Jan. 7 (BusinessDesk) – New Zealand shares rose, pushing the NZX 50 Index to a new five-year high as investors cheered Ryman Healthcare’s performance by pushing the retirement village operator to a record close. Rival Metlifecare also advanced.
The NZX 50 rose 9.803 points, or 0.2 percent, to 4084.84, the highest since December 2007. Within the index, 28 stocks rose, 10 fell and 12 were unchanged. Turnover was $72 million.
Ryman gained 2.4 percent to $4.77. The company is targeting 15 percent earnings growth this year and managing director Simon Challies told Fairfax Media that Ryman is aiming to be the biggest stock on the NZX. The shares have gained 66 percent in the past 12 months and are rated ‘outperform’ based on the consensus of six recommendations compiled by Reuters.
“Ryman is a great success story,” said David Price, head of institutional broking at Forsyth Barr. “The market has been prepared to pay up for their success because they have such a good track record.”
Metlifecare, which joined the NZX 50 on Dec. 24 along with fellow retirement home company Summerset Group, gained 2.6 percent to $3.21. Summerset was unchanged at $2.26.
Price said the New Zealand market is probably around fair value currently. Equity markets have been driven higher by relatively low interest rates, which have encouraged investors to buy stocks. The Standard & Poor’s 500 Index closed at a five-year high on Friday.
Mainfreight, the transport and logistics group, rose 1.6 percent to $12, the first time it has closed at that level. The company is rated ‘outperform’ based on a Reuters poll.
Michael Hill International, the jewellery chain, gained 1.6 percent to $1.25 and children’s clothing retailer Pumpkin Patch climbed 1.5 percent to $1.35.
Carpet maker Cavalier rose 1.2 percent to $1.69 and Ebos Group, the medical supplies and petfood company, rose 1.2 percent to $8.45.
OceanaGold, operator of the Macraes gold field, fell 3.5 percent to $3.27 and PGG Wrightson, the nation’s biggest rural services company, fell 2.2 percent to 45 cents.
Fletcher Building, the biggest company on the NZX 50, was unchanged at $8.48 and Telecom, the second-largest, added 0.7 percent to $2.195. Contact Energy fell 0.9 percent to $5.27.
Xero, the cloud-based accounting service, rose about 1 percent to $7.47 and Diligent Board Member Services, whose software for company directors can be used on an iPad, fell 0.4 percent to $5.48.