SkyCity folds 6% as NZX 50 trades flat

The S&P/NZX 50 traded flat on Monday, ending the day at 12,421.09 points. 33.2 million shares traded hands, amounting to $108.6m in total value traded.

Senior research analyst at Craigs Investment Partners, Mohandeep Singh, noted that despite the volatility in April, United States markets have ended up more or less where they started.

The S&P 500 fell 0.64% overnight, snapping a nine-week winning streak, but it is still up 11.62% over the last month. The tech-heavy Nasdaq composite has followed a similar track and is now up 14% in 30 days.

“If you just look at the S&P point to point – the start of April to the end of April – you think nothing happened, that it ended reasonably flat. But there’s been this big V-shaped recovery,” Singh said. 

He said no NZX-listed stock followed this pattern closer than Infratil, which rose 3.67% to $11.58 on Tuesday and is closing in on wiping out all the losses it made in the first quarter.

“Most of those big [American] tech names that got hammered have rebounded, and this is probably just Infratil going along for the ride, both when it was falling and now on the rebound, given that they've actually not come out with anything to say how business is materially impacted or otherwise.”

The a2 Milk Company dominated the day’s trading volumes, with a value of $21.5m.

Singh said most of that turnover was attributable to a handful of large trades. The company’s securities fell 1.88% to $8.88. 

News flow

On the announcement front, SkyCity shares fell 6.09% to $1.08 after the casino operator downgraded its earnings guidance for the second time, citing continued deterioration of market conditions. 

SkyCity now expects earnings before interest, taxes, depreciation, and amortisation (ebitda) for 2025 to fall to about 4% below the bottom of the current guidance range of $225m to $245m. In February, the firm downgraded its 2025 full-year guidance from between $245m and $265m.

“That’s the second swing of the bat with lower guidance now,” Singh said. 

“They’ve missed consensus by about 5%, and the stock is down 6%. That's about right.”

Singh pointed out that SkyCity is one of two companies on the index that are now trading at 52-year lows. The other, Tourism Holdings, fell 5.8% to $1.30 and finished the day nearly 35% down for the year.

Travelling in the other direction was NZME, which got a boost after the company’s board indicated how it intends to avert a takeover of the board sought by Jim Grenon, a 9.97% shareholder.

The media company made the resignation from the board of the current chair, Barbara Chapman, contingent on the election of John Key-era Cabinet minister Steven Joyce to the board. Shares rallied 6.60% to $1.13 on the news.

Leaders and laggards

The day's other success stories were Oceania, up 3.23% at 64 cents.

A notice on the NZX showed that Forsyth Barr Investment Management (FBIM) had raised its holding of the retirement company to over 10% on May 2. Around the same time last year, records show FBIM owning about 6%. 

Fellow retirement village and aged care company Ryman was up 1.25% to $2.43, continuing its strong run so far in May.

The other company in the category, Summerset Group, fell 2.53% to $10.78 on volumes worth $1.8m.

Vista Group International fell steadily throughout the day, ending 7.63% down at $7.30.