Australian Broker Call *Extra* Edition – Nov 26, 2021

Daily Market Reports | Nov 26 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)

DMP   EHL   ELO   GTK   IPH   LOV   LTR   LYL   MND   MNY   MYX   PPH   SGM   WPR  

DMP    DOMINO'S PIZZA ENTERPRISES LIMITED

Food, Beverages & Tobacco - Overnight Price: $125.78

Jarden rates ((DMP)) as Overweight (2) -

Domino's Pizza has underperformed the index by -11% since its AGM, which reported weakness in Japan post-covid and no new M&A, leading to overvaluation assumptions. Jarden has since taken a closer look.

The broker finds that while Japan's one-year trend has been soft, the two-year trend shows improvement. More recent comments suggest further M&A may be imminent, and the broker can identify several opportunities.

Looking at enterprise value and return on capital invested, Jarden does not see the stock as expensive and retains Overweight. The issue is nonetheless confused by an unchanged target of $113, which is well below the current trading price.

This report was published on November 23, 2021.

Target price is $113.00 Current Price is $125.78 Difference: minus $12.78 (current price is over target).
If DMP meets the Jarden target it will return approximately minus 10% (excluding dividends, fees and charges - negative figures indicate an expected loss).
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:

Jarden forecasts a full year FY22 EPS of 235.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 53.52.

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:

Jarden forecasts a full year FY23 EPS of 296.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 42.49.

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

EHL    EMECO HOLDINGS LIMITED

Mining Sector Contracting - Overnight Price: $1.02

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

Emeco Holdings has reiterated its outlook for FY22, which Bell Potter notes guides to a marginally softer-than-expected first half outlook but strong growth across all segments in the second half. 

The broker explains tight WA labour markets and slow recovery in east coast rentals are driving the first half outlook. Positively, expect rental utilisation rates to approach pre-covid levels exiting FY22 and potential rental rate increases in 2022, offering forecast upside. 

The Buy rating and target price of $1.55 are retained. 

This report was published on November 19, 2021.

Target price is $1.55 Current Price is $1.02 Difference: $0.53
If EHL meets the Bell Potter target it will return approximately 52% (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 4.60 cents and EPS of 14.60 cents.
At the last closing share price the estimated dividend yield is 4.51%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 6.99.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 5.40 cents and EPS of 16.80 cents.
At the last closing share price the estimated dividend yield is 5.29%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 6.07.

Market Sentiment: 1.0
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: $5.53

Wilsons rates ((ELO)) as Underweight (5) -

An update from Elmo Software highlighted a additional $20m in liquidity, a combinationf of extended debt facility and Webexpense opting into scrip, but Wilsons estimates headroom equates to a year before cash balance is depleted given a potential $30m free cash flow loss in FY22 and FY23.

More positively, an increase in the Webexpenses earnout grew to $9m from $7.6m, suggesting improved trading in the UK market, which Wilsons expects is 2-3 months ahead of Australia, allowing potential for a background of economic stability in Australia in the second half. 

The Underweight rating is retained and the target price increases to $4.64 from $4.33.

This report was published on November 18, 2021.

Target price is $4.64 Current Price is $5.53 Difference: minus $0.89 (current price is over target).
If ELO meets the Wilsons target it will return approximately minus 16% (excluding dividends, fees and charges - negative figures indicate an expected loss).
The company's fiscal year ends in June.

Forecast for FY22:

Wilsons forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 37.20 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 14.87.

Forecast for FY23:

Wilsons forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 30.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 18.43.

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

GTK    GENTRACK GROUP LIMITED

Software & Services - Overnight Price: $1.82

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

The UK energy crisis has resulted in the toughest conditions the market has ever seen, Shaw & Partners notes, so far leading to the failure of 21 energy companies in 2021. But Gentrack Group may have seen some positives.

The broker is watching closely to see if any more of Gentrack's customers go under, but one customer, Shell, has been acting as supplier of the last resort, and a recent trading update suggested 10% revenue growth in FY22.

There is an ongoing risk of failures, but Shaw believes this is priced in. Hence on valuation, the broker retains Buy (High Risk) and a $3.35 target.

This report was published on November 23, 2021.

Target price is $3.35 Current Price is $1.82 Difference: $1.53
If GTK meets the Shaw and Partners target it will return approximately 84% (excluding dividends, fees and charges).
The company's fiscal year ends in September.

Forecast for FY21:

Shaw and Partners forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 1.50 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 121.09.

Forecast for FY22:

Shaw and Partners forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 8.17 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 22.27.

This company reports in NZD. All estimates have been converted into AUD by FNArena at present FX values.
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources


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