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

Daily Market Reports | Aug 31 2022

This story features ARB CORPORATION LIMITED, and other companies. For more info SHARE ANALYSIS: ARB

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)

ARB   BRG   CQR (2)   CTP   DEG   EDV   EHE   FLT   HUB (2)   KGN   NEU   NWL   QUB   REH   WTC  

ARB    ARB CORPORATION LIMITED

Automobiles & Components – Overnight Price: $29.77

JP Morgan rates ((ARB)) as Neutral (3) –

Following FY22 results, JP Morgan remains positive on the near-term outlook for ARB Corp though keeps a Neutral rating due to the risk to near-term operating margins from delays to new vehicle deliveries. The $32 target is maintained.

FY22 profit was a slight miss compared to the consensus estimate, due to omicron-related challenges in the 3Q and a lack of new vehicles in the 4Q, explains the broker.

Management revealed four new products will be launched in FY23 and a new commercial arrangement with Toyota (in North America) was struck, though no details are available as yet.

The company expects to counter inflation in FY23 with incremental price rises to maintain margins.

This report was published on August 24, 2022.

Target price is $32.00 Current Price is $29.77 Difference: $2.23
If ARB meets the JP Morgan target it will return approximately 7% (excluding dividends, fees and charges).
Current consensus price target is $37.31, suggesting upside of 25.3%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

JP Morgan forecasts a full year FY23 dividend of 65.00 cents and EPS of 130.00 cents.
At the last closing share price the estimated dividend yield is 2.18%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 22.90.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 141.7, implying annual growth of -5.2%.
Current consensus DPS estimate is 73.5, implying a prospective dividend yield of 2.5%.
Current consensus EPS estimate suggests the PER is 21.0.

Forecast for FY24:

JP Morgan forecasts a full year FY24 dividend of 66.00 cents and EPS of 132.00 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 22.55.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 157.2, implying annual growth of 10.9%.
Current consensus DPS estimate is 83.2, implying a prospective dividend yield of 2.8%.
Current consensus EPS estimate suggests the PER is 18.9.

Market Sentiment: 0.8
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: $21.59

JP Morgan rates ((BRG)) as Neutral (3) –

Breville Group's FY22 result was largely in line with JP Morgan's expectations and company guidance. Softness in EMEA was offset by strength in the Americas (the largest division) and the APAC region.

The broker is not concerned by a more than doubling of inventory given low obsolescence risk, and the benefits from selling later and manufacturing earlier in an inflationary environment.

No FY23 guidance was provided. A final dividend of 15c was declared.

The broker's Neutral rating is maintained, while the target falls to $23.70 from $29.00 on earnings adjustments and lower peer multiples.

This report was published on August 24, 2022.

Target price is $23.70 Current Price is $21.59 Difference: $2.11
If BRG meets the JP Morgan target it will return approximately 10% (excluding dividends, fees and charges).
Current consensus price target is $24.27, suggesting upside of 12.4%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

JP Morgan forecasts a full year FY23 dividend of 33.00 cents and EPS of 82.00 cents.
At the last closing share price the estimated dividend yield is 1.53%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 26.33.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 80.4, implying annual growth of 5.9%.
Current consensus DPS estimate is 33.0, implying a prospective dividend yield of 1.5%.
Current consensus EPS estimate suggests the PER is 26.9.

Forecast for FY24:

JP Morgan forecasts a full year FY24 dividend of 37.00 cents and EPS of 90.00 cents.
At the last closing share price the estimated dividend yield is 1.71%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 23.99.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 91.8, implying annual growth of 14.2%.
Current consensus DPS estimate is 37.0, implying a prospective dividend yield of 1.7%.
Current consensus EPS estimate suggests the PER is 23.5.

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

CQR    CHARTER HALL RETAIL REIT

REITs – Overnight Price: $4.07

Jarden rates ((CQR)) as Overweight (2) –

Jarden considers Charter Hall Retail REIT well-placed for organic growth in the next 12-24 months. The portfolio management over the recent years has produced a higher proportion of triple net leases and CPI-linked leases with robust anchor tenants.

This suggests net operating income growth should be well ahead of the 2-3% long-term average, and the broker believes enough to offset the rising cost of debt.

The stock is considered an attractive way to play convenience-based retail and an Overweight rating is maintained. Target is reduced to $4.55 from $4.70.

This report was published on August 23, 2022.

Target price is $4.55 Current Price is $4.07 Difference: $0.48
If CQR meets the Jarden target it will return approximately 12% (excluding dividends, fees and charges).
Current consensus price target is $4.16, suggesting upside of 2.2%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 25.70 cents and EPS of 25.70 cents.
At the last closing share price the estimated dividend yield is 6.31%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.84.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 28.1, implying annual growth of -75.5%.
Current consensus DPS estimate is 25.5, implying a prospective dividend yield of 6.3%.
Current consensus EPS estimate suggests the PER is 14.5.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 26.30 cents and EPS of 26.30 cents.
At the last closing share price the estimated dividend yield is 6.46%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.48.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 28.9, implying annual growth of 2.8%.
Current consensus DPS estimate is 25.1, implying a prospective dividend yield of 6.2%.
Current consensus EPS estimate suggests the PER is 14.1.

Market Sentiment: 0.1
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources


JP Morgan rates ((CQR)) as Neutral (3) –

Following in-line FY22 results for Charter Hall Retail REIT, JP Morgan notes convenience retail asset values will likely be more resilient than most property sub-sectors, on account of highly defensive income streams.

The broker expects stable like-for-like net operating income growth of around 2-4%, supported by fixed annual escalations, sustainable occupancy costs and improving releasing spreads.

FY23 EPS guidance is for no less than 28.6cpu and dividends of no less than 25.7cpu, which implies to the analyst a higher payout ratio of around 90%. The price target is adjusted lower to $4.20 from $4.30. Neutral.

This report was published on August 24, 2022.

Target price is $4.20 Current Price is $4.07 Difference: $0.13
If CQR meets the JP Morgan target it will return approximately 3% (excluding dividends, fees and charges).
Current consensus price target is $4.16, suggesting upside of 2.2%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

JP Morgan forecasts a full year FY23 dividend of 26.00 cents and EPS of 29.20 cents.
At the last closing share price the estimated dividend yield is 6.39%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.94.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 28.1, implying annual growth of -75.5%.
Current consensus DPS estimate is 25.5, implying a prospective dividend yield of 6.3%.
Current consensus EPS estimate suggests the PER is 14.5.

Forecast for FY24:

JP Morgan forecasts a full year FY24 dividend of 25.00 cents and EPS of 29.00 cents.
At the last closing share price the estimated dividend yield is 6.14%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.03.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 28.9, implying annual growth of 2.8%.
Current consensus DPS estimate is 25.1, implying a prospective dividend yield of 6.2%.
Current consensus EPS estimate suggests the PER is 14.1.

Market Sentiment: 0.1
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

CTP    CENTRAL PETROLEUM LIMITED

NatGas – Overnight Price: $0.09

Bell Potter rates ((CTP)) as Downgrade to Hold from Buy (3) –

Central Petroleum announced the Board will conduct a strategic review of the company's assets, growth strategy and capital position with independent advisers expected to appointed.

The review comes on the back of "recent unsuccessful appraisal campaigns", notes Bell Potter.

The broker adjusts earnings forecasts to account for only the current production, but notes the upside for the non-producing assets is dependent upon the strategic review.

The rating is downgraded to Hold from Buy and the target is lowered to $0.11 from $0.18.

This report was published on August 24, 2022.

Target price is $0.11 Current Price is $0.09 Difference: $0.02
If CTP meets the Bell Potter target it will return approximately 22% (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 minus 0.60 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 15.00.

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 90.00.

Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

DEG    DE GREY MINING LIMITED

Gold & Silver – Overnight Price: $0.92

Bell Potter rates ((DEG)) as Speculative Buy (1) –

Bell Potter highlights De Grey Mining is soon to release the Pre-Feasibility Study on the 100% owned Mallina Gold Project (MGP).

The broker believes this study can deliver more certainty for investors around the development of MGP and improvements over the October 2021 Scoping Study.

There is no change to the Speculative Buy rating or $1.80 target price, and Bell Potter believes MGP is a potential takeover target as a "Tier 1 asset" in a top mining area.

This report was published on August 24, 2022.

Target price is $1.80 Current Price is $0.92 Difference: $0.88
If DEG meets the Bell Potter target it will return approximately 96% (excluding dividends, fees and charges).

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

EDV    ENDEAVOUR GROUP LIMITED

Food, Beverages & Tobacco – Overnight Price: $7.28

Jarden rates ((EDV)) as Underweight (4) –

Despite Endeavour Group delivering 3% year-on-year earnings growth, Jarden notes rising costs and some normalisation in promotional activity drove a -17% decline in Retail, with trends expected to continue into the new year. 

The broker flags costs will be a focus moving ahead, with general labour and rent inflation further compounded by increased supply chain costs, -$20m in Victorian electronic gaming machine taxes and up to -$30m in technology costs, and Jarden is predicting a -19% decline in first half Retail earnings. 

Earnings per share forecasts are reduced -2-6% through to FY25. The Underweight rating is retained and the target price decreases to $6.50 from $6.80.

This report was published on August 23, 2022.

Target price is $6.50 Current Price is $7.28 Difference: minus $0.78 (current price is over target).
If EDV meets the Jarden target it will return approximately minus 11% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $7.44, suggesting upside of 2.2%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 20.00 cents and EPS of 27.90 cents.
At the last closing share price the estimated dividend yield is 2.75%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 26.09.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 29.8, implying annual growth of 7.8%.
Current consensus DPS estimate is 21.4, implying a prospective dividend yield of 2.9%.
Current consensus EPS estimate suggests the PER is 24.4.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 22.00 cents and EPS of 30.10 cents.
At the last closing share price the estimated dividend yield is 3.02%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 24.19.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 32.2, implying annual growth of 8.1%.
Current consensus DPS estimate is 22.9, implying a prospective dividend yield of 3.1%.
Current consensus EPS estimate suggests the PER is 22.6.

Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

EHE    ESTIA HEALTH LIMITED

Aged Care & Seniors – Overnight Price: $2.01

Jarden rates ((EHE)) as Buy (1) –

Jarden notes Estia Health's full year result saw mature homes earnings miss expectations by -15%, or -$37.5m, largely due to -$7.0m in incremental covid costs not forecast. 

Full year occupancy of 91.5% was in line with the broker's expectations, but lifted to 92.0% by mid-August. 

Jarden's earnings per share forecasts decline -12.6% and -11.2% for FY23 and FY24 respectively, reflecting a shift to the funding model, greater than expected covid costs, and higher occupancy in the coming year. 

The Buy rating is retained and the target price decreases to $2.88 from $3.11.

This report was published on August 23, 2022.

Target price is $2.88 Current Price is $2.01 Difference: $0.87
If EHE meets the Jarden target it will return approximately 43% (excluding dividends, fees and charges).
Current consensus price target is $2.18, suggesting upside of 8.2%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 11.20 cents and EPS of 14.60 cents.
At the last closing share price the estimated dividend yield is 5.57%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.77.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 17.4, implying annual growth of N/A.
Current consensus DPS estimate is 12.9, implying a prospective dividend yield of 6.4%.
Current consensus EPS estimate suggests the PER is 11.6.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 9.40 cents and EPS of 11.10 cents.
At the last closing share price the estimated dividend yield is 4.68%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.11.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 13.2, implying annual growth of -24.1%.
Current consensus DPS estimate is 12.0, implying a prospective dividend yield of 6.0%.
Current consensus EPS estimate suggests the PER is 15.2.

Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

FLT    FLIGHT CENTRE TRAVEL GROUP LIMITED

Travel, Leisure & Tourism – Overnight Price: $17.35

JP Morgan rates ((FLT)) as Upgrade to Neutral from Underweight (3) –

Following FY22 results, JP Morgan upgrades its rating for Flight Centre Travel to Neutral from Underweight after a recent share price de-rating.

The Corporate business recovery is on track and delivering market share gains though the Leisure division is being weighed down by closed Chinese borders and supply constraints, explains the analyst.

The broker points out the company was EBITDA positive in 4Q in both Corporate and Leisure, as well as across all regions ex-Asia.

The $16.50 target price is unchanged.

This report was published on August 26, 2022.

Target price is $16.50 Current Price is $17.35 Difference: minus $0.85 (current price is over target).
If FLT meets the JP Morgan target it will return approximately minus 5% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $16.52, suggesting downside of -4.8%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

JP Morgan forecasts a full year FY23 dividend of 0.00 cents and EPS of 49.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 35.41.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 40.7, 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 42.6.

Forecast for FY24:

JP Morgan forecasts a full year FY24 dividend of 18.00 cents and EPS of 118.00 cents.
At the last closing share price the estimated dividend yield is 1.04%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.70.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 93.3, implying annual growth of 129.2%.
Current consensus DPS estimate is 31.4, implying a prospective dividend yield of 1.8%.
Current consensus EPS estimate suggests the PER is 18.6.

Market Sentiment: -0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

HUB    HUB24 LIMITED

Wealth Management & Investments – Overnight Price: $23.40

Jarden rates ((HUB)) as Neutral (3) –

FY22 operating earnings were in line with forecasts. A stronger market drives an upgrade to FY23 earnings estimates and Jarden lifts its target to $25.00 from $24.55.

The main risks envisaged for Hub24 include large variations in flows from the evolving adviser, market and competitor environment, competitive pressures on platform fees and volatility in equity market returns. Jarden retains a Neutral rating.

This report was published on August 23, 2022.

Target price is $25.00 Current Price is $23.40 Difference: $1.6
If HUB meets the Jarden target it will return approximately 7% (excluding dividends, fees and charges).
Current consensus price target is $29.76, suggesting upside of 27.2%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 30.80 cents and EPS of 69.30 cents.
At the last closing share price the estimated dividend yield is 1.32%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 33.77.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 63.0, implying annual growth of 212.2%.
Current consensus DPS estimate is 26.4, implying a prospective dividend yield of 1.1%.
Current consensus EPS estimate suggests the PER is 37.1.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 36.70 cents and EPS of 81.70 cents.
At the last closing share price the estimated dividend yield is 1.57%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 28.64.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 74.6, implying annual growth of 18.4%.
Current consensus DPS estimate is 31.3, implying a prospective dividend yield of 1.3%.
Current consensus EPS estimate suggests the PER is 31.4.

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


JP Morgan rates ((HUB)) as Neutral (3) –

FY22 Platform revenue for Hub24 was a 2% beat compared to JP Morgan's forecast and the broker raises its target to $22.50 from $21.50.

Management provided a seven week trading update for the beginning of FY23 showing FUA had increased to $54.1bn from $49.7bn. The company also downgraded the FY24 funds under administration (FUA) outlook by -3.4% due to soft equity markets.

The broker sees emerging signs of growing pains as shown by slower growth in adviser numbers and likely higher gross outflows as the platform matures.

The Neutral rating is unchanged on near-term volatility and likely cash margin headwinds from December when the existing ADI cash agreement is renegotiated.

This report was published on August 24, 2022.

Target price is $22.50 Current Price is $23.40 Difference: minus $0.9 (current price is over target).
If HUB meets the JP Morgan target it will return approximately minus 4% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $29.76, suggesting upside of 27.2%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

JP Morgan forecasts a full year FY23 dividend of 31.00 cents and EPS of 64.00 cents.
At the last closing share price the estimated dividend yield is 1.32%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 36.56.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 63.0, implying annual growth of 212.2%.
Current consensus DPS estimate is 26.4, implying a prospective dividend yield of 1.1%.
Current consensus EPS estimate suggests the PER is 37.1.

Forecast for FY24:

JP Morgan forecasts a full year FY24 dividend of 40.00 cents and EPS of 78.00 cents.
At the last closing share price the estimated dividend yield is 1.71%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 30.00.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 74.6, implying annual growth of 18.4%.
Current consensus DPS estimate is 31.3, implying a prospective dividend yield of 1.3%.
Current consensus EPS estimate suggests the PER is 31.4.

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

KGN    KOGAN.COM LIMITED

Retailing – Overnight Price: $3.42

Jarden rates ((KGN)) as Underweight (4) –

The highlight of the FY22 result was the July trading update, Jarden asserts, that showed a continuing return to profitability. Kogan.com provided more detail on cost cutting measures which include reducing the product range, stopping Kogan delivery services and reducing marketing expenditure.

The company will invest in an advertising platform for marketplace sellers, nonetheless, which appears to Jarden at odds with the cost reduction strategy.

Earnings uncertainty is heightened and the broker observes a step up in competitive intensity across Australia's online retail segment. Underweight maintained. Target is revised down to $4.02 from $4.45.

This report was published on August 23, 2022.

Target price is $4.02 Current Price is $3.42 Difference: $0.6
If KGN meets the Jarden target it will return approximately 18% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 0.00 cents and EPS of 7.20 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 47.50.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 0.00 cents and EPS of 11.80 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 28.98.

Market Sentiment: -0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

NEU    NEUREN PHARMACEUTICALS LIMITED

Pharmaceuticals & Biotech/Lifesciences – Overnight Price: $5.78

Bell Potter rates ((NEU)) as Sepculative Buy (1) –

Neuren Pharmaceuticals provided a 1H22 trading update with cash on hand of $31.1m and investigational new drug approvals from the FDA for NNZ-259 in March, notes Bell Potter.

The Phase 2 trials are going well and are expected to be available in the 1H23 while the forecast R&D for the second asset NNZ-2591 is now expected to be higher over the next 3 years.

The target is lowered to $6.85 from $7.00 and the Speculative Buy rating is unchanged.

This report was published on August 24, 2022.

Target price is $6.85 Current Price is $5.78 Difference: $1.07
If NEU meets the Bell Potter target it will return approximately 19% (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 2.90 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 199.31.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 0.00 cents and EPS of 38.10 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.17.

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

NWL    NETWEALTH GROUP LIMITED

Wealth Management & Investments – Overnight Price: $12.87

JP Morgan rates ((NWL)) as Neutral (3) –

Following in-line FY22 results for Netwealth Group, JP Morgan retains its Neutral rating due to near-term risks from an elevated cost base. Earnings margins declined during FY22 due to accelerated investment in labour and technology.

The company delivered record funds under administration (FUA) net inflows of $13.4bn in FY22.

Upbeat FY23 guidance, according to the analyst, was provided for FY23, with net inflows of between $11-13bn expected. Management also anticipate tailwinds from recent cash rate increases.

Operating leverage remains elusive, notes the broker, and is unlikely to be attained in the near-term, as shown by the EBITDA margin for FY22 of 50%, down from 56% in the previous corresponding period.

The $13.00 target price is unchanged.

This report was published on August 25, 2022.

Target price is $13.00 Current Price is $12.87 Difference: $0.13
If NWL meets the JP Morgan target it will return approximately 1% (excluding dividends, fees and charges).
Current consensus price target is $15.12, suggesting upside of 17.5%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

JP Morgan forecasts a full year FY23 dividend of 23.00 cents and EPS of 29.00 cents.
At the last closing share price the estimated dividend yield is 1.79%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 44.38.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 29.6, implying annual growth of 29.9%.
Current consensus DPS estimate is 24.8, implying a prospective dividend yield of 1.9%.
Current consensus EPS estimate suggests the PER is 43.5.

Forecast for FY24:

JP Morgan forecasts a full year FY24 dividend of 29.00 cents and EPS of 36.00 cents.
At the last closing share price the estimated dividend yield is 2.25%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 35.75.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 37.3, implying annual growth of 26.0%.
Current consensus DPS estimate is 31.2, implying a prospective dividend yield of 2.4%.
Current consensus EPS estimate suggests the PER is 34.5.

Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

QUB    QUBE HOLDINGS LIMITED

Transportation & Logistics – Overnight Price: $2.87

JP Morgan rates ((QUB)) as Overweight (1) –

FY22 results for Qube Holdings were ahead of JP Morgan's forecasts. Revenue for Ports and Logistics grew strongly though margins were supressed by operational challenges, the weather and labour issues.

Ports & Bulk exceeded the analyst's revenue estimates assisted by higher steel imports/grain exports compared to the previous corresponding period. Lower NZ forestry exports provided a partial offset.

Management guided to strong underlying earnings growth underpinned by strong container volumes and margin improvement for Patrick. The FY22 dividend of 7c matched the analyst's estimate and included a special dividend of 0.7c.

JP Morgan's Overweight rating is unchanged and the target rises to $3.70 from $3.60.

This report was published on August 26, 2022.

Target price is $3.70 Current Price is $2.87 Difference: $0.83
If QUB meets the JP Morgan target it will return approximately 29% (excluding dividends, fees and charges).
Current consensus price target is $3.28, suggesting upside of 14.2%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

JP Morgan forecasts a full year FY23 dividend of 6.00 cents and EPS of 12.00 cents.
At the last closing share price the estimated dividend yield is 2.09%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 23.92.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 11.9, implying annual growth of 80.6%.
Current consensus DPS estimate is 7.5, implying a prospective dividend yield of 2.6%.
Current consensus EPS estimate suggests the PER is 24.1.

Forecast for FY24:

JP Morgan forecasts a full year FY24 dividend of 7.00 cents and EPS of 12.00 cents.
At the last closing share price the estimated dividend yield is 2.44%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 23.92.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 13.0, implying annual growth of 9.2%.
Current consensus DPS estimate is 8.1, implying a prospective dividend yield of 2.8%.
Current consensus EPS estimate suggests the PER is 22.1.

Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

REH    REECE LIMITED

Furniture & Renovation – Overnight Price: $16.01

JP Morgan rates ((REH)) as Underweight (5) –

JP Morgan assesses the overall outlook is largely unchanged following FY22 results for Reece and the Underweight rating is maintained, while the target rises to $15.25 from $14.35.

The company maintained flat gross margins in FY22 in what was a strong pass-through of supplier price rises, according to the analyst. Execution is considered key to maintaining margins going forward.

Following successful store trials in FY22, management now intends to begin the physical rebranding of Reece stores in the US, as well as opening 10-15 stores annually.

This report was published on August 25, 2022.

Target price is $15.25 Current Price is $16.01 Difference: minus $0.76 (current price is over target).
If REH meets the JP Morgan target it will return approximately minus 5% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $15.47, suggesting downside of -3.4%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

JP Morgan forecasts a full year FY23 dividend of 21.00 cents and EPS of 65.00 cents.
At the last closing share price the estimated dividend yield is 1.31%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 24.63.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 63.7, implying annual growth of 4.8%.
Current consensus DPS estimate is 24.2, implying a prospective dividend yield of 1.5%.
Current consensus EPS estimate suggests the PER is 25.1.

Forecast for FY24:

JP Morgan forecasts a full year FY24 dividend of 21.00 cents and EPS of 64.00 cents.
At the last closing share price the estimated dividend yield is 1.31%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 25.02.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 64.6, implying annual growth of 1.4%.
Current consensus DPS estimate is 25.2, implying a prospective dividend yield of 1.6%.
Current consensus EPS estimate suggests the PER is 24.8.

Market Sentiment: -0.2
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

WTC    WISETECH GLOBAL LIMITED

Cloud services – Overnight Price: $58.38

Bell Potter rates ((WTC)) as Hold (3) –

Bell Potter views the WiseTech Global FY22 results as better than forecast which can be attributed to a tax benefit, while underlying profits were in line with expectations.

Management guided to 20-23% revenue growth and 21-30% EBITDA growth in FY23.

Bell Potter adjusts earnings forecasts by 8% and 10% for FY23 and FY24, respectively from an increase in revenue forecasts and higher margin expectations.

A Hold rating is retained and the target is raised to $60 from $50.

This report was published on August 24, 2022.

Target price is $60.00 Current Price is $58.38 Difference: $1.62
If WTC meets the Bell Potter target it will return approximately 3% (excluding dividends, fees and charges).
Current consensus price target is $56.18, suggesting downside of -3.8%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 14.20 cents and EPS of 76.30 cents.
At the last closing share price the estimated dividend yield is 0.24%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 76.51.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 76.0, implying annual growth of 27.3%.
Current consensus DPS estimate is 14.5, implying a prospective dividend yield of 0.2%.
Current consensus EPS estimate suggests the PER is 76.8.

Forecast for FY24:

Bell Potter forecasts a full year FY24 dividend of 17.50 cents and EPS of 94.00 cents.
At the last closing share price the estimated dividend yield is 0.30%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 62.11.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 96.7, implying annual growth of 27.2%.
Current consensus DPS estimate is 18.3, implying a prospective dividend yield of 0.3%.
Current consensus EPS estimate suggests the PER is 60.4.

Market Sentiment: -0.1
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources


Disclaimer:
The content of this information does in no way reflect the opinions of FNArena, or of its journalists. In fact we don't have any opinion about the stock market, its value, future direction or individual shares. FNArena solely reports about what the main experts in the market note, believe and comment on. By doing so we believe we provide intelligent investors with a valuable tool that helps them in making up their own minds, reading market trends and getting a feel for what is happening beneath the surface. This document is provided for informational purposes only. It does not constitute an offer to sell or a solicitation to buy any security or other financial instrument. FNArena employs very experienced journalists who base their work on information believed to be reliable and accurate, though no guarantee is given that the daily report is accurate or complete. Investors should contact their personal adviser before making any investment decision.

As part of emerging new trends overseas, The Australian Broker Call *Extra* Edition also includes providers of sponsored research. Readers should bear in mind, sponsored research, while not necessarily of lower quality, has the embedded complication that the company that is the subject of the research has paid for this research. Providers of sponsored research that can potentially be included in this Report are Breakaway Research, Edison Investment Research, Independent Investment Research, NDF Research, Pitt Street Research, and TMT Analytics.

Decisions about inclusions in this Report are made independently of the providers of stock market research and at full discretion of the team of journalists responsible for content at FNArena. Inclusion does not equal endorsement, in any way, shape or form. This Report is provided for informational purposes only.

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CHARTS

ARB BRG CQR CTP DEG EDV EHE FLT HUB KGN NEU NWL QUB REH WTC

For more info SHARE ANALYSIS: ARB - ARB CORPORATION LIMITED

For more info SHARE ANALYSIS: BRG - BREVILLE GROUP LIMITED

For more info SHARE ANALYSIS: CQR - CHARTER HALL RETAIL REIT

For more info SHARE ANALYSIS: CTP - CENTRAL PETROLEUM LIMITED

For more info SHARE ANALYSIS: DEG - DE GREY MINING LIMITED

For more info SHARE ANALYSIS: EDV - ENDEAVOUR GROUP LIMITED

For more info SHARE ANALYSIS: EHE - ESTIA HEALTH LIMITED

For more info SHARE ANALYSIS: FLT - FLIGHT CENTRE TRAVEL GROUP LIMITED

For more info SHARE ANALYSIS: HUB - HUB24 LIMITED

For more info SHARE ANALYSIS: KGN - KOGAN.COM LIMITED

For more info SHARE ANALYSIS: NEU - NEUREN PHARMACEUTICALS LIMITED

For more info SHARE ANALYSIS: NWL - NETWEALTH GROUP LIMITED

For more info SHARE ANALYSIS: QUB - QUBE HOLDINGS LIMITED

For more info SHARE ANALYSIS: REH - REECE LIMITED

For more info SHARE ANALYSIS: WTC - WISETECH GLOBAL LIMITED