Australian Broker Call
August 07, 2017
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COMPANIES DISCUSSED IN THIS ISSUE
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Last Updated: 11:42 AM
Your daily news report on the latest recommendation, valuation, forecast and opinion changes.
This report includes concise but limited reviews of research recently published by Stockbrokers, which should be considered as information concerning likely market behaviour rather than advice on the securities mentioned. Do not act on the contents of this Report without first reading the important information included at the end.
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Today's Upgrades and Downgrades
| BSL - | BLUESCOPE STEEL | Upgrade to Accumulate from Hold | Ord Minnett |
| ORL - | OROTONGROUP | Upgrade to Buy from Neutral | Citi |
| SGM - | SIMS METAL MANAGEMENT | Downgrade to Hold from Accumulate | Ord Minnett |
| WEB - | WEBJET | Downgrade to Underweight from Equal-weight | Morgan Stanley |
Credit Suisse rates AOF as Neutral (3) -
The company reports on August 8 and Credit Suisse forecasts free funds from operations of 17.1 cents per security, at the top end of the previously upgraded guidance range. FY17 has been characterised by outperformance in leasing.
Neutral retained. Target is raised to $2.25 from $2.10.
Target price is $2.25 Current Price is $2.20 Difference: $0.05
If AOF meets the Credit Suisse target it will return approximately 2% (excluding dividends, fees and charges).
The company's fiscal year ends in June.
Forecast for FY17:
Credit Suisse forecasts a full year FY17 dividend of 15.00 cents and EPS of 17.00 cents. |
Forecast for FY18:
Credit Suisse forecasts a full year FY18 dividend of 15.00 cents and EPS of 17.00 cents. |
Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Ord Minnett rates BSL as Upgrade to Accumulate from Hold (2) -
Ord Minnett has undertaken a pre-report review and marked to market commodity prices. The broker has re-based costs to levels achieved post restructuring in FY16. Further potential value upside is envisaged from any additional efficiency benefits.
Rating is upgraded to Accumulate from Hold. Target is raised to $15 from $13.
Target price is $15.00 Current Price is $13.35 Difference: $1.65
If BSL meets the Ord Minnett target it will return approximately 12% (excluding dividends, fees and charges).
Current consensus price target is $13.96, suggesting downside of -1.5% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Ord Minnett forecasts a full year FY17 dividend of 10.00 cents and EPS of 119.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 123.5, implying annual growth of 99.0%. Current consensus DPS estimate is 9.7, implying a prospective dividend yield of 0.7%. Current consensus EPS estimate suggests the PER is 11.5. |
Forecast for FY18:
Ord Minnett forecasts a full year FY18 dividend of 12.00 cents and EPS of 117.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 120.6, implying annual growth of -2.3%. Current consensus DPS estimate is 15.3, implying a prospective dividend yield of 1.1%. Current consensus EPS estimate suggests the PER is 11.7. |
Market Sentiment: 0.8
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Morgan Stanley rates CBA as Underweight (5) -
AUSTRAC's action raises further concerns about conduct, Morgan Stanley believes, with the potential implications including material penalties, brand damage, higher costs and management changes.
Civil penalty proceedings have been initiated against the bank for serious and systemic non-compliance with the anti-money laundering act.
The action reinforces the broker's view that increased political and regulatory issues weigh on the banks' outlook in 2018-19 and CBA is vulnerable to a de-rating as its growth prospects decline and return on equity gap to peers narrows.
Underweight. Target is $72. Industry view is In-Line.
Target price is $72.00 Current Price is $80.72 Difference: minus $8.72 (current price is over target).
If CBA meets the Morgan Stanley target it will return approximately minus 11% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $80.93, suggesting downside of -0.8% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Morgan Stanley forecasts a full year FY17 dividend of 428.00 cents and EPS of 556.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 556.9, implying annual growth of 0.3%. Current consensus DPS estimate is 424.0, implying a prospective dividend yield of 5.2%. Current consensus EPS estimate suggests the PER is 14.7. |
Forecast for FY18:
Morgan Stanley forecasts a full year FY18 dividend of 430.00 cents and EPS of 558.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 570.7, implying annual growth of 2.5%. Current consensus DPS estimate is 430.3, implying a prospective dividend yield of 5.3%. Current consensus EPS estimate suggests the PER is 14.3. |
Market Sentiment: -0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Ord Minnett rates CBA as Hold (3) -
Ord Minnett expects few surprises at the FY17 result on August 9 but believes the bank is likely to address the charges by AUSTRAC over the money laundering allegations.
Ord Minnett expects parts of the lending book to remain under pressure, particularly in Western Australia and Queensland. Hold rating and $76.50 target retained.
Target price is $76.50 Current Price is $80.72 Difference: minus $4.22 (current price is over target).
If CBA meets the Ord Minnett target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $80.93, suggesting downside of -0.8% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Ord Minnett forecasts a full year FY17 dividend of 420.00 cents and EPS of 552.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 556.9, implying annual growth of 0.3%. Current consensus DPS estimate is 424.0, implying a prospective dividend yield of 5.2%. Current consensus EPS estimate suggests the PER is 14.7. |
Forecast for FY18:
Ord Minnett forecasts a full year FY18 EPS of 559.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 570.7, implying annual growth of 2.5%. Current consensus DPS estimate is 430.3, implying a prospective dividend yield of 5.3%. Current consensus EPS estimate suggests the PER is 14.3. |
Market Sentiment: -0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
UBS rates CBA as Neutral (3) -
AUSTRAC has initiated court proceedings against the bank, alleging it failed to act on suspected money laundering activities. The bank could face substantial fines if found to have breached disclosure requirements.
The allegations highlight several critical questions for UBS, such as whether this will damage the bank's reputation and whether it adds fuel to the fire for a Royal Commission into the banks.
Neutral rating and $83 target retained.
Target price is $83.00 Current Price is $80.72 Difference: $2.28
If CBA meets the UBS target it will return approximately 3% (excluding dividends, fees and charges).
Current consensus price target is $80.93, suggesting downside of -0.8% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
UBS forecasts a full year FY17 dividend of 424.00 cents and EPS of 552.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 556.9, implying annual growth of 0.3%. Current consensus DPS estimate is 424.0, implying a prospective dividend yield of 5.2%. Current consensus EPS estimate suggests the PER is 14.7. |
Forecast for FY18:
UBS forecasts a full year FY18 dividend of 430.00 cents and EPS of 558.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 570.7, implying annual growth of 2.5%. Current consensus DPS estimate is 430.3, implying a prospective dividend yield of 5.3%. Current consensus EPS estimate suggests the PER is 14.3. |
Market Sentiment: -0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Citi rates CWN as Buy (1) -
FY17 operating earnings were ahead of Citi's estimates but largely because of an adjustment on an investment. Otherwise, the broker was disappointed.
Citi trims FY18-20 EBITDA estimates by -2-2.5%, largely because of reductions to growth assumptions on the main floor of Melbourne and Perth. Buy rating retained. Target is reduced to $13.75 from $14.80.
Target price is $13.75 Current Price is $12.40 Difference: $1.35
If CWN meets the Citi target it will return approximately 11% (excluding dividends, fees and charges).
Current consensus price target is $12.75, suggesting upside of 6.9% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Citi forecasts a full year FY18 dividend of 60.00 cents and EPS of 51.90 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 51.9, implying annual growth of N/A. Current consensus DPS estimate is 58.6, implying a prospective dividend yield of 4.9%. Current consensus EPS estimate suggests the PER is 23.0. |
Forecast for FY19:
Citi forecasts a full year FY19 dividend of 60.00 cents and EPS of 60.30 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 57.5, implying annual growth of 10.8%. Current consensus DPS estimate is 64.0, implying a prospective dividend yield of 5.4%. Current consensus EPS estimate suggests the PER is 20.7. |
Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Credit Suisse rates CWN as Neutral (3) -
Despite a weak FY17 result Credit Suisse believes the company is currently under geared and there are implications for return of capital.
Credit Suisse downgrades net profit forecasts by -18% because the company has indicated its future tax rate will approach the Australian statutory rate of 30%.
The broker downgrades EBITDA by -8% across the forecast period, the primary driver for a reduction in its target price to $12.00 from $12.50. Neutral retained.
Target price is $12.00 Current Price is $12.40 Difference: minus $0.4 (current price is over target).
If CWN meets the Credit Suisse target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $12.75, suggesting upside of 6.9% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Credit Suisse forecasts a full year FY18 dividend of 48.00 cents and EPS of 46.50 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 51.9, implying annual growth of N/A. Current consensus DPS estimate is 58.6, implying a prospective dividend yield of 4.9%. Current consensus EPS estimate suggests the PER is 23.0. |
Forecast for FY19:
Credit Suisse forecasts a full year FY19 dividend of 81.10 cents and EPS of 53.56 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 57.5, implying annual growth of 10.8%. Current consensus DPS estimate is 64.0, implying a prospective dividend yield of 5.4%. Current consensus EPS estimate suggests the PER is 20.7. |
Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Deutsche Bank rates CWN as Buy (1) -
FY17 results disappointed Deutsche Bank as it was boosted by a $15m investment game. Australian casino operating earnings declined by -11% on a -13% decline in revenue.
The company also does not anticipate any significant cost savings in addition to those achieved in the second half. Deutsche Bank retains a Hold rating and reduces the target to $11.75 from $13.25.
Target price is $11.75 Current Price is $12.40 Difference: minus $0.65 (current price is over target).
If CWN meets the Deutsche Bank target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $12.75, suggesting upside of 6.9% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Deutsche Bank forecasts a full year FY18 dividend of 60.00 cents and EPS of 47.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 51.9, implying annual growth of N/A. Current consensus DPS estimate is 58.6, implying a prospective dividend yield of 4.9%. Current consensus EPS estimate suggests the PER is 23.0. |
Forecast for FY19:
Deutsche Bank forecasts a full year FY19 dividend of 60.00 cents and EPS of 55.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 57.5, implying annual growth of 10.8%. Current consensus DPS estimate is 64.0, implying a prospective dividend yield of 5.4%. Current consensus EPS estimate suggests the PER is 20.7. |
Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Morgan Stanley rates CWN as Equal-weight (3) -
Mass gaming revenue weakened in the second half and VIP revenues were worse than Morgan Stanley feared. Moreover, the broker envisages the risk of higher capital expenditure for Sydney. A buy-back and the balance sheet should provide some support.
Given labour costs can only be reduced by so much to be sustainable and corporate costs are expected to increase in FY18 there is little more the company can do on the cost front, in the broker's opinion.
Equal-weight rating retained. Target is $12.50. Industry view is Cautious.
Target price is $12.50 Current Price is $12.40 Difference: $0.1
If CWN meets the Morgan Stanley target it will return approximately 1% (excluding dividends, fees and charges).
Current consensus price target is $12.75, suggesting upside of 6.9% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Morgan Stanley forecasts a full year FY18 dividend of 60.00 cents and EPS of 51.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 51.9, implying annual growth of N/A. Current consensus DPS estimate is 58.6, implying a prospective dividend yield of 4.9%. Current consensus EPS estimate suggests the PER is 23.0. |
Forecast for FY19:
Morgan Stanley forecasts a full year FY19 dividend of 60.00 cents and EPS of 57.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 57.5, implying annual growth of 10.8%. Current consensus DPS estimate is 64.0, implying a prospective dividend yield of 5.4%. Current consensus EPS estimate suggests the PER is 20.7. |
Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Ord Minnett rates CWN as Buy (1) -
FY17 results were below Ord Minnett's forecasts as a result of VIP weakness. Uncertainty around the corporate strategy has persisted but the broker believes cost savings, share buy-backs and debt capacity will allow it to undertake significant changes.
The broker is increasingly confident that management will focus on shareholder returns and domestic growth, to underpin value. Buy rating retained. Target is reduced to $13.70 from $14.00.
Target price is $13.70 Current Price is $12.40 Difference: $1.3
If CWN meets the Ord Minnett target it will return approximately 10% (excluding dividends, fees and charges).
Current consensus price target is $12.75, suggesting upside of 6.9% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Ord Minnett forecasts a full year FY18 dividend of 62.00 cents and EPS of 57.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 51.9, implying annual growth of N/A. Current consensus DPS estimate is 58.6, implying a prospective dividend yield of 4.9%. Current consensus EPS estimate suggests the PER is 23.0. |
Forecast for FY19:
Ord Minnett forecasts a full year FY19 dividend of 63.00 cents and EPS of 61.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 57.5, implying annual growth of 10.8%. Current consensus DPS estimate is 64.0, implying a prospective dividend yield of 5.4%. Current consensus EPS estimate suggests the PER is 20.7. |
Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
UBS rates CWN as Neutral (3) -
FY17 net profit of $343m was down -16% on the prior year, and below UBS forecasts. Earnings were negatively affected by -49% fall in VIP volumes and a -1% decline in main floor revenue.
The broker observes the announcement of another $375m buy-back to supplement capital management shows a continued desire to return funds to shareholders, which has probably supported the shares for the past six months.
UBS retains a Neutral rating and reduces the target to $12.28 from $13.19.
Target price is $12.28 Current Price is $12.40 Difference: minus $0.12 (current price is over target).
If CWN meets the UBS target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $12.75, suggesting upside of 6.9% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
UBS forecasts a full year FY18 dividend of 60.00 cents and EPS of 52.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 51.9, implying annual growth of N/A. Current consensus DPS estimate is 58.6, implying a prospective dividend yield of 4.9%. Current consensus EPS estimate suggests the PER is 23.0. |
Forecast for FY19:
UBS forecasts a full year FY19 dividend of 60.00 cents and EPS of 58.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 57.5, implying annual growth of 10.8%. Current consensus DPS estimate is 64.0, implying a prospective dividend yield of 5.4%. Current consensus EPS estimate suggests the PER is 20.7. |
Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Credit Suisse rates KMD as Neutral (3) -
FY17 guidance shows positive momentum, Credit Suisse observes. The company has reported total sales of NZ$445.3m, up 4.6% on the prior year.
While a further positive for the stock, the broker believes this is an early step in what may prove to be a long transition to network maturity. Moreover, until the company starts to execute on its capital-light growth options in wholesale and greater online sales, it is hard to incorporate these into forecasts.
Target price is raised to NZ$2.15 from NZ$2.03. Neutral rating retained.
Current Price is $2.06. Target price not assessed.
Current consensus price target is $2.27, suggesting upside of 9.1% (ex-dividends)
The company's fiscal year ends in July.
Forecast for FY17:
Credit Suisse forecasts a full year FY17 dividend of 12.28 cents and EPS of 17.56 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 17.4, implying annual growth of N/A. Current consensus DPS estimate is 11.0, implying a prospective dividend yield of 5.3%. Current consensus EPS estimate suggests the PER is 12.0. |
Forecast for FY18:
Credit Suisse forecasts a full year FY18 dividend of 12.28 cents and EPS of 18.60 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 18.7, implying annual growth of 7.5%. Current consensus DPS estimate is 12.1, implying a prospective dividend yield of 5.8%. Current consensus EPS estimate suggests the PER is 11.1. |
This company reports in NZD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.7
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Morgan Stanley rates LLC as Overweight (1) -
The company has released several pages from its draft financial report ahead of the reporting date to ensure uniform disclosure following a data breach.
Morgan Stanley observes EBITDA is slightly ahead of its estimates. The broker suspects that additional details from the results will highlight FY18 is a transition year which, in the absence of trading profits above the levels witnessed over the past three years, will result in lower near-term growth.
Overweight rating and $16.45 target retained. Industry view is Attractive.
Target price is $16.45 Current Price is $16.66 Difference: minus $0.21 (current price is over target).
If LLC meets the Morgan Stanley target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $16.94, suggesting upside of 1.0% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Morgan Stanley forecasts a full year FY17 dividend of 66.00 cents and EPS of 132.10 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 129.1, implying annual growth of 2.2%. Current consensus DPS estimate is 64.4, implying a prospective dividend yield of 3.8%. Current consensus EPS estimate suggests the PER is 13.0. |
Forecast for FY18:
Morgan Stanley forecasts a full year FY18 dividend of 70.50 cents and EPS of 141.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 138.6, implying annual growth of 7.4%. Current consensus DPS estimate is 69.8, implying a prospective dividend yield of 4.2%. Current consensus EPS estimate suggests the PER is 12.1. |
Market Sentiment: 0.7
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Morgan Stanley rates MFG as Equal-weight (3) -
Morgan Stanley's interest in the FY17 results centre on the company's ability to sustain flows and growth in order to justify a price/earnings premium to peers.
The broker's estimates are around 4% ahead of consensus for FY17.
Equal-weight retained. Target is raised to $26.50 from $25.00. Industry view: In-Line.
Target price is $26.50 Current Price is $26.87 Difference: minus $0.37 (current price is over target).
If MFG meets the Morgan Stanley target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $27.33, suggesting upside of 0.3% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Morgan Stanley forecasts a full year FY17 dividend of 86.90 cents and EPS of 118.40 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 116.0, implying annual growth of -6.1%. Current consensus DPS estimate is 86.8, implying a prospective dividend yield of 3.2%. Current consensus EPS estimate suggests the PER is 23.5. |
Forecast for FY18:
Morgan Stanley forecasts a full year FY18 dividend of 100.50 cents and EPS of 133.30 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 134.7, implying annual growth of 16.1%. Current consensus DPS estimate is 100.2, implying a prospective dividend yield of 3.7%. Current consensus EPS estimate suggests the PER is 20.2. |
Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Citi rates ORL as Upgrade to Buy from Neutral (1) -
The company is taking steps to address its losses by closing the Gap brand. Citi believes this is an important step and will allow the business to focus on the more profitable Oroton brand.
There are six stores trading and Citi estimates the brand contributed 20% to total sales for the group.
Citi upgrades to Buy, High Risk from Neutral, High Risk. Target is raised to $1.20 from $1.14.
Target price is $1.20 Current Price is $1.01 Difference: $0.19
If ORL meets the Citi target it will return approximately 19% (excluding dividends, fees and charges).
Current consensus price target is $1.20, suggesting upside of 17.6% (ex-dividends)
The company's fiscal year ends in July.
Forecast for FY17:
Citi forecasts a full year FY17 dividend of 0.00 cents and EPS of minus 2.60 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 6.3, implying annual growth of -38.8%. Current consensus DPS estimate is 5.0, implying a prospective dividend yield of 4.9%. Current consensus EPS estimate suggests the PER is 16.2. |
Forecast for FY18:
Citi forecasts a full year FY18 dividend of 0.00 cents and EPS of 0.90 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 0.9, implying annual growth of -85.7%. Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A. Current consensus EPS estimate suggests the PER is 113.3. |
Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Credit Suisse rates OZL as Underperform (5) -
Ahead of the first half results on August 16, Credit Suisse forecasts underlying net profit of $87m, albeit acknowledging the complex accounting in the company's reports does not reconcile cleanly with quarterly reporting. This suggests a moderate degree of risk to forecasts.
Underperform rating maintained and target is raised to $7.30 from $7.15.
Target price is $7.30 Current Price is $8.53 Difference: minus $1.23 (current price is over target).
If OZL meets the Credit Suisse target it will return approximately minus 14% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $8.46, suggesting downside of -2.6% (ex-dividends)
The company's fiscal year ends in December.
Forecast for FY17:
Credit Suisse forecasts a full year FY17 dividend of 12.00 cents and EPS of 54.96 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 53.1, implying annual growth of 48.7%. Current consensus DPS estimate is 13.3, implying a prospective dividend yield of 1.5%. Current consensus EPS estimate suggests the PER is 16.4. |
Forecast for FY18:
Credit Suisse forecasts a full year FY18 dividend of 12.00 cents and EPS of 20.68 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 32.4, implying annual growth of -39.0%. Current consensus DPS estimate is 12.9, implying a prospective dividend yield of 1.5%. Current consensus EPS estimate suggests the PER is 26.8. |
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Credit Suisse rates SGM as Underperform (5) -
Credit Suisse was disappointed with the confirmation of consensus earnings expectations as this forecast achieves nothing from a materially stronger second half market, presumably because market gains have been consumed by cost reductions that have not been sustained.
The company has also announced the departure of its MD and CFO. Alistair Field has been appointed MD to replace Galdino Claro.
Underperform and $11 target retained.
Target price is $11.00 Current Price is $13.41 Difference: minus $2.41 (current price is over target).
If SGM meets the Credit Suisse target it will return approximately minus 18% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $13.12, suggesting downside of -5.1% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Credit Suisse forecasts a full year FY17 dividend of 38.43 cents and EPS of 67.57 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 70.9, implying annual growth of 32.1%. Current consensus DPS estimate is 39.7, implying a prospective dividend yield of 2.9%. Current consensus EPS estimate suggests the PER is 19.5. |
Forecast for FY18:
Credit Suisse forecasts a full year FY18 dividend of 38.72 cents and EPS of 77.45 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 83.0, implying annual growth of 17.1%. Current consensus DPS estimate is 42.1, implying a prospective dividend yield of 3.0%. Current consensus EPS estimate suggests the PER is 16.7. |
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Deutsche Bank rates SGM as Hold (3) -
FY17 guidance is for underlying EBIT of $180-185m. Accordingly, Deutsche Bank increases estimates by 3% and attributes the improvement to a marginally better North American operation.
The company has also announced the departure of its MD and CFO. Alistair Field will become the new managing director. Amit Patel has been appointed acting CFO.
Hold rating retained. Target is reduced to $12.60 from $12.86.
Target price is $12.60 Current Price is $13.41 Difference: minus $0.81 (current price is over target).
If SGM meets the Deutsche Bank target it will return approximately minus 6% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $13.12, suggesting downside of -5.1% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Deutsche Bank forecasts a full year FY17 dividend of 37.00 cents and EPS of 61.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 70.9, implying annual growth of 32.1%. Current consensus DPS estimate is 39.7, implying a prospective dividend yield of 2.9%. Current consensus EPS estimate suggests the PER is 19.5. |
Forecast for FY18:
Deutsche Bank forecasts a full year FY18 dividend of 32.00 cents and EPS of 70.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 83.0, implying annual growth of 17.1%. Current consensus DPS estimate is 42.1, implying a prospective dividend yield of 3.0%. Current consensus EPS estimate suggests the PER is 16.7. |
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Ord Minnett rates SGM as Downgrade to Hold from Accumulate (3) -
Ord Minnett has undertaken a pre-report review and marked to market commodity prices. The broker updates scrap forecasts in line with long-term iron ore forecasts of US$50/t.
The broker will also be seeking clarity at the results about the reasons for the surprise departures of the CEO and CFO.
Rating is downgraded to Hold from Accumulate as the stock looks fully valued. Target is reduced to $13.60 from $15.20.
Target price is $13.60 Current Price is $13.41 Difference: $0.19
If SGM meets the Ord Minnett target it will return approximately 1% (excluding dividends, fees and charges).
Current consensus price target is $13.12, suggesting downside of -5.1% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Ord Minnett forecasts a full year FY17 dividend of 40.00 cents and EPS of 81.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 70.9, implying annual growth of 32.1%. Current consensus DPS estimate is 39.7, implying a prospective dividend yield of 2.9%. Current consensus EPS estimate suggests the PER is 19.5. |
Forecast for FY18:
Ord Minnett forecasts a full year FY18 dividend of 40.00 cents and EPS of 98.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 83.0, implying annual growth of 17.1%. Current consensus DPS estimate is 42.1, implying a prospective dividend yield of 3.0%. Current consensus EPS estimate suggests the PER is 16.7. |
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
UBS rates SGM as Buy (1) -
The company has guided to underlying FY17 EBIT of $180-185m. A new CEO, Alistair Field, has also been appointed to replace Galdino Claro. CFO Fred Knechtel has also departed.
Uncertainty surrounding the exit of top management remains a concern given the lack of detail and UBS expects this to weigh on the stock until the company reaffirms progress in getting to its 10% return on capital target. Buy rating and $14.10 target retained.
Target price is $14.10 Current Price is $13.41 Difference: $0.69
If SGM meets the UBS target it will return approximately 5% (excluding dividends, fees and charges).
Current consensus price target is $13.12, suggesting downside of -5.1% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
UBS forecasts a full year FY17 dividend of 34.00 cents and EPS of 68.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 70.9, implying annual growth of 32.1%. Current consensus DPS estimate is 39.7, implying a prospective dividend yield of 2.9%. Current consensus EPS estimate suggests the PER is 19.5. |
Forecast for FY18:
UBS forecasts a full year FY18 dividend of 40.00 cents and EPS of 80.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 83.0, implying annual growth of 17.1%. Current consensus DPS estimate is 42.1, implying a prospective dividend yield of 3.0%. Current consensus EPS estimate suggests the PER is 16.7. |
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Ord Minnett rates SUL as Lighten (4) -
Following a review of the company's strategy update for the sports division, Ord Minnett increases earnings estimates. Synergies are expected to add more to EBIT than the existing Amart improvement plans.
Lighten rating and $8 target retained.
Target price is $8.00 Current Price is $8.25 Difference: minus $0.25 (current price is over target).
If SUL meets the Ord Minnett target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $10.13, suggesting upside of 21.2% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Ord Minnett forecasts a full year FY17 dividend of 44.00 cents and EPS of 49.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 63.7, implying annual growth of 100.3%. Current consensus DPS estimate is 43.7, implying a prospective dividend yield of 5.2%. Current consensus EPS estimate suggests the PER is 13.1. |
Forecast for FY18:
Ord Minnett forecasts a full year FY18 dividend of 48.00 cents and EPS of 73.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 73.7, implying annual growth of 15.7%. Current consensus DPS estimate is 50.2, implying a prospective dividend yield of 6.0%. Current consensus EPS estimate suggests the PER is 11.3. |
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Citi rates TAH as Sell (5) -
FY17 results were in line with recently provided guidance. Wagering and media missed Citi's expectations because of lower-than-expected margins but this was offset by a beat from gaming services.
The broker trims FY18-19 EBITDA estimates by -2%. Sell rating retained. Target is reduced to $3.95 from $4.00.
Target price is $3.95 Current Price is $4.35 Difference: minus $0.4 (current price is over target).
If TAH meets the Citi target it will return approximately minus 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $4.51, suggesting upside of 4.7% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Citi forecasts a full year FY18 dividend of 23.50 cents and EPS of 20.50 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 22.4, implying annual growth of N/A. Current consensus DPS estimate is 25.5, implying a prospective dividend yield of 5.9%. Current consensus EPS estimate suggests the PER is 19.2. |
Forecast for FY19:
Citi forecasts a full year FY19 dividend of 26.00 cents and EPS of 21.90 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 24.1, implying annual growth of 7.6%. Current consensus DPS estimate is 27.0, implying a prospective dividend yield of 6.3%. Current consensus EPS estimate suggests the PER is 17.9. |
Market Sentiment: -0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Credit Suisse rates TAH as Neutral (3) -
FY17 results were in line with guidance. Wagering EBITDA fell -17% in the second half because of lower revenue, higher costs and poor event outcomes... as well as other excuses, Credit Suisse asserts. The broker suggests the company is not stimulating existing customers.
FY18 forecasts for earnings per share are downgraded because it appears likely the merger with Tatts ((TTS)) will be delayed. The broker acknowledges the stock now appears better value but does not believe the first half will be very exciting. Neutral retained. Target is $4.80.
Target price is $4.80 Current Price is $4.35 Difference: $0.45
If TAH meets the Credit Suisse target it will return approximately 10% (excluding dividends, fees and charges).
Current consensus price target is $4.51, suggesting upside of 4.7% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Credit Suisse forecasts a full year FY18 dividend of 25.00 cents and EPS of 20.44 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 22.4, implying annual growth of N/A. Current consensus DPS estimate is 25.5, implying a prospective dividend yield of 5.9%. Current consensus EPS estimate suggests the PER is 19.2. |
Forecast for FY19:
Credit Suisse forecasts a full year FY19 dividend of 25.00 cents and EPS of 23.50 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 24.1, implying annual growth of 7.6%. Current consensus DPS estimate is 27.0, implying a prospective dividend yield of 6.3%. Current consensus EPS estimate suggests the PER is 17.9. |
Market Sentiment: -0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Deutsche Bank rates TAH as Buy (1) -
Deutsche Bank considers the FY17 result reasonable, relative to recently lowered market expectations. There were encouraging trends in the core wagering business with digital turnover up 14% and fixed odds revenue growth of 15%.
Deutsche Bank reduces earnings forecast by -3% to reflect the net impact of lower wagering & media earnings and higher net interest expense, partly offset by higher gaming services earnings.
Buy rating retained. Target is reduced to $5.20 from $5.35.
Target price is $5.20 Current Price is $4.35 Difference: $0.85
If TAH meets the Deutsche Bank target it will return approximately 20% (excluding dividends, fees and charges).
Current consensus price target is $4.51, suggesting upside of 4.7% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Deutsche Bank forecasts a full year FY18 dividend of 26.00 cents and EPS of 22.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 22.4, implying annual growth of N/A. Current consensus DPS estimate is 25.5, implying a prospective dividend yield of 5.9%. Current consensus EPS estimate suggests the PER is 19.2. |
Forecast for FY19:
Deutsche Bank forecasts a full year FY19 dividend of 30.00 cents and EPS of 26.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 24.1, implying annual growth of 7.6%. Current consensus DPS estimate is 27.0, implying a prospective dividend yield of 6.3%. Current consensus EPS estimate suggests the PER is 17.9. |
Market Sentiment: -0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Ord Minnett rates TAH as Lighten (4) -
FY17 net profit was down -3.8% on the prior year. Ord Minnett reduces FY18 normalised estimates by -7.5%.
The broker notes the company is exposed to declining wagering yields from competitive pressures and weak growth, with margin declines evident in FY17.
The broker envisages significant execution risk related to Sun Bets as well as with the integration of the UBET brand. Lighten rating retained. Target is reduced to $4.10 from $4.20.
Target price is $4.10 Current Price is $4.35 Difference: minus $0.25 (current price is over target).
If TAH meets the Ord Minnett target it will return approximately minus 6% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $4.51, suggesting upside of 4.7% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Ord Minnett forecasts a full year FY18 dividend of 25.00 cents and EPS of 22.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 22.4, implying annual growth of N/A. Current consensus DPS estimate is 25.5, implying a prospective dividend yield of 5.9%. Current consensus EPS estimate suggests the PER is 19.2. |
Forecast for FY19:
Ord Minnett forecasts a full year FY19 dividend of 27.00 cents and EPS of 25.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 24.1, implying annual growth of 7.6%. Current consensus DPS estimate is 27.0, implying a prospective dividend yield of 6.3%. Current consensus EPS estimate suggests the PER is 17.9. |
Market Sentiment: -0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Credit Suisse rates VAH as Neutral (3) -
The company reports FY17 results on August 10. Credit Suisse forecasts an underlying pre-tax loss of -$23.6m. Velocity has underperformed expectations with new FY17 guidance of EBIT growth of 2-3% versus 15% previously.
Credit Suisse observes Velocity may not have recovered the cost of IT investment in labour during the launch of its partnership with FlyBuys in the first half and revenue per member has declined.
The broker lowers the target to 18c from 20.5c and retains a Neutral rating.
Target price is $0.18 Current Price is $0.17 Difference: $0.01
If VAH meets the Credit Suisse target it will return approximately 6% (excluding dividends, fees and charges).
Current consensus price target is $0.18, suggesting upside of 1.9% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Credit Suisse forecasts a full year FY17 dividend of 0.00 cents and EPS of minus 1.54 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 0.4, implying annual growth of N/A. Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A. Current consensus EPS estimate suggests the PER is 43.7. |
Forecast for FY18:
Credit Suisse forecasts a full year FY18 dividend of 0.00 cents and EPS of minus 0.77 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 0.7, implying annual growth of 75.0%. Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A. Current consensus EPS estimate suggests the PER is 25.0. |
Market Sentiment: -0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Morgan Stanley rates WEB as Downgrade to Underweight from Equal-weight (5) -
The company will pay $330m to acquire JacTravel. A strong outlook and 20% accretion are not enough to entice Morgan Stanley into what it describes as an increasingly complex and opaque story.
JacTravel is a large acquisition to absorb and comes within a week of the auditor disagreeing with the accounting for a previous acquisition.
Morgan Stanley downgrades to Underweight from Equal-weight. Industry view: In line. Target is raised to $11.35 from $10.50.
Target price is $11.35 Current Price is $12.08 Difference: minus $0.73 (current price is over target).
If WEB meets the Morgan Stanley target it will return approximately minus 6% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $12.82, suggesting upside of 7.8% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Morgan Stanley forecasts a full year FY17 dividend of 20.00 cents and EPS of 41.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 43.4, implying annual growth of 58.6%. Current consensus DPS estimate is 18.9, implying a prospective dividend yield of 1.6%. Current consensus EPS estimate suggests the PER is 27.4. |
Forecast for FY18:
Morgan Stanley forecasts a full year FY18 dividend of 24.20 cents and EPS of 60.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 54.9, implying annual growth of 26.5%. Current consensus DPS estimate is 24.2, implying a prospective dividend yield of 2.0%. Current consensus EPS estimate suggests the PER is 21.7. |
Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Summaries
| AOF - | AUSTRALIAN UNITY OFFICE FUND | Neutral - Credit Suisse | Overnight Price $2.20 |
| BSL - | BLUESCOPE STEEL | Upgrade to Accumulate from Hold - Ord Minnett | Overnight Price $13.35 |
| CBA - | COMMBANK | Underweight - Morgan Stanley | Overnight Price $80.72 |
| Hold - Ord Minnett | Overnight Price $80.72 | ||
| Neutral - UBS | Overnight Price $80.72 | ||
| CWN - | CROWN RESORTS | Buy - Citi | Overnight Price $12.40 |
| Neutral - Credit Suisse | Overnight Price $12.40 | ||
| Buy - Deutsche Bank | Overnight Price $12.40 | ||
| Equal-weight - Morgan Stanley | Overnight Price $12.40 | ||
| Buy - Ord Minnett | Overnight Price $12.40 | ||
| Neutral - UBS | Overnight Price $12.40 | ||
| KMD - | KATHMANDU | Neutral - Credit Suisse | Overnight Price $2.06 |
| LLC - | LEND LEASE CORP | Overweight - Morgan Stanley | Overnight Price $16.66 |
| MFG - | MAGELLAN FINANCIAL GROUP | Equal-weight - Morgan Stanley | Overnight Price $26.87 |
| ORL - | OROTONGROUP | Upgrade to Buy from Neutral - Citi | Overnight Price $1.01 |
| OZL - | OZ MINERALS | Underperform - Credit Suisse | Overnight Price $8.53 |
| SGM - | SIMS METAL MANAGEMENT | Underperform - Credit Suisse | Overnight Price $13.41 |
| Hold - Deutsche Bank | Overnight Price $13.41 | ||
| Downgrade to Hold from Accumulate - Ord Minnett | Overnight Price $13.41 | ||
| Buy - UBS | Overnight Price $13.41 | ||
| SUL - | SUPER RETAIL | Lighten - Ord Minnett | Overnight Price $8.25 |
| TAH - | TABCORP HOLDINGS | Sell - Citi | Overnight Price $4.35 |
| Neutral - Credit Suisse | Overnight Price $4.35 | ||
| Buy - Deutsche Bank | Overnight Price $4.35 | ||
| Lighten - Ord Minnett | Overnight Price $4.35 | ||
| VAH - | VIRGIN AUSTRALIA | Neutral - Credit Suisse | Overnight Price $0.17 |
| WEB - | WEBJET | Downgrade to Underweight from Equal-weight - Morgan Stanley | Overnight Price $12.08 |
RATING SUMMARY
| Rating | No. Of Recommendations |
| 1. Buy | 7 |
| 2. Accumulate | 1 |
| 3. Hold | 12 |
| 4. Reduce | 2 |
| 5. Sell | 5 |
Monday 07 August 2017
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The content of this information does in no way reflect the opinions of
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the stock market, its value, future direction or individual shares. FNArena solely reports about what the main experts in the market note, believe
and comment on. By doing so we believe we provide intelligent investors
with a valuable tool that helps them in making up their own minds, reading
market trends and getting a feel for what is happening beneath the surface.
This document is provided for informational purposes only. It does not
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base their work on information believed to be reliable and accurate, though
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