Australian Broker Call *Extra* Edition – Sep 16, 2020

Daily Market Reports | Sep 16 2020

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)

APD   APT   ASB   AVN   BIN (2)   BKL   ERF   GEM (2)   HUB   IDX   IMR   JLG (2)   MLD   MNF   MOZ   NAN (3)   OBL   PFP   PME   PPE   PRN (3)   PSI   RFF (2)   RHP   SOM   SSG   XRF  

APD    APN PROPERTY GROUP

Real Estate - Overnight Price: $0.53

Moelis rates ((APD)) as Reinstate coverage with Buy (1) -

APN Property Group's FY20 operating earnings were up circa 6% over FY19 with funds under management (FUM) of $2.7bn led by growth in APN Industria REIT and APN Convenience Retail REIT, although offset somewhat by a reduction in property security FUM due to covid-19.

Dividend guidance for FY21 is 2.5-2.8c, less than FY20's 3.15c. The broker notes the primary drivers are costs related to the launch of the Global REIT Income fund and the reduction in A-REIT FUM.

The broker believes the second half marks a low point for earnings with the company set to benefit from operating leverage as the business goes back to growth mode.

Moelis reinstates coverage with a Buy rating and a target price of $0.66.

This report was published on August 25, 2020.

Target price is $0.66 Current Price is $0.53 Difference: $0.13
If APD meets the Moelis target it will return approximately 25% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY21:

Moelis forecasts a full year FY21 dividend of 2.70 cents and EPS of 2.90 cents.
At the last closing share price the estimated dividend yield is 5.09%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.28.

Forecast for FY22:

Moelis forecasts a full year FY22 dividend of 3.10 cents and EPS of 3.40 cents.
At the last closing share price the estimated dividend yield is 5.85%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.59.

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

APT    AFTERPAY LIMITED

Business & Consumer Credit - Overnight Price: $75.01

Wilsons rates ((APT)) as Upgrade to Overweight (1) -

Afterpay pre-announced its key FY20 and Moelis notes its concerns around covid-19 related stresses along with the threat of competition in the core AU/US markets have been put to bed.

The broker expects a rising tide of growth catalysts that are yet to be priced in. Wilsons upgrades its rating to Overweight with the target price increasing to $94.16.

This report was published on August 24, 2020.

Target price is $94.16 Current Price is $75.01 Difference: $19.15
If APT meets the Wilsons target it will return approximately 26% (excluding dividends, fees and charges).
Current consensus price target is $81.72, suggesting upside of 8.9%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Wilsons forecasts a full year FY21 dividend of 0.00 cents and EPS of 11.70 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 641.11.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 6.2, 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 1209.8.

Forecast for FY22:

Wilsons forecasts a full year FY22 dividend of 0.00 cents and EPS of 26.80 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 279.89.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 41.2, implying annual growth of 564.5%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 182.1.

Market Sentiment: 0.2
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

ASB    AUSTAL LIMITED

Commercial Services & Supplies - Overnight Price: $3.29

Goldman Sachs rates ((ASB)) as Buy (1) -

Austal's FY20 results were solid and highlight the company’s defensive earnings profile, observes Goldman Sachs.

The broker considers Austal's multi-year outlook attractive with its investment thesis based on the underappreciated market perception of Austal's shipbuilding's strategic importance to the US Navy.

With the result, these drivers have been incrementally confirmed prompting Goldman Sachs to reiterate its Buy rating with the target price rising to $4.35 from $4.08.

This report was published on August 24, 2020.

Target price is $4.35 Current Price is $3.29 Difference: $1.06
If ASB meets the Goldman Sachs target it will return approximately 32% (excluding dividends, fees and charges).
Current consensus price target is $3.97, suggesting upside of 20.6%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Goldman Sachs forecasts a full year FY21 dividend of 9.00 cents and EPS of 25.00 cents.
At the last closing share price the estimated dividend yield is 2.74%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.16.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 23.9, implying annual growth of -4.4%.
Current consensus DPS estimate is 8.9, implying a prospective dividend yield of 2.7%.
Current consensus EPS estimate suggests the PER is 13.8.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 dividend of 9.00 cents and EPS of 25.00 cents.
At the last closing share price the estimated dividend yield is 2.74%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.16.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 24.1, implying annual growth of 0.8%.
Current consensus DPS estimate is 8.8, implying a prospective dividend yield of 2.7%.
Current consensus EPS estimate suggests the PER is 13.7.

Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

AVN    AVENTUS GROUP

REITs - Overnight Price: $2.34

Moelis rates ((AVN)) as Buy (1) -

Aventus Group's FY20 earnings were down about -1% versus last year, considered a solid result by Moelis considering the impact of covid-19.

The broker notes the operating performance held up much better than expected. Rent collections were strong with circa 87% of rent collected through the covid-19 period between March-June.

The group did not provide any guidance but expects to reinstate distributions. The broker highlights there seems to be a preference to be conservative seen in the 66% payout ratio to help shore up the balance sheet.

Looking at the resilience of rent collections, the broker expects the payout ratios will be back to more normalised levels.

Expecting Aventus will continue to find yield support, Moelis reinstates coverage with a Buy rating and a target price of $2.43.

This report was published on August 25, 2020.

Target price is $2.43 Current Price is $2.34 Difference: $0.09
If AVN meets the Moelis target it will return approximately 4% (excluding dividends, fees and charges).
Current consensus price target is $2.66, suggesting upside of 13.7%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Moelis forecasts a full year FY21 dividend of 15.50 cents and EPS of 18.10 cents.
At the last closing share price the estimated dividend yield is 6.62%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.93.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 18.1, implying annual growth of 75.7%.
Current consensus DPS estimate is 13.6, implying a prospective dividend yield of 5.8%.
Current consensus EPS estimate suggests the PER is 12.9.

Forecast for FY22:

Moelis forecasts a full year FY22 dividend of 16.00 cents and EPS of 18.80 cents.
At the last closing share price the estimated dividend yield is 6.84%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.45.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 19.9, implying annual growth of 9.9%.
Current consensus DPS estimate is 17.1, implying a prospective dividend yield of 7.3%.
Current consensus EPS estimate suggests the PER is 11.8.

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

BIN    BINGO INDUSTRIES LIMITED

Industrial Sector Contractors & Engineers - Overnight Price: $2.30

Goldman Sachs rates ((BIN)) as Neutral (3) -

Bingo Industries reported a FY20 result slightly ahead of Goldman Sachs expectations. The report highlights to the broker an ability to effectively manage operations in challenging conditions.

The outlook commentary suggests macroeconomic headwinds will persist in FY21. This leads Goldman Sachs to lower EPS forecasts for FY21 and FY22 by -6.7% and -2.7%, respectively.

The analyst expects earnings to start to recover in FY22 and is comfortable the long-term strategy remains firmly intact.

The Neutral rating is unchanged and the target price is increased to $2.35 from $2.25

This report was published on August 25, 2020.

Target price is $2.35 Current Price is $2.30 Difference: $0.05
If BIN meets the Goldman Sachs target it will return approximately 2% (excluding dividends, fees and charges).
Current consensus price target is $2.56, suggesting upside of 11.2%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Goldman Sachs forecasts a full year FY21 dividend of 0.00 cents and EPS of 7.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 32.86.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 6.0, implying annual growth of -40.6%.
Current consensus DPS estimate is 2.4, implying a prospective dividend yield of 1.0%.
Current consensus EPS estimate suggests the PER is 38.3.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 dividend of 4.00 cents and EPS of 10.00 cents.
At the last closing share price the estimated dividend yield is 1.74%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 23.00.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 9.6, implying annual growth of 60.0%.
Current consensus DPS estimate is 4.3, implying a prospective dividend yield of 1.9%.
Current consensus EPS estimate suggests the PER is 24.0.

Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources


Shaw and Partners rates ((BIN)) as Hold (3) -

Bingo Industries announced a much stronger-than-expected FY20 result, according to Shaw and Partners.

The broker believes the company is perhaps being too conservative and cautious with respect to FY21 earnings (EBITDA) guidance.

The analyst places the result into some perspective by showing group margin diminution over time. In FY18 it was 30.8% and then fell to 26.9% in FY19, before strongly bouncing back to a robust 31.3% in FY20.

The Hold rating is unchanged and the target price is increased to $2.50 from $2.40.

This report was published on August 26, 2020.

Target price is $2.50 Current Price is $2.30 Difference: $0.2
If BIN meets the Shaw and Partners target it will return approximately 9% (excluding dividends, fees and charges).
Current consensus price target is $2.56, suggesting upside of 11.2%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Shaw and Partners forecasts a full year FY21 dividend of 4.00 cents and EPS of 7.10 cents.
At the last closing share price the estimated dividend yield is 1.74%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 32.39.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 6.0, implying annual growth of -40.6%.
Current consensus DPS estimate is 2.4, implying a prospective dividend yield of 1.0%.
Current consensus EPS estimate suggests the PER is 38.3.

Forecast for FY22:

Shaw and Partners forecasts a full year FY22 dividend of 6.00 cents and EPS of 12.00 cents.
At the last closing share price the estimated dividend yield is 2.61%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 19.17.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 9.6, implying annual growth of 60.0%.
Current consensus DPS estimate is 4.3, implying a prospective dividend yield of 1.9%.
Current consensus EPS estimate suggests the PER is 24.0.

Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

BKL    BLACKMORES LIMITED

Health & Nutrition - Overnight Price: $63.69

Wilsons rates ((BKL)) as Market Weight (3) -

Blackmores reported a profit (NPAT) of $18m, moderately below Wilsons' expectations. This was considered driven by China Exports and BioCeuticals, combined with a bigger than expected impact from raw material price increases.

There was no explicit guidance, but management expects profit growth in FY21, primarily driven by the second half.

Wilsons sees the success of Singles Day in China as an important near-term catalyst to rejuvenate the brand.

The Market Weight rating is unchanged. The target price is decreased to $64 from $70.5. 

This report was published on August 26, 2020.

Target price is $64.00 Current Price is $63.69 Difference: $0.31
If BKL meets the Wilsons target it will return approximately 0% (excluding dividends, fees and charges).
Current consensus price target is $67.38, suggesting upside of 5.8%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Wilsons forecasts a full year FY21 dividend of 117.40 cents and EPS of 167.80 cents.
At the last closing share price the estimated dividend yield is 1.84%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 37.96.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 175.6, implying annual growth of 69.7%.
Current consensus DPS estimate is 118.4, implying a prospective dividend yield of 1.9%.
Current consensus EPS estimate suggests the PER is 36.3.

Forecast for FY22:

Wilsons forecasts a full year FY22 dividend of 177.40 cents and EPS of 253.40 cents.
At the last closing share price the estimated dividend yield is 2.79%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 25.13.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 238.2, implying annual growth of 35.6%.
Current consensus DPS estimate is 167.0, implying a prospective dividend yield of 2.6%.
Current consensus EPS estimate suggests the PER is 26.7.

Market Sentiment: -0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources


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