Australian Broker Call *Extra* Edition – May 26, 2022

Daily Market Reports | May 26 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)

5GG   AFP   ARX   AZY   BWX   BXB   CIP   COF   ELD (4)   GDF   GOZ   PMV   SCG   TNE   WOA   WPR  

5GG    PENTANET LIMITED

Telecommunication - Overnight Price: $0.27

Bell Potter rates ((5GG)) as Initiation of coverage with Buy (1) -

Bell Potter initiates coverage on Pentanet, an early stage NBN alternative and cloud gaming provider, as it undergoes significant growth investment. 

The broker notes Pentanet is not only investing in a 5G network, but also an Australian-first wireless gigabit mesh network, both with the aim of increasing capacity. While the 5G network will lift capacity to 83,500, the company estimates its mesh network could see capacity expand by a further 214,000.

The company has successfully grown subscribers at a 109.2% compound annual growth rate since its launch to more than 15,000, while the company's cloud gaming platform gained 12,000 users at its October launch.

The broker initiates with a Buy rating and a target price of $0.41.

This report was published on May 25, 2022.

Target price is $0.41 Current Price is $0.27 Difference: $0.14
If 5GG meets the Bell Potter target it will return approximately 52% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY21:

Bell Potter forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 1.90 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 14.21.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 2.30 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 11.74.

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

AFP    AFT PHARMACEUTICALS LIMITED

Pharmaceuticals & Biotech/Lifesciences - Overnight Price: $3.00

Bell Potter rates ((AFP)) as Upgrade to Buy from Hold (1) -

AFT Pharmaceuticals FY22 full-year result beat Bell Potter's forecasts, as strong sales and royalties in Australia and New Zealand triumphed over cost inflation, yielding a slight margin gain.

The broker upgrades earnings forecasts for FY23 to account for $8m in extra licence fees and stronger than forecast revenue growth and eases forecasts in FY24.

Rating upgraded to Buy from Hold, the broker expecting the company will pay a maiden dividend in FY23 of  20% to 30% while keeping debt levels steady, thanks to solid earnings outlook. Target $4.80.

This report was published on May 24, 2022.

Target price is $4.80 Current Price is $3.00 Difference: $1.8
If AFP meets the Bell Potter target it will return approximately 60% (excluding dividends, fees and charges).
The company's fiscal year ends in March.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 0.00 cents and EPS of 22.75 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.19.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 4.51 cents and EPS of 20.03 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 14.98.

This company reports in NZD. 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

ARX    AROA BIOSURGERY LIMITED

Pharmaceuticals & Biotech/Lifesciences - Overnight Price: $0.82

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

Aroa Biosurgery's reported full year results are largely in line with Bell Potter's expectations, with total revenue of NZ$39.7m, including a NZ$1.5m currency tailwind, a beat on the company's NZ$34-37m guidance.

The company is now guiding to revenue of NZ$51-55m in the coming year, reflecting 30-40% growth, although Bell Potter notes this is dependent on performance from TELA Bio. 

The Buy rating and target price of $1.45 are retained.

This report was published on May 25, 2022.

Target price is $1.45 Current Price is $0.82 Difference: $0.63
If ARX meets the Bell Potter target it will return approximately 77% (excluding dividends, fees and charges).
The company's fiscal year ends in March.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 3.10 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 26.45.

Forecast for FY24:

Bell Potter forecasts a full year FY24 dividend of 0.00 cents and EPS of minus 0.70 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 117.14.

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

AZY    ANTIPA MINERALS LIMITED

Mining - Overnight Price: $0.04

Shaw and Partners rates ((AZY)) as Buy (1) -

A recent resource update for Antipa Minerals' Minyari Dome project offers sufficient scale for a development scenario to be feasible according to Shaw and Partners, with the new resource of 33m tonnes including 1.6 grams of gold per tonne, or 1.8m ounces. 

The broker expects the most likely development scenario is for the company to look to recover significant copper and cobalt alongside the golf resource. 

The Buy rating is retained and the target price increases to 8.2c from 8.0c.

This report was published on May 24, 2022.

Target price is $0.08 Current Price is $0.04 Difference: $0.042
If AZY meets the Shaw and Partners target it will return approximately 105% (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 4.80 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 0.83.

Forecast for FY23:

Shaw and Partners forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 5.40 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 0.74.

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

BWX    BWX LIMITED

Household & Personal Products - Overnight Price: $1.40

Shaw and Partners rates ((BWX)) as Buy (1) -

Shaw and Partners continues to expect BWX to re-rate from FY23 onwards, noting the company appears focused on removing unnecessary costs and non-core investment in the near-term, before focusing on its strong core brands, Sukin, Andalou, Mineral Fusion and Go-To, which should deliver strong earnings growth over the next few years.

The company's new Clayton facility, a feature of its recent Investor Strategy Day, is expected to support results, driving a cost per unit reduction to $2.00 from $5.00, de-risking the company's supply chain, and improving quality controls.

The Buy rating is retained and the target price decreases to $2.70 from $2.80.

This report was published on May 23, 2022.

Target price is $2.70 Current Price is $1.40 Difference: $1.3
If BWX meets the Shaw and Partners target it will return approximately 93% (excluding dividends, fees and charges).
Current consensus price target is $2.50, suggesting upside of 82.7%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Shaw and Partners forecasts a full year FY22 dividend of 4.10 cents and EPS of 1.50 cents.
At the last closing share price the estimated dividend yield is 2.93%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 93.33.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 8.1, implying annual growth of -52.5%.
Current consensus DPS estimate is 2.2, implying a prospective dividend yield of 1.6%.
Current consensus EPS estimate suggests the PER is 16.9.

Forecast for FY23:

Shaw and Partners forecasts a full year FY23 dividend of 1.40 cents and EPS of 11.00 cents.
At the last closing share price the estimated dividend yield is 1.00%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.73.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 11.9, implying annual growth of 46.9%.
Current consensus DPS estimate is 3.9, implying a prospective dividend yield of 2.8%.
Current consensus EPS estimate suggests the PER is 11.5.

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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