Australian Broker Call *Extra* Edition – Apr 13, 2022

Daily Market Reports | Apr 13 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)

BSL   CGS   IEL   LKE   LYC   PDN   PME (2)   PTM   RMD   TLX   WPL  

BSL    BLUESCOPE STEEL LIMITED

Steel & Scrap - Overnight Price: $21.26

Jarden rates ((BSL)) as Buy (2) -

In what Jarden considers could be a significant strategic step, BlueScope Steel has entered into a binding agreement to acquire Coil Coatings for -US$500m. The company is the second-largest metal painter in the US.

The transaction could enable the North American business to transform its focus to a value-added product (like Colorbond and Truecore in Australia) from a commodity product.

Management believes building an equivalent business from the ground up would have taken around 10-15 years, and cost more than -$1bn.

The Overweight rating and $23.60 target price are retained.

This report was published on April 12, 2022.

Target price is $23.60 Current Price is $21.26 Difference: $2.34
If BSL meets the Jarden target it will return approximately 11% (excluding dividends, fees and charges).
Current consensus price target is $26.05, suggesting upside of 21.8%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Jarden forecasts a full year FY22 dividend of 50.00 cents and EPS of 483.80 cents.
At the last closing share price the estimated dividend yield is 2.35%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 4.39.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 514.3, implying annual growth of 117.0%.
Current consensus DPS estimate is 50.0, implying a prospective dividend yield of 2.3%.
Current consensus EPS estimate suggests the PER is 4.2.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 50.00 cents and EPS of 484.50 cents.
At the last closing share price the estimated dividend yield is 2.35%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 4.39.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 308.7, implying annual growth of -40.0%.
Current consensus DPS estimate is 50.0, implying a prospective dividend yield of 2.3%.
Current consensus EPS estimate suggests the PER is 6.9.

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

CGS    COGSTATE LIMITED

Medical Equipment & Devices - Overnight Price: $2.20

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

Canaccord Genuity notes the opportunity to use larger-scale patient registries for reimbursement, for companies investigating monoclonal antibodies for Alzheimer's. This follows a determination from the Center for Medicare Services in the US.

The analyst feels this aides the environment for Cogstate's digital tool, with its ability to detect changes in an individual's cognitive ability.

Canaccord Genuity points out Cogstate has a 13% market share in the Alzheimer’s space, and 40% of trials still use paper and pencil tests.

The Buy rating and $2.50 target price are unchanged.

This report was published on April 11, 2022.

Target price is $2.50 Current Price is $2.20 Difference: $0.3
If CGS meets the Canaccord Genuity target it will return approximately 14% (excluding dividends, fees and charges).

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

IEL    IDP EDUCATION LIMITED

Education & Tuition - Overnight Price: $27.32

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

Goldman Sachs continues to expect strong improvement in student placement volumes in Australia in the second half, backed by student visa data from the Statistics Bureau, and the anticipated 100% growth in placement volumes should directly benefit IDP Education. 

The broker anticipates 12,900 student placements in the second half, with recovery over coming financial years to build to pre-pandemic levels in FY24. Further, Goldman Sachs notes student volumes in the northern hemisphere have already outstripped pre-pandemic.

Earnings per share estimates increase 1.2%, 1.2% and 1.0% through to FY24.

The Buy rating is retained and the target price increases to $35.50 from $35.00.

This report was published on April 13, 2022.

Target price is $35.50 Current Price is $27.32 Difference: $8.18
If IEL meets the Goldman Sachs target it will return approximately 30% (excluding dividends, fees and charges).
Current consensus price target is $36.80, suggesting upside of 33.1%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 dividend of 22.00 cents and EPS of 37.00 cents.
At the last closing share price the estimated dividend yield is 0.81%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 73.84.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 39.1, implying annual growth of 174.0%.
Current consensus DPS estimate is 26.2, implying a prospective dividend yield of 0.9%.
Current consensus EPS estimate suggests the PER is 70.7.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 dividend of 41.00 cents and EPS of 58.00 cents.
At the last closing share price the estimated dividend yield is 1.50%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 47.10.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 63.8, implying annual growth of 63.2%.
Current consensus DPS estimate is 46.0, implying a prospective dividend yield of 1.7%.
Current consensus EPS estimate suggests the PER is 43.3.

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

LKE    LAKE RESOURCES N.L.

New Battery Elements - Overnight Price: $1.84

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

Lake Resources has announced memorandums of understanding with both Hanwa and Ford for 25,000 tonnes per annum each, accounting for the full 50,000 tonnes per annum initial lithium product offtake anticipated from the Kachi project. 

Bell Potter highlights the agreements add weight to Lake Resources' ongoing finance and pre-development activities for Kachi. Bell Potter expects the company to deliver a definitive feasibility study in the September quarter.  

The Buy rating is retained and the target price increases to $2.83 from $1.82.

This report was published on April 12, 2022.

Target price is $2.83 Current Price is $1.84 Difference: $0.99
If LKE meets the Bell Potter target it will return approximately 54% (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 0.60 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 306.67.

Forecast for FY23:

Bell Potter forecasts a full year FY23 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 1840.00.

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


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