Australian Broker Call *Extra* Edition – Jul 20, 2022

Daily Market Reports | Jul 20 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)

ALU   ANZ   ARU   BGA   BRG   CLU   DSE   KGN   LYC (3)   MMM   NWC   NWL   PTM   RBL   TOY   TPW   WOW   WTC  

BGA    BEGA CHEESE LIMITED

Dairy - Overnight Price: $3.28

Bell Potter rates ((BGA)) as Hold (3) -

Bell Potter reviews forecasts for Bega Cheese for the increase in farmgate milk prices.

The broker reduces earnings estimates by -9% for FY23 to reflect the higher farmgate milk prices and highlights the downgrade in target price reflects the input pricing hikes reducing the long-term return on capital for Bega Cheese.

Bell Potter notes its own FY23 earnings forecasts are at the lower end of consensus expectations.

Rating is unchanged at Hold and the target reduced to $3.80 from $4.20.

This report was published on July 13, 2022.

Target price is $3.80 Current Price is $3.28 Difference: $0.52
If BGA meets the Bell Potter target it will return approximately 16% (excluding dividends, fees and charges).
Current consensus price target is $3.30, suggesting upside of 0.6%(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 3.35%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 23.10.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 14.4, implying annual growth of -47.3%.
Current consensus DPS estimate is 11.0, implying a prospective dividend yield of 3.4%.
Current consensus EPS estimate suggests the PER is 22.8.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 12.00 cents and EPS of 15.50 cents.
At the last closing share price the estimated dividend yield is 3.66%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 21.16.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 11.3, implying annual growth of -21.5%.
Current consensus DPS estimate is 11.0, implying a prospective dividend yield of 3.4%.
Current consensus EPS estimate suggests the PER is 29.0.

Market Sentiment: -0.3
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: $19.82

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

As Europe will be the medium-term growth engine for Breville Group, Wilsons is concerned that looming results from global peers will lead to industry-wide multiple contraction. In anticipation, the broker lowers its target price to $18.50 from $30.00. Market Weight.

Despite this severe cut in target price, the broker's valuation is still set at an around 50% premium to domestic and international peers.

The analyst estimates that around 17% of the company's European footprint (including the UK) has been impacted by declining consumer confidence, due to the Ukraine conflict. Declining demand conditions in North America are also expected to weigh.

This report was published on July 18, 2022.

Target price is $18.50 Current Price is $19.82 Difference: minus $1.32 (current price is over target).
If BRG meets the Wilsons target it will return approximately minus 7% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $26.12, suggesting upside of 31.8%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Wilsons forecasts a full year FY22 dividend of 29.90 cents and EPS of 74.80 cents.
At the last closing share price the estimated dividend yield is 1.51%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 26.50.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 76.2, implying annual growth of 15.9%.
Current consensus DPS estimate is 30.0, implying a prospective dividend yield of 1.5%.
Current consensus EPS estimate suggests the PER is 26.0.

Forecast for FY23:

Wilsons forecasts a full year FY23 dividend of 32.90 cents and EPS of 82.10 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 24.14.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 83.9, implying annual growth of 10.1%.
Current consensus DPS estimate is 33.9, implying a prospective dividend yield of 1.7%.
Current consensus EPS estimate suggests the PER is 23.6.

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

CLU    CLUEY LIMITED

Education & Tuition - Overnight Price: $0.54

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

In a general sector report on eCommerce in Australia, Canaccord Genuity sees continued challenges on the horizon, with consumer spending to take a step back next year as property prices are projected to decline.

While keeping a favourable view longer-term, the broker states, for now, companies with debt and high fixed costs are at greater risk given the large negative operating leverage inherent in eCommerce business models.

Cluey is Australia's largest tutoring platform, points out Canaccord Genuity, immediately adding: it also remains one of the fastest-growing companies on the ASX.

Canaccord Genuity is of the view that Cluey will continue its growth, regardless of economic conditions. Buy rating retained. Price target drops to $1.20 from $1.70.

This report was published on July 19, 2022.

Target price is $1.20 Current Price is $0.54 Difference: $0.66
If CLU meets the Canaccord Genuity target it will return approximately 122% (excluding dividends, fees and charges).

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


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