efficiencies and build merchandise capabilities over the next 12 to 18 months.

Wesfarmers share price: looking forward

Even with Wesfarmers share price at all-time highs, the company still commands an impressive dividend yield of 5.72%.

For income-focused investors, this is likely to be a continued focus as we move closer to the full-year results in August.

The Wesfarmers Ltd share price has now risen 23% year-to-date, slightly outpacing the gains of the ASX200.


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