Australian Broker Call *Extra* Edition – Nov 15, 2021

Daily Market Reports | Nov 15 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)

BRL   BTN   BWX   CHN   CUV   DMP   KMD   LKE   M7T   MGH   MNF   NTO (2)   OBL   OFX   PBH   PDN   PSC   RWC   SLK   UWL  

BRL    BATHURST RESOURCES LIMITED

Coal - Overnight Price: $0.77

Bell Potter rates ((BRL)) as Upgrade to Buy from Hold (1) -

Bathhurst Resources' quarterly production of 300,000 tonnes was not only a miss on Bell Potter's forecast but a -15% quarter-on-quarter decline, driven largely by weather impacts on production at the North Island Domestic business. 

Positively, stronger realised prices on hard coking coal offered revenue support and kept revenue consistent quarter-on-quarter. The company has retained its full-year guidance.

Bell Potter expects further upside to hard coking coal to benefit the company in the December quarter.

The rating is upgraded to Buy from Hold and the target price of $0.98 is retained. 

This report was published on November 5, 2021.

Target price is $0.98 Current Price is $0.77 Difference: $0.21
If BRL meets the Bell Potter target it will return approximately 27% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 0.00 cents and EPS of 37.40 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 2.06.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 11.27 cents and EPS of 23.20 cents.
At the last closing share price the estimated dividend yield is 14.64%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 3.32.

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

BTN    BUTN LIMITED

Overnight Price: $0.31

Canaccord Genuity rates ((BTN)) as Initiation of coverage with a Speculative Buy (1) -

Canaccord Genuity initiates coverage on Butn with a Speculative Buy rating and a $0.55 price target. The SME funder operates via a proprietary fintech platform that automates the funding process as well as integrating into third-party platform partners. 

The analyst likes the focus upon platform partners, which enables a greater potential to scale relative to traditional SME financiers. Also, its technology stack is platform-agnostic and its partners have global reach.

In addition, MYOB has a 19.9% shareholding which aligns its interests with Butn's growth plans, explains the broker. Risks include competition from large financial institutions, emerging fintechs and shadow lenders, cautions Canaccord.

This report was published on November 5, 2021.

Target price is $0.55 Current Price is $0.31 Difference: $0.24
If BTN meets the Canaccord Genuity target it will return approximately 77% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY22:

Canaccord Genuity forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 2.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 15.50.

Forecast for FY23:

Canaccord Genuity forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 2.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 15.50.

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

BWX    BWX LIMITED

Household & Personal Products - Overnight Price: $4.47

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

Moelis expects domestic sales for BWX to be weak in the first half of FY22 given skincare sales in both pharmacy and grocery declined during the quarter, while margins will likely be impacted by supply chain issues and increased freight costs. 

Additionally, further delays in the construction of a new manufacturing facility mean gross profit margin improvements expected to be driven by the facility won't be realised until FY23. Earnings per share forecasts are downgraded -14% to -16% through to FY24. 

The rating is downgraded to Hold from Buy and the target price decreases to $5.20 from $6.05.

This report was published on November 10, 2021.

Target price is $5.20 Current Price is $4.47 Difference: $0.73
If BWX meets the Moelis target it will return approximately 16% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY22:

Moelis forecasts a full year FY22 dividend of 4.70 cents and EPS of 14.40 cents.
At the last closing share price the estimated dividend yield is 1.05%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 31.04.

Forecast for FY23:

Moelis forecasts a full year FY23 dividend of 6.50 cents and EPS of 20.60 cents.
At the last closing share price the estimated dividend yield is 1.45%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 21.70.

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

CHN    CHALICE MINING LIMITED

Industrial Metals - Overnight Price: $9.78

Bell Potter rates ((CHN)) as Speculative Buy (1) -

Chalice Mining has published its maiden Mineral Resource Estimate for the Gonneville deposit in Western Australia, revealing a large, lower grade pit-constrained resource and a higher grade sulphide resource.

Bell Potter describes the resource as globally significant and strategic.

The broker says both resources are of high quality with roughly half available to conversion to reserves, the sulphide resource suggesting a mine life of at least 12 years and the lower grade resource suggesting a multi-generational mine life.

Bell Potter says the resources also support the green thematic, most notably green hydrogen, green ammonia and hydrogen fuel-cell production, with nickel and copper constituting about 35% of the recovered value.

Speculative Buy rating retained. Target price rises to $11.73 from $6.35.

This report was published on November 10, 2021.

Target price is $11.73 Current Price is $9.78 Difference: $1.95
If CHN meets the Bell Potter target it will return approximately 20% (excluding dividends, fees and charges).

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

CUV    CLINUVEL PHARMACEUTICALS LIMITED

Pharmaceuticals & Biotech/Lifesciences - Overnight Price: $32.18

Wilsons rates ((CUV)) as Downgrade to Market Weight from Overweight (3) -

Noting that recent share volatility for Clinuvel Pharmaceuticals has corrected, Wilsons has downgraded its rating on the company. 

The company's aim is now to diversify into the commercialisation of NEURACTHEL adrenocorticotropic hormones, but in Wilsons' view the portfolio addition is a confusing one, with launch pathways unclear and apparent limited expansion opportunity. 

The broker will look to 2021 product launches and progress on the vitiligo program to support a more positive long-term view on the company.

The rating is downgraded to Market Weight from Overweight and the target price of $33.19 is retained.

This report was published on November 9, 2021. 

Target price is $33.19 Current Price is $32.18 Difference: $1.01
If CUV meets the Wilsons target it will return approximately 3% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY22:

Wilsons forecasts a full year FY22 dividend of 5.80 cents and EPS of 68.20 cents.
At the last closing share price the estimated dividend yield is 0.18%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 47.18.

Forecast for FY23:

Wilsons forecasts a full year FY23 dividend of 6.10 cents and EPS of 79.70 cents.
At the last closing share price the estimated dividend yield is 0.19%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 40.38.

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

DMP    DOMINO'S PIZZA ENTERPRISES LIMITED

Food, Beverages & Tobacco - Overnight Price: $121.71

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

Weaker trading in Japan was largely responsible for a significant earnings miss by Domino's Pizza Enterprises versus the expectations held by Goldman Sachs. After the trading update, the analyst reduces the FY22 earnings forecast for Japan by -13.4%.

While same store sales growth in Japan has turned negative since the end of the state of emergency, A&NZ and European trading have remained resilient after reopening, explains the broker. Overall Goldman Sachs' long term outlook is unchanged.

The target price falls to $147 from $154.90 and the Buy rating is unchanged.

This report was published on November 3, 2021.

Target price is $147.00 Current Price is $121.71 Difference: $25.29
If DMP meets the Goldman Sachs target it will return approximately 21% (excluding dividends, fees and charges).
Current consensus price target is $127.88, suggesting upside of 0.7%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 dividend of 202.00 cents and EPS of 252.50 cents.
At the last closing share price the estimated dividend yield is 1.66%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 48.20.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 232.5, implying annual growth of 9.3%.
Current consensus DPS estimate is 186.1, implying a prospective dividend yield of 1.5%.
Current consensus EPS estimate suggests the PER is 54.6.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 dividend of 251.20 cents and EPS of 314.00 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 38.76.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 287.9, implying annual growth of 23.8%.
Current consensus DPS estimate is 231.6, implying a prospective dividend yield of 1.8%.
Current consensus EPS estimate suggests the PER is 44.1.

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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