article 3 months old

Australian Broker Call *Extra* Edition – Mar 18, 2022

Daily Market Reports | Mar 18 2022

This story features ALPHA HPA LIMITED, and other companies. For more info SHARE ANALYSIS: A4N

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)

A4N   ALC   BRG   DDH   DOC   HDN   HMC   OFX   PNI   RDY   RMD   SHA   STA   WBC  

A4N    ALPHA HPA LIMITED

Aluminium, Bauxite & Alumina – Overnight Price: $0.63

Bell Potter rates ((A4N)) as Buy (1) –

Alpha HPA has won a $45m grant for the HPA First Project under the Commonwealth Department of Industry, Science, Energy and Resources' modern manufacturing initiative.

Bell Potter reports the grant is split: 90% towards Alpha HPA, and 10% towards chemical partner Orica ((ORI)).

The broker says the grant provides further due diligence to support the project and could provide a significant proportion of the HPA First Project's estimated $308m equity requirement, and expects a group of government and commercial lenders will fund 65% or $200m of the balance.

Bell Potter notes the company's HPA and aluminium precursor products can be used in the lithium ion battery, micro-LED and semiconductor manufacturing industries – all at the heart of the decarbonisation and onshoring themes.

Speculative Buy rating retained. Target price rises to $0.96 from $0.92. 

This report was published on March 16, 2022.

Target price is $0.96 Current Price is $0.63 Difference: $0.33
If A4N meets the Bell Potter target it will return approximately 52% (excluding dividends, fees and charges).

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 0.00 cents and EPS of 0.00 cents.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 1.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 63.00.

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

ALC    ALCIDION GROUP LIMITED

Healthcare services – Overnight Price: $0.19

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

Alcidion Group has announced a new $1.9m five-year contract with NHS Tayside to implement its Miya Observations software. Canaccord Genuity notes a front-loaded contract payment scheme will allow for capital to support roll out. 

While the broker expects further contract announcements ahead of the financial year end it notes this agreement expands presence to 39 NHS sites, bringing contracted revenue for FY22 to $28m and leaving $4-5m required to meet the broker's revenue forecast. 

Positively, the broker suggested funding initiatives centered on patient flow and optimising efficiency of care may be motivation for further sites to adopt technology. 

The Buy rating and target price of $0.32 are retained.

This report was published on March 16, 2022.

Target price is $0.32 Current Price is $0.19 Difference: $0.13
If ALC meets the Canaccord Genuity target it will return approximately 68% (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 0.00 cents.

Forecast for FY23:

Canaccord Genuity forecasts a full year FY23 dividend of 0.00 cents and EPS of 0.30 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 63.33.

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

BRG    BREVILLE GROUP LIMITED

Household & Personal Products – Overnight Price: $28.60

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

While updates from Breville Group's competitors on fourth quarter performance were largely positive, Wilsons noted a softer competitive landscape was emerging as the industry offsets margin-impacting cost inflation with price increases. 

Post result market reaction also surprised the broker, with share prices for the eight companies slipping an average of -2.7% in the five days following the release despite six of eight competitors reported positive like-for-like growth. 

Breville Group reaffirmed full year earnings guidance of $156m. The Market Weight rating and target price of $30.00 are retained. 

This report was published on March 17, 2022.

Target price is $30.00 Current Price is $28.60 Difference: $1.4
If BRG meets the Wilsons target it will return approximately 5% (excluding dividends, fees and charges).
Current consensus price target is $33.03, suggesting upside of 15.9%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Wilsons forecasts a full year FY22 dividend of 30.00 cents and EPS of 74.50 cents.
At the last closing share price the estimated dividend yield is 1.05%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 38.39.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 78.6, implying annual growth of 19.5%.
Current consensus DPS estimate is 31.1, implying a prospective dividend yield of 1.1%.
Current consensus EPS estimate suggests the PER is 36.2.

Forecast for FY23:

Wilsons forecasts a full year FY23 dividend of 35.00 cents and EPS of 87.00 cents.
At the last closing share price the estimated dividend yield is 1.22%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 32.87.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 89.9, implying annual growth of 14.4%.
Current consensus DPS estimate is 36.0, implying a prospective dividend yield of 1.3%.
Current consensus EPS estimate suggests the PER is 31.7.

Market Sentiment: 0.8
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

DDH    DDH1 LIMITED

Mining Sector Contracting – Overnight Price: $1.03

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

Bell Potter says DDH1 enjoys leverage to several tailwinds which point to stronger 2022 earnings, including Australian exploration data; key commodity pricing; and Australia junior exploration capital raising data.

ABS exploration expenditure data is at all-time highs, suggesting further expenditure and increases in drill rates, says the broker; and $A capital raising data and commodities remain 28.2% above the peak of the last cycle.

With these trends set to continue for another year, in the broker's view, Bell Potter expects strong 2022 earnings and believes the normalisation of borders also suggest operational upside.

Buy rating and $1.56 target price retained.

This report was published on March 16, 2022.

Target price is $1.56 Current Price is $1.03 Difference: $0.53
If DDH meets the Bell Potter target it will return approximately 51% (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 5.00 cents and EPS of 13.20 cents.
At the last closing share price the estimated dividend yield is 4.85%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 7.80.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 5.80 cents and EPS of 15.40 cents.
At the last closing share price the estimated dividend yield is 5.63%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 6.69.

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

DOC    DOCTOR CARE ANYWHERE GROUP PLC

Healthcare services – Overnight Price: $0.31

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

Having exceeded its revenue guidance for the year, Bell Potter expects Doctor Care Anywhere can reach profitability in the second half of FY23. The broker says the company demonstrated confidence in its new model, guiding to more than 40% revenue growth in FY22. 

Contract renegotiation with AXA PPP Healthcare Group has allowed the company to offer virtual consultations with an Advanced Nurse Practitioner and improve pricing for GP consultations. The broker notes changes should increase consultation capacity. 

The Buy rating is retained and the target price decreases to $0.55 from $1.30.

This report was published on March 14, 2022.

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

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 8.69 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 3.57.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 2.22 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 13.96.

This company reports in GBP. 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

HDN    HOMECO DAILY NEEDS REIT

REITs – Overnight Price: $1.39

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

Goldman Sachs reinstates coverage of HomeCo Daily Needs REIT with a Buy rating and target price of $1.70. The REIT is considered undervalued, given the diversified tenant base and positioning to benefit from the shift to omni-channel retailing.

The secular trend toward ‘last-mile fulfillment offerings should also play to the REIT's strength, according to the analyst, as the tenant's location allows omni-channel sales with store fulfillment.

The broker points out tenants like the relatively lower rentals, compared to other retail sub-sectors.

This report was published on March 17, 2022.

Target price is $1.70 Current Price is $1.39 Difference: $0.31
If HDN meets the Goldman Sachs target it will return approximately 22% (excluding dividends, fees and charges).
Current consensus price target is $1.62, suggesting upside of 15.4%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 dividend of 8.00 cents and EPS of 9.00 cents.
At the last closing share price the estimated dividend yield is 5.76%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.44.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 8.6, implying annual growth of 51.1%.
Current consensus DPS estimate is 8.3, implying a prospective dividend yield of 5.9%.
Current consensus EPS estimate suggests the PER is 16.3.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 dividend of 9.00 cents and EPS of 9.00 cents.
At the last closing share price the estimated dividend yield is 6.47%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.44.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 9.3, implying annual growth of 8.1%.
Current consensus DPS estimate is 9.0, implying a prospective dividend yield of 6.4%.
Current consensus EPS estimate suggests the PER is 15.1.

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

HMC    HOME CONSORTIUM LIMITED

Wealth Management & Investments – Overnight Price: $6.39

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

Goldman Sachs reinstates coverage on HomeCo following completion of the HomeCo Daily Needs REIT ((HDN)) and Aventus Group  merger, further supporting an assets under management (AUM) base the company has grown 280% to date this financial year. 

The broker likes HomeCo's proven delivery on a capital light strategy and potential for future growth. The company continues to target AUM exceeding $10bn by 2024 through growth in listed vehicles and target sector investment supported by liquidity of more than $400m. 

The broker reinstates with a Buy rating and target price of $7.38.

This report was published on March 17, 2022.

Target price is $7.38 Current Price is $6.39 Difference: $0.99
If HMC meets the Goldman Sachs target it will return approximately 15% (excluding dividends, fees and charges).
Current consensus price target is $6.73, suggesting upside of 4.7%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 dividend of 12.00 cents and EPS of 28.00 cents.
At the last closing share price the estimated dividend yield is 1.88%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 22.82.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 24.7, implying annual growth of N/A.
Current consensus DPS estimate is 12.0, implying a prospective dividend yield of 1.9%.
Current consensus EPS estimate suggests the PER is 26.0.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 dividend of 12.00 cents and EPS of 31.00 cents.
At the last closing share price the estimated dividend yield is 1.88%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 20.61.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 22.1, implying annual growth of -10.5%.
Current consensus DPS estimate is 12.9, implying a prospective dividend yield of 2.0%.
Current consensus EPS estimate suggests the PER is 29.1.

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

OFX    OFX GROUP LIMITED

Diversified Financials – Overnight Price: $2.43

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

A trading update from OFX Group delivered results to date ahead of Canaccord Genuity's estimates, with the company guiding to full year net operating income growth of 23-25%, equating to $143-145m or a 2% increase to its previous guidance. 

Highlighting top-line momentum across all segments and geographies, the broker noted the corporate segment is now the company's biggest revenue contributor at more than 50% and expects this will further increase following the Firma settlement.

The broker updates its revenue forecasts 3% each year through to FY24, and its earnings forecasts 9%, 6% and 6% for the same years. 

The Buy rating is retained and the target price increases to $2.85 from $2.70.

This report was published on March 17, 2022.

Target price is $2.85 Current Price is $2.43 Difference: $0.42
If OFX meets the Canaccord Genuity target it will return approximately 17% (excluding dividends, fees and charges).
The company's fiscal year ends in March.

Forecast for FY22:

Canaccord Genuity forecasts a full year FY22 dividend of 0.00 cents and EPS of 10.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 24.30.

Forecast for FY23:

Canaccord Genuity forecasts a full year FY23 dividend of 7.20 cents and EPS of 12.00 cents.
At the last closing share price the estimated dividend yield is 2.96%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 20.25.

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

PNI    PINNACLE INVESTMENT MANAGEMENT GROUP LIMITED

Wealth Management & Investments – Overnight Price: $10.11

Wilsons rates ((PNI)) as Overweight (1) –

While Wilsons sees attractive upside from Pinnacle Investment Management's multi-affiliate strategy in the medium-term, the recent market volatility and underperformance from some affiliates may impact the 2H.

The broker lowers its target price to $15 from $16 after forecasting 2H gross performance fees of $19.8m versus $23.8m previously.

The Overweight rating is retained mainly because affiliates present growth opportunities, and distribution is gaining traction in international markets, explains the analyst.

This report was published on March 17, 2022.

Target price is $15.00 Current Price is $10.11 Difference: $4.89
If PNI meets the Wilsons target it will return approximately 48% (excluding dividends, fees and charges).
Current consensus price target is $15.09, suggesting upside of 51.2%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Wilsons forecasts a full year FY22 dividend of 32.00 cents and EPS of 41.00 cents.
At the last closing share price the estimated dividend yield is 3.17%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 24.66.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 43.8, implying annual growth of 14.6%.
Current consensus DPS estimate is 34.7, implying a prospective dividend yield of 3.5%.
Current consensus EPS estimate suggests the PER is 22.8.

Forecast for FY23:

Wilsons forecasts a full year FY23 dividend of 38.60 cents and EPS of 48.20 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 20.98.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 50.4, implying annual growth of 15.1%.
Current consensus DPS estimate is 41.0, implying a prospective dividend yield of 4.1%.
Current consensus EPS estimate suggests the PER is 19.8.

Market Sentiment: 0.9
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

RDY    READYTECH HOLDINGS LIMITED

Software & Services – Overnight Price: $3.02

Wilsons rates ((RDY)) as Overweight (1) –

ReadyTech has announced the acquisition of cloud-based talent management platform PhoenixHRIS for a gross consideration of $3.3m. Although likely to provide minimal earnings benefits, Wilsons notes the strategic purchase should improve large mid-market win rates.

The PhoenixHRIS offers twelve employee lifecycle modules, covering recruitment, onboarding and ongoing engagement, and appears under invested according to the broker.

The Overweight rating and target price of $4.19 are retained.

This report was published on March 18, 2022.

Target price is $4.19 Current Price is $3.02 Difference: $1.17
If RDY meets the Wilsons target it will return approximately 39% (excluding dividends, fees and charges).
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 14.30 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 21.12.

Forecast for FY23:

Wilsons forecasts a full year FY23 dividend of 0.00 cents and EPS of 16.30 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.53.

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

RMD    RESMED INC

Medical Equipment & Devices – Overnight Price: $35.07

Jarden rates ((RMD)) as Buy (2) –

Jarden reaffirms substantial market share is ResMed's for the taking, but more reliable access to chips is key to supplying CPAP demand. Supply constraints are tough to get a read on according to the broker, but indicators suggest supply issues easing into the third quarter.

The Russia-Ukraine conflict could hamper global semiconductor chip supply, with manufacturing relying on neon gas of which Ukraine is a large exporter. Despite this, the market forecasts 29% device growth in the third quarter and 18.2% device growth in the fourth quarter.

The Overweight rating and target price of $41.44 are retained.

This report was published on March 11, 2022.

Target price is $41.44 Current Price is $35.07 Difference: $6.37
If RMD meets the Jarden target it will return approximately 18% (excluding dividends, fees and charges).
Current consensus price target is $38.24, suggesting upside of 9.4%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Jarden forecasts a full year FY22 dividend of 23.79 cents and EPS of 86.29 cents.
At the last closing share price the estimated dividend yield is 0.68%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 40.64.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 81.7, implying annual growth of N/A.
Current consensus DPS estimate is 23.0, implying a prospective dividend yield of 0.7%.
Current consensus EPS estimate suggests the PER is 42.8.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 29.18 cents and EPS of 103.49 cents.
At the last closing share price the estimated dividend yield is 0.83%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 33.89.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 97.4, implying annual growth of 19.2%.
Current consensus DPS estimate is 24.6, implying a prospective dividend yield of 0.7%.
Current consensus EPS estimate suggests the PER is 35.9.

This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.8
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

SHA    SHAPE AUSTRALIA CORPORATION LIMITED

Overnight Price: $2.15

Moelis rates ((SHA)) as Initiation of coverage with Buy (1) –

Moelis initiates coverage on commercial fit-out specialist Shape Australia. Exposure to non-residential construction should benefit strong earnings growth moving forwards, according to Moelis which expects a rebound in the segment post-covid.

Strategic expansion into Defence and Health and Aged Care should provide additional revenue streams, with elevated government spend likely to benefit, while a capital expenditure light model drives free cash flow generation from FY23 according to the broker. 

Moelis predicts an earnings compound annual growth rate of 63% through to FY24, and an earnings per share compound annual growth rate of 81% over the same period. 

The broker initiates coverage with a Buy rating and a target price of $2.49. 

This report was published on March 17, 2022.

Target price is $2.49 Current Price is $2.15 Difference: $0.34
If SHA meets the Moelis target it will return approximately 16% (excluding dividends, fees and charges).

Forecast for FY22:

Moelis forecasts a full year FY22 dividend of 14.00 cents and EPS of 4.00 cents.
At the last closing share price the estimated dividend yield is 6.51%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 53.75.

Forecast for FY23:

Moelis forecasts a full year FY23 dividend of 10.00 cents and EPS of 13.00 cents.
At the last closing share price the estimated dividend yield is 4.65%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.54.

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

STA    STRANDLINE RESOURCES LIMITED

Mineral Sands – Overnight Price: $0.35

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

In a closer look at Strandline Resources' Coburn project, Shaw and Partners notes at 63% completion first production remains on track and budget for the fourth quarter.

The broker noted avoidance of cost impacts and delays plaguing other WA projects is testament to management experience. 

Shaw highlighted initial production is likely to be delivered into a high pricing environment, with spot pricing for zircon and rutile materially higher than previously assumed.

Earnings forecasts increase to $128m and $215m in FY3 and FY24, from $102m and $167m. Strandline Resources remains the broker's top emerging resource pick. The Buy rating and target price of $0.71 are retained.

This report was published on March 17, 2022.

Target price is $0.71 Current Price is $0.35 Difference: $0.36
If STA meets the Shaw and Partners target it will return approximately 103% (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 1.10 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 31.82.

Forecast for FY23:

Shaw and Partners forecasts a full year FY23 dividend of 0.00 cents and EPS of 5.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 7.00.

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

WBC    WESTPAC BANKING CORPORATION

Banks – Overnight Price: $23.68

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

Westpac has appointed Yianna Papanikolaou Chief Transformation Officer (formerly GM Transformation, then chief transformation officer at Deutsche Bank in the UK).

She is responsible for major change programs including the Customer Outcomes and Risk Excellence (CORE) program aimed at creating a simpler and stronger bank.

Bell Potter says the proof of the appointment will be in the pudding as Westpac needs to derisk its overall change management and investment thesis. 

The only material project to date is a stated target for cutting costs to $8bn by FY24, says the broker. 

Hold rating retained but Bell Potter raises the target price to $25 from $24 to reflect positive cash flow movements.

This report was published on March 17, 2022.

Target price is $25.00 Current Price is $23.68 Difference: $1.32
If WBC meets the Bell Potter target it will return approximately 6% (excluding dividends, fees and charges).
Current consensus price target is $25.16, suggesting upside of 6.1%(ex-dividends)
The company's fiscal year ends in September.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 120.00 cents and EPS of 168.00 cents.
At the last closing share price the estimated dividend yield is 5.07%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.10.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 154.2, implying annual growth of 3.2%.
Current consensus DPS estimate is 125.2, implying a prospective dividend yield of 5.3%.
Current consensus EPS estimate suggests the PER is 15.4.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 127.00 cents and EPS of 203.00 cents.
At the last closing share price the estimated dividend yield is 5.36%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.67.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 187.1, implying annual growth of 21.3%.
Current consensus DPS estimate is 134.7, implying a prospective dividend yield of 5.7%.
Current consensus EPS estimate suggests the PER is 12.7.

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


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.

Share on FacebookTweet about this on TwitterShare on LinkedIn

Click to view our Glossary of Financial Terms

CHARTS

A4N ALC BRG DDH DOC HDN HMC OFX ORI PNI RDY RMD SHA STA WBC

For more info SHARE ANALYSIS: A4N - ALPHA HPA LIMITED

For more info SHARE ANALYSIS: ALC - ALCIDION GROUP LIMITED

For more info SHARE ANALYSIS: BRG - BREVILLE GROUP LIMITED

For more info SHARE ANALYSIS: DDH - DDH1 LIMITED

For more info SHARE ANALYSIS: DOC - DOCTOR CARE ANYWHERE GROUP PLC

For more info SHARE ANALYSIS: HDN - HOMECO DAILY NEEDS REIT

For more info SHARE ANALYSIS: HMC - HOME CONSORTIUM LIMITED

For more info SHARE ANALYSIS: OFX - OFX GROUP LIMITED

For more info SHARE ANALYSIS: ORI - ORICA LIMITED

For more info SHARE ANALYSIS: RDY - READYTECH HOLDINGS LIMITED

For more info SHARE ANALYSIS: RMD - RESMED INC

For more info SHARE ANALYSIS: SHA - SHAPE AUSTRALIA CORPORATION LIMITED

For more info SHARE ANALYSIS: STA - STRANDLINE RESOURCES LIMITED

For more info SHARE ANALYSIS: WBC - WESTPAC BANKING CORPORATION