Australian Broker Call *Extra* Edition – Nov 11, 2021

Daily Market Reports | Nov 11 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 (2)   A2M (2)   ALU   AQZ   ARX   BEX (2)   BRI   CDA   CGS   COE   COL   CPU   CRW   DUB   DUG   ELO   EOS   GDC   GNG   HPG   IMR   INA   JRV   LBY   MAD   NTO (3)   OPY   PBH   SPT   TGR   TNT   WBC   WZR   ZBT  

NTO    NITRO SOFTWARE LIMITED

IT & Support - Overnight Price: $3.84

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

Nitro Software has upgraded its full-year revenue guidance range to US$49-51m following a strong third quarter, although Bell Potter notes despite annual recurring revenue a 50% year-on-year increase it was a slight miss on forecast. 

The broker noted that full-year annual recurring revenue of US$39-42m was not upgraded, with guidance range equating to 40-50% year-on-year growth. Given 50% year-on-year growth at the end of September, a top of guidance range result looks to be achievable. 

The Buy rating is retained and the target price increases to $4.50 from $4.00. 

This report was published on October 28, 2021.

Target price is $4.50 Current Price is $3.84 Difference: $0.66
If NTO meets the Bell Potter target it will return approximately 17% (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 13.11 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 29.29.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 11.26 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 34.12.

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


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

Nitro Software's September-quarter trading update pleased Shaw & Partners, thanks to improved FY21 revenues (annual recurring revenue up 50% outpaced guidance) and earnings; an improved pipeline; and expanded capacity.

Nitro raises guidance 2% to 4% and expects an increase annual recurring revenue in FY22. Cost guidance was reduced. The company finished the quarter with a net cash balance of $31.4m (down from $38.8m in the June half).

The broker expects little movement on headcount, which was one of the biggest contributors in cash burn this year, and upgrades revenue forecasts 5% to 7%.

The broker believes FY22 may be Nitro's year and raises the target price to $4.75 from $4.35. Buy, High Risk.

This report was published on October 28, 2021.

Target price is $4.75 Current Price is $3.84 Difference: $0.91
If NTO meets the Shaw and Partners target it will return approximately 24% (excluding dividends, fees and charges).
The company's fiscal year ends in December.

Forecast for FY21:

Shaw and Partners forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 12.05 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 31.87.

Forecast for FY22:

Shaw and Partners forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 12.05 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 31.87.

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


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

Nitro Software remains on a solid trajectory entering its fourth quarter, with Wilsons noting it is typically the company's strongest quarter and has an estimated pipeline twice as strong as the third quarter. 

The company grew annual recurring revenue 50% on the previous comparable period in the quarter, and while full-year guidance range of US$39-42m was reiterated Wilsons is forecasting $43m to be achievable. 

The broker also noted the company has referred to strategic mergers and acquisitions which could be a short-term catalyst to growth. 

The Overweight rating is retained and the target price increases to $4.37 from $4.22.

This report was published on October 28, 2021.

Target price is $4.37 Current Price is $3.84 Difference: $0.53
If NTO meets the Wilsons target it will return approximately 14% (excluding dividends, fees and charges).
The company's fiscal year ends in December.

Forecast for FY21:

Wilsons forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 7.81 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 49.15.

Forecast for FY22:

Wilsons forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 8.74 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 43.94.

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

OPY    OPENPAY GROUP LIMITED

Business & Consumer Credit - Overnight Price: $1.26

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

Openpay Group has carried the momentum of FY21 into the first quarter of FY22, with Shaw and Partners noting results were largely better than expected with highlights including active customers up 56% from the first quarter FY21 and active merchants up 87%. 

Looking forward, the quickly evolving US strategy is now live and ready to onboard customers.

The Buy rating and target price of $3.50 are retained. 

This report was published on October 29, 2021.

Target price is $3.50 Current Price is $1.26 Difference: $2.24
If OPY meets the Shaw and Partners target it will return approximately 178% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY22:

Shaw and Partners forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 34.90 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 3.61.

Forecast for FY23:

Shaw and Partners forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 16.50 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 7.64.

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

PBH    POINTSBET HOLDINGS LIMITED

Gaming - Overnight Price: $8.84

Evans and Partners rates ((PBH)) as Upgrade to Positive (1) -

Evans & Partners upgrades PointsBet Holdings to $13.92 in response to US official state data showing the company is holding online market share in the face of intense competition; and sharper than expected growth in the US market.

September-quarter data reveals a 163% rise in market share year-on-year.

The broker believes the company has a superior product thanks to purpose-built technology and expects the NBC deal, combined with likely new partnerships, will contribute to scale.

Evans & Partners likes the PointsBet's risk-reward profile and upgrades to a Positive rating. Target price rises to $13.92 from $13.44.

This report was published on October 27, 2021.

Target price is $13.92 Current Price is $8.84 Difference: $5.08
If PBH meets the Evans and Partners target it will return approximately 57% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY22:

Evans and Partners forecasts a full year FY22 dividend of 0.00 cents and EPS of 60.30 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.66.

Forecast for FY23:

Evans and Partners forecasts a full year FY23 dividend of 0.00 cents and EPS of 99.20 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 8.91.

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

SPT    SPLITIT PAYMENTS LIMITED

Business & Consumer Credit - Overnight Price: $0.35

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

Splitit Payments' September-quarter trading update disappointed Cannacord Genuity, the strategic review and CEO's departure slowing momentum, a 31% increase in merchant sales volume to US$93m falling shy of expectations.

The broker reiterates the strength of the company's unique selling proposition but downgrades its target price to $1.30 from $1.80 to reflect the disruption.

Speculative Buy rating retained.

This report was published on October 29, 2021.

Target price is $1.30 Current Price is $0.35 Difference: $0.95
If SPT meets the Canaccord Genuity target it will return approximately 271% (excluding dividends, fees and charges).
The company's fiscal year ends in December.

Forecast for FY21:

Canaccord Genuity forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 7.60 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 4.61.

Forecast for FY22:

Canaccord Genuity forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 4.50 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 7.78.

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

TGR    TASSAL GROUP LIMITED

Aquaculture - Overnight Price: $3.39

Goldman Sachs rates ((TGR)) as Buy (1) -

Following a 1Q trading update by Tassal Group, Goldman Sachs notes salmon volumes are up around 25%, while export pricing is up circa 20% versus the previous corresponding period. Meanwhile, the company's 1Q export volumes are up approximately 150%.

The target price is increased to $4.20 from $4.00, following minor adjustments to forecast salmon prices and channel mix.

Management expects strong operating free cash flow in FY22, (more sales volume than harvest volume) as inventory returns to more normal levels. The Buy rating is maintained.

This report was published on October 28, 2021.

Target price is $4.20 Current Price is $3.39 Difference: $0.81
If TGR meets the Goldman Sachs target it will return approximately 24% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 dividend of 17.00 cents and EPS of 28.00 cents.
At the last closing share price the estimated dividend yield is 5.01%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.11.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 dividend of 18.00 cents and EPS of 29.00 cents.
At the last closing share price the estimated dividend yield is 5.31%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.69.

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


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