Australian Broker Call *Extra* Edition – May 04, 2022

Daily Market Reports | May 04 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)

360   A1M   A2M   ARX   BGA   CCX   CIP   CLU   CMM   COH   CRN   CSS   DXS   ECF   FSF   GOR   HMY   ILU   ING   MAD   NST   OBL   OZL   PLT   TPG   TRS   WOW   WPR   WSA   WSP  

360    LIFE360, INC

Software & Services - Overnight Price: $3.87

Bell Potter rates ((360)) as Buy (1) -

Life360 released an Appendix 4C for the first quarter 2022 and showed poor operating cashflow -US$38m which was largely expected by Bell Potter.

The broker has lowered the revenue and EBITDA forecasts for 2022 and 2023.

Bell Potter has downgraded the share price target forecast by -18% to $8.25 from $10, while noting Life360 has ceased the US dual-listing process.

A Buy rating is maintained.

This report was published on May 3, 2022.

Target price is $8.25 Current Price is $3.87 Difference: $4.38
If 360 meets the Bell Potter target it will return approximately 113% (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 35.85 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 10.79.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 15.48 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 25.00.

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

A1M    AIC MINES LIMITED

Gold & Silver - Overnight Price: $0.61

Shaw and Partners rates ((A1M)) as Buy rating (1) -

AIC Mines' March-quarter activities report appears to have disappointed Shaw and Partners, as lower grades drove a weaker production performance.

But the broker expects a recovery as grades improve, management advised blasting issues had been rectified at the start of April and that high-grade mining had started at the end of March.

Management increased all-in-sustaining cost guidance to reflect rising smelter costs and the inclusion of freight equalisation into the calculation (it was excluded in December).

Buy rating retained. Target price falls to 73c from 78c to account for the cost revisions and changes to the broker's price deck.

This report was published on April 28, 2022.

Target price is $0.73 Current Price is $0.61 Difference: $0.12
If A1M meets the Shaw and Partners target it will return approximately 20% (excluding dividends, fees and charges).
The company's fiscal year ends in December.

Forecast for FY22:

Shaw and Partners forecasts a full year FY22 dividend of 0.00 cents and EPS of 12.30 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 4.96.

Forecast for FY23:

Shaw and Partners forecasts a full year FY23 dividend of 0.00 cents and EPS of 7.80 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 7.82.

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

A2M    A2 MILK COMPANY LIMITED

Dairy - Overnight Price: $4.34

Jarden rates ((A2M)) as Downgrade to Underweight from Neutral (4) -

Jarden downgrades a2 Milk Co to Underweight from Overweight, noting the company is shifting from being an early defensive covid beneficiary, to a late covid disruption victim. 

The broker says the China's infant formula market is also moving from a period of growth to decline, in line with birth rates

Combine the two factors, and Jarden also spies heightened execution risk to its growth strategy, and doesn't expect daigou channels to return to 60% of pre-covid levels within the next five years.

The company may also be suffering form overstocking just as Chinese lockdowns heighten, possibly forcing the company to buy-back stocks, says the broker.

Target price slumps -33% to NZ$7.90, the broker sitting below consensus.

This report was published on April 27, 2022.

Current Price is $4.34. Target price not assessed.
Current consensus price target is $5.49, suggesting upside of 29.1%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Jarden forecasts a full year FY22 dividend of 0.00 cents and EPS of 28.34 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.31.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 14.3, 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 29.7.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 0.00 cents and EPS of 29.94 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.50.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 18.8, implying annual growth of 31.5%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 22.6.

This company reports in NZD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: -0.2
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

ARX    AROA BIOSURGERY LIMITED

Pharmaceuticals & Biotech/Lifesciences - Overnight Price: $0.84

Jarden rates ((ARX)) as Buy rating (1) -

Aroa Biosurgery's full-year preliminary revenue outpaced Jarden and consensus forecasts by a decent clip (full results are due in May).

Net cash flow was NZ$5.1m, compare with Jarden's forecast outflow of -NZ$0.8m, mainly due to the timing of receipts, followed by stronger sales, and Jarden expects the cash position should correct.

The broker appreciates the company's strong cash balance and expects the company will be cash flow positive by FY25. Post-covid, the company's Myriad is finally starting to ramp up and hospital accounts are on the rise.

Buy rating retained. Target price falls to $1.28 from $1.37 to reflect rising US rates and FX impacts.

This report was published on April 27, 2022.

Target price is $1.28 Current Price is $0.84 Difference: $0.44
If ARX meets the Jarden target it will return approximately 52% (excluding dividends, fees and charges).
The company's fiscal year ends in March.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 2.40 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 35.00.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 0.00 cents and EPS of minus 2.10 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 40.00.

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

BGA    BEGA CHEESE LIMITED

Dairy - Overnight Price: $4.95

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

Bega Cheese announced revised FY22 earnings guidance.

Bell Potter notes that FY22 EBITDA guidance has been downgraded due to Covid costs, flooding and sales slippage from congestion at the Port of Shanghai. The updated guidance is in-line with the broker's previous forecast.

The company also raised farmgate prices guidance for FY22-23 and this is consistent with commodity prices over the second half of FY22.

Due to the higher debt balances and interest rate rises, the broker downgraded forecast profits by -5% for FY22 and FY23.

Bell Potter has maintained the $5.90 price target forecast and a Buy rating.

This report was published on April 27, 2022.

Target price is $5.90 Current Price is $4.95 Difference: $0.95
If BGA meets the Bell Potter target it will return approximately 19% (excluding dividends, fees and charges).
Current consensus price target is $5.18, suggesting upside of 5.0%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 11.00 cents and EPS of 14.20 cents.
At the last closing share price the estimated dividend yield is 2.22%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 34.86.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 16.1, implying annual growth of -41.1%.
Current consensus DPS estimate is 11.0, implying a prospective dividend yield of 2.2%.
Current consensus EPS estimate suggests the PER is 30.6.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 16.50 cents and EPS of 24.40 cents.
At the last closing share price the estimated dividend yield is 3.33%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 20.29.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 24.3, implying annual growth of 50.9%.
Current consensus DPS estimate is 12.0, implying a prospective dividend yield of 2.4%.
Current consensus EPS estimate suggests the PER is 20.3.

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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