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

Daily Market Reports | Sep 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)

AIM   AVD   B4P   CSS   FZO   GOR   HLA (2)   HMY   HVN   IMR   MCR   MSB   NIC   OPT   OSL   PBH (2)   PPS   PRU   RFF   RMC   SBM   SXE  

RMC    RESIMAC GROUP LIMITED

Banks - Overnight Price: $1.15

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

Bell Potter says Resimac Group's FY22 result was something of a mixed bag.

The broker spies headwinds to credit growth after a slowing in book growth in the second half, but notes credit quality is strong albeit weakening in the second half, and the company's net interest margin eased.

The loan impairment expense rose $2.14m to reflect an increase in general positions as economic growth slows.

The broker says all of this is to be expected given recent rate rises and shaves FY23 earnings  forecasts -1.1% but increases FY24 earnings forecasts (up 4%).

Hold rating retained, Bell Potter noting the recent fall in the share price to $1.27 already accounts for most of the rate-rise impact. Target price rises to $2.25 from $2.15.

This report was published on September 1, 2022.

Target price is $2.25 Current Price is $1.15 Difference: $1.1
If RMC meets the Bell Potter target it will return approximately 96% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 8.00 cents and EPS of 23.20 cents.
At the last closing share price the estimated dividend yield is 6.96%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 4.96.

Forecast for FY24:

Bell Potter forecasts a full year FY24 dividend of 8.00 cents and EPS of 20.40 cents.
At the last closing share price the estimated dividend yield is 6.96%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 5.64.

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

SBM    ST. BARBARA LIMITED

Gold & Silver - Overnight Price: $0.93

Canaccord Genuity rates ((SBM)) as Hold (3) -

Following broadly in-line FY22 results, Canaccord Genuity leaves is Hold rating and $0.95 target unchanged for St. Barbara. While FY23 guidance was maintained, the broker points to near-term grade headwinds at Gwalia.

The company continues to conduct a strategic review of the Simberi operations in Papua New Guinea and the analyst suggests the asset will be sold.

Should a sale occur, Canaccord expects heightened corporate interest will follow, particularly in light of recent progress for permitting at the Atlantic operations in Canada.

This report was published on September 1, 2022.

Target price is $0.85 Current Price is $0.93 Difference: minus $0.08 (current price is over target).
If SBM meets the Canaccord Genuity target it will return approximately minus 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $1.04, suggesting upside of 11.6%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

Canaccord Genuity forecasts a full year FY23 dividend of 0.00 cents and EPS of 12.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 7.75.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 0.6, implying annual growth of N/A.
Current consensus DPS estimate is 0.8, implying a prospective dividend yield of 0.9%.
Current consensus EPS estimate suggests the PER is 155.0.

Forecast for FY24:

Canaccord Genuity forecasts a full year FY24 dividend of 0.00 cents and EPS of 13.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 7.15.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 1.4, implying annual growth of 133.3%.
Current consensus DPS estimate is 1.5, implying a prospective dividend yield of 1.6%.
Current consensus EPS estimate suggests the PER is 66.4.

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

SXE    SOUTHERN CROSS ELECTRICAL ENGINEERING LIMITED

Mining Sector Contracting - Overnight Price: $0.74

Moelis rates ((SXE)) as Buy (1) -

Southern Cross Electrical Engineering's earnings (EBITDA) outpaced Moelis's forecasts by 17% and met upgraded August guidance.

Strong cash conversion of 127% proved a highlight, as did the absence of bank debt excluding leases, and the broker says the strong balance sheet provides room for M&A.

FY23 revenue guidance was flat but EBITDA guidance rose. Moelis upgraded FY23 and FY24 EBITDA forecasts by 10%.

Buy rating retained. Target price rises to 99c from 73c.

This report was published on September 1, 2022.

Target price is $0.99 Current Price is $0.74 Difference: $0.25
If SXE meets the Moelis target it will return approximately 34% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY23:

Moelis forecasts a full year FY23 dividend of 5.50 cents and EPS of 7.40 cents.
At the last closing share price the estimated dividend yield is 7.43%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.00.

Forecast for FY24:

Moelis forecasts a full year FY24 dividend of 5.60 cents and EPS of 7.80 cents.
At the last closing share price the estimated dividend yield is 7.57%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.49.

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


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