Australian Broker Call *Extra* Edition – Jun 23, 2021

Daily Market Reports | Jun 23 2021

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)

360   AMN   API   APX   ASG   BLX   EML   EVN   GEM   HSN   ILU   JAN   NUF (3)   PWH   QAN   S32   SBM   UMG  

360    LIFE360, INC

Software & Services - Overnight Price: $6.30

Bell Potter rates ((360)) as Buy (1) -

Following Life360's proposed acquisition of Jobit earlier in the year, Bell Potter expects another acquisition in coming months to be likely, and points to a US-based digital insurance agent as the most logical acquisition for the company. 

The broker feels this is consistent with where the market is heading and could support growth in tech and online sales. Being US-based would also allow an acquisition to support Life360's very engaged US user base. 

Bell Potter has marginally increased revenue forecasts for FF21, FY22 and FY23 by around 1% each driven by subscription revenue forecast increases.

The Buy rating and target price of $7.00 are retained. 

This report was published on May 21, 2021.

Target price is $7.00 Current Price is $6.30 Difference: $0.7
If 360 meets the Bell Potter target it will return approximately 11% (excluding dividends, fees and charges).
The company's fiscal year ends in December.

Forecast for FY21:

Bell Potter forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 18.11 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 34.80.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 9.39 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 67.11.

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

AMN    AGRIMIN LIMITED

Agriculture - Overnight Price: $0.48

Canaccord Genuity rates ((AMN)) as Buy (1) -

At 150ktpa for 10 years with Sinochem, Cannacord Genuity regards Agrimin Ltd's first offtake - by far the largest single binding offtake for any Australian Sulphate of Potash (SOP) project - as a watershed moment for the Lake Mackay SOP project.

In the broker's view, the project provides the momentum required to secure additional offtake agreements in the near/medium term.

Lake Mackay is the largest undeveloped potash-bearing lake in the world, and the 150ktpa agreement covers one third of Agrimin's planned SOP production of 450ktpa.

Cannacord values the project at $471m and expects it to generate earnings of $190m at plateau and have a 4.2-year payback.

Speculative Buy rating is maintained with a target price increasing to $1.57 from $1.37.

The report was first published on May 19, 2021.

Target price is $1.57 Current Price is $0.48 Difference: $1.09
If AMN meets the Canaccord Genuity target it will return approximately 227% (excluding dividends, fees and charges).

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

API    AUSTRALIAN PHARMACEUTICAL INDUSTRIES LIMITED

Health & Nutrition - Overnight Price: $1.11

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

Pfizer has announced its intention to return its distribution business back to main stream wholesalers, beginning with Australian Pharmaceutical Industries, following dissatisfaction with services delivered by DHL.

Australian Pharmaceutical estimates a $4.0m earnings tailwind from the Pfizer business, with Bell Potter assuming a more conservative $3.0m earnings impact, with an estimated revenue impact of around $60m. 

Bell Potter also notes that the Clearskin Clinics franchise continues to grow rapidly, with an additional 25 clinics expected in the next two to three years. Each clinic is capable of more than $1m in annual cash sales after reaching profitability. 

The Buy rating and target price of $1.50 are retained. 

This report was published on May 20, 2021.

Target price is $1.50 Current Price is $1.11 Difference: $0.39
If API meets the Bell Potter target it will return approximately 35% (excluding dividends, fees and charges).
Current consensus price target is $1.35, suggesting upside of 21.6%(ex-dividends)
The company's fiscal year ends in August.

Forecast for FY21:

Bell Potter forecasts a full year FY21 dividend of 4.30 cents and EPS of 8.50 cents.
At the last closing share price the estimated dividend yield is 3.87%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.06.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 8.5, implying annual growth of N/A.
Current consensus DPS estimate is 4.3, implying a prospective dividend yield of 3.9%.
Current consensus EPS estimate suggests the PER is 13.1.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 5.10 cents and EPS of 10.20 cents.
At the last closing share price the estimated dividend yield is 4.59%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.88.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 9.9, implying annual growth of 16.5%.
Current consensus DPS estimate is 7.3, implying a prospective dividend yield of 6.6%.
Current consensus EPS estimate suggests the PER is 11.2.

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

APX    APPEN LIMITED

IT & Support - Overnight Price: $13.71

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

Appen has announced three new products that support the company's transition to a product-led strategy, which it aims to use to capture and capitalise on growth.

Appen Intelligence is a proprietary machine learning model that improves automation, In-Platform Audit analyses and debugs data, and Appen Mobile allows the company's crowd workers to operate from mobile phones.

Earnings guidance of US$83-90m is heavily weighted to the second half of FY21 due to delays in key projects in late 2020.

The Overweight rating is retained and the target price decreases to $22.69 from $22.83.

This report was released on May 21, 2021.

Target price is $22.69 Current Price is $13.71 Difference: $8.98
If APX meets the Wilsons target it will return approximately 65% (excluding dividends, fees and charges).
Current consensus price target is $21.97, suggesting upside of 60.2%(ex-dividends)
The company's fiscal year ends in December.

Forecast for FY21:

Wilsons forecasts a full year FY21 dividend of 12.00 cents and EPS of 31.80 cents.
At the last closing share price the estimated dividend yield is 0.88%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 43.11.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 49.4, implying annual growth of 18.9%.
Current consensus DPS estimate is 10.0, implying a prospective dividend yield of 0.7%.
Current consensus EPS estimate suggests the PER is 27.8.

Forecast for FY22:

Wilsons forecasts a full year FY22 dividend of 14.00 cents and EPS of 37.50 cents.
At the last closing share price the estimated dividend yield is 1.02%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 36.56.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 63.0, implying annual growth of 27.5%.
Current consensus DPS estimate is 13.5, implying a prospective dividend yield of 1.0%.
Current consensus EPS estimate suggests the PER is 21.8.

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

ASG    AUTOSPORTS GROUP LIMITED

Automobiles & Components - Overnight Price: $2.45

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

Following a great April, which is typically a seasonally weakest month, in which new car sales were 22% ahead of April 19 levels, Moelis is optimistic that Autosports Group is on track to deliver a record second half FY21 result.

While supply continues to lag demand, the broker notes that April year-to-date vehicle deliveries are 3.5% ahead of April 2019 year-to-date levels.

Given the current visibility around the forward order book, Moelis expects the company to deliver an outstanding fourth quarter 2021 result, provided the company can obtain sufficient supply.

Moelis has upgraded FY21-23 earnings per share by 7-13% to reflect the continuation of current trading conditions until the end of calendar year 2021, and further structural cost outs from FY23 and beyond.

Moelis retains its Buy rating with a target price of $2.90.

This report was published on May 21, 2021.

Target price is $2.90 Current Price is $2.45 Difference: $0.45
If ASG meets the Moelis target it will return approximately 18% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY21:

Moelis forecasts a full year FY21 dividend of 4.80 cents and EPS of 24.30 cents.
At the last closing share price the estimated dividend yield is 1.96%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.08.

Forecast for FY22:

Moelis forecasts a full year FY22 dividend of 11.40 cents and EPS of 25.10 cents.
At the last closing share price the estimated dividend yield is 4.65%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.76.

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

BLX    BEACON LIGHTING GROUP LIMITED

Furniture & Renovation - Overnight Price: $1.90

Jarden rates ((BLX)) as Downgrade to Overweight from Buy (2) -

Jarden increases net profit after tax forecast for Beacon Lighting Group by around 4% to $36.7m. This is slightly above the midpoint of the company's guidance. Company guidance implies 32% year-on-year growth during the second half of FY21.

The broker also notes the forward pipeline in the coming 6-12  months is likely strong due to federal stimulus flow through.

The rating is downgraded to Overweight from Buy and the target price increases to $2.20.

This report was published on May 20, 2021.

Target price is $2.20 Current Price is $1.90 Difference: $0.3
If BLX meets the Jarden target it will return approximately 16% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY21:

Jarden forecasts a full year FY21 dividend of 8.20 cents and EPS of 16.50 cents.
At the last closing share price the estimated dividend yield is 4.32%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.52.

Forecast for FY22:

Jarden forecasts a full year FY22 dividend of 7.00 cents and EPS of 11.60 cents.
At the last closing share price the estimated dividend yield is 3.68%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.38.

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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