Australian Broker Call *Extra* Edition – Dec 13, 2021

This story features A2 MILK COMPANY LIMITED, and other companies. For more info SHARE ANALYSIS: A2M

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)

A2M   ALG   CAR   COE   DSE   FLT   JIN   MTO   PLY   SLR   TAH   TLX   TNT   TRJ   VUL   WEB   WPL  

A2M    A2 MILK COMPANY LIMITED

Dairy – Overnight Price: $5.64

Bell Potter rates ((A2M)) as Buy (1) –

While making no change to its $7.70 target price for the a2 Milk Co, Bell Potter sees scope for EPS to double by FY26.

The analyst believes this is possible provided the China offline expansion strategy is executed and 50% of the lost sales of English label infant milk formula (from FY20-21) can be recovered.

An additional lift would come from exiting the loss-making US assets or performing a turnaround at the Mataura Valley Milk, points out the broker. The Buy rating is unchanged.

This report was published on December 8, 2021.

Target price is $7.70 Current Price is $5.64 Difference: $2.06
If A2M meets the Bell Potter target it will return approximately 37% (excluding dividends, fees and charges).
Current consensus price target is $6.96, suggesting upside of 22.8%(ex-dividends)
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 15.62 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 36.10.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 15.3, 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 37.1.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 0.00 cents and EPS of 19.48 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 28.95.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 21.1, implying annual growth of 37.9%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 26.9.

This company reports in NZD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.2
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

ALG    ARDENT LEISURE GROUP LIMITED

Travel, Leisure & Tourism – Overnight Price: $1.48

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

Peer disclosures and economic data points have provided confidence in Canaccord Genuity's expectation that Ardent Leisure Group's Main Event segment should benefit from continuing robust trading in the near term.

The broker also expects inflation commentary to be impacting investor sentiment. Despite commodity inflation impacting industry food cost margins and labour inflation impacting labour costs, the broker maintains a positive outlook.

The Buy rating and target price of $1.97 are retained.

This report was published on December 8, 2021.

Target price is $1.97 Current Price is $1.48 Difference: $0.49
If ALG meets the Canaccord Genuity target it will return approximately 33% (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 1.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 148.00.

Forecast for FY23:

Canaccord Genuity forecasts a full year FY23 dividend of 0.00 cents and EPS of 4.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 37.00.

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

CAR    CARSALES.COM LIMITED

Automobiles & Components – Overnight Price: $26.22

Goldman Sachs rates ((CAR)) as Neutral (3) –

Goldman Sachs believes domestic targets set at Carsales.com's investor day were below consensus expectations though the broker gives credit for management's greater disclosure around the international operations.

The company’s estimate of only 15% volume share and 15-25% fees for the Select (digital used car service) opportunity disappointed the analyst. While management reiterated its FY22 guidance, no long term targets were disclosed.

Management was positive on Trader Interactive (within the international operations) noting dealer wallet data shows upside in a shift to a leads-based model. 

Goldman Sachs increases its target price to $26.70 from $26.40 and maintains its Neutral rating.

This report was published on December 8, 2021.

Target price is $26.70 Current Price is $26.22 Difference: $0.48
If CAR meets the Goldman Sachs target it will return approximately 2% (excluding dividends, fees and charges).
Current consensus price target is $24.59, suggesting downside of -6.8%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 dividend of 57.00 cents and EPS of 68.30 cents.
At the last closing share price the estimated dividend yield is 2.17%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 38.39.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 67.6, implying annual growth of 28.4%.
Current consensus DPS estimate is 54.7, implying a prospective dividend yield of 2.1%.
Current consensus EPS estimate suggests the PER is 39.0.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 dividend of 66.00 cents and EPS of 79.10 cents.
At the last closing share price the estimated dividend yield is 2.52%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 33.15.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 77.1, implying annual growth of 14.1%.
Current consensus DPS estimate is 63.5, implying a prospective dividend yield of 2.4%.
Current consensus EPS estimate suggests the PER is 34.2.

Market Sentiment: 0.2
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

COE    COOPER ENERGY LIMITED

Crude Oil – Overnight Price: $0.28

Jarden rates ((COE)) as Neutral (3) –

Cooper Energy has downgraded production guidance to 3.0-3.4mmboe from 3.0-3.6mmboe on higher gas purchase costs and delayed Phase 2B works. The latter means there will be fewer months of possible higher output in FY22, explains Jarden.

FY22 earnings guidance was reduced by -$7m, due to higher third party gas purchase costs. The target price falls to $0.29 from $0.30. The Neutral rating is maintained.

In contemplating the acquisition of the Orbost gas processing plant (recently mooted by management), Jarden notes it would significantly improve gas margins though funding could be a challenge.

This report was published on December 8, 2021.

Target price is $0.29 Current Price is $0.28 Difference: $0.01
If COE meets the Jarden target it will return approximately 4% (excluding dividends, fees and charges).
Current consensus price target is $0.28, suggesting downside of -0.7%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Jarden forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 0.90 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 31.11.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -1.2, 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 FY23:

Jarden forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 0.30 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 93.33.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 0.5, 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 56.0.

Market Sentiment: 0.1
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

DSE    DROPSUITE LIMITED

Cloud services – Overnight Price: $0.21

Canaccord Genuity rates ((DSE)) as Initiation of coverage with Buy (1) –

Canaccord Genuity initiates coverage on global cloud software platform Dropsuite. The company supports 575,000 active users, generating annual recurring revenue of $13.1m which has increased 79% in the last year. 

With small and medium entities increasingly outsourcing IT services, data suggests the cloud backup and recovery software industry is estimated to be worth US$22bn by 2025, from US$6bn in 2017. 

In Canaccord's view Dropsuite is a profitable, high-growth, recurring revenue model business operating in a large and increasing addressable market.

The broker initiates with a Buy rating and a target price of $0.30.

This report was published on December 8, 2021.

Target price is $0.30 Current Price is $0.21 Difference: $0.09
If DSE meets the Canaccord Genuity target it will return approximately 43% (excluding dividends, fees and charges).
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 0.00 cents.

Forecast for FY22:

Canaccord Genuity forecasts a full year FY22 dividend of 0.00 cents and EPS of 0.10 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 210.00.

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

FLT    FLIGHT CENTRE TRAVEL GROUP LIMITED

Travel, Leisure & Tourism – Overnight Price: $17.78

Goldman Sachs rates ((FLT)) as Neutral (3) –

Flight Centre has a significant business in South Africa (where the omicron outbreak originated) and Goldman Sachs expects a slowdown in recovery in the EMEA region in late 1H22 and early 2H22.

Despite this setback, the broker makes no changes to its outlook into FY23 and beyond.

Under a worst case scenario, recovery would be delayed another six months, estimates the analyst. However, it’s thought this scenario is rendered unlikely as hospitalisation rates remain under control at this stage.

The Neutral rating is maintained and the target price falls to $20.40 from $20.70, after Goldman Sachs allows for an AGM earnings update and the recent issue of convertible notes.

This report was published on December 9, 2021.

Target price is $20.40 Current Price is $17.78 Difference: $2.62
If FLT meets the Goldman Sachs target it will return approximately 15% (excluding dividends, fees and charges).
Current consensus price target is $18.81, suggesting upside of 6.3%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 81.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 21.95.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -58.8, 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 FY23:

Goldman Sachs forecasts a full year FY23 dividend of 0.00 cents and EPS of 78.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 22.79.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 75.6, implying annual growth of N/A.
Current consensus DPS estimate is 19.3, implying a prospective dividend yield of 1.1%.
Current consensus EPS estimate suggests the PER is 23.4.

Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

JIN    JUMBO INTERACTIVE LIMITED

Gaming – Overnight Price: $19.19

Goldman Sachs rates ((JIN)) as Neutral (3) –

Goldman Sachs assesses positive momentum for Jumbo Interactive through the first half of 2022 from the latest domestic lottery trends. The broker makes changes to earnings forecasts to largely reflect the latest run of jackpots and current app downloads data.

After allowing for the defensive nature of the company’s assets and the strong operating environment, the broker raises its valuation multiple, and consequently its target price to $17.20 from $16.30. The Neutral rating is maintained 

This report was published on December 8, 2021.

Target price is $17.20 Current Price is $19.19 Difference: minus $1.99 (current price is over target).
If JIN meets the Goldman Sachs target it will return approximately minus 10% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $17.37, suggesting downside of -7.4%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 EPS of 53.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 36.21.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 50.7, implying annual growth of 17.4%.
Current consensus DPS estimate is 36.5, implying a prospective dividend yield of 1.9%.
Current consensus EPS estimate suggests the PER is 37.0.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 EPS of 63.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 30.46.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 61.0, implying annual growth of 20.3%.
Current consensus DPS estimate is 50.0, implying a prospective dividend yield of 2.7%.
Current consensus EPS estimate suggests the PER is 30.8.

Market Sentiment: 0.7
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

MTO    MOTORCYCLE HOLDINGS LIMITED

Automobiles & Components – Overnight Price: $3.03

Moelis rates ((MTO)) as Buy (1) –

Moelis lifts its target price for Motorcycle Holdings to $3.70 from $3.54 and retains Buy after stronger-than-expected 1H trading. Management expects 1H underlying earnings (EBITDA) of between $16-18m, a 10-24% beat on the analyst's estimate.

The broker upgrades FY22-24 EPS forecasts for the stronger trading conditions and also incorporates the impact of two recent acquisitions in the outer years.

The company announced the acquisition of Widebay Motorcycles in Queensland. Also, Forbes & Davies, the accessories importer and distributor in New Zealand, was acquired in early November.

This report was published on December 8, 2021.

Target price is $3.70 Current Price is $3.03 Difference: $0.67
If MTO meets the Moelis target it will return approximately 22% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY22:

Moelis forecasts a full year FY22 dividend of 19.70 cents and EPS of 32.70 cents.
At the last closing share price the estimated dividend yield is 6.50%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.27.

Forecast for FY23:

Moelis forecasts a full year FY23 dividend of 17.70 cents and EPS of 29.30 cents.
At the last closing share price the estimated dividend yield is 5.84%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.34.

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

PLY    PLAYSIDE STUDIOS LIMITED

Gaming – Overnight Price: $0.87

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

PlaySide Studios has won a work-for-hire contract with Shibu Inu cryptocurreny entity, Shibu Inu Games, to develop a collectible card game. Canaccord Genuity notes PlaySide Studios gains exposure to demonstrate competence in the emerging cryptogaming space.

It is expected  game elements will permit purchase of NFTs and Shiba Inu tokens to increase monetisation, utilising tech that is expected to become more widely adopted in gaming over time.

The Buy rating and target price of $1.00 are retained.

This report was published on December 8, 2021.

Target price is $1.00 Current Price is $0.87 Difference: $0.13
If PLY meets the Canaccord Genuity target it will return approximately 15% (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 0.40 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 217.50.

Forecast for FY23:

Canaccord Genuity forecasts a full year FY23 dividend of 0.00 cents and EPS of 0.50 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 174.00.

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

SLR    SILVER LAKE RESOURCES LIMITED

Gold & Silver – Overnight Price: $1.61

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

Silver Lake Resources has announced it has entered into a Subscription Agreement to acquire Harte Gold, having recently acquired Harte Gold's credit facilities, for a headline cost of around US$125 as reported by Canaccord Genuity.

The purchase cost comprises an approximate US$74.1m non-cash credit bid that includes the provision of a $10.8m debtor-in-possession loan to support working capital, and $28m in Silver Lake Resources shares that will satisfy debt with Appian Capital.

The agreement would see Silver Lake Resources become the sole shareholder of Harte Gold. Canaccord notes the purchase could benefit the company's production profile by 60,000 ounces per annum on feasibility study projections. 

The Buy rating is retained and the target price increases to $2.20 from $2.15.

This report was published on December 8, 2021.

Target price is $2.20 Current Price is $1.61 Difference: $0.59
If SLR meets the Canaccord Genuity target it will return approximately 37% (excluding dividends, fees and charges).
Current consensus price target is $1.95, suggesting upside of 18.9%(ex-dividends)
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 8.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 20.13.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 9.3, implying annual growth of -16.5%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 17.6.

Forecast for FY23:

Current consensus EPS estimate is 10.1, implying annual growth of 8.6%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 16.2.

Market Sentiment: 0.7
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

TAH    TABCORP HOLDINGS LIMITED

Gaming – Overnight Price: $5.05

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

Goldman Sachs assesses positive momentum for Tabcorp Holdings through the first half of 2022 from the latest domestic lottery trends. The broker makes changes to earnings forecasts to largely reflect the latest run of jackpots and current app downloads data.

After allowing for the defensive nature of the company’s assets and the strong operating environment, the broker raises its valuation multiple, and consequently its target price to $6.00 from $5.81. The Buy rating is maintained.

The analyst highlights the potential access to new and different ESG-focused investor categories, as a result of a standalone lottery business, which may drive a re-rate in multiple.

This report was published on December 8, 2021.

Target price is $6.00 Current Price is $5.05 Difference: $0.95
If TAH meets the Goldman Sachs target it will return approximately 19% (excluding dividends, fees and charges).
Current consensus price target is $5.53, suggesting upside of 10.1%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 EPS of 17.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 29.71.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 16.8, implying annual growth of 36.4%.
Current consensus DPS estimate is 14.2, implying a prospective dividend yield of 2.8%.
Current consensus EPS estimate suggests the PER is 29.9.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 EPS of 23.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 21.96.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 20.7, implying annual growth of 23.2%.
Current consensus DPS estimate is 16.6, implying a prospective dividend yield of 3.3%.
Current consensus EPS estimate suggests the PER is 24.3.

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

TLX    TELIX PHARMACEUTICALS LIMITED

Pharmaceuticals & Biotech/Lifesciences – Overnight Price: $7.97

Jarden rates ((TLX)) as Buy (1) –

Telix Pharmaceuticals has struck a commercial distribution agreement with Madrid-based NUCLIBER. Jarden explains NUCLIBER was selected for its ability to deliver a secure and continuous supply of 68Ga (the radiation source needed to synthesise ILLUCCIX).

ILLUCCIX is the company's prostate cancer imaging-investigational product and the analyst explains the incidence of prostate cancer in Spain accounts for around 14% of the broker's EU total addressable market.

Jarden points to FDA approval for ILLUCCIX (expected in December, 2021) as the next big catalyst for the share price.

The Buy rating and $7.90 target price are retained.

This report was published on December 8, 2021.

Target price is $7.90 Current Price is $7.97 Difference: minus $0.07 (current price is over target).
If TLX meets the Jarden target it will return approximately minus 1% (excluding dividends, fees and charges – negative figures indicate an expected loss).
The company's fiscal year ends in December.

Forecast for FY21:

Jarden forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 21.50 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 37.07.

Forecast for FY22:

Jarden forecasts a full year FY22 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 104.87.

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

TNT    TESSERENT LIMITED

IT & Support – Overnight Price: $0.18

Shaw and Partners rates ((TNT)) as Buy (1) –

Shaw and Partners believes Tesserent has removed a near-term share price headwind and reaffirmed the company's outlook, after announcing two acquisitions in the Federal government sphere.

The company acquired Pearson Corp, the provider of Essential Eight programs across government departments and agencies, and Claricent, a provider of governance risk and compliance services.

These transactions provide the broker with further comfort around management’s ability to execute on its stated plans.

Shaw retains its Buy rating and $0.35 target price.

This report was published on December 8, 2021.

Target price is $0.35 Current Price is $0.18 Difference: $0.17
If TNT meets the Shaw and Partners target it will return approximately 94% (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 0.70 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 25.71.

Forecast for FY23:

Shaw and Partners forecasts a full year FY23 dividend of 0.00 cents and EPS of 1.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.00.

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

TRJ    TRAJAN GROUP HOLDINGS LIMITED

Medical Equipment & Devices – Overnight Price: $3.37

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

Trajan Group Holdings has announced the purchase of LEAP PAL Parts and Consumables for US$7.7m, in what Canaccord Genuity notes is the company's second acquisition within the space of a month.

The company expects the purchase will provide a $5.2m revenue benefit in FY22 and a $10.4m benefit in FY23, bringing total acquired revenue contribution to $19.7m and $33.7m for the same years.

Notably, Trajan acquired LEAP Technologies, which was part of the same business as LEAP Pal Parts and Consumables, in 2016, which should allow for simplified office integration. 

The Buy rating and target price of $2.86 are retained.

This report was published on December 8, 2021.

Target price is $2.86 Current Price is $3.37 Difference: minus $0.51 (current price is over target).
If TRJ meets the Canaccord Genuity target it will return approximately minus 15% (excluding dividends, fees and charges – negative figures indicate an expected loss).
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 6.20 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 54.35.

Forecast for FY23:

Canaccord Genuity forecasts a full year FY23 dividend of 0.00 cents and EPS of 8.50 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 39.65.

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

VUL    VULCAN ENERGY RESOURCES LIMITED

New Battery Elements – Overnight Price: $11.50

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

Vulcan Energy Resources has announced the signing of a definitive offtake agreement with Volkswagen for 34-42,000 tonnes of lithium hydroxide to be provided over five years from 2026.

The agreement with Volkswagen adds to the list of offtake agreements Vulcan has already secured with Stellantis, Renault, Umicore and LG Energy Systems. Similar to existing agreements, pricing will be based on market rates.

The Speculative Buy rating and target price of $21.00 are retained.

This report was published on December 8, 2021.

Target price is $21.00 Current Price is $11.50 Difference: $9.5
If VUL meets the Canaccord Genuity target it will return approximately 83% (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 12.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 95.83.

Forecast for FY23:

Canaccord Genuity forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 22.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 52.27.

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

WEB    WEBJET LIMITED

Travel, Leisure & Tourism – Overnight Price: $5.49

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

In the wake of Webjet’s 1H results, Goldman Sachs assesses positive progress in the reopening. The analyst believes the 20% cost savings target remains intact for WebBeds, a division believed to have a long-term-growth story.

The broker’s positive assessment comes despite a slight miss for 1H earnings (EBITDA) versus the analyst’s expectations. However, the result was considered positive in terms of cash generation and recovery in the Americas, among a few other qualitative markers.

Goldman Sachs makes no changes to its estimates due to the omicron variant and sees Webjet as a net beneficiary of the post-covid recovery. 

The Buy rating is maintained and the target price falls to $6.90 from $7.

This report was published on December 9, 2021

Target price is $6.90 Current Price is $5.49 Difference: $1.41
If WEB meets the Goldman Sachs target it will return approximately 26% (excluding dividends, fees and charges).
Current consensus price target is $6.15, suggesting upside of 12.1%(ex-dividends)
The company's fiscal year ends in March.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 14.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 39.21.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -10.3, implying annual growth of N/A.
Current consensus DPS estimate is 2.6, implying a prospective dividend yield of 0.5%.
Current consensus EPS estimate suggests the PER is N/A.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 dividend of 9.00 cents and EPS of 19.00 cents.
At the last closing share price the estimated dividend yield is 1.64%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 28.89.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 19.9, implying annual growth of N/A.
Current consensus DPS estimate is 5.3, implying a prospective dividend yield of 1.0%.
Current consensus EPS estimate suggests the PER is 27.5.

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

WPL    WOODSIDE PETROLEUM LIMITED

NatGas – Overnight Price: $22.03

Jarden rates ((WPL)) as Buy (1) –

Hydrogen and ammonia, and to a lesser extent solar and carbon capture and storage (CCS) projects, are the focus of Woodside Petroleum's new energy strategy, explains Jarden.

The broker believes the right balance for the proposed -5bn investment has been struck with less than 20% of 2022-30 estimated cumulative free cash flow required for 2026-30. This period is where the bulk of the investment is skewed, notes the analyst.

Emissions reduction targets were reiterated by management and are on track after the proposed BHP ((BHP)) petroleum merger, which is considered a positive by Jarden.

The Buy rating and $28.60 target price are maintained.

This report was published on December 8, 2021.

Target price is $28.60 Current Price is $22.03 Difference: $6.57
If WPL meets the Jarden target it will return approximately 30% (excluding dividends, fees and charges).
Current consensus price target is $26.63, suggesting upside of 18.7%(ex-dividends)
The company's fiscal year ends in December.

Forecast for FY21:

Jarden forecasts a full year FY21 dividend of 143.29 cents and EPS of 176.99 cents.
At the last closing share price the estimated dividend yield is 6.50%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.45.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 180.1, implying annual growth of N/A.
Current consensus DPS estimate is 125.8, implying a prospective dividend yield of 5.6%.
Current consensus EPS estimate suggests the PER is 12.5.

Forecast for FY22:

Jarden forecasts a full year FY22 dividend of 180.44 cents and EPS of 274.78 cents.
At the last closing share price the estimated dividend yield is 8.19%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 8.02.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 256.0, implying annual growth of 42.1%.
Current consensus DPS estimate is 136.2, implying a prospective dividend yield of 6.1%.
Current consensus EPS estimate suggests the PER is 8.8.

This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

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