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Hot stock SEEK Limited

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This week Money asks independent equities research firm Kalkine for a hot stock pick - Seek Limited (ASX:SEK)

Key statistics:

6/10/15 closing share price: $12.420 52 week high: $18.990

seek.com.au

Most recent dividend: 17c Annual dividend yield: 2.88%

SEEK Limited (ASX: SEK) encompasses a strong portfolio of employment, education and volunteer businesses which span across 17 countries. SEK reported a solid revenue increase of 20% year on year (yoy) to $858.4 million in the 2014-2015 financial year. This was driven by better Australia and New Zealand online employment businesses, Premium Talent Search promotion, integration of JobsDB and JobStreet to Zhaopin in China.

The group continues to maintain its market leadership Australia, generating over 32% of placements and a lead of 10x higher against the nearest competitor. The total visits in Australia reported a compound annual growth rate (CAGR) increase of 22% from the 2012 financial year to 35+million. Mobile visits performed even better showing a CAGR of 47% in the same period. SEK is also developing its penetration in China through Zhaopin, post the integration of JobsDB and JobStreet.

The group already owns market leaders in Brazil and Mexico. The group's stock fell over 27.6% in the past four weeks, as the group issued a conservative outlook and anticipates a revenue growth of 15% to 18% range while EBITDA is estimated to grow in the range of 5% to 8%. But we view this correction as an opportunity given its solid penetration in international markets and a dividend yield of about 3%.

SEEK limited

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