Australian Broker Call *Extra* Edition – Oct 21, 2020

This story features A2 MILK COMPANY LIMITED, and other companies. For more info SHARE ANALYSIS: A2M

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   ARB   BIN (2)   BTH   BXB   CCL   CQE (2)   CRN   GNG   GOZ   MTO   MYX   NWL (2)   OTW   PSQ   RMS   SRG   TCL   VHT   VVA   WHC  

A2M    THE A2 MILK COMPANY LIMITED

Dairy – Overnight Price: $14.70

Bell Potter rates ((A2M)) as Sell (5) –

The key question in a2 Milk's case is whether Bell Potter's FY21 downgrade to revenue expectations is a temporary daigou supply chain issue, or is it reflective of a wider demand issue?

Bell Potter notes it looks like demand expectations resulting from the pandemic have not eventuated and this has exposed a2 Milk to a destocking event over the first half of FY21. This is expected to continue until the true level of demand is discovered.

The broker does not agree with consensus baseline estimates and considers them too optimistic. Bell Potter retains its Sell rating with the target price falling to $12.70 from $13.75.

This report was published on October 9, 2020.

Target price is $12.70 Current Price is $14.70 Difference: minus $2 (current price is over target).
If A2M meets the Bell Potter target it will return approximately minus 14% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $16.12, suggesting upside of 9.7%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Bell Potter forecasts a full year FY21 dividend of 0.00 cents and EPS of 47.88 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 30.70.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 50.2, 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 29.3.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 0.00 cents and EPS of 54.77 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 26.84.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 60.5, implying annual growth of 20.5%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 24.3.

This company reports in NZD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.1
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

ARB    ARB CORPORATION LIMITED

Automobiles & Components – Overnight Price: $32.85

Wilsons rates ((ARB)) as Overweight (1) –

With sales up 18% with considerable margin expansion, Wilsons notes ARB Corp had a strong start to FY21. However, domestic sales are constrained by new vehicle supply and the Melbourne lockdown.

Stronger sales growth is expected in the second half provided constraints ease. ARB Corp expects export sales to remain strong in key markets like Europe, New Zealand and the US. Wilsons sees good prospects for sustained sales growth through a continued shift to SUVs and penetration of export markets.

Wilsons maintains its Overweight rating with a target price of $33.50.

This report was published on October 8, 2020.

Target price is $33.50 Current Price is $32.85 Difference: $0.65
If ARB meets the Wilsons target it will return approximately 2% (excluding dividends, fees and charges).
Current consensus price target is $28.51, suggesting downside of -13.2%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Wilsons forecasts a full year FY21 dividend of 46.50 cents and EPS of 100.80 cents.
At the last closing share price the estimated dividend yield is 1.42%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 32.59.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 97.0, implying annual growth of 35.1%.
Current consensus DPS estimate is 50.4, implying a prospective dividend yield of 1.5%.
Current consensus EPS estimate suggests the PER is 33.9.

Forecast for FY22:

Wilsons forecasts a full year FY22 dividend of 52.50 cents and EPS of 95.60 cents.
At the last closing share price the estimated dividend yield is 1.60%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 34.36.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 92.9, implying annual growth of -4.2%.
Current consensus DPS estimate is 53.0, implying a prospective dividend yield of 1.6%.
Current consensus EPS estimate suggests the PER is 35.4.

Market Sentiment: -0.3
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: $2.73

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

Bingo Industries' first-quarter saw stronger than expected post-collections volumes offset by weaker collections volumes. Prices are below pre-covid levels and in-line with Goldman Sachs's estimate.

On account of the support from the budget, re-opening of NSW and Victoria progressing to a potential lifting of stage-4 lockdown, the broker believes the risks to Bingo's outlook are reducing in the near term.

Earnings estimates remain unchanged. Neutral rating is reaffirmed with the target price increased to $2.50 from $2.35.

This report was published on October 8, 2020.

Target price is $2.50 Current Price is $2.73 Difference: minus $0.23 (current price is over target).
If BIN meets the Goldman Sachs target it will return approximately minus 8% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $2.61, suggesting downside of -4.5%(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 6.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 45.50.

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 2.6, implying a prospective dividend yield of 1.0%.
Current consensus EPS estimate suggests the PER is 45.5.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 dividend of 4.00 cents and EPS of 9.00 cents.
At the last closing share price the estimated dividend yield is 1.47%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 30.33.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 9.8, implying annual growth of 63.3%.
Current consensus DPS estimate is 4.5, implying a prospective dividend yield of 1.6%.
Current consensus EPS estimate suggests the PER is 27.9.

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

Shaw and Partners notes the outlook for Bingo Industries post the pandemic remains positive although the growth trajectory has been pushed back to FY22 from FY21.

Several tailwinds exist in the form of massive infrastructure pipeline, a shift from landfill to recycling and the federal budget stimulus toward infrastructure and recycling segments.

However, the current uncertainty mars the positive outlook somewhat and Shaw and Partners maintains its Hold rating. The target price is increased to $2.65 from $2.50.

This report was published on October 9, 2020.

Target price is $2.65 Current Price is $2.73 Difference: minus $0.08 (current price is over target).
If BIN meets the Shaw and Partners target it will return approximately minus 3% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $2.61, suggesting downside of -4.5%(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 1.47%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 38.45.

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 2.6, implying a prospective dividend yield of 1.0%.
Current consensus EPS estimate suggests the PER is 45.5.

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 2.20%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 22.75.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 9.8, implying annual growth of 63.3%.
Current consensus DPS estimate is 4.5, implying a prospective dividend yield of 1.6%.
Current consensus EPS estimate suggests the PER is 27.9.

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

BTH    BIGTINCAN HOLDINGS LIMITED

Cloud services – Overnight Price: $1.40

Canaccord Genuity rates ((BTH)) as Buy (1) –

Bigtincan Holdings started FY21 with the acquisition of Agnitio, a Danish-based company that is a pioneer in sales enablement for the Life Sciences sector.

In Canaccord Genuity's view, the acquisition is strategically sound as it brings a complementary technology extending the capability of Bigtincan's platform offering and is likely to be accretive from a revenue perspective.

The deal also increases the company's presence in Europe and improves geographic diversification. Target price is steady at $1.40. Buy rating retained.

This report was published on October 9, 2020.

Target price is $1.40 Current Price is $1.40 Difference: $0
If BTH meets the Canaccord Genuity target it will return approximately 0% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY21:

Canaccord Genuity forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 1.80 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 77.78.

Forecast for FY22:

Canaccord Genuity forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 0.60 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 233.33.

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

BXB    BRAMBLES LIMITED

Transportation & Logistics – Overnight Price: $10.49

Goldman Sachs rates ((BXB)) as Buy (1) –

Brambles' AGM reaffirmed the company would provide a more comprehensive update on first-quarter trading in early-mid November. The company reiterated its FY21 guidance for flat sales revenue growth with improved profit margins.

Goldman Sachs notes the company's current trading remains at the top end of its guidance. The outlook for FY21 implies demand volatility due to a weaker economic environment.

Goldman Sachs reiterates its Buy rating on account of Brambles' key defensive positioning in the current uncertain market environment and the broker highlights the stock is on its regional conviction list.

Buy rating is reiterated with a target price of $13.67.

The report was published on October 8, 2020.

Target price is $13.67 Current Price is $10.49 Difference: $3.18
If BXB meets the Goldman Sachs target it will return approximately 30% (excluding dividends, fees and charges).
Current consensus price target is $12.23, suggesting upside of 16.5%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Goldman Sachs forecasts a full year FY21 dividend of 29.36 cents and EPS of 52.86 cents.
At the last closing share price the estimated dividend yield is 2.80%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 19.85.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 54.1, implying annual growth of N/A.
Current consensus DPS estimate is 32.2, implying a prospective dividend yield of 3.1%.
Current consensus EPS estimate suggests the PER is 19.4.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 dividend of 33.77 cents and EPS of 61.67 cents.
At the last closing share price the estimated dividend yield is 3.22%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.01.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 60.3, implying annual growth of 11.5%.
Current consensus DPS estimate is 36.1, implying a prospective dividend yield of 3.4%.
Current consensus EPS estimate suggests the PER is 17.4.

This company reports in USD. 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

CCL    COCA-COLA AMATIL LIMITED

Food, Beverages & Tobacco – Overnight Price: $10.18

Goldman Sachs rates ((CCL)) as Buy (1) –

Goldman Sachs observes Coca Cola Amatil is an outlier amongst Australian consumer staples stocks when it comes to the negative impact of the pandemic due to its exposure to the on-the-go channels. The broker believes the earnings and potential for quick recovery remain underappreciated.

The broker believes its near term forecasts for Coca Cola remain conservative when adjusted for the expected cost savings in FY20. In the medium term, there is potential upside if the longer-term cost savings were to materialise.

Regardless, the broker's expectations are ahead of market consensus. Goldman Sachs reiterates its Buy rating with a target price of $10.60.

This report was published on October 9, 2020.

Target price is $10.60 Current Price is $10.18 Difference: $0.42
If CCL meets the Goldman Sachs target it will return approximately 4% (excluding dividends, fees and charges).
Current consensus price target is $9.83, suggesting downside of -3.5%(ex-dividends)
The company's fiscal year ends in December.

Forecast for FY20:

Goldman Sachs forecasts a full year FY20 dividend of 31.00 cents and EPS of 44.00 cents.
At the last closing share price the estimated dividend yield is 3.05%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 23.14.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 43.2, implying annual growth of -16.4%.
Current consensus DPS estimate is 26.6, implying a prospective dividend yield of 2.6%.
Current consensus EPS estimate suggests the PER is 23.6.

Forecast for FY21:

Goldman Sachs forecasts a full year FY21 dividend of 41.00 cents and EPS of 51.00 cents.
At the last closing share price the estimated dividend yield is 4.03%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 19.96.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 50.6, implying annual growth of 17.1%.
Current consensus DPS estimate is 42.1, implying a prospective dividend yield of 4.1%.
Current consensus EPS estimate suggests the PER is 20.1.

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

CQE    CHARTER HALL SOCIAL INFRASTRUCTURE REIT

Childcare – Overnight Price: $2.81

Canaccord Genuity rates ((CQE)) as Buy (1) –

Canaccord Genuity notes Charter Hall Social Infrastructure REIT's tenant profile and asset base have strengthened after the acquisition of a healthcare property in Queensland for -$122.5m.

The acquisition is seen as logical as the asset has a tenant for a period of 10 years and fixed rental increases of 3% per annum. The broker thinks the transaction signifies the beginning of a potentially rewarding relationship with Mater (the tenant).

Canaccord Genuity views the stock as a low-risk investment with an attractive yield and maintains its Buy rating. The target increases to $2.99 from $2.79.

The report was published on October 12, 2020.

Target price is $2.99 Current Price is $2.81 Difference: $0.18
If CQE meets the Canaccord Genuity target it will return approximately 6% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY21:

Canaccord Genuity forecasts a full year FY21 dividend of 15.00 cents and EPS of 15.30 cents.
At the last closing share price the estimated dividend yield is 5.34%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.37.

Forecast for FY22:

Canaccord Genuity forecasts a full year FY22 dividend of 17.00 cents and EPS of 17.60 cents.
At the last closing share price the estimated dividend yield is 6.05%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.97.

Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

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Goldman Sachs rates ((CQE)) as Buy (1) –

Charter Hall Social Infrastructure REIT acquired a healthcare asset for -$122.5m. The asset will be leased back to the former owner for 10 years – Mater, Queensland’s largest Catholic not-for-profit health provider.

While Childcare assets remain Charter Hall Social Infrastructure REIT's top preference, Goldman Sachs believes this transaction shows the REIT is executing on its strategy to broaden its investments in social infrastructure. Furthermore, the deal demonstrates the REIT's ability to source high quality, accretive assets leased to strong tenant covenants.

This acquisition has also solidified the broker's view that the REIT is positioned for a solid growth outlook given its strong balance sheet.

Buy rating is retained with a target price of $3.23.

This report was published on October 9, 2020.

Target price is $3.23 Current Price is $2.81 Difference: $0.42
If CQE meets the Goldman Sachs target it will return approximately 15% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY21:

Goldman Sachs forecasts a full year FY21 EPS of 16.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.56.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 EPS of 18.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.61.

Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

CRN    CORONADO GLOBAL RESOURCES

Coal – Overnight Price: $0.87

Bell Potter rates ((CRN)) as Buy (1) –

Bell Potter marked-to-market its coal prices for the September 2020 quarter and moderated its 2021 outlook.

The impact has been a reduction in the price outlook of hard coking coal for the first and the second half of FY21 by -6% and -3%. The thermal coal price outlook has also reduced by -11% and -8% for the two halves of FY21. 

Bell Potter has decreased its earnings growth outlook for the company in 2020-21 with no change in 2022. The analyst surmises Coronado Global Resources year to date has been impacted by issues at Curragh, the idling of its US operations, withdrawal of guidance and debt-holder covenant waivers.

With met coal markets showing improvement, the broker expects Coronado to be able to provide a clearer outlook for the rest of the year. Bell Potter notes the company has a portfolio of long-life met coal assets in Australia and the US, favourably positioned on the global cost curve.

Also, Coronado's earnings are highly leveraged to improved met coal prices. Bell Potter retains its Buy recommendation, with its target price falling slightly to $1.60 from $1.63.

This report was published on October 7, 2020.

Target price is $1.60 Current Price is $0.87 Difference: $0.73
If CRN meets the Bell Potter target it will return approximately 84% (excluding dividends, fees and charges).
Current consensus price target is $1.40, suggesting upside of 60.9%(ex-dividends)
The company's fiscal year ends in December.

Forecast for FY20:

Bell Potter forecasts a full year FY20 dividend of 0.00 cents and EPS of minus 17.62 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 4.94.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -12.1, 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 FY21:

Bell Potter forecasts a full year FY21 dividend of 8.37 cents and EPS of 19.09 cents.
At the last closing share price the estimated dividend yield is 9.62%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 4.56.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 4.5, 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 19.3.

This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

GNG    GR ENGINEERING SERVICES LIMITED

Mining Sector Contracting – Overnight Price: $1.08

Euroz rates ((GNG)) as Buy (1) –

GR engineering has been appointed as the EPC contractor by Wiluna Mining Corp. Work will commence in early December and commissioning is scheduled for October 2021.

The firm has guided to revenue between $280- $300m. Looking at its contract wins and a healthy orderbook, Euroz expects the company will achieve the upper side of guidance.

The broker believes the company is well-placed to benefit from gold sector momentum. The FY21 dividend is expected to be 8c, implying an attractive 7.8% yield.

Euroz rates the stock as Buy with a target price of $1.27.

This report was published on October 2, 2020.

Target price is $1.27 Current Price is $1.08 Difference: $0.19
If GNG meets the Euroz target it will return approximately 18% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

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

GOZ    GROWTHPOINT PROPERTIES AUSTRALIA

Infra & Property Developers – Overnight Price: $3.40

Moelis rates ((GOZ)) as Buy (1) –

Growthpoint Properties Australia secured Bunnings to anchor its recently completed Botanicca 3 development for a period of 10 years and 7 months which makes up for 71% of the building.

Moelis notes the lease has made Bunnings one of Growthpoint’s top 10 tenants. The broker adds the lease has strategic significance for Growthpoint given the uncertainty around trends for office markets in a post-covid market.

The REIT is an attractive investment proposition, believes Moelis, given the quality of its tenant and asset bases and the lease at Botanicca 3 is considered proof of management’s capability.

Moelis reaffirms its Buy rating with a target price of $3.81.

This report was published on October 6, 2020.

Target price is $3.81 Current Price is $3.40 Difference: $0.41
If GOZ meets the Moelis target it will return approximately 12% (excluding dividends, fees and charges).
Current consensus price target is $3.49, suggesting upside of 2.6%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Moelis forecasts a full year FY21 dividend of 20.00 cents and EPS of 24.10 cents.
At the last closing share price the estimated dividend yield is 5.88%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.11.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 19.9, implying annual growth of -43.6%.
Current consensus DPS estimate is 20.0, implying a prospective dividend yield of 5.9%.
Current consensus EPS estimate suggests the PER is 17.1.

Forecast for FY22:

Moelis forecasts a full year FY22 dividend of 22.30 cents and EPS of 26.00 cents.
At the last closing share price the estimated dividend yield is 6.56%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.08.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 23.3, implying annual growth of 17.1%.
Current consensus DPS estimate is 22.2, implying a prospective dividend yield of 6.5%.
Current consensus EPS estimate suggests the PER is 14.6.

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

MTO    MOTORCYCLE HOLDINGS LIMITED

Automobiles & Components – Overnight Price: $2.74

Moelis rates ((MTO)) as Buy (1) –

Motorcycle Holdings' Q1 revealed strong trading, observes Moelis, with the first half operating income expected to be in excess of $20m.

The broker notes following the easing of restrictions in May, demand for motorcycles has seen an uptick throughout the last five months. The company's operating income guidance implies more than 90% growth versus last year.

Given the strong first-quarter trading along with JobKeeper benefit, Moelis believes Motorcycle Holdings is close to a net cash position and is expected to remain significantly under-geared.

FY21-23 earnings estimates have been upgraded to capture the increased gross margins and lower interest costs.

Moelis maintains its Buy rating with the target price rising to $2.98 from $2.56.

This report was published on October 8, 2020.

Target price is $2.98 Current Price is $2.74 Difference: $0.24
If MTO meets the Moelis target it will return approximately 9% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY21:

Moelis forecasts a full year FY21 dividend of 11.90 cents and EPS of 30.30 cents.
At the last closing share price the estimated dividend yield is 4.34%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.04.

Forecast for FY22:

Moelis forecasts a full year FY22 dividend of 12.80 cents and EPS of 21.30 cents.
At the last closing share price the estimated dividend yield is 4.67%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.86.

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

MYX    MAYNE PHARMA GROUP LIMITED

Pharmaceuticals & Biotech/Lifesciences – Overnight Price: $0.32

Bell Potter rates ((MYX)) as Downgrade to Hold from Buy (3) –

Mayne Pharma Group has received a second complete response letter with respect to the generic Nuvaring. The letter includes a request for more information and the broker believes it has blindsided the company. The delay to the potential launch is estimated to be many months.

On a more heartening note, the FDA noted no major issues with Nextstellis and no significant safety concerns. The product has been subject to clinical trials involving more than 3,000 women and has been shown to be highly effective as a contraceptive and very safe, states the broker. The product is on course for approval next year.

Removal of forecast revenues for both Nuvaring and Nextstellis means the company has four business units with no major product releases in the short term, points out the analyst.

Bell Potter downgrades its rating to Hold from Buy with the target price reducing to $0.32 from $0.48.

This report was published on October 7, 2020.

Target price is $0.32 Current Price is $0.32 Difference: $0
If MYX meets the Bell Potter target it will return approximately 0% (excluding dividends, fees and charges).
Current consensus price target is $0.37, suggesting upside of 14.8%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Bell Potter forecasts a full year FY21 dividend of 0.00 cents and EPS of 2.70 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.85.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -0.1, 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:

Bell Potter forecasts a full year FY22 dividend of 0.00 cents and EPS of 2.60 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.31.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 2.0, 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 16.0.

Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

NWL    NETWEALTH GROUP LIMITED

Wealth Management & Investments – Overnight Price: $18.21

Bell Potter rates ((NWL)) as Hold (3) –

With interest rates expected to be lower for longer, Bell Potter thinks reliable growth stocks will be valued at a premium. This partly explains Netwealth Group's recent share price run.

Post the federal budget, the broker admits it may be time to reduce the risk-free rate component in its discounted cash flow valuation based methodology, which will have a material impact on valuations.

Bell Potter acknowledges Netwealth Group looks attractive especially when seen against the backdrop of many major players exiting. The broker notes the group retains a 3.8% market share but is the fastest-growing player in the financial platform market.

Post the group's quarterly update, the broker has upgraded its earnings growth estimates for FY21-23 driven by higher closing funds under administration.

Bell Potter maintains its Hold rating with the target price increasing to $17.35 from $13.40.

The report was first published on October 9, 2020.

Target price is $17.35 Current Price is $18.21 Difference: minus $0.86 (current price is over target).
If NWL meets the Bell Potter target it will return approximately minus 5% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $12.67, suggesting downside of -30.5%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Bell Potter forecasts a full year FY21 dividend of 17.00 cents and EPS of 21.40 cents.
At the last closing share price the estimated dividend yield is 0.93%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 85.09.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 20.4, implying annual growth of 11.1%.
Current consensus DPS estimate is 16.5, implying a prospective dividend yield of 0.9%.
Current consensus EPS estimate suggests the PER is 89.3.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 21.00 cents and EPS of 26.40 cents.
At the last closing share price the estimated dividend yield is 1.15%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 68.98.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 25.7, implying annual growth of 26.0%.
Current consensus DPS estimate is 20.7, implying a prospective dividend yield of 1.1%.
Current consensus EPS estimate suggests the PER is 70.9.

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

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Goldman Sachs rates ((NWL)) as Neutral (3) –

Netwealth Group's first-quarter funds under administration (FuA) net inflows stood at $1,912m, up 29.1% versus last year. Market movements drove a quarterly growth of 8%. The group guided to FY21 FUA net inflows of circa $8bn.

Total growth in funds under management was 81.5% versus last year. Total member accounts increased by 2,930 in the quarter and Netwealth noted a cash transaction account balance of 9.1%, which is well above pre-covid levels.

The broker retains its Neutral rating on account of positively skewed near-term earnings risks and sees structural opportunities for emerging wealth platforms in the medium-term.

Target price rises to $15.99 from $11.10.

This report was published on October 8, 2020.

Target price is $15.99 Current Price is $18.21 Difference: minus $2.22 (current price is over target).
If NWL meets the Goldman Sachs target it will return approximately minus 12% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $12.67, suggesting downside of -30.5%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Goldman Sachs forecasts a full year FY21 dividend of 18.00 cents and EPS of 22.00 cents.
At the last closing share price the estimated dividend yield is 0.99%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 82.77.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 20.4, implying annual growth of 11.1%.
Current consensus DPS estimate is 16.5, implying a prospective dividend yield of 0.9%.
Current consensus EPS estimate suggests the PER is 89.3.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 dividend of 22.00 cents and EPS of 27.00 cents.
At the last closing share price the estimated dividend yield is 1.21%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 67.44.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 25.7, implying annual growth of 26.0%.
Current consensus DPS estimate is 20.7, implying a prospective dividend yield of 1.1%.
Current consensus EPS estimate suggests the PER is 70.9.

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

OTW    OVER THE WIRE HOLDINGS LIMITED

Cloud services – Overnight Price: $4.54

Bell Potter rates ((OTW)) as Hold (3) –

Over The Wire will be acquiring Digital Sense Hosting, expected to become fait accompli at the end of October.

Bell Potter upgrades its earnings growth forecasts for FY21-23. The upgrades are less than the company’s expected double-digit earnings accretion in the first full year of ownership since it includes the non-cash impact of the increased D&A, the broker clarifies.

The balance sheet is strong and the company is well placed for more acquisitions that the broker expects to occur in the second half of FY21 or in FY22.

Bell Potter maintains its Hold rating with the target price upgraded to $5 from $4.50.

This report was published on August 20, 2020.

Target price is $5.00 Current Price is $4.54 Difference: $0.46
If OTW meets the Bell Potter target it will return approximately 10% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY21:

Bell Potter forecasts a full year FY21 dividend of 4.30 cents and EPS of 14.60 cents.
At the last closing share price the estimated dividend yield is 0.95%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 31.10.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 5.30 cents and EPS of 19.60 cents.
At the last closing share price the estimated dividend yield is 1.17%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 23.16.

Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

PSQ    PACIFIC SMILES GROUP LIMITED

Healthcare services – Overnight Price: $1.92

Bell Potter rates ((PSQ)) as Buy (1) –

Pacific Smiles' update on same centre patient fee growth (SCPFG) as of 30th September shows a growth rate of 10.0% year to date including Victoria and 21.7% excluding it.

Bell Potter is pleased the SCPFG rate has improved from August (8.7% year to date growth in August including Victoria and 19.2% excluding it) despite tough lockdown conditions. This indicates the rest of the centres in NSW, Queensland and ACT are performing well, suggests the analyst.

The broker expects more improvement moving forward and believes the company is on track to achieve its FY21 guidance of 15% growth in patient fees and operating income. Bell Potter also believes management may revise its guidance upwards at the AGM.

Bell Potter retains its Buy rating with the target price increased to $1.95 from $1.90.

This report was published on October 9, 2020.

Target price is $1.95 Current Price is $1.92 Difference: $0.03
If PSQ meets the Bell Potter target it will return approximately 2% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY21:

Bell Potter forecasts a full year FY21 dividend of 5.80 cents and EPS of 5.90 cents.
At the last closing share price the estimated dividend yield is 3.02%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 32.54.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 6.00 cents and EPS of 6.40 cents.
At the last closing share price the estimated dividend yield is 3.13%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 30.00.

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

RMS    RAMELIUS RESOURCES LIMITED

Gold & Silver – Overnight Price: $2.11

Shaw and Partners rates ((RMS)) as Buy (-1) –

Shaw and Partners upgrades its price target to $2.79 from $2.45 while maintaining its Buy rating.

The increase has been inspired by Ramelius Resources’ strong execution into a higher gold price forecast. The latter has been lifted by US$300-500/oz for the next three years.

The broker expects gold to peak at around US$2,500/oz in early 2023. Moreover, negative real interest rates are expected to persist for at least the next three years and will drive the price of gold higher in the broker's view.

The company reported September quarter production of 71.3koz, maintaining its track record of exceeding guidance. The production is expected to reach 270koz in FY21, making Ramelius one of the few gold companies generating production growth over the next two years, points out the analyst.

This report was published on October 9, 2020.

Target price is $2.79 Current Price is $2.11 Difference: $0.68
If RMS meets the Shaw and Partners target it will return approximately 32% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY21:

Shaw and Partners forecasts a full year FY21 dividend of 6.00 cents and EPS of 20.90 cents.
At the last closing share price the estimated dividend yield is 2.84%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.10.

Forecast for FY22:

Shaw and Partners forecasts a full year FY22 dividend of 13.00 cents and EPS of 32.00 cents.
At the last closing share price the estimated dividend yield is 6.16%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 6.59.

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

SRG    SRG GLOBAL LIMITED

Mining Sector Contracting – Overnight Price: $0.32

Shaw and Partners rates ((SRG)) as Buy (1) –

SRG Global's FY21 operating income guidance is between $38-$42m, implying 31%-45% growth over the year. This guidance range is well ahead of Shaw and Partners' $32.8m forecast and market consensus at $32.1m.

The company is now in a stronger, lower cost and far more competitive position, believes the broker, with a diverse mix of clients as well as more diversity in work at hand.

Buy rating maintained. Target price is $0.45.

This report was published on October 9, 2020.

Target price is $0.45 Current Price is $0.32 Difference: $0.13
If SRG meets the Shaw and Partners target it will return approximately 41% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY21:

Shaw and Partners forecasts a full year FY21 dividend of 2.00 cents and EPS of 3.10 cents.
At the last closing share price the estimated dividend yield is 6.25%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.32.

Forecast for FY22:

Shaw and Partners forecasts a full year FY22 dividend of 2.00 cents and EPS of 4.30 cents.
At the last closing share price the estimated dividend yield is 6.25%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 7.44.

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

TCL    TRANSURBAN GROUP

Infrastructure & Utilities – Overnight Price: $13.91

Goldman Sachs rates ((TCL)) as Neutral (3) –

Transurban Group's first-quarter traffic figures revealed daily volumes down -25.2% versus last year, below Goldman Sachs's estimated -10.7%.

Overall, traffic declined across nearly all of the group's assets except for Sydney due to movement restrictions. Melbourne saw a significant decline in traffic volumes due to the enactment of a Stage 4 lockdown.

The broker expects the stock to continue to find support from the current market preference for structurally defensive ‘low-beta’ names. Estimates have been lowered due to lower traffic volumes expected.

Goldman Sachs retains its Neutral rating with a target price of $13.27.

This report was published on October 8, 2020.

Target price is $13.27 Current Price is $13.91 Difference: minus $0.64 (current price is over target).
If TCL meets the Goldman Sachs target it will return approximately minus 5% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $14.34, suggesting upside of 3.1%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Goldman Sachs forecasts a full year FY21 EPS of 0.00 cents.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 6.4, implying annual growth of N/A.
Current consensus DPS estimate is 39.5, implying a prospective dividend yield of 2.8%.
Current consensus EPS estimate suggests the PER is 217.3.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 EPS of 7.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 198.71.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 20.2, implying annual growth of 215.6%.
Current consensus DPS estimate is 54.1, implying a prospective dividend yield of 3.9%.
Current consensus EPS estimate suggests the PER is 68.9.

Market Sentiment: -0.1
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

VHT    VOLPARA HEALTH TECHNOLOGIES LIMITED

Medical Equipment & Devices – Overnight Price: $1.48

Bell Potter rates ((VHT)) as Buy (1) –

Volpara Health Technology's annual recurring revenue increased to $19.9m for the September quarter. This was a record increase, points out Bell Potter, driven by major new deals and some significant upgrades on renewals.

In the second half of FY20, the annual recurring revenue increased by US$1.4m and the broker expects a large increase over and above this level in the second half of FY21.

Buy recommendation retained with the target unchanged at $1.75.

This report was published on October 9, 2020.

Target price is $1.75 Current Price is $1.48 Difference: $0.27
If VHT meets the Bell Potter target it will return approximately 18% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY21:

Bell Potter forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 4.52 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 32.71.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 3.77 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 39.26.

This company reports in NZD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

VVA    VIVA LEISURE LIMITED

Travel, Leisure & Tourism – Overnight Price: $2.96

Shaw and Partners rates ((VVA)) as Buy (1) –

Shaw and Partners notes discretionary leisure stocks like the ASX-listed travel stocks are now being re-rated as investors add covid-19 impacted exposures to their portfolios to hedge against recovery. Viva Leisure falls into the category and experienced a significant de-rate with its share price down -21% from its February high. 

However, the broker points out unlike most the company did not experience a material sales downturn over the last 9 months. The broker thinks this earnings profile reflects potential upside appreciation without the downside risk should another covid wave eventuate.

Shaw and Partners reaffirms its Buy rating with a target price of $2.60.

This report was published on October 12, 2020.

Target price is $3.60 Current Price is $2.96 Difference: $0.64
If VVA meets the Shaw and Partners target it will return approximately 22% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY21:

Shaw and Partners forecasts a full year FY21 dividend of -2.00 cents and EPS of 10.90 cents.
At the last closing share price the estimated dividend yield is – 0.68%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 27.16.

Forecast for FY22:

Shaw and Partners forecasts a full year FY22 dividend of 4.20 cents and EPS of 22.40 cents.
At the last closing share price the estimated dividend yield is 1.42%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.21.

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

WHC    WHITEHAVEN COAL LIMITED

Coal – Overnight Price: $1.03

Bell Potter rates ((WHC)) as Buy (1) –

Bell Potter marked-to-market its coal prices for the September 2020 quarter and moderated its 2021 outlook. As a result, the price forecast for hard coking coal for the first and the second half of FY21 went down by -6% and -3%.

In similar vein, the price forecast for thermal coal also went down -11% and -8% for the two halves of FY21. Bell Potter's FY21 earnings growth forecast for Whitehaven Coal has been reduced to -3c from 6.4c.

Coal prices remained weak for most of the September 2020 quarter. Whitehaven has guided to a second-half weighted FY21. The broker expects the company's expansion projects to remain on hold for the rest of 2020.

The Buy rating is unchanged and the target price is decreased to $2.15 from $2.25.

This report was published on October 7, 2020.

Target price is $2.15 Current Price is $1.03 Difference: $1.12
If WHC meets the Bell Potter target it will return approximately 109% (excluding dividends, fees and charges).
Current consensus price target is $1.47, suggesting upside of 42.3%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Bell Potter 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 34.33.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -7.7, implying annual growth of N/A.
Current consensus DPS estimate is 0.1, implying a prospective dividend yield of 0.1%.
Current consensus EPS estimate suggests the PER is N/A.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 8.00 cents and EPS of 15.00 cents.
At the last closing share price the estimated dividend yield is 7.77%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 6.87.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 4.0, implying annual growth of N/A.
Current consensus DPS estimate is 1.7, implying a prospective dividend yield of 1.7%.
Current consensus EPS estimate suggests the PER is 25.8.

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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