Australian Broker Call *Extra* Edition – Oct 14, 2020

Daily Market Reports | Oct 14 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)

A2M   AHX   BRG   CTD   CXL   ELD   IRI   MFG   MSB   NST (2)   PGX   PMY   QAN   SAR   SHV   STO   SYD   TLX   TNE   TYR   WHC  

TLX    TELIX PHARMACEUTICALS LIMITED

Pharmaceuticals & Biotech/Lifesciences - Overnight Price: $1.80

Wilsons rates ((TLX)) as Overweight (1) -

Wilsons maintains its Overweight rating and a price target of $2.73.

Telix Pharmaceuticals’ prostate cancer agent (TLX591-CDx) was filed for both US and European approvals and is expected to be approved by the second quarter of 2021.

The broker highlights Telix is the first to seek approval for a PSMA directed PET/CT imaging agent in both major markets and expects the product to generate more than $100m annualised sales within three years of launch.

The report was published on October 2, 2020.

Target price is $2.73 Current Price is $1.80 Difference: $0.93
If TLX meets the Wilsons target it will return approximately 52% (excluding dividends, fees and charges).
The company's fiscal year ends in December.

Forecast for FY20:

Wilsons forecasts a full year FY20 dividend of 0.00 cents and EPS of minus 12.90 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 13.95.

Forecast for FY21:

Wilsons forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 0.70 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 257.14.

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

TNE    TECHNOLOGYONE LIMITED

IT & Support - Overnight Price: $8.38

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

TechnologyOne received an adverse ruling in a court case (brought about by an ex-employee) that requires TechnologyOne to pay the ex-employee -$5.2m. Bell Potter notes this is well above the -$1.6m hit the company had already taken in relation to the case.

While the company will be appealing the verdict, it will have to take an additional provision of about -$3.6m in its FY20 result. As a result, the company now expects to be at the lower end of guidance (which is for profit before tax between $82.5-85.6m) 

FY20 earnings per share forecast has been reduced by -2% due to the expected additional provision, but there is negligible change to the broker's FY21-22 forecasts.

Bell Potter maintains its Buy rating with a target price of $9.50.

This report was published on October 6, 2020.

Target price is $9.50 Current Price is $8.38 Difference: $1.12
If TNE meets the Bell Potter target it will return approximately 13% (excluding dividends, fees and charges).
Current consensus price target is $8.12, suggesting downside of -3.2%(ex-dividends)
The company's fiscal year ends in September.

Forecast for FY20:

Bell Potter forecasts a full year FY20 dividend of 13.10 cents and EPS of 19.70 cents.
At the last closing share price the estimated dividend yield is 1.56%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 42.54.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 19.3, implying annual growth of 4.7%.
Current consensus DPS estimate is 12.6, implying a prospective dividend yield of 1.5%.
Current consensus EPS estimate suggests the PER is 43.4.

Forecast for FY21:

Bell Potter forecasts a full year FY21 dividend of 15.10 cents and EPS of 23.00 cents.
At the last closing share price the estimated dividend yield is 1.80%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 36.43.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 21.3, implying annual growth of 10.4%.
Current consensus DPS estimate is 14.5, implying a prospective dividend yield of 1.7%.
Current consensus EPS estimate suggests the PER is 39.3.

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

TYR    TYRO PAYMENTS LIMITED

Business & Consumer Credit - Overnight Price: $3.91

Goldman Sachs rates ((TYR)) as Initiation of coverage with Neutral (3) -

Goldman Sachs initiates coverage on Tyro Payments with a Neutral rating and a target price of $3.20.

Tyro Payments provides in-store payment services as a merchant acquirer along with a number of business banking products to more than 32k merchants in the Australian market.

In Goldman Sachs's view, Tyro Payments has several drivers of growth like the rising usage of card payment relative to cash, value-add services that can only be provided by Tyro since it is the only specialist payment provider with a banking license and its e-commerce solution for online payment acceptance.

These tailwinds are expected to drive revenue growth over FY20-FY23 at a compounded annual growth rate (CAGR) of 20%.

Target price is $3.20 Current Price is $3.91 Difference: minus $0.71 (current price is over target).
If TYR meets the Goldman Sachs target it will return approximately minus 18% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $3.48, suggesting downside of -10.9%(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 minus 3.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 130.33.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -3.1, 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 N/A.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 1.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 391.00.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -1.0, 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 N/A.

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

WHC    WHITEHAVEN COAL LIMITED

Coal - Overnight Price: $0.99

Shaw and Partners rates ((WHC)) as Upgrade to Buy (1) -

Shaw and Partners expects coal to be in the top three performing commodities in September looking at the 20-25% rise in prices during the month.

The inflection point across thermal & metallurgical coal occurred during the 1st week of the month and reflects the resumption of buying by India post covid-19 and the monsoon season lull as well as supply side financials stretched with more than 50% of global producers operating at a cash loss position.

The broker expects Whitehaven Coal will continue to progress and close the gap with Fortescue Metals Group while tracking the cyclical trajectory of the coal price.

Rating has been upgraded to Buy with the target price rising to $2 from $1.80.

This report was published on October 1, 2020.

Target price is $2.00 Current Price is $0.99 Difference: $1.01
If WHC meets the Shaw and Partners target it will return approximately 102% (excluding dividends, fees and charges).
Current consensus price target is $1.52, suggesting upside of 53.7%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Shaw and Partners forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 13.40 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 7.39.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -5.8, implying annual growth of N/A.
Current consensus DPS estimate is 0.4, implying a prospective dividend yield of 0.4%.
Current consensus EPS estimate suggests the PER is N/A.

Forecast for FY22:

Shaw and Partners forecasts a full year FY22 dividend of 3.00 cents and EPS of 8.40 cents.
At the last closing share price the estimated dividend yield is 3.03%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.79.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 4.2, implying annual growth of N/A.
Current consensus DPS estimate is 2.5, implying a prospective dividend yield of 2.5%.
Current consensus EPS estimate suggests the PER is 23.6.

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


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