Australian Broker Call *Extra* Edition – Mar 31, 2022

Daily Market Reports | Mar 31 2022

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)

APE   APM   JDO   KSN   LKE   NEA   PMV   PRU   QML   RHC   SBM   SGM   SHV   TSI   UBI  

SGM    SIMS LIMITED

Steel & Scrap - Overnight Price: $21.55

Goldman Sachs rates ((SGM)) as Buy (1) -

Sims provided positive commentary on its volume and margin outlook at its recent investor day, noting demand and price momentum for scrap metal has continued into the second half. Goldman Sachs notes the company maintains a 40% volume increase target by FY25.

The company highlighted labour and shipping inflation was largely being offset by strong scrap pricing, while demand was allowing elevated freight costs to be absorbed by steel mills and customers.

The broker maintains a second half earnings forecast of $329m, notably higher than consensus of $317m. The Buy rating is retained and the target price increases to $21.40 from $20.00.

This report was published on March 30, 2022.

Target price is $21.40 Current Price is $21.55 Difference: minus $0.15 (current price is over target).
If SGM meets the Goldman Sachs target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $20.40, suggesting downside of -6.2%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 dividend of 63.00 cents and EPS of 250.00 cents.
At the last closing share price the estimated dividend yield is 2.92%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 8.62.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 243.5, implying annual growth of 113.4%.
Current consensus DPS estimate is 74.8, implying a prospective dividend yield of 3.4%.
Current consensus EPS estimate suggests the PER is 8.9.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 dividend of 59.00 cents and EPS of 184.00 cents.
At the last closing share price the estimated dividend yield is 2.74%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.71.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 178.6, implying annual growth of -26.7%.
Current consensus DPS estimate is 56.2, implying a prospective dividend yield of 2.6%.
Current consensus EPS estimate suggests the PER is 12.2.

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

SHV    SELECT HARVESTS LIMITED

Agriculture - Overnight Price: $5.43

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

Bell Potter says forward sales of the FY22 crop appear similar to subdued levels seen a year ago and downgrades its near-term almond price forecasts and cuts FY22 net profit after tax forecasts for Select Harvests by -48% in FY22 and -18% in FY23.

The broker makes similar cuts to EPS forecasts. 

While Bell Potter considers consensus forecasts for Select Harvests to be optimistic, the broker spies solid value in the asset base and retains a Buy rating. Target price falls to $6.60 from $6.85.

This report was published on March 31, 2022.

Target price is $6.60 Current Price is $5.43 Difference: $1.17
If SHV meets the Bell Potter target it will return approximately 22% (excluding dividends, fees and charges).
The company's fiscal year ends in September.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 4.00 cents and EPS of 10.90 cents.
At the last closing share price the estimated dividend yield is 0.74%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 49.82.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 9.00 cents and EPS of 24.70 cents.
At the last closing share price the estimated dividend yield is 1.66%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 21.98.

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

TSI    TOP SHELF INTERNATIONAL HOLDINGS LIMITED

Food, Beverages & Tobacco - Overnight Price: $1.60

Canaccord Genuity rates ((TSI)) as Buy (1) -

Canaccord attended Top Shelf International Holdings investor briefing and reports the company is developing Australian brands to take to market with a launch date estimated roughly at the start of 2024.

The company also took an opportunity to advise of its AgTech applications to monitor and optimise plant growth on lower resources (sustainability being an ESG thematic).

Speculative Buy rating and $2.44 target price retained.

This report was published on March 29, 2022.

Target price is $2.44 Current Price is $1.60 Difference: $0.84
If TSI meets the Canaccord Genuity target it will return approximately 52% (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 22.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 7.27.

Forecast for FY23:

Canaccord Genuity 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 16.00.

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

UBI    UNIVERSAL BIOSENSORS, INC

Medical Equipment & Devices - Overnight Price: $0.84

Canaccord Genuity rates ((UBI)) as Initiation of coverage with Buy (1) -

Canaccord Genuity initiates coverage of Universal Biosensors with a Speculative Buy rating and $1.25 target price.

The company manufactures hand-held point of care/use devices and test strips to measure analytes across the Life Sciences, Environmental, Animal Health and Food & Beverage industries.

The broker appreciates the company's proven technology pedigree and notes the Sentia wine testing product is the first new product in seven years, and that there are several products in the pipeline, including cancer and human-health related biomarkers. 

This report was published on March 30, 2022.

Target price is $1.25 Current Price is $0.84 Difference: $0.41
If UBI meets the Canaccord Genuity target it will return approximately 49% (excluding dividends, fees and charges).
The company's fiscal year ends in December.

Forecast for FY22:

Canaccord Genuity forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 5.90 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 14.24.

Forecast for FY23:

Canaccord Genuity forecasts a full year FY23 dividend of 0.00 cents and EPS of 5.20 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.15.

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


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