Australian Broker Call *Extra* Edition – Sep 28, 2022

Daily Market Reports | Sep 28 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)

AIZ   ALL   AMA   ANG   AVH   CAT   CGS   CHC   COI   COL   CTP   CUV   EDV   FMG (2)   GL1   IEL (2)   JAN   KMD   MAD   NHC   ORG   RWC   TAH   TLX  

AIZ    AIR NEW ZEALAND LIMITED

Transportation & Logistics - Overnight Price: $0.62

Jarden rates ((AIZ)) as Neutral (3) -

Jarden increases near-term earnings forecasts for Air New Zealand materially to reflect the strength of the yield environment and new 1H FY23 profit guidance, which was well above market expectations.

The broker expects the buoyant yield environment to soften in the 2H as the company deploys greater capacity and competition ramps-up on the Tasman and long haul routes.

The Neutral rating is retained as the analyst expects only modest upside to the target price, which is increased to NZ76c from NZ70c on positive forecast earnings changes.

This report was published on September 23, 2022.

Current Price is $0.62. Target price not assessed.
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 7.85 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 7.89.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 0.00 cents and EPS of 6.47 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.59.

This company reports in NZD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

ALL    ARISTOCRAT LEISURE LIMITED

Gaming - Overnight Price: $33.39

Goldman Sachs rates ((ALL)) as Buy (1) -

Accounting for the -14% global decline in mobile gaming revenue in August and recent currency exchange rate changes, Goldman Sachs has updated its earnings outlook for Aristocrat Leisure by 2.3% and 0.4% in FY22 and FY23, but by -3.1% in FY24. 

The largest declines came from the racing, shooting and geolocation genres, down -32.7%, -32.2% and -29.1% respectively, but revenue remains 4.4% ahead of pre-covid levels on a three-year compound annual growth rate basis.

Underpinned by Aristocrat Leisure's strong design and development spend, the Buy rating and target price of $43.00 are retained.

This report was published on September 16, 2022.

Target price is $43.00 Current Price is $33.39 Difference: $9.61
If ALL meets the Goldman Sachs target it will return approximately 29% (excluding dividends, fees and charges).
Current consensus price target is $43.29, suggesting upside of 30.3%(ex-dividends)
The company's fiscal year ends in September.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 dividend of 63.00 cents and EPS of 176.00 cents.
At the last closing share price the estimated dividend yield is 1.89%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.97.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 162.5, implying annual growth of 26.8%.
Current consensus DPS estimate is 58.3, implying a prospective dividend yield of 1.8%.
Current consensus EPS estimate suggests the PER is 20.4.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 dividend of 76.00 cents and EPS of 191.00 cents.
At the last closing share price the estimated dividend yield is 2.28%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.48.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 184.3, implying annual growth of 13.4%.
Current consensus DPS estimate is 69.8, implying a prospective dividend yield of 2.1%.
Current consensus EPS estimate suggests the PER is 18.0.

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

AMA    AMA GROUP LIMITED

Automobiles & Components - Overnight Price: $0.25

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

With AMA Group's debt facility close to fully drawn, and cash at only $52m as of the end of June, Bell Potter feels a capital raise may be necessary.

The broker sees potential for a pull forward of the company's next market incentive payment or negotiation of its Capital Smart contract to reduce the need for a capital raise.

Less likely, according to the broker, would be the sale of ACM Parts, which it expects is too integral to the business.

The Hold rating is retained and the target price increases to $0.24 from $0.17.

This report was published on September 27, 2022.

Target price is $0.24 Current Price is $0.25 Difference: minus $0.01 (current price is over target).
If AMA meets the Bell Potter target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).
The company's fiscal year ends in June.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 3.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 8.33.

Forecast for FY24:

Bell Potter forecasts a full year FY24 dividend of 0.00 cents and EPS of 0.20 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 125.00.

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

ANG    AUSTIN ENGINEERING LIMITED

Mining Sector Contracting - Overnight Price: $0.34

Shaw and Partners rates ((ANG)) as Initiation of coverage with Buy (1) -

Shaw and Partners initiates coverage on Austin Engineering, a designer and manufacturer of customised heavy equipment, typically for the hard rock, high wear mining industry. 

In the last year, dump truck trays accounted for 80% of the company's sales. Austin Engineering's recent acquisition of Mainetec gives it access to Mainetec's Hulk premium mining bucket range, expanding Austin Engineering's potential customer base.

Earnings margins have improved in the last year, and Shaw and Partners considers the near-term outlook for mining volumes to be solid. The broker initiates with a Buy rating and a target price of $0.45.

This report was published on September 26, 2022.

Target price is $0.45 Current Price is $0.34 Difference: $0.11
If ANG meets the Shaw and Partners target it will return approximately 32% (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 1.00 cents and EPS of 4.60 cents.
At the last closing share price the estimated dividend yield is 2.94%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 7.39.

Forecast for FY24:

Shaw and Partners forecasts a full year FY24 dividend of 1.00 cents and EPS of 5.20 cents.
At the last closing share price the estimated dividend yield is 2.94%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 6.54.

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


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