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Australian Broker Call *Extra* Edition – Feb 24, 2021

Daily Market Reports | Feb 24 2021

This story features ADAIRS LIMITED, and other companies. For more info SHARE ANALYSIS: ADH

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)

ADH   ALU   AVH   CL1   CQE   CTD   ELO   EML   GMA   GUD (2)   NEA   RDY   RHP   SUL  

ADH    ADAIRS LIMITED

Furniture & Renovation – Overnight Price: $3.88

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

Adairs reported a first-half operating income of $60.2m, beating guidance and Wilsons' estimated $58.3m. Wilsons notes the businesses including online and Mocka are performing better than expected and have continued to grow despite achieving margin expansion.

No guidance was provided due to covid-induced volatility but the broker finds sales in the first seven weeks to be encouraging.

Looking at the market share gains via Adairs' omni-channel strategy and a loyal customer base and seeing significant valuation upside, Wilsons retains its Overweight rating with a target price of $4.50.

The report was published on February 17, 2021.

Target price is $4.50 Current Price is $3.88 Difference: $0.62
If ADH meets the Wilsons target it will return approximately 16% (excluding dividends, fees and charges).
Current consensus price target is $4.47, suggesting upside of 15.1%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Wilsons forecasts a full year FY21 dividend of 20.00 cents and EPS of 36.90 cents.
At the last closing share price the estimated dividend yield is 5.15%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.51.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 42.6, implying annual growth of 102.9%.
Current consensus DPS estimate is 28.2, implying a prospective dividend yield of 7.3%.
Current consensus EPS estimate suggests the PER is 9.1.

Forecast for FY22:

Wilsons forecasts a full year FY22 dividend of 21.00 cents and EPS of 37.70 cents.
At the last closing share price the estimated dividend yield is 5.41%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.29.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 33.9, implying annual growth of -20.4%.
Current consensus DPS estimate is 25.0, implying a prospective dividend yield of 6.4%.
Current consensus EPS estimate suggests the PER is 11.4.

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

ALU    ALTIUM LIMITED

Hardware & Equipment – Overnight Price: $27.64

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

Altium's first-half operating income of US$30.6m was -11% below Bell Potter's forecast of US$34.5m and was driven by a much lower-than-expected margin. Operating income margin fell to 32.7% versus last year driven by continued investment in the cloud business.

The broker has changed its FY21 forecasts with TASKING now treated as a discontinued business, consistent with the company's reporting procedure.

Bell Potter is at the lower end of revenue and operating income guidance for FY21.

The target price has decreased to $28.50 from $31.25 with a Hold rating.

This report was published on February 16, 2021.

Target price is $28.50 Current Price is $27.64 Difference: $0.86
If ALU meets the Bell Potter target it will return approximately 3% (excluding dividends, fees and charges).
Current consensus price target is $33.44, suggesting upside of 21.0%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Bell Potter forecasts a full year FY21 dividend of 52.54 cents and EPS of 44.45 cents.
At the last closing share price the estimated dividend yield is 1.90%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 62.19.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 44.2, implying annual growth of N/A.
Current consensus DPS estimate is 46.3, implying a prospective dividend yield of 1.7%.
Current consensus EPS estimate suggests the PER is 62.5.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 56.80 cents and EPS of 52.54 cents.
At the last closing share price the estimated dividend yield is 2.06%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 52.61.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 53.0, implying annual growth of 19.9%.
Current consensus DPS estimate is 49.2, implying a prospective dividend yield of 1.8%.
Current consensus EPS estimate suggests the PER is 52.2.

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

AVH    AVITA THERAPEUTICS, INC

Pharmaceuticals & Biotech/Lifesciences – Overnight Price: $6.15

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

Wilsons maintains its Overweight position on Avita Medical post the second-quarter results with a price target of $7.80. US RECELL sales were below the broker's forecast and net loss compared favourably with the broker's forecast. 

December quarter trading was subdued for Avita, observes Wilsons, which was the case across most of the US medtech sector. Wilsons broadly maintains the revenue forecasts but has increased opex estimates due to higher costs for certain R&D programs.

In the broker's view, the company is bringing a higher level of sales sophistication to a marketplace with the intention of disrupting and capturing it. The company’s vitiligo program is the largest source of valuation upside over the next year, adds Wilsons.

Overweight rating with a target price of $7.80.

This report was published on February 15, 2021.

Target price is $7.80 Current Price is $6.15 Difference: $1.65
If AVH meets the Wilsons target it will return approximately 27% (excluding dividends, fees and charges).
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 minus 154.20 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 3.99.

Forecast for FY22:

Wilsons forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 153.70 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 4.00.

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

CL1    CLASS LIMITED

Cloud services – Overnight Price: $1.83

Wilsons rates ((CL1)) as Market Weight (3) –

Class' announced a solid set of results, observes Wilsons, with in-line revenue and operating income.

The company has upgraded its FY21 revenue growth guidance increased to 22% from 20% which includes a 4-month contribution from the ReckonDocs acquisition.

The Class Trust offering appears to be gaining traction, notes a pleased Wilsons, with trust pilot programs up 50% to 2,571 versus June 2020. The company is looking to supplement its core super offering with acquisition aimed at gaining scale.

Market Weight rating with the target rising to $2.26 from $2.11.

This report was published on February 17, 2021.

Target price is $2.26 Current Price is $1.83 Difference: $0.43
If CL1 meets the Wilsons target it will return approximately 23% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY21:

Wilsons forecasts a full year FY21 dividend of 5.00 cents and EPS of 5.60 cents.
At the last closing share price the estimated dividend yield is 2.73%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 32.68.

Forecast for FY22:

Wilsons forecasts a full year FY22 dividend of 5.00 cents and EPS of 6.80 cents.
At the last closing share price the estimated dividend yield is 2.73%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 26.91.

Market Sentiment: 1.0
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: $2.98

Moelis rates ((CQE)) as Buy (1) –

Charter Hall Social Infrastructure REIT delivered first half like for like rental growth of 2.5% versus last year with 99.6% of rent collected. This along with the REIT's balance sheet deployment led to a 5% rise in FY21 distribution guidance, highlights Moelis.

The broker expects upward pressure on valuations to continue driven by investor demand for direct assets. The portfolio weighted average expiry lease increased to 14 years versus 12.7 years in June 2020.

Moelis feels 2021 will be a year of transformation for the REIT with meaningful shifts in capital allocation including the acquisition of a hospital in Brisbane and the development of circa $80m emergency services in Adelaide. 

Buy rating with a target price of $3.37.

This report was published on February 12, 2021.

Target price is $3.37 Current Price is $2.98 Difference: $0.39
If CQE meets the Moelis target it will return approximately 13% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY21:

Moelis forecasts a full year FY21 dividend of 15.60 cents and EPS of 16.50 cents.
At the last closing share price the estimated dividend yield is 5.23%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.06.

Forecast for FY22:

Moelis forecasts a full year FY22 dividend of 17.80 cents and EPS of 18.30 cents.
At the last closing share price the estimated dividend yield is 5.97%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.28.

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

CTD    CORPORATE TRAVEL MANAGEMENT LIMITED

Travel, Leisure & Tourism – Overnight Price: $20.80

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

Corporate Travel Management reported a first-half operating loss of -$15.7m considerably down versus last year and -$9.9m below Bell Potter's expectations. Underlying net profit was down materially to a loss of -$26m.

Covid negatively impacted operating conditions for global travel, notes the broker, with total transaction value down -88% and revenue down -67% to $74.2m. The A&NZ region was the highlight with a positive operating income of $3m in the first half. 

Bell Potter remains bullish on the company owing to its execution and leverage to the return of travel. The broker believes share price will do well over the medium term due to ongoing improvement in travel sentiment and market share gains from client wins.

Bell Potter maintains its Buy rating with the target price increasing to $22 from $18.50. 

The report was published on February 18, 2021.

Target price is $22.00 Current Price is $20.80 Difference: $1.2
If CTD meets the Bell Potter target it will return approximately 6% (excluding dividends, fees and charges).
Current consensus price target is $21.15, suggesting upside of 1.7%(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 minus 23.30 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 89.27.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -23.2, implying annual growth of N/A.
Current consensus DPS estimate is 1.7, 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 15.00 cents and EPS of 37.70 cents.
At the last closing share price the estimated dividend yield is 0.72%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 55.17.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 58.3, implying annual growth of N/A.
Current consensus DPS estimate is 22.9, implying a prospective dividend yield of 1.1%.
Current consensus EPS estimate suggests the PER is 35.7.

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

ELO    ELMO SOFTWARE LIMITED

Jobs & Skilled Labour Services – Overnight Price: $5.45

Wilsons rates ((ELO)) as Market Weight (3) –

With Elmo software's top-line number pre-announced in January, Wilsons notes the result focused on the performance of Breathe and Webexpenses.

Management reaffirmed guidance for the group and is confident in achieving the mid-point on all metrics, although Wilsons believes a strong fourth quarter in Australia, New Zealand and the UK markets might lead to a top-end annual recurring revenue result.

Wilsons likes the fact that Elmo Software will benefit from the forthcoming business recovery expected in the UK/A&NZ but the lack of any meaningful operating leverage keeps the broker at Neutral. The target price is $6.87.

This report was published on February 17, 2021.

Target price is $6.87 Current Price is $5.45 Difference: $1.42
If ELO meets the Wilsons target it will return approximately 26% (excluding dividends, fees and charges).
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 minus 31.20 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 17.47.

Forecast for FY22:

Wilsons forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 38.40 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 14.19.

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

EML    EML PAYMENTS LIMITED

Business & Consumer Credit – Overnight Price: $5.05

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

Wilsons remains constructive on EML Payments and sees FY21 as the "digestion" year, where Prepaid Financial Services will prove the value proposition of its offering.

While the second half will not be without its challenges, the broker expects EML Payment to consolidate and extend its market position in FY22. The broker expects general purpose reloadable to be 53% of gross profit in FY21.

Overweight rating with the target rising to $5.41 from $4.55.

This report was published on February 18, 2021.

Target price is $5.41 Current Price is $5.05 Difference: $0.36
If EML meets the Wilsons target it will return approximately 7% (excluding dividends, fees and charges).
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 8.80 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 57.39.

Forecast for FY22:

Wilsons forecasts a full year FY22 dividend of 0.00 cents and EPS of 13.70 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 36.86.

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

GMA    GENWORTH MORTGAGE INSURANCE AUSTRALIA LIMITED

Banks – Overnight Price: $2.67

Goldman Sachs rates ((GMA)) as No Rating (-1) –

Genworth Mortgage Insurance Australia’s reported its second half result with a better than expected net loss of -$17.6 m versus Goldman Sachs's forecast of -$35.4 m. This was driven by a better-than-expected outcome on net earned premiums (NEP).

The underwriting loss was -$60.7m and was 20% above the broker estimate led yet again by the stronger-than-expected NEP performance although this was more than offset by higher claims, which explains the loss.

The broker finds the company's capital position strong and has upgraded its FY21-22 earnings forecast by 67.5% and 28.4%.

Goldman Sachs has no rating on the stock.

This report was published on February 12, 2021.

Current Price is $2.67. Target price not assessed.
The company's fiscal year ends in December.

Forecast for FY21:

Goldman Sachs forecasts a full year FY21 dividend of 8.00 cents and EPS of 12.00 cents.
At the last closing share price the estimated dividend yield is 3.00%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 22.25.

Forecast for FY22:

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

GUD    G.U.D. HOLDINGS LIMITED

Automobiles & Components – Overnight Price: $12.25

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

GUD Holdings' first-half result was broadly in line with Goldman Sachs' forecasts. The broker incorporates the recent acquisitions of AMA Group’s automotive components and accessories division and Australian Clutch Services.

The acquisitions coupled with a solid first half drive the broker's upgrades for FY21 with operating income estimated to be $98.1m versus the company guidance of $95-100m.

The broker forecasts the company to deliver FY20-FY23 earnings growth (CAGR) of 14% with scope for further M&A activity to add to this.

Buy rating with the target rising to $14.70 from $14.20.

This report was published on February 11, 2021.

Target price is $14.70 Current Price is $12.25 Difference: $2.45
If GUD meets the Goldman Sachs target it will return approximately 20% (excluding dividends, fees and charges).
Current consensus price target is $13.71, suggesting upside of 11.9%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Goldman Sachs forecasts a full year FY21 dividend of 45.00 cents and EPS of 69.00 cents.
At the last closing share price the estimated dividend yield is 3.67%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.75.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 68.5, implying annual growth of 35.9%.
Current consensus DPS estimate is 50.8, implying a prospective dividend yield of 4.1%.
Current consensus EPS estimate suggests the PER is 17.9.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 dividend of 60.00 cents and EPS of 75.00 cents.
At the last closing share price the estimated dividend yield is 4.90%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.33.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 76.1, implying annual growth of 11.1%.
Current consensus DPS estimate is 54.6, implying a prospective dividend yield of 4.5%.
Current consensus EPS estimate suggests the PER is 16.1.

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


Wilsons rates ((GUD)) as Market Weight (3) –

GUD Holdings reported a strong first half result with net profit up 18% led by higher automotive operating income and higher sales activity. FY21 guidance seems conservative to Wilsons and the broker's operating income forecast is circa 4% above the guidance mid-point.

Growth in FY22 will be underpinned by GUD's recent acquisitions and a more favourable fx position, asserts the broker while acknowledging the mix of new businesses will likely see automotive margins decline.

Wilsons maintains its Market Weight rating with the target rising to $13.25 from $12.10.

This report was published on February 11, 2021.

Target price is $13.25 Current Price is $12.25 Difference: $1
If GUD meets the Wilsons target it will return approximately 8% (excluding dividends, fees and charges).
Current consensus price target is $13.71, suggesting upside of 11.9%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Wilsons forecasts a full year FY21 dividend of 49.50 cents and EPS of 70.50 cents.
At the last closing share price the estimated dividend yield is 4.04%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.38.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 68.5, implying annual growth of 35.9%.
Current consensus DPS estimate is 50.8, implying a prospective dividend yield of 4.1%.
Current consensus EPS estimate suggests the PER is 17.9.

Forecast for FY22:

Wilsons forecasts a full year FY22 dividend of 59.00 cents and EPS of 77.90 cents.
At the last closing share price the estimated dividend yield is 4.82%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.73.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 76.1, implying annual growth of 11.1%.
Current consensus DPS estimate is 54.6, implying a prospective dividend yield of 4.5%.
Current consensus EPS estimate suggests the PER is 16.1.

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

NEA    NEARMAP LTD

Software & Services – Overnight Price: $2.46

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

Nearmap's first-half result beat Canaccord Genuity's expectations despite a weak economic environment. Both Nearmap's annualised contract value (ACV) and sales rose 21% while operating income at $13.5m was materially higher than the broker's estimated $4.7m.

The company reiterated its previous ACV guidance of $120-$128m but stated the company is tracking towards the upper end of the range. The broker considers the top end of the guidance range achievable if Nearmap can continue to drive new sales growth.

Canaccord Genuity especially highlights the result was led by an "impressive" net retention rate of 107% which in the broker's view, illustrates the resilience and scalability of its business model.

The Buy rating is unchanged. The target price is increased to $3.10 from $2.90.

The report was first published on February 16, 2021.

Target price is $3.10 Current Price is $2.46 Difference: $0.64
If NEA meets the Canaccord Genuity target it will return approximately 26% (excluding dividends, fees and charges).
Current consensus price target is $2.93, suggesting upside of 19.2%(ex-dividends)
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 6.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 41.00.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -4.8, 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:

Canaccord Genuity forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 5.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 49.20.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -3.8, 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: 0.7
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

RDY    READYTECH HOLDINGS LTD

Software & Services – Overnight Price: $1.83

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

ReadyTech Holdings posted a strong first half update, largely meeting Wilsons' expectations on revenue and operating income while being 11% ahead on earnings. Guidance was reaffirmed.

The broker notes the result was led by strong average revenue per new customers gained in the half. The Open Office transaction is expected to be concluded by March 23.

The Overweight rating is unchanged with the target rising to $2.85 from $2.78.

This report was published on February 18, 2021.

Target price is $2.85 Current Price is $1.83 Difference: $1.02
If RDY meets the Wilsons target it will return approximately 56% (excluding dividends, fees and charges).
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 9.80 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.67.

Forecast for FY22:

Wilsons forecasts a full year FY22 dividend of 0.00 cents and EPS of 13.90 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.17.

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

RHP    RHIPE LIMITED

Cloud services – Overnight Price: $1.73

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

Rhipe delivered a first-half operating profit of $8.8m, up 34% versus last year and in-line with pre-released figures.

Despite cycling a strong result last year, Bell Potter notes Rhipe delivered top-line growth of 15% reflecting strong growth in Microsoft public cloud revenue streams and services revenue. An interim dividend of 1.5c was announced versus Bell Potter's expected 1c.

On the flip side, these positives were offset by soft operating conditions seen by Rhipe's SMB client base which, in the broker's view, has remained in cash conservation mode since the beginning of the pandemic.

Bell Potter retains its Buy rating with the target price unchanged at $2.50.

This report was published on February 17, 2021.

Target price is $2.50 Current Price is $1.73 Difference: $0.77
If RHP meets the Bell Potter target it will return approximately 45% (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 3.50 cents and EPS of 4.90 cents.
At the last closing share price the estimated dividend yield is 2.02%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 35.31.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 4.50 cents and EPS of 6.70 cents.
At the last closing share price the estimated dividend yield is 2.60%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 25.82.

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

SUL    SUPER RETAIL GROUP LIMITED

Automobiles & Components – Overnight Price: $11.66

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

Super Retail Group's first-half result was strong, observes Bell Potter, with operating income by 112% over last year to $272m. The result was led by elevated sales across all segments, expansion in gross margin and significant opex leverage benefits.

The group's lastest update for the second half points to buoyant trading conditions with like for like sales growth in first 7 weeks led by Rebel, BCF and Macpac. Super Retail expects promotional activity to rise as inventory levels are restored. 

Bell Potter retains its Hold rating with the target price rising to $11.80 from $11.45.

This report was published on February 18, 2021.

Target price is $11.80 Current Price is $11.66 Difference: $0.14
If SUL meets the Bell Potter target it will return approximately 1% (excluding dividends, fees and charges).
Current consensus price target is $13.29, suggesting upside of 14.0%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Bell Potter forecasts a full year FY21 dividend of 67.20 cents and EPS of 118.60 cents.
At the last closing share price the estimated dividend yield is 5.76%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.83.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 124.3, implying annual growth of 122.8%.
Current consensus DPS estimate is 69.7, implying a prospective dividend yield of 6.0%.
Current consensus EPS estimate suggests the PER is 9.4.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 47.30 cents and EPS of 78.90 cents.
At the last closing share price the estimated dividend yield is 4.06%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.78.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 87.5, implying annual growth of -29.6%.
Current consensus DPS estimate is 56.2, implying a prospective dividend yield of 4.8%.
Current consensus EPS estimate suggests the PER is 13.3.

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


Disclaimer:
The content of this information does in no way reflect the opinions of FNArena, or of its journalists. In fact we don't have any opinion about the stock market, its value, future direction or individual shares. FNArena solely reports about what the main experts in the market note, believe and comment on. By doing so we believe we provide intelligent investors with a valuable tool that helps them in making up their own minds, reading market trends and getting a feel for what is happening beneath the surface. This document is provided for informational purposes only. It does not constitute an offer to sell or a solicitation to buy any security or other financial instrument. FNArena employs very experienced journalists who base their work on information believed to be reliable and accurate, though no guarantee is given that the daily report is accurate or complete. Investors should contact their personal adviser before making any investment decision.

As part of emerging new trends overseas, The Australian Broker Call *Extra* Edition also includes providers of sponsored research. Readers should bear in mind, sponsored research, while not necessarily of lower quality, has the embedded complication that the company that is the subject of the research has paid for this research. Providers of sponsored research that can potentially be included in this Report are Breakaway Research, Edison Investment Research, Independent Investment Research, NDF Research, Pitt Street Research, and TMT Analytics.

Decisions about inclusions in this Report are made independently of the providers of stock market research and at full discretion of the team of journalists responsible for content at FNArena. Inclusion does not equal endorsement, in any way, shape or form. This Report is provided for informational purposes only.

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CHARTS

ADH ALU AVH CL1 CQE CTD ELO EML GMA GUD NEA RDY RHP SUL

For more info SHARE ANALYSIS: ADH - ADAIRS LIMITED

For more info SHARE ANALYSIS: ALU - ALTIUM

For more info SHARE ANALYSIS: AVH - AVITA MEDICAL INC

For more info SHARE ANALYSIS: CL1 - CLASS LIMITED

For more info SHARE ANALYSIS: CQE - CHARTER HALL SOCIAL INFRASTRUCTURE REIT

For more info SHARE ANALYSIS: CTD - CORPORATE TRAVEL MANAGEMENT LIMITED

For more info SHARE ANALYSIS: ELO - ELMO SOFTWARE LIMITED

For more info SHARE ANALYSIS: EML - EML PAYMENTS LIMITED

For more info SHARE ANALYSIS: GUD - G.U.D. HOLDINGS LIMITED

For more info SHARE ANALYSIS: NEA - NEARMAP LIMITED

For more info SHARE ANALYSIS: RDY - READYTECH HOLDINGS LIMITED

For more info SHARE ANALYSIS: RHP - RHIPE LIMITED

For more info SHARE ANALYSIS: SUL - SUPER RETAIL GROUP LIMITED