Australian Broker Call *Extra* Edition – Feb 16, 2022

This story features AUDINATE GROUP LIMITED, and other companies. For more info SHARE ANALYSIS: AD8

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)

AD8   DGL   DXI   ELO   JLG   KED   NAB   NAN   NWC   PPS   TGR  

AD8    AUDINATE GROUP LIMITED

Hardware & Equipment – Overnight Price: $7.41

Shaw and Partners rates ((AD8)) as Buy (1) –

Shaw and Partners' sales forecasts was met though the H1 bottom line slightly missed, but the broker makes it clear: the latter is of no importance.

The future directory for Audinate Group remains positive, says the broker, with current headwinds deemed to be temporary. Earnings estimates have reduced, which leads to a lower price target; $11.75 instead of $12.

Buy rating is unchanged. Audinate reaching profitability seems to have been pushed out by 12 months, to FY24.

This report was published on February 15, 2022.

Target price is $11.75 Current Price is $7.41 Difference: $4.34
If AD8 meets the Shaw and Partners target it will return approximately 59% (excluding dividends, fees and charges).
Current consensus price target is $10.60, suggesting upside of 43.0%(ex-dividends)
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 4.40 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 168.41.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -9.2, 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:

Shaw and Partners forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 3.30 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 224.55.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 0.4, 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 1852.5.

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

DGL    DGL GROUP LIMITED

Commercial Services & Supplies – Overnight Price: $2.79

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

DGL Group, the specialty chemicals and logistics company, delivered preliminary 1H results well ahead of Bell Potter's expectations. Moreover, earnings guidance was estimated to be a 30% upgrade to the FY22 consensus estimate.

The analyst attributes the 160bps margin expansion to some earlier than expected network benefits from acquisitions completed during the first half.

The broker sees large network upside for the chemicals, transport and liquid waste vertical. The target rises to $3.05 from $3 and the Buy rating is unchanged.

This report was published on February 11, 2022.

Target price is $3.05 Current Price is $2.79 Difference: $0.26
If DGL meets the Bell Potter target it will return approximately 9% (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 10.40 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 26.83.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 0.00 cents and EPS of 10.90 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 25.60.

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

DXI    DEXUS INDUSTRIA REIT

REITs – Overnight Price: $3.19

Moelis rates ((DXI)) as Hold (3) –

Following 1H results, Moelis suggests recent share price falls provide a relatively attractive time to acquire shares in Dexus Industria REIT, despite maintaining a Hold rating. 

Over the past year strong leasing outcomes have underpinned the portfolio, explains the analyst. 

While the development pipeline is a minor drag on earnings, the broker notes this also represents medium-term growth potential for net tangible assets (NTA) and earnings.

Moelis' target price rises to $3.47 from $3.43, due to a lower cost of debt and increased capital deployment at Jandakot in Perth.

This report was published on February 10, 2022.

Target price is $3.47 Current Price is $3.19 Difference: $0.28
If DXI meets the Moelis target it will return approximately 9% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY22:

Moelis forecasts a full year FY22 dividend of 17.30 cents and EPS of 18.50 cents.
At the last closing share price the estimated dividend yield is 5.42%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.24.

Forecast for FY23:

Moelis forecasts a full year FY23 dividend of 17.50 cents and EPS of 19.50 cents.
At the last closing share price the estimated dividend yield is 5.49%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.36.

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: $4.01

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

Shaw and Partners believes Elmo Software delivered a strong result, plus a strong start to FY22. It was all better-than-expected and management has upped its FY22 guidance.

Elmo is one of the broker's Top Picks for the year ahead and the standing Buy rating is once again re-iterated.

The broker explains top line growth is returning to pre-covid levels while cost growth is moderating and the combination of the two is driving operating leverage. Target $8.50 (unchanged).

This report was published on February 15, 2022.

Target price is $8.50 Current Price is $4.01 Difference: $4.49
If ELO meets the Shaw and Partners target it will return approximately 112% (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 40.20 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 9.98.

Forecast for FY23:

Shaw and Partners forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 21.40 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 18.74.

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

JLG    JOHNS LYNG GROUP LIMITED

Building Products & Services – Overnight Price: $7.86

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

Following Johns Lyng Group's completed acquisition of US insurance repair provider Reconstruction Experts, Goldman Sachs incorporates the transaction into forecasts, resulting in a 37% jump in target price to $9.30. Buy.

The analyst expects the purchase will provide scale in the US partly from a horizontal expansion into build-to-rent, non-Homeowners Association (HOA), single family homes and commercial properties.

Moreover, Johns Lyng Group's expertise in insurance building & restoration services (IB&RS) should expand the service offering.

Goldman Sachs expects a solid upcoming 1H result and expects an upgrade to FY22 guidance.

This report was published on February 14, 2022.

Target price is $9.30 Current Price is $7.86 Difference: $1.44
If JLG meets the Goldman Sachs target it will return approximately 18% (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 7.00 cents and EPS of 15.00 cents.
At the last closing share price the estimated dividend yield is 0.89%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 52.40.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 dividend of 11.00 cents and EPS of 21.00 cents.
At the last closing share price the estimated dividend yield is 1.40%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 37.43.

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

KED    KEYPATH EDUCATION INTERNATIONAL INC

Education & Tuition – Overnight Price: $2.80

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

Shaw and Partners believes Keypath Education International released a strong interim report, leaving the recent IPO well-positioned to achieve prospectus forecasts.

The broker re-iterates its Buy rating alongside a price target of $4.65 (unchanged).

The analyst suggests the current share price is "a fantastic entry point" for investors seeking to own a quality business. 

This report was published on February 15, 2022.

Target price is $4.65 Current Price is $2.80 Difference: $1.85
If KED meets the Shaw and Partners target it will return approximately 66% (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 9.60 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 29.17.

Forecast for FY23:

Shaw and Partners forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 5.80 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 48.28.

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

NAB    NATIONAL AUSTRALIA BANK LIMITED

Banks – Overnight Price: $30.42

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

Bell Potter increases its valuation and price target for National Australia Bank by almost 5% following unaudited 1Q results.

Despite covid headwinds, cash earnings increased by 12%, due to benign asset quality and strong momentum across the business, explains the analyst.

The broker now forecasts strong growth from Corporate and Institutional Banking. A fall in forecast net interest margin (NIM) is offset by higher expected banking volumes. Moreover, lower impairment charges are expected each forecast year.

The Buy rating is maintained and the target is set at $32.50, up from $31.

This report was published on February 11, 2022.

Target price is $32.50 Current Price is $30.42 Difference: $2.08
If NAB meets the Bell Potter target it will return approximately 7% (excluding dividends, fees and charges).
Current consensus price target is $30.86, suggesting upside of 1.4%(ex-dividends)
The company's fiscal year ends in September.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 136.00 cents and EPS of 204.00 cents.
At the last closing share price the estimated dividend yield is 4.47%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.91.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 202.6, implying annual growth of 5.0%.
Current consensus DPS estimate is 142.7, implying a prospective dividend yield of 4.7%.
Current consensus EPS estimate suggests the PER is 15.0.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 140.00 cents and EPS of 209.00 cents.
At the last closing share price the estimated dividend yield is 4.60%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.56.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 219.4, implying annual growth of 8.3%.
Current consensus DPS estimate is 153.7, implying a prospective dividend yield of 5.1%.
Current consensus EPS estimate suggests the PER is 13.9.

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

NAN    NANOSONICS LIMITED

Medical Equipment & Devices – Overnight Price: $4.77

Wilsons rates ((NAN)) as Upgrade to Overweight from Market Weight (1) –

Wilsons is positive on Nanosonics' North American sales model restructure and upgrades its rating to Overweight from Market-weight. Trophon reseller GE Healthcare will transfer to a pass-through OEM arrangement and no longer carry capital inventory.

Given Nanosonics assumed control of its US consumables resupply business in FY20, the analyst sees this latest move as a natural step. The company is now expected to attain a higher average selling price for Trophon-2, and at a greater margin.

In addition, with the removal of GE Healthcare, other ultrasound OEMS may increase engagement with Nanosonics. The target price falls to $7 from $7.18.

This report was published on February 15, 2022.

Target price is $7.00 Current Price is $4.77 Difference: $2.23
If NAN meets the Wilsons target it will return approximately 47% (excluding dividends, fees and charges).
Current consensus price target is $5.01, suggesting upside of 5.0%(ex-dividends)
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 1.90 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 251.05.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 1.7, implying annual growth of -40.4%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 280.6.

Forecast for FY23:

Wilsons forecasts a full year FY23 dividend of 0.00 cents and EPS of 4.50 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 106.00.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 6.0, implying annual growth of 252.9%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 79.5.

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

NWC    NEW WORLD RESOURCES LIMITED

Copper – Overnight Price: $0.07

Shaw and Partners rates ((NWC)) as Initiation of coverage with Buy (1) –

Shaw and Partners has initiated coverage on New World Resources with a Buy rating and $0.20ps price target.

New World is a copper development company focused on restart of the high-grade Antler copper mine in Arizona, USA. The broker believes ongoing expansion of the Resource is likely.

This report was published on February 15, 2022.

Target price is $0.20 Current Price is $0.07 Difference: $0.13
If NWC meets the Shaw and Partners target it will return approximately 186% (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 4.60 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 1.52.

Forecast for FY23:

Shaw and Partners forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 10.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 0.70.

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

PPS    PRAEMIUM LIMITED

Wealth Management & Investments – Overnight Price: $0.99

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

Praemium delivered a weaker-than-anticipated interim performance, comment Shaw and Partners, plus weaker FY22 guidance on top.

Higher costs on top of acquisition costs re Powerwrap are the main responsible factors. The broker reduces forecasts.

Shaw explains Praemium normally does not quantify its guidance, so it's a positive the platform operator did so this time, albeit with the observation that guidance was a disappointment.

Price target drops -10c to $1.70. Buy/High Risk rating retained.

This report was published on February 15, 2022.

Target price is $1.70 Current Price is $0.99 Difference: $0.71
If PPS meets the Shaw and Partners target it will return approximately 72% (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 0.20 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 495.00.

Forecast for FY23:

Shaw and Partners forecasts a full year FY23 dividend of 0.00 cents and EPS of 0.90 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 110.00.

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

TGR    TASSAL GROUP LIMITED

Aquaculture – Overnight Price: $3.66

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

Tassal Group's 1H earnings (EBITDA) missed Goldman Sachs estimate by -5% due to increased supply chain costs, which are expected to be offset by higher domestic wholesale prices in the 2H.

The price rises are expected from tightening supply demand for Atlantic salmon. The analyst also expects a strong 2H for the Tiger Prawns segment. The Buy rating and target price of $4.20 are unchanged.

Operating cash flow  was much improved versus the previous corresponding period, and was a 34% beat versus the broker's forecast.

This report was published on February 15, 2022.

Target price is $4.20 Current Price is $3.66 Difference: $0.54
If TGR meets the Goldman Sachs target it will return approximately 15% (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 4.64%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.07.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 dividend of 18.00 cents and EPS of 30.00 cents.
At the last closing share price the estimated dividend yield is 4.92%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.20.

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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Disclaimer:
The content of this information does in no way reflect the opinions of FNArena, or of its journalists. In fact we don't have any opinion about the stock market, its value, future direction or individual shares. FNArena solely reports about what the main experts in the market note, believe and comment on. By doing so we believe we provide intelligent investors with a valuable tool that helps them in making up their own minds, reading market trends and getting a feel for what is happening beneath the surface. This document is provided for informational purposes only. It does not constitute an offer to sell or a solicitation to buy any security or other financial instrument. FNArena employs very experienced journalists who base their work on information believed to be reliable and accurate, though no guarantee is given that the daily report is accurate or complete. Investors should contact their personal adviser before making any investment decision.

As part of emerging new trends overseas, The Australian Broker Call *Extra* Edition also includes providers of sponsored research. Readers should bear in mind, sponsored research, while not necessarily of lower quality, has the embedded complication that the company that is the subject of the research has paid for this research. Providers of sponsored research that can potentially be included in this Report are Breakaway Research, Edison Investment Research, Independent Investment Research, NDF Research, Pitt Street Research, and TMT Analytics.

Decisions about inclusions in this Report are made independently of the providers of stock market research and at full discretion of the team of journalists responsible for content at FNArena. Inclusion does not equal endorsement, in any way, shape or form. This Report is provided for informational purposes only.

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