Australian Broker Call *Extra* Edition – Feb 21, 2022

This story features CODAN LIMITED, and other companies. For more info SHARE ANALYSIS: CDA

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.

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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)

CDA   DHG (2)   HCW   ING   MFG   OBL   PWH (2)   QBE   RFF (2)  

CDA    CODAN LIMITED

Hardware & Equipment – Overnight Price: $8.11

Moelis rates ((CDA)) as Buy (1) –

Codan's first half results were a mixed bag, with profit of $50.1m a 21% increase on the previous comparable period while disruption in the Sudan region drove a -$17m reduction in Metal Detection on lower gold sales. 

Performance from Communications acquisitions drove the profit result, and Moelis notes excluding acquisitions earnings were down -3%. Gold sales in the Sudan region remain uncertain, although coin and treasure detector sales remained at record levels in the half. 

The Buy rating is retained and the target price decreases to $12.23 from $13.43.

This report was published on February 21, 2022.

Target price is $12.23 Current Price is $8.11 Difference: $4.12
If CDA meets the Moelis target it will return approximately 51% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY22:

Moelis forecasts a full year FY22 dividend of 31.00 cents and EPS of 56.60 cents.
At the last closing share price the estimated dividend yield is 3.82%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.33.

Forecast for FY23:

Moelis forecasts a full year FY23 dividend of 33.50 cents and EPS of 61.00 cents.
At the last closing share price the estimated dividend yield is 4.13%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.30.

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

DHG    DOMAIN HOLDINGS AUSTRALIA LIMITED

Real Estate – Overnight Price: $4.20

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

A strong revenue environment and lower than expected capital expenditure saw Domain Holdings deliver a beat on Goldman Sachs' first half forecasts, with sales 2% over the broker's expectations, earnings up 8% and profit up 20%.

Goldman Sachs noted yield growth continues to be strong, up 19% on the previous comparable period, which the broker expects should support 12% earnings growth in FY23 despite an expected listings decline as the market normalises. 

The Neutral rating is retained and the target price increases to $5.10. 

This report was published on February 18, 2022.

Target price is $5.10 Current Price is $4.20 Difference: $0.9
If DHG meets the Goldman Sachs target it will return approximately 21% (excluding dividends, fees and charges).
Current consensus price target is $5.30, suggesting upside of 26.8%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 dividend of 4.00 cents and EPS of 10.00 cents.
At the last closing share price the estimated dividend yield is 0.95%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 42.00.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 9.3, implying annual growth of 58.4%.
Current consensus DPS estimate is 5.8, implying a prospective dividend yield of 1.4%.
Current consensus EPS estimate suggests the PER is 44.9.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 dividend of 6.00 cents and EPS of 11.00 cents.
At the last closing share price the estimated dividend yield is 1.43%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 38.18.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 11.8, implying annual growth of 26.9%.
Current consensus DPS estimate is 8.2, implying a prospective dividend yield of 2.0%.
Current consensus EPS estimate suggests the PER is 35.4.

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

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Jarden rates ((DHG)) as Overweight (2) –

Domain Holdings Australia's December first-half result outpaced consensus by 10%, thanks to strong housing momentum, and management guided to a positive second half.

Jarden expects continued house price strength and stronger turnover for the next 12-18 months but expects euphoria will start fading from FY23. Higher than forecasts investment in Corporate and Consumer Solutions leads the broker to shave forecasts. 

Jarden believes the share price is oversold and retains an Overweight rating. Target price eases to $4.90 from $5.10

This report was published on February 18, 2022.

Target price is $4.90 Current Price is $4.20 Difference: $0.7
If DHG meets the Jarden target it will return approximately 17% (excluding dividends, fees and charges).
Current consensus price target is $5.30, suggesting upside of 26.8%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Jarden forecasts a full year FY22 dividend of 4.50 cents and EPS of 9.40 cents.
At the last closing share price the estimated dividend yield is 1.07%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 44.68.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 9.3, implying annual growth of 58.4%.
Current consensus DPS estimate is 5.8, implying a prospective dividend yield of 1.4%.
Current consensus EPS estimate suggests the PER is 44.9.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 5.60 cents and EPS of 11.10 cents.
At the last closing share price the estimated dividend yield is 1.33%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 37.84.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 11.8, implying annual growth of 26.9%.
Current consensus DPS estimate is 8.2, implying a prospective dividend yield of 2.0%.
Current consensus EPS estimate suggests the PER is 35.4.

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

HCW    HEALTHCO HEALTHCARE & WELLNESS REIT

REITs – Overnight Price: $2.09

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

HealthCo Healthcare & Wellness has reported first half earnings of $7.0m, largely in line with Goldman Sachs' forecast, and funds from operations of 1.8 cents per share, a beat on the broker's expectations.

The funds from operations beat was supported by lower than anticipated interest expenses as the company moved into a net cash position in December. Occupancy rates improved to 98% from 96%, and the development pipeline is ahead of schedule. 

The Buy rating and target price of $2.56 are retained. 

This report was published on February 18, 2022.

Target price is $2.56 Current Price is $2.09 Difference: $0.47
If HCW meets the Goldman Sachs target it will return approximately 22% (excluding dividends, fees and charges).
Current consensus price target is $2.48, suggesting upside of 20.6%(ex-dividends)
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 5.00 cents.
At the last closing share price the estimated dividend yield is 3.35%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 41.80.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 6.8, implying annual growth of N/A.
Current consensus DPS estimate is 7.9, implying a prospective dividend yield of 3.8%.
Current consensus EPS estimate suggests the PER is 30.3.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 dividend of 8.00 cents and EPS of 9.00 cents.
At the last closing share price the estimated dividend yield is 3.83%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 23.22.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 9.4, implying annual growth of 38.2%.
Current consensus DPS estimate is 9.2, implying a prospective dividend yield of 4.5%.
Current consensus EPS estimate suggests the PER is 21.9.

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

ING    INGHAMS GROUP LIMITED

Food, Beverages & Tobacco – Overnight Price: $3.35

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

Inghams Group's December first-half result slightly outpaced Bell Potter's forecasts, and the result was seriously affected by covid disruptions as indicated in previous guidance downgrades.

Management provided no clear guidance, but continued labour challenges bode ill for the March quarter, says the broker.

The broker downgrades FY22 earnings (EBITDA) forecasts -3%.

Buy rating retained, the broker expecting it is just a matter of time before a covid recovery kicks in. Target price is steady at $4.

This report was published on February 18, 2022.

Target price is $4.00 Current Price is $3.35 Difference: $0.65
If ING meets the Bell Potter target it will return approximately 19% (excluding dividends, fees and charges).
Current consensus price target is $3.69, suggesting upside of 8.5%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 9.00 cents and EPS of 15.50 cents.
At the last closing share price the estimated dividend yield is 2.69%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 21.61.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 17.0, implying annual growth of -24.2%.
Current consensus DPS estimate is 11.6, implying a prospective dividend yield of 3.4%.
Current consensus EPS estimate suggests the PER is 20.0.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 16.50 cents and EPS of 28.10 cents.
At the last closing share price the estimated dividend yield is 4.93%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.92.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 26.2, implying annual growth of 54.1%.
Current consensus DPS estimate is 17.3, implying a prospective dividend yield of 5.1%.
Current consensus EPS estimate suggests the PER is 13.0.

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

MFG    MAGELLAN FINANCIAL GROUP LIMITED

Wealth Management & Investments – Overnight Price: $21.70

Jarden rates ((MFG)) as Underweight (4) –

Magellan Financial Group's December first-half result outpaced consensus and Jarden's forecasts by a decent clip, thanks in part to cost cuts.

But the broker was unimpressed, citing obscure capital management plans, no investment-process changes, little room for accretion in a proposed buyback and no set date for the return of Hamish Douglass. 

Management announces a 1-for-8 bonus issue of options for shareholders and 10m for employees.

Jarden raises FY22 EPS to reflect the beat but expects costs growth will continue to weigh in FY23 and FY24, and that the risk that outflows will continue to threaten fee income is strong.

Underweight rating retained. Target price eases to $16.60 from $16.90.

This report was published on February 18, 2022.

Target price is $16.60 Current Price is $21.70 Difference: minus $5.1 (current price is over target).
If MFG meets the Jarden target it will return approximately minus 24% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $18.35, suggesting downside of -14.2%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Jarden forecasts a full year FY22 dividend of 202.00 cents and EPS of 226.90 cents.
At the last closing share price the estimated dividend yield is 9.31%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.56.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 230.2, implying annual growth of 59.2%.
Current consensus DPS estimate is 197.0, implying a prospective dividend yield of 9.2%.
Current consensus EPS estimate suggests the PER is 9.3.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 148.80 cents and EPS of 171.50 cents.
At the last closing share price the estimated dividend yield is 6.86%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.65.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 183.0, implying annual growth of -20.5%.
Current consensus DPS estimate is 165.9, implying a prospective dividend yield of 7.8%.
Current consensus EPS estimate suggests the PER is 11.7.

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

OBL    OMNI BRIDGEWAY LIMITED

Diversified Financials – Overnight Price: $3.11

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

Following the release of Omni Bridgeway's first half results release, Goldman Sachs notes investment over the last twelve months leaves the company well positioned for a solid second half and on track to meet its full year target of $520m in commitments. 

First generation funds are close to delivering a sizeable cash payout to shareholders given capital has been repaid to investors. The company suggested excess capital may reach $1.2bn, marking a material earnings and cash flow jump in FY23.

The Buy rating and target price of $5.10 are retained. 

This report was published on February 18, 2022.

Target price is $5.10 Current Price is $3.11 Difference: $1.99
If OBL meets the Goldman Sachs target it will return approximately 64% (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 0.00 cents and EPS of 12.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 25.92.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 dividend of 27.00 cents and EPS of 108.00 cents.
At the last closing share price the estimated dividend yield is 8.68%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 2.88.

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

PWH    PWR HOLDINGS LIMITED

Automobiles & Components – Overnight Price: $8.70

Bell Potter rates ((PWH)) as Hold (3) –

PWR Holdings's December first-half result outpaced Bell Potter's expectations thanks to stronger-than-expected revenue in Motorsports and Emerging Tech.

The beat followed December downgrades to guidance.

Management spies strong organic growth opportunities and reports a strong order book for the June half.

Bell Potter expects stronger revenue will be largely offset by tighter margins as inflation hits wages, materials and supply chains.

Hold rating retained. Target price rises to $8.75 from $8.50 after adjusting for market movements, time creep and earnings changes.

This report was published on February 18, 2022.

Target price is $8.75 Current Price is $8.70 Difference: $0.05
If PWH meets the Bell Potter target it will return approximately 1% (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 11.10 cents and EPS of 20.50 cents.
At the last closing share price the estimated dividend yield is 1.28%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 42.44.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 13.30 cents and EPS of 24.70 cents.
At the last closing share price the estimated dividend yield is 1.53%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 35.22.

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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Moelis rates ((PWH)) as Hold (3) –

PWR Holdings' first half result delivered 22% revenue growth to $45.5m, 16.6% earnings growth to $14.1m and 14% profit growth to $7.5m, and while the company is yet to provide guidance Moelis notes there appears strong demand across all segments.

The broker noted there appears opportunity in emerging technology, including cold plate and micro matrix technologies. Early stage contracts with aereospace and defence customers and continued targeting of new technologies could benefit the company.

The Hold rating is retained and the target price increases to $8.78 from $7.70. 

This report was published on February 20, 2022.

Target price is $8.78 Current Price is $8.70 Difference: $0.08
If PWH meets the Moelis target it will return approximately 1% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY22:

Moelis forecasts a full year FY22 dividend of 9.80 cents and EPS of 18.20 cents.
At the last closing share price the estimated dividend yield is 1.13%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 47.80.

Forecast for FY23:

Moelis forecasts a full year FY23 dividend of 11.30 cents and EPS of 21.20 cents.
At the last closing share price the estimated dividend yield is 1.30%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 41.04.

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

QBE    QBE INSURANCE GROUP LIMITED

Insurance – Overnight Price: $11.55

Jarden rates ((QBE)) as Buy (1) –

QBE's FY21 result fell 5% short of consensus but met Jarden's forecasts, primarily due to provisioning by management for a rainy day.

The underlying result was, however, solid, with strong premiums and interest rate rises all outpacing inflation and forecasts.

The broker forecasts a 5% rise EPS forecasts and a 14%, two-year compound annual from FY23 onward.

Target price eases to $14.35 from $14.50. Buy rating retained.

This report was published on February 19, 2022.

Target price is $14.35 Current Price is $11.55 Difference: $2.8
If QBE meets the Jarden target it will return approximately 24% (excluding dividends, fees and charges).
Current consensus price target is $14.65, suggesting upside of 24.5%(ex-dividends)
The company's fiscal year ends in December.

Forecast for FY22:

Jarden forecasts a full year FY22 dividend of 67.20 cents and EPS of 93.28 cents.
At the last closing share price the estimated dividend yield is 5.82%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.38.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 90.3, implying annual growth of N/A.
Current consensus DPS estimate is 74.7, implying a prospective dividend yield of 6.3%.
Current consensus EPS estimate suggests the PER is 13.0.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 81.99 cents and EPS of 116.94 cents.
At the last closing share price the estimated dividend yield is 7.10%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.88.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 115.2, implying annual growth of 27.6%.
Current consensus DPS estimate is 80.6, implying a prospective dividend yield of 6.8%.
Current consensus EPS estimate suggests the PER is 10.2.

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

RFF    RURAL FUNDS GROUP

REITs – Overnight Price: $2.92

Bell Potter rates ((RFF)) as Hold (3) –

Rural Funds Group's December first-half result broadly met Bell Potter's forecasts, outpacing on revenue.

Capital expenditure was hefty, but net debt finished the half at $427m.

Management reiterated guidance and the broker upgrades forecasts to reflect the temporary beef-up in cattle prices.

Hold rating retained. Target price rises to $2.95 from $2.80.

This report was published on February 18, 2022.

Target price is $2.95 Current Price is $2.92 Difference: $0.03
If RFF meets the Bell Potter target it will return approximately 1% (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 11.70 cents and EPS of 11.90 cents.
At the last closing share price the estimated dividend yield is 4.01%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 24.54.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 12.20 cents and EPS of 14.30 cents.
At the last closing share price the estimated dividend yield is 4.18%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 20.42.

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

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Wilsons rates ((RFF)) as Market Weight (3) –

Rural Funds Group's December-half result met Wilsons' forecasts at the funds from operations level, but cash revenue outpaced by 5%, thanks to Other net income (mainly Maryborough properties).

Management reiterated FY22 guidance.

Elsewhere, Australian Agricultural Company ((AAC)) has signed a 10-year lease of two two cattle assets, starting this May and Wilsons says the deal validates Rural Funds' strategy in this segment.

EPS forecasts roughly halve to reflect a realignment of the profit-and-loss statement to treat non-cash adjustments as significant items.

Target price is $2.80. Market Weight rating retained.

This report was published on February 21, 2022.

Target price is $2.81 Current Price is $2.92 Difference: minus $0.11 (current price is over target).
If RFF meets the Wilsons target it will return approximately minus 4% (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 11.70 cents and EPS of 11.90 cents.
At the last closing share price the estimated dividend yield is 4.01%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 24.54.

Forecast for FY23:

Wilsons forecasts a full year FY23 dividend of 12.20 cents and EPS of 12.70 cents.
At the last closing share price the estimated dividend yield is 4.18%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 22.99.

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

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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.

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