Australian Broker Call *Extra* Edition – Dec 02, 2019

Daily Market Reports | Dec 02 2019

An additional news report on the recommendation, valuation, forecast and opinion changes for ASX-listed equities.

In addition to The Australian Broker Call Report, which is published and updated daily (Mon-Fri), FNArena has now added The Australian Broker Call *Extra* Edition, featuring additional sources of research and insights on ASX-listed stocks, also enlarging the number of stocks that make up the FNArena universe.

One key difference is the *Extra* Edition will not be updated daily, but merely "regularly" depending on availability of suitable quality content. As such, the *Extra* Edition tries to build a bridge between daily updates via the Australian Broker Call Report and ad hoc news stories, that are not always timely for investors hungry for the next information update.

Investors using the *Extra* Edition as a source of input for their own share market research should thus take into account that information after publication may not be up to date, or yet awaiting another update by FNArena's team of journalists.

Similar to The Australian Broker Call Report, this *Extra* Edition includes concise but limited reviews of research recently published by Stockbrokers and other experts, 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 of this Report.

The Australian Broker Call *Extra* Edition is a summary that has been prepared independently of the sources identified. Readers will check the full text of the recommendations and consult a Licenced Advisor before making any investment decision.

The copyright of this Report is owned by the publisher. Readers will not copy, forward or disseminate this Report to any other person. For more vital information about the sources included, see the bottom of this Report.

COMPANIES DISCUSSED IN THIS ISSUE

Click on a symbol for fast access.
The number next to the symbol represents the number of brokers covering it for this report -(if more than 1)

ADA   APT   BVS (2)   BWX   GUD   IPH   LVT   MLX   NBL   PAL   PWG   RIC   RMC  

ADA    ADACEL TECHNOLOGIES LTD

Software & Services - Overnight Price: $0.60

Bell Potter rates ((ADA)) as Buy (1) -

Adacel Technologies has upgraded pre-tax profit guidance and Bell Potter says forecast revenue, either contracted or with a high probability of being contracted, rose to 85% from 77% at the beginning of FY20.

The broker expects the company will be cash-flow positive in FY20 and will recommence dividend payments this year.

Bell Potter makes no changes to forecasts but changes to valuation methods result in a 15% increase in the target price to 75c a share. Buy rating retained.

This report was published on November 26, 2019.

Target price is $0.75 Current Price is $0.60 Difference: $0.15
If ADA meets the Bell Potter target it will return approximately 25% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY20:

Bell Potter forecasts a full year FY20 dividend of 1.50 cents and EPS of 4.80 cents.
At the last closing share price the estimated dividend yield is 2.50%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.50.

Forecast for FY21:

Bell Potter forecasts a full year FY21 dividend of 2.50 cents and EPS of 5.90 cents.
At the last closing share price the estimated dividend yield is 4.17%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.17.

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

APT    AFTERPAY TOUCH GROUP LIMITED

Business & Consumer Credit - Overnight Price: $31.39

Bell Potter rates ((APT)) as Buy (1) -

Bell Potter considers the independent auditors final report for AUSTRAC on Afterpay to be as good as it gets, noting the company should now be classified as 'Low Risk' under AUSTRAC's money laundering framework.

Given respectable reviews from ASIC, the Australian Senate Enquiry, and New Zealand Parliamentary Enquiry, the broker believes Afterpay's regulatory challenges are behind it.

The broker makes no changes to EPS forecasts but again discards its -7.5% AUSTRAC risk discount on valuation. Target price rises to $49.35 from $45.50. Buy rating retained.

The report was published on November 25, 2019.

Target price is $49.35 Current Price is $31.39 Difference: $17.96
If APT meets the Bell Potter target it will return approximately 57% (excluding dividends, fees and charges).
Current consensus price target is $33.00, suggesting upside of 5.1%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY20:

Bell Potter forecasts a full year FY20 dividend of 0.00 cents and EPS of 14.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 224.21.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 6.7, 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 468.5.

Forecast for FY21:

Bell Potter forecasts a full year FY21 dividend of 0.00 cents and EPS of 30.10 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 104.29.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 22.9, implying annual growth of 241.8%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 137.1.

Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

BVS    BRAVURA SOLUTIONS LIMITED

Wealth Management & Investments - Overnight Price: $4.99

Goldman Sachs rates ((BVS)) as Upgrade to Buy from Neutral (1) -

Goldman Sachs upgrades Bravura Solutions to a Buy from Neutral after the company signed a series of contracts and raised guidance at its annual general meeting.

Cigna has moved to Bravura Solutions' Sonata product, switching from Talisman, and Bravura also signed a contract with a leading Australian fund administration outsourcer.

The news, combined with assurances of a healthy pipeline, prospects of increased margins, a strong balance sheet, room for acquisitions, low churn favourable regulatory announcements, and opportunity in the UK pension market, triggered upgrades in earnings per share: 6.6% in FY20, 8.4% in FY21 and 8.2% in FY22.

The target priced edges up 0.2% to $5.06.

This report was published on November 27, 2019.

Target price is $5.06 Current Price is $4.99 Difference: $0.07
If BVS meets the Goldman Sachs target it will return approximately 1% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY20:

Goldman Sachs forecasts a full year FY20 dividend of 2.60 cents and EPS of 17.00 cents.
At the last closing share price the estimated dividend yield is 0.52%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 29.35.

Forecast for FY21:

Goldman Sachs forecasts a full year FY21 dividend of 3.00 cents and EPS of 19.00 cents.
At the last closing share price the estimated dividend yield is 0.60%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 26.26.

Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources


Wilsons rates ((BVS)) as Buy (1) -

Wilsons retains its Overweight rating for Bravura Solutions and raises the target price to $5.97 from $5.44 after the company reported positively at the annual general meeting.

The company repeatedly spoke of a confident outlook and strong pipeline, and increased guidance, causing the broker to upgrade net profit after tax forecasts by 4%.

The broker notes the company has plenty of room to grow with opportunities opening in Europe, and merger-and-acquisition potential. Add to that solid contracts, a broad, recurring earnings mix and signs of fog clearing on BREXIT (55% of Bravura's earnings are sourced from Britain), and the broker is feeling positive.

This report was published on November 27, 2019.

Target price is $5.44 Current Price is $4.99 Difference: $0.45
If BVS meets the Wilsons target it will return approximately 9% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY20:

Wilsons forecasts a full year FY20 dividend of 11.70 cents and EPS of 16.70 cents.
At the last closing share price the estimated dividend yield is 2.34%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 29.88.

Forecast for FY21:

Wilsons forecasts a full year FY21 dividend of 14.40 cents and EPS of 20.60 cents.
At the last closing share price the estimated dividend yield is 2.89%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 24.22.

Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources


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