Australian Broker Call *Extra* Edition – Nov 20, 2020

Daily Market Reports | Nov 20 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)

CAT   CNI   CQR (2)   CXL   DRR   FLT   FZO   ILU   INA   IPL   JHX   MAQ   NEC   PBP   SGM   UWL   ZBT  

CAT    CATAPULT GROUP INTERNATIONAL LTD

Medical Equipment & Devices - Overnight Price: $2.00

Bell Potter rates ((CAT)) as Hold (3) -

Catapult Group International provided a business update.

Key points for Bell Potter include churn remains low, subscription renewals remain strong and customer usage of the company's cloud-based SaaS solutions are higher than the previous year across all regions.

The broker explains new business opportunities that were delayed from late FY20 remain mostly open, but are challenged in the current environment.

Bell Potter makes only slight changes to profit (NPAT) forecasts. The Hold rating is unchanged and the target price is increased to $1.95 from $1.85.

This report was published on November 10, 2020.

Target price is $1.95 Current Price is $2.00 Difference: minus $0.05 (current price is over target).
If CAT meets the Bell Potter target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).
The company's fiscal year ends in March.

Forecast for FY21:

Bell Potter forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 2.80 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 71.43.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 0.90 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 222.22.

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

CNI    CENTURIA CAPITAL GROUP

Diversified Financials - Overnight Price: $2.40

Moelis rates ((CNI)) as Downgraded to Hold from Buy (3) -

The Centuria Capital Group has acquired New Zealand’s only glass bottle & jar manufacturing site for NZ$178m. The group undertook a $120m equity raising at $2.25 per security.

The Auckland-based Visy facility is acquired for a new single asset unlisted fund on the Augusta platform. Moelis expects the group to generate fees of around $6m in FY21 from the syndication of the Visy asset.

Proceeds from the equity raising will be used to fund new transaction opportunities (including syndicating the Visy Facility) as well as retiring debt.

Moelis downgrades the rating to Hold from Buy and increases the target to $2.52 from $2.30.

This report was published on November 9, 2020.

Target price is $2.52 Current Price is $2.40 Difference: $0.12
If CNI meets the Moelis target it will return approximately 5% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY21:

Moelis forecasts a full year FY21 dividend of 9.00 cents and EPS of 11.70 cents.
At the last closing share price the estimated dividend yield is 3.75%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 20.51.

Forecast for FY22:

Moelis forecasts a full year FY22 dividend of 9.20 cents and EPS of 12.50 cents.
At the last closing share price the estimated dividend yield is 3.83%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 19.20.

Market Sentiment: 0.8
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

CQR    CHARTER HALL RETAIL REIT

REITs - Overnight Price: $3.88

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

Charter Hall Retail REIT's first-quarter update introduced a dividend guidance for the first half of 10.7c versus a consensus estimate of 10.9c. The REIT also expects the second half dividend to be higher than the first half.

Charter Hall Retail REIT also noted improved cash collection of 92% from 79% in the June quarter of FY20 with only 5% as tenant support and the remaining outstanding for collection. Management looks comfortable with the credit loss provision of -$1.5m in June, comments the broker.

In Goldman Sachs's view, the result shows resiliency and strength of the REIT's portfolio and its active asset management. The broker expects supermarket sales performance to moderate over FY21-22.

Neutral rating is retained with a target price of $3.70.

This report was published on November 10, 2020.

Target price is $3.70 Current Price is $3.88 Difference: minus $0.18 (current price is over target).
If CQR 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 $3.38, suggesting downside of -13.0%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Goldman Sachs forecasts a full year FY21 EPS of 27.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.37.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 25.9, implying annual growth of 173.8%.
Current consensus DPS estimate is 22.4, implying a prospective dividend yield of 5.8%.
Current consensus EPS estimate suggests the PER is 15.0.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 EPS of 27.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.37.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 27.0, implying annual growth of 4.2%.
Current consensus DPS estimate is 24.5, implying a prospective dividend yield of 6.3%.
Current consensus EPS estimate suggests the PER is 14.4.

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


Moelis rates ((CQR)) as Downgrade to Hold from Buy (3) -

Looking at its strong cash collections year to date, Charter Hall Retail REIT has guided to a first-half dividend of 10.7c and expects the second half distribution to be higher. This implies a payout ratio of 88% and, according to Moelis, more reflective of cash flow.

The REIT's rent collections continued to improve with 92% of rent collected in the quarter. Total tenant support in the quarter was $3.7m, of which $1.4m pertained to Victoria. With conditions improving, the broker expects rent support measures to decline.

Supermarkets remained strong performers while specialties were in the negative, dragged down by Victoria.

Moelis downgrades its rating to Hold from Buy on valuation grounds with the target rising to $3.75 from $3.69.

This report was published on November 11, 2020.

Target price is $3.75 Current Price is $3.88 Difference: minus $0.13 (current price is over target).
If CQR meets the Moelis target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $3.38, suggesting downside of -13.0%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Moelis forecasts a full year FY21 dividend of 22.10 cents and EPS of 25.20 cents.
At the last closing share price the estimated dividend yield is 5.70%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.40.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 25.9, implying annual growth of 173.8%.
Current consensus DPS estimate is 22.4, implying a prospective dividend yield of 5.8%.
Current consensus EPS estimate suggests the PER is 15.0.

Forecast for FY22:

Moelis forecasts a full year FY22 dividend of 24.40 cents and EPS of 27.80 cents.
At the last closing share price the estimated dividend yield is 6.29%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.96.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 27.0, implying annual growth of 4.2%.
Current consensus DPS estimate is 24.5, implying a prospective dividend yield of 6.3%.
Current consensus EPS estimate suggests the PER is 14.4.

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

CXL    CALIX LIMITED

Mining Sector Contracting - Overnight Price: $0.99

Shaw and Partners rates ((CXL)) as Buy (1) -

Year to date sales for Calix are up 333% at $5.78m post its acquisition of IER. Shaw and Partners concludes Calix's traditional business sales were flat, considered good given the impact of covid-19 in its markets.

Year to date, Calix's total revenue is up 124% with its gross margin up 5-30% reflecting the introduction of its technology into IER.

Over the next 12 months, the broker expects a potential partial sell down of the LEILAC technology along with a significant capacity increase for IEL.

Buy rating reaffirmed with a target price of $1.20.

This report was published on November 9, 2020.

Target price is $1.20 Current Price is $0.99 Difference: $0.21
If CXL meets the Shaw and Partners target it will return approximately 21% (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 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 165.00.

Forecast for FY22:

Shaw and Partners forecasts a full year FY22 dividend of 0.00 cents and EPS of 0.20 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 495.00.

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


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