Australian Broker Call *Extra* Edition – Sep 19, 2022

This story features ALS LIMITED, and other companies. For more info SHARE ANALYSIS: ALQ

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)

ALQ   ANP   ARX   BMT   BSL   COL   CU6   FSF   HLA   HPG   IAG   JHX   RFF   RHC   SGM   SUN   TPW  

ALQ    ALS LIMITED

Industrial Sector Contractors & Engineers – Overnight Price: $11.24

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

While ALS maintains the commodities cycle remains strong, Jarden has signified cyclical concerns may diminish as the company's life sciences segment continues to grow. The broker feels the company has capacity to pursue acquisitive growth in its life sciences division while the market debates the commodity cycle.

The company further highlighted mix shifts towards gold and battery minerals have left its commodities segment less exposed to cyclicality. Jarden expects the commodities segment to be the best potential source of long-term upwards earnings risk.

The Overweight rating and target price of $13.00 are retained.

This report was published on September 13, 2022.

Target price is $13.00 Current Price is $11.24 Difference: $1.76
If ALQ meets the Jarden target it will return approximately 16% (excluding dividends, fees and charges).
Current consensus price target is $13.44, suggesting upside of 20.4%(ex-dividends)
The company's fiscal year ends in March.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 37.30 cents and EPS of 61.00 cents.
At the last closing share price the estimated dividend yield is 3.32%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.43.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 62.6, implying annual growth of 58.5%.
Current consensus DPS estimate is 36.7, implying a prospective dividend yield of 3.3%.
Current consensus EPS estimate suggests the PER is 17.8.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 41.50 cents and EPS of 65.50 cents.
At the last closing share price the estimated dividend yield is 3.69%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.16.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 66.6, implying annual growth of 6.4%.
Current consensus DPS estimate is 38.8, implying a prospective dividend yield of 3.5%.
Current consensus EPS estimate suggests the PER is 16.8.

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

ANP    ANTISENSE THERAPEUTICS LIMITED

Pharmaceuticals & Biotech/Lifesciences – Overnight Price: $0.09

Wilsons rates ((ANP)) as Overweight (1) –

Wilsons cuts Antisense Therapeutics's target price to 36c from 57c after the company was forced to adjust clinical trial plans due to funding constraints, preferring a smaller fully funded IIb trial over an underfunded Phase IIb/III trial for the treatment of non-ambulant DMD.

The broker says this defers European commercialisation by two years but remains positive on the company's prospects and considers the decision to be the correct one in the current environment.

Overweight rating retained.

This report was published on September 13, 2022.

Target price is $0.36 Current Price is $0.09 Difference: $0.27
If ANP meets the Wilsons target it will return approximately 300% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY23:

Wilsons forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 0.90 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 10.00.

Forecast for FY24:

Wilsons forecasts a full year FY24 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 3.75.

Market Sentiment: 1.0
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: $0.81

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

Aroa Biosurgery has updated revenue guidance by 43% to 53% on FY21 and Bell Potter notes the company's cash position at June 30 was $27.7m, after gaining a US$50m credit facility from MidCap Financial.

Add to that another US$34m garnered from its August public offering on Nasdaq, and the broker is satisfied the balance sheet will support growth guidance.

Bell Potter also expects the Aroa may benefit from lawsuits directed at a key competitor in the hernia mesh market, particularly given Aroa's OvitTex product has a relative low hernia recurrence of less than 5% based on anecdotal evidence from high-volume surgeons, which supports study findings, says the broker.

Bell Potter retains a speculative Buy rating. Target price rises to $1.40 from $1.35.

This report was published on September 9, 2022.

Target price is $1.40 Current Price is $0.81 Difference: $0.59
If ARX meets the Bell Potter target it will return approximately 73% (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 2.90 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 27.93.

Forecast for FY24:

Bell Potter forecasts a full year FY24 dividend of 0.00 cents and EPS of minus 0.10 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 810.00.

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

BMT    BEAMTREE HOLDINGS LIMITED

Healthcare services – Overnight Price: $0.26

Shaw and Partners rates ((BMT)) as Initiation of coverage with Buy (1) –

Shaw and Partners initiates coverage of Beamtree Holdings with a Buy rating and 60c target price.

Beamtree offers health data analytics and decision support software that operates across most major regions except the United States.

Shaw says the company's "RippleDown" technology is used to help the health industry today improve quality of care and lower the cost of delivery. To date, the technology has been used in diagnostic pathology and Beamtree is seeking to extend that to clinical decision support and automated clinical coding.

The broker pegs the company's four-year revenue compound annual growth rate at 22% and estimates it will break even in the FY24 June half, the company hitting a cash nadir of $4.35 to $5m that year. 

Beamtree exited June 30 with a $6.4m cash balance and the broker says it is fully funded based on its research.

Shaw believes the company has reached an inflection point, having gained several contracts and renewed others, and being trialled by National Health Service Trusts, and is outpacing forecasts.

This report was published on September 9, 2022.

Target price is $0.60 Current Price is $0.26 Difference: $0.34
If BMT meets the Shaw and Partners target it will return approximately 131% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY23:

Shaw and Partners forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 1.60 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 16.25.

Forecast for FY24:

Shaw and Partners 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 37.14.

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

BSL    BLUESCOPE STEEL LIMITED

Steel & Scrap – Overnight Price: $16.14

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

Jarden is anticipating an uncertain outlook for scrap metal in coming months, expecting weakening demand from Europe and Turkey, uncertain energy supply and rising costs to drive prolonged production shutdowns.

For BlueScope Steel, the broker considers steel spread volatility as a key risk. Steel spreads currently reflect December levels on a lagged basis. 

The Overweight rating and target price of $20.80 are retained.

This report was published on September 9, 2022.

Target price is $20.80 Current Price is $16.14 Difference: $4.66
If BSL meets the Jarden target it will return approximately 29% (excluding dividends, fees and charges).
Current consensus price target is $20.99, suggesting upside of 29.6%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 50.00 cents and EPS of 296.80 cents.
At the last closing share price the estimated dividend yield is 3.10%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 5.44.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 251.0, implying annual growth of -56.1%.
Current consensus DPS estimate is 50.0, implying a prospective dividend yield of 3.1%.
Current consensus EPS estimate suggests the PER is 6.5.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 50.00 cents and EPS of 168.90 cents.
At the last closing share price the estimated dividend yield is 3.10%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.56.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 207.8, implying annual growth of -17.2%.
Current consensus DPS estimate is 50.0, implying a prospective dividend yield of 3.1%.
Current consensus EPS estimate suggests the PER is 7.8.

Market Sentiment: 0.7
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

COL    COLES GROUP LIMITED

Food, Beverages & Tobacco – Overnight Price: $16.60

Goldman Sachs rates ((COL)) as Downgrade to Sell from Neutral (5) –

Goldman Sachs has highlighted retailers look to be refocusing on defensive strategies, including elevated inventories and a return of promotional activity, and offensive strategies as the industry is challenged by high inflation.

The broker expects food and beverage grocery and home improvement retailers to be the most resilient to an economic downturn. Despite this, the broker has downgraded its rating on Coles Group given the company's slow approach to digital transformation, which has driven market share loss.

The rating is downgraded to Sell from Neutral and the target price decreases to $15.60 from $17.90.

This report was published on September 14, 2022.

Target price is $15.60 Current Price is $16.60 Difference: minus $1 (current price is over target).
If COL meets the Goldman Sachs target it will return approximately minus 6% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $18.74, suggesting upside of 12.7%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 dividend of 62.20 cents and EPS of 77.70 cents.
At the last closing share price the estimated dividend yield is 3.75%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 21.36.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 81.9, implying annual growth of 3.9%.
Current consensus DPS estimate is 67.2, implying a prospective dividend yield of 4.0%.
Current consensus EPS estimate suggests the PER is 20.3.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 62.60 cents and EPS of 78.20 cents.
At the last closing share price the estimated dividend yield is 3.77%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 21.23.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 86.4, implying annual growth of 5.5%.
Current consensus DPS estimate is 69.9, implying a prospective dividend yield of 4.2%.
Current consensus EPS estimate suggests the PER is 19.2.

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

CU6    CLARITY PHARMACEUTICALS LIMITED

Medical Equipment & Devices – Overnight Price: $0.63

Wilsons rates ((CU6)) as Initiation of coverage with Overweight (1) –

Wilsons initiates coverage on Clarity Pharmaceuticals, which it considers to be leading the copper-based radiopharmaceuticals renaissance. Clarity Pharmaceuticals is looking to establish its technology in neuroblastoma, which could drive early revenue generation.

Clarity Pharmaceuticals' technology allows for the use of copper without leakage, and the company has already secured exclusive supply agreements. Wilsons expects this makes Clarity Pharmaceuticals an attractive target for pharma oncology companies

The broker initiates with an Overweight rating and a target price of $0.82. 

This report was published on September 19, 2022.

Target price is $0.82 Current Price is $0.63 Difference: $0.19
If CU6 meets the Wilsons target it will return approximately 30% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY22:

Wilsons forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 10.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 6.30.

Forecast for FY23:

Wilsons forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 9.90 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 6.36.

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

FSF    FONTERRA SHAREHOLDERS FUND

Dairy – Overnight Price: $2.99

Jarden rates ((FSF)) as Upgrade to Overweight from Neutral (2) –

Fonterra Shareholders Fund has upgraded FY23 EPs guidance to NZ45c-60c from NZ30c-45c thanks to strong non-reference product performance, notes Jarden, and the broker raises FY23 EPS and DPS forecasts accordingly

The broker says the fund is experiencing supernormal profits from the above, while managing to maintain WMP returns, and management suspects that if the trend continues further upgrades may be upcoming.

The broker says the market has been cautious about the company's new capital structure which is due to be implemented over the next six months, but suspects fears are overdone, although it says the issues for outside investors differ.

The broker seeks more detail on FY23 capital expenditure investment.

Rating upgraded to Overweight from Neutral on valuation grounds. Target price rises to NZ$3.76 from NZ$3.62.

This report was published on September 9, 2022.

Current Price is $2.99. Target price not assessed.
The company's fiscal year ends in July.

Forecast for FY22:

Jarden forecasts a full year FY22 dividend of 18.53 cents and EPS of 32.79 cents.
At the last closing share price the estimated dividend yield is 6.20%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.12.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 27.79 cents and EPS of 49.65 cents.
At the last closing share price the estimated dividend yield is 9.29%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 6.02.

This company reports in NZD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

HLA    HEALTHIA LIMITED

Healthcare services – Overnight Price: $1.55

Jarden rates ((HLA)) as Buy (1) –

Having raised $10m equity through an institutional entitlement offer, Healthia seeks to raise an additional $5m through a retail entitlement offer. Jarden has reported the company will use part proceeds to fund the acquisition of ten physio clinics in Victoria.

Healthia has guided to an $8.9m revenue contribution and $1.9m earnings contribution from the purchases, while Jarden expects if settled by the end of October, the clinics can provide a 3.4% contributions to FY23 earnings. 

The Buy rating is retained and the target price increases to $2.46 from $2.43.

This report was published on September 13, 2022.

Target price is $2.46 Current Price is $1.55 Difference: $0.91
If HLA meets the Jarden target it will return approximately 59% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 5.00 cents and EPS of 12.30 cents.
At the last closing share price the estimated dividend yield is 3.23%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.60.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 6.00 cents and EPS of 14.40 cents.
At the last closing share price the estimated dividend yield is 3.87%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.76.

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

HPG    HIPAGES GROUP HOLDINGS LIMITED

Online media & mobile platforms – Overnight Price: $1.38

Goldman Sachs rates ((HPG)) as Buy (1) –

In light of rising interest rates, Goldman Sachs prefers structural growth companies with a balanced approach to investment.

The broker feels hipages Group is in the early phases of such long term structural growth to become the leading trade services marketplace in Australia. 

The analyst notes tradies haven't previously been big users of technology and hipages Group is driving the digitisation of
the industry. A strong brand presence has driven 79% of jobs through organic channels, and jobs posted by repeat consumers.

The Buy rating and $2.20 target price are maintained.

This report was published on September 9, 2022.

Target price is $2.20 Current Price is $1.38 Difference: $0.82
If HPG meets the Goldman Sachs target it will return approximately 59% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 dividend of 0.00 cents and EPS of 1.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 138.00.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 0.00 cents and EPS of 3.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 46.00.

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

IAG    INSURANCE AUSTRALIA GROUP LIMITED

Insurance – Overnight Price: $4.51

Jarden rates ((IAG)) as Buy (1) –

Jarden expects general insurers are positioned to benefit from rate rises accelerating to the highest levels in a decade across personal lines, highlighting Insurance Australia Group and Suncorp Group as being positioned to improve insurance trading ratios into target ranges by FY24.

Comparing the two, Jarden finds Insurance Australia Group ahead on insurance trading ratios given its better exposure to direct personal lines. The broker expects Insurance Australia Group to be on track for insurance trading ratios of 16% by FY24.

The Buy rating and target price of $5.40 are retained.

This report was published on September 11, 2022.

Target price is $5.40 Current Price is $4.51 Difference: $0.89
If IAG meets the Jarden target it will return approximately 20% (excluding dividends, fees and charges).
Current consensus price target is $4.97, suggesting upside of 10.6%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 26.00 cents and EPS of 32.20 cents.
At the last closing share price the estimated dividend yield is 5.76%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.01.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 30.2, implying annual growth of 114.3%.
Current consensus DPS estimate is 24.8, implying a prospective dividend yield of 5.5%.
Current consensus EPS estimate suggests the PER is 14.9.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 31.00 cents and EPS of 37.20 cents.
At the last closing share price the estimated dividend yield is 6.87%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.12.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 33.1, implying annual growth of 9.6%.
Current consensus DPS estimate is 27.3, implying a prospective dividend yield of 6.1%.
Current consensus EPS estimate suggests the PER is 13.6.

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

JHX    JAMES HARDIE INDUSTRIES PLC

Building Products & Services – Overnight Price: $31.99

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

James Hardie Industries' recent investor day saw management reiterate its strategy focus on marketing to homeowners in a bid to generate demand. Given the ultimate goal of growing penetration in repair and remodeling, Jarden considers the US's North East and Mid West regions to hold the most growth potential.

Jarden has reiterated its view that James Hardie Industries retains strong product pricing power and a preferable business mix than in previous economic downturns.

The Overweight rating is retained and the target price decreases to $42.20 from $42.40.

This report was published on September 13, 2022.

Target price is $42.20 Current Price is $31.99 Difference: $10.21
If JHX meets the Jarden target it will return approximately 32% (excluding dividends, fees and charges).
Current consensus price target is $48.57, suggesting upside of 51.4%(ex-dividends)
The company's fiscal year ends in February.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 142.56 cents and EPS of 233.40 cents.
At the last closing share price the estimated dividend yield is 4.46%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.71.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 247.4, implying annual growth of N/A.
Current consensus DPS estimate is 125.4, implying a prospective dividend yield of 3.9%.
Current consensus EPS estimate suggests the PER is 13.0.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 124.39 cents and EPS of 207.69 cents.
At the last closing share price the estimated dividend yield is 3.89%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.40.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 257.5, implying annual growth of 4.1%.
Current consensus DPS estimate is 134.9, implying a prospective dividend yield of 4.2%.
Current consensus EPS estimate suggests the PER is 12.5.

This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.8
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

RFF    RURAL FUNDS GROUP

REITs – Overnight Price: $2.57

Wilsons rates ((RFF)) as Upgrade to Overweight from Market Weight (1) –

Rural Funds has entered into a lease agreement with The Rohatyn Group for up to 3,000 hectares of macadamia orchards, with key terms of the agreement attractive according to Wilsons. Approval of the lease will leave Rural Funds with a $101m unleased development pipeline of cattle and cropping properties.

The lease supports material upgrades to the broker's earnings forecasts for the next four years. Wilsons lifts its cash revenue forecasts 6-13%  and cash earnings 8-18%. 

The rating is upgraded to Overweight and the target price increases to $2.73 from $2.72.

This report was published on September 13, 2022.

Target price is $2.73 Current Price is $2.57 Difference: $0.16
If RFF meets the Wilsons target it will return approximately 6% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY23:

Wilsons forecasts a full year FY23 dividend of 11.70 cents and EPS of 11.30 cents.
At the last closing share price the estimated dividend yield is 4.55%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 22.74.

Forecast for FY24:

Wilsons forecasts a full year FY24 dividend of 11.70 cents and EPS of 12.00 cents.
At the last closing share price the estimated dividend yield is 4.55%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 21.42.

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

RHC    RAMSAY HEALTH CARE LIMITED

Healthcare services – Overnight Price: $63.60

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

Following Ramsay Health Care's rejection of the KKR consortium's bid in late August, the healthcare provider has now confirmed the consortium is not placed to improve its offer.

As highlighted by Jarden, on review of Ramsay's full year results the consortium raised concerns as to downward pressure on valuation. The consortium has allowed opportunity for Ramsay to review its valuation and consider a new proposal, but Jarden sees a deal as less likely.

The Overweight rating is retained and the target price decreases to $66.07 from $84.93.

This report was published on September 13, 2022.

Target price is $66.07 Current Price is $63.60 Difference: $2.47
If RHC meets the Jarden target it will return approximately 4% (excluding dividends, fees and charges).
Current consensus price target is $73.73, suggesting upside of 18.6%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 100.00 cents and EPS of 171.50 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 37.08.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 193.7, implying annual growth of 66.5%.
Current consensus DPS estimate is 112.4, implying a prospective dividend yield of 1.8%.
Current consensus EPS estimate suggests the PER is 32.1.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 154.90 cents and EPS of 266.10 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 23.90.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 262.2, implying annual growth of 35.4%.
Current consensus DPS estimate is 152.4, implying a prospective dividend yield of 2.5%.
Current consensus EPS estimate suggests the PER is 23.7.

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

SGM    SIMS LIMITED

Steel & Scrap – Overnight Price: $14.03

Jarden rates ((SGM)) as Downgrade to Neutral from Overweight (3) –

Jarden is anticipating an uncertain outlook for scrap metal in coming months, expecting weakening demand from Europe and Turkey, uncertain energy supply and rising costs to drive prolonged production shutdowns.

The broker has lowered its sales volumes assumptions for Sims by -5% for North America and -14.5% for UK, noting every -5% reduction could impact on FY23 earnings per share by -18.8%. Jarden lowers earnings per share forecasts -5.2%, -13.1% and -3.1% through to FY25.

The rating is downgraded to Neutral from Overweight and the target price decreases to $14.80 from $16.00.

This report was published on September 9, 2022.

Target price is $14.80 Current Price is $14.03 Difference: $0.77
If SGM meets the Jarden target it will return approximately 5% (excluding dividends, fees and charges).
Current consensus price target is $16.57, suggesting upside of 16.7%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 41.70 cents and EPS of 138.90 cents.
At the last closing share price the estimated dividend yield is 2.97%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.10.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 150.4, implying annual growth of -50.4%.
Current consensus DPS estimate is 50.7, implying a prospective dividend yield of 3.6%.
Current consensus EPS estimate suggests the PER is 9.4.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 38.40 cents and EPS of 127.80 cents.
At the last closing share price the estimated dividend yield is 2.74%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.98.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 123.7, implying annual growth of -17.8%.
Current consensus DPS estimate is 42.4, implying a prospective dividend yield of 3.0%.
Current consensus EPS estimate suggests the PER is 11.5.

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

SUN    SUNCORP GROUP LIMITED

Insurance – Overnight Price: $10.28

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

Jarden expects general insurers are positioned to benefit from rate rises accelerating to the highest levels in a decade across personal lines, highlighting Insurance Australia Group and Suncorp Group as being positioned to improve insurance trading ratios into target ranges by FY24.

Comparing the two, Jarden finds Insurance Australia Group ahead on insurance trading ratios given its better exposure to direct personal lines. The broker expects Suncorp Group to be on track for insurance trading ratios between 10-12% by FY24.

The Buy rating is retained and the target price increases to $13.15 from $13.00.

This report was published on September 11, 2022.

Target price is $13.15 Current Price is $10.28 Difference: $2.87
If SUN meets the Jarden target it will return approximately 28% (excluding dividends, fees and charges).
Current consensus price target is $13.11, suggesting upside of 26.4%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 96.00 cents and EPS of 93.50 cents.
At the last closing share price the estimated dividend yield is 9.34%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.99.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 90.5, implying annual growth of 68.2%.
Current consensus DPS estimate is 68.7, implying a prospective dividend yield of 6.6%.
Current consensus EPS estimate suggests the PER is 11.5.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 43.00 cents and EPS of 91.70 cents.
At the last closing share price the estimated dividend yield is 4.18%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.21.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 99.3, implying annual growth of 9.7%.
Current consensus DPS estimate is 77.2, implying a prospective dividend yield of 7.4%.
Current consensus EPS estimate suggests the PER is 10.4.

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

TPW    TEMPLE & WEBSTER GROUP LIMITED

Furniture & Renovation – Overnight Price: $5.81

Goldman Sachs rates ((TPW)) as Initiation of coverage with Buy (1) –

In light of rising interest rates, Goldman Sachs prefers structural growth companies with a balanced approach to investment.

The broker considers Temple & Webster is in the early phase of such long term structural growth and will become the leading marketplace in the online homewares/home furnishings market. Coverage is initiated with a Buy rating and $7.55 target price.

The analyst believes the market is overestimating the negative cyclical demand impact from the economic backdrop. It's felt the depth and breadth of product will help transfer market share from more premium retailers as consumers search for value.

The low-inventory business model also helps remove risk around fluctuations in demand, observes Goldman Sachs.

This report was published on September 9, 2022.

Target price is $7.55 Current Price is $5.81 Difference: $1.74
If TPW meets the Goldman Sachs target it will return approximately 30% (excluding dividends, fees and charges).
Current consensus price target is $6.09, suggesting upside of 6.6%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 dividend of 0.70 cents and EPS of 7.70 cents.
At the last closing share price the estimated dividend yield is 0.12%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 75.45.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 7.8, implying annual growth of -21.5%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 73.2.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 0.00 cents and EPS of 11.50 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 50.52.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 10.5, implying annual growth of 34.6%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 54.4.

Market Sentiment: 0.3
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.

Click to view our Glossary of Financial Terms