Daily Market Reports | Mar 16 2023
An additional news report on the recommendation, valuation, forecast and opinion changes and updates 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)
5GG APE CAR (2) CTP DDR DRO GL1 GNC HAS INR MAQ ORI PWH RGN SGM VUL
PWH PWR HOLDINGS LIMITED
Automobiles & Components - Overnight Price: $9.76
Bell Potter rates ((PWH)) as Hold (3) -
Following the release of PWR Holdings' first half results, Bell Potter has lifted its revenue forecasts 2% and 4% for FY24 and FY25 respectively, and reduced its net profit forecasts for the same years.
Additionally, increased investment in the UK, alongside other investment costs, saw capital expenditure forecasts increase to -$11.2m, -$10.0m and -$15.0m for FY23, FY24 and FY25.
The broker considers PWR Holdings fairly valued, noting given the company's strong pipeline potential large contracts could be announced in coming months and serve as a catalyst for share price upside.
The Hold rating is retained and the target price decreases to $10.75 from $11.00.
This report was published on March 7, 2023.
Target price is $10.75 Current Price is $9.76 Difference: $0.99
If PWH meets the Bell Potter target it will return approximately 10% (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 13.00 cents and EPS of 22.60 cents.
At the last closing share price the estimated dividend yield is 1.33%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 43.19.
Forecast for FY24:
Bell Potter forecasts a full year FY24 dividend of 15.50 cents and EPS of 27.50 cents.
At the last closing share price the estimated dividend yield is 1.59%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 35.49.
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
RGN REGION GROUP
REITs - Overnight Price: $2.44
Moelis rates ((RGN)) as Upgrade to Buy from Hold (1) -
Region Group's earnings profile has been muted near-term, Moelis notes, given rising rates, limited funds under management growth within the GIC mandate, and a modest balance sheet.
The broker suggests excess balance sheet capacity may make the eventual resurgence of direct market liquidity something of a catalyst for earnings.
Region's share price has fallen -10% since reporting results a month ago versus -6% for the ASX300 REITs, and has now entered value territory in the broker's view. Upgrade to Buy from Hold. Target unchanged at $2.85.
This report was published on March 7, 2023.
Target price is $2.85 Current Price is $2.44 Difference: $0.41
If RGN meets the Moelis target it will return approximately 17% (excluding dividends, fees and charges).
Current consensus price target is $2.77, suggesting upside of 12.4%(ex-dividends)
The company's fiscal year ends in June.
Forecast for FY23:
Moelis forecasts a full year FY23 dividend of 15.20 cents and EPS of 16.90 cents.
At the last closing share price the estimated dividend yield is 6.23%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.44.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 16.4, implying annual growth of -62.7%.
Current consensus DPS estimate is 15.1, implying a prospective dividend yield of 6.1%.
Current consensus EPS estimate suggests the PER is 15.0.
Forecast for FY24:
Moelis forecasts a full year FY24 dividend of 14.60 cents and EPS of 17.50 cents.
At the last closing share price the estimated dividend yield is 5.98%.
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 16.4, implying annual growth of N/A.
Current consensus DPS estimate is 15.2, implying a prospective dividend yield of 6.2%.
Current consensus EPS estimate suggests the PER is 15.0.
Market Sentiment: 0.2
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
SGM SIMS LIMITED
Steel & Scrap - Overnight Price: $15.03
Jarden rates ((SGM)) as Neutral (3) -
Sims has commenced a divestment process for its 50% stake in renewable energy generator LMS Energy. There is significant ongoing capital expenditure from biogas to energy projects, which Jarden believes may not be considered core investment for Sims.
The broker assumes the company would prioritise the use of funds for potential acquisitions ahead of capital management initiatives, with the earliest possible timing for completion of a sale in the first half FY24.
The gradual resumption of production at EU steel mills in coming months would help volume and pricing for scrap metal, Jarden suggests.
Target rises to $16.60 from $16.40, Neutral retained.
This report was published on March 7, 2023.
Target price is $16.60 Current Price is $15.03 Difference: $1.57
If SGM meets the Jarden target it will return approximately 10% (excluding dividends, fees and charges).
Current consensus price target is $14.84, suggesting upside of 0.9%(ex-dividends)
The company's fiscal year ends in June.
Forecast for FY23:
Jarden forecasts a full year FY23 dividend of 28.70 cents and EPS of 75.90 cents.
At the last closing share price the estimated dividend yield is 1.91%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 19.80.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 75.2, implying annual growth of -75.2%.
Current consensus DPS estimate is 32.3, implying a prospective dividend yield of 2.2%.
Current consensus EPS estimate suggests the PER is 19.6.
Forecast for FY24:
Jarden forecasts a full year FY24 dividend of 26.40 cents and EPS of 88.10 cents.
At the last closing share price the estimated dividend yield is 1.76%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.06.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 95.5, implying annual growth of 27.0%.
Current consensus DPS estimate is 31.3, implying a prospective dividend yield of 2.1%.
Current consensus EPS estimate suggests the PER is 15.4.
Market Sentiment: -0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
VUL VULCAN ENERGY RESOURCES LIMITED
New Battery Elements - Overnight Price: $6.09
Canaccord Genuity rates ((VUL)) as Speculative Buy (1) -
Vulcan Energy Resources has released its definitive feasibility study for phase one of the Zero Carbon Lithium Project. While production expectations have increased, so has the capital requirement due to it being a larger project.
Taking into account a pushed back timeline for first cashflow, higher costs and a decline in lithium grade over the project life, Canaccord Genuity has cut its target to $15 from $19. Speculative Buy retained.
This report was published on March 16, 2023.
Target price is $15.00 Current Price is $6.09 Difference: $8.91
If VUL meets the Canaccord Genuity target it will return approximately 146% (excluding dividends, fees and charges).
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
The full story is for FNArena subscribers only. To read the full story plus enjoy a free two-week trial to our service SIGN UP HERE
If you already had your free trial, why not join as a paying subscriber? CLICK HERE
