Australian Broker Call *Extra* Edition – Apr 20, 2023

This story features AIR NEW ZEALAND LIMITED, and other companies. For more info SHARE ANALYSIS: AIZ

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)

AIZ   AMA   BXB   ELD   EML   IPD (2)   IPH   LAU   TCL   TLX  

AIZ    AIR NEW ZEALAND LIMITED

Transportation & Logistics – Overnight Price: $0.70

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

Jarden suspects Air New Zealand will beat current guidance. In the second half to date, load factor and RASK (revenue per average seat kilometre) are close to record levels. The broker lifts forecasts for pre-tax profit by 11% to NZ$553m.

Recent oil price volatility is expected to have a limited impact on fuel guidance, given the likely hedge profile. Consumer confidence may be low and the macro outlook fragile but the broker notes momentum is strong. Target is reduced to NZ$0.85 from NZ$0.87. Overweight.

This report was published on April 18, 2023.

Current Price is $0.70. Target price not assessed.
The company's fiscal year ends in June.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 3.01 cents and EPS of 11.03 cents.
At the last closing share price the estimated dividend yield is 4.27%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 6.39.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 4.83 cents and EPS of 7.75 cents.
At the last closing share price the estimated dividend yield is 6.86%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.10.

This company reports in NZD. 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

AMA    AMA GROUP LIMITED

Automobiles & Components – Overnight Price: $0.16

Canaccord Genuity rates ((AMA)) as Buy (1) –

AMA Group's March-quarter trading update appears to have pleased Canaccord Genuity, but management sharply downgraded FY23 earnings (Ebitda) guidance to reflect rising labour costs and broader inflation.

On the upside, the company reported positive operating cash flow fo $0.3m (a continued turnaround), despite a -$11.7m outflow relating to interest and finance costs. 

The company closed the quarter with $20.5m in cash – which should cover June-quarter operations, says the broker, targeting a $12.5m cash balance at the close of the June financial year.

Canaccord Genuity believes the long-term thesis remains intact and retains a Speculative Buy rating. Target price falls to 24c from 30c.

This report was published on April 18, 2023.

Target price is $0.24 Current Price is $0.16 Difference: $0.08
If AMA meets the Canaccord Genuity target it will return approximately 50% (excluding dividends, fees and charges).
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 minus 2.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 8.00.

Forecast for FY24:

Canaccord Genuity forecasts a full year FY24 dividend of 0.00 cents and EPS of 0.00 cents.

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

BXB    BRAMBLES LIMITED

Transportation & Logistics – Overnight Price: $13.91

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

A strong price environment continued over the March quarter which Jarden assesses is a positive indicator for the update expected on April 20. The broker believes Brambles can capitalise on discounted lumber prices to improve free cash flow.

Meanwhile, freight and diesel costs continue to normalise which should provide a tailwind to margins into the fourth quarter.

The Overweight rating and $13.15 target are maintained.

This report was published on April 17, 2023.

Target price is $13.15 Current Price is $13.91 Difference: minus $0.76 (current price is over target).
If BXB meets the Jarden target it will return approximately minus 5% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $13.98, suggesting upside of 0.5%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

Jarden forecasts a full year FY23 EPS of 70.01 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 19.87.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 81.5, implying annual growth of N/A.
Current consensus DPS estimate is 42.9, implying a prospective dividend yield of 3.1%.
Current consensus EPS estimate suggests the PER is 17.1.

Forecast for FY24:

Jarden forecasts a full year FY24 EPS of 72.51 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 19.18.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 89.2, implying annual growth of 9.4%.
Current consensus DPS estimate is 48.0, implying a prospective dividend yield of 3.5%.
Current consensus EPS estimate suggests the PER is 15.6.

This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

ELD    ELDERS LIMITED

Agriculture – Overnight Price: $8.30

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

Goldman Sachs removes Elders from its conviction list although maintains a Buy rating. The stock has underperformed since the FY22 financial report.

The broker believes this is driven by the view that peak cycle earnings have passed and a downturn in rural markets is likely following three strong years. The stock has de-rated, which the broker believes is now overdone. Target is reduced to $13.20 from $18.40.

This report was published on April 17, 2023.

Target price is $13.20 Current Price is $8.30 Difference: $4.9
If ELD meets the Goldman Sachs target it will return approximately 59% (excluding dividends, fees and charges).
Current consensus price target is $11.82, suggesting upside of 42.4%(ex-dividends)
The company's fiscal year ends in September.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 dividend of 47.00 cents and EPS of 93.00 cents.
At the last closing share price the estimated dividend yield is 5.66%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 8.92.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 88.6, implying annual growth of -14.9%.
Current consensus DPS estimate is 51.3, implying a prospective dividend yield of 6.2%.
Current consensus EPS estimate suggests the PER is 9.4.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 52.00 cents and EPS of 103.00 cents.
At the last closing share price the estimated dividend yield is 6.27%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 8.06.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 82.1, implying annual growth of -7.3%.
Current consensus DPS estimate is 49.4, implying a prospective dividend yield of 6.0%.
Current consensus EPS estimate suggests the PER is 10.1.

Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

EML    EML PAYMENTS LIMITED

Business & Consumer Credit – Overnight Price: $0.81

Wilsons rates ((EML)) as Underweight (5) –

EML Payments has announced a strategic review and appointed a new CEO. The company will focus on key priorities away from the long-range strategy.

Priorities include remediation, cost optimisation, growth in the core business and talent retention. Wilsons puts earnings forecasts under review while retaining an Underweight rating and 42c target.

This report was published on April 17, 2023.

Target price is $0.42 Current Price is $0.81 Difference: minus $0.395 (current price is over target).
If EML meets the Wilsons target it will return approximately minus 48% (excluding dividends, fees and charges – negative figures indicate an expected loss).
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 6.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 13.58.

Forecast for FY24:

Wilsons forecasts a full year FY24 dividend of 0.00 cents and EPS of 0.70 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 116.43.

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

IPD    IMPEDIMED LIMITED

Medical Equipment & Devices – Overnight Price: $0.12

Canaccord Genuity rates ((IPD)) as Buy (1) –

ImpediMed's March-quarter result met Canaccord Genuity's tempered expectations. 

The company managed to pass through a 33% average monthly licence fee increase across its US contract renewals, and 12 Sozo units were added in the quarter (weaker than previous quarters), taking the total base to more than 950.

Operating cash outflow met guidance thanks to the company's cost program and the broker estimates closing cash of $21.4 should provide a decent operational runway.

The big ticket item now is last March's NCCN inclusion of ImpediMed's measurement tool for lymphoedema in cancer patients and Canaccord Genuity says updates so far have been positive, management targeting 6,000 hospitals (with a tighter target of the 1600 cancer centres).

Buy rating and 18c target price retained.

This report was published on April 18, 2023.

Target price is $0.18 Current Price is $0.12 Difference: $0.06
If IPD meets the Canaccord Genuity target it will return approximately 50% (excluding dividends, fees and charges).
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 minus 1.30 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 9.23.

Forecast for FY24:

Canaccord Genuity forecasts a full year FY24 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 20.00.

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

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

ImpediMed's March quarter results were consistent with expectations, Wilsons notes. The broker now looks ahead for more updates on private payor coverage policies and the commercial roll-out of Sozo devices.

Wilsons retains an Overweight rating and 23c target.

This report was published on April 17, 2023.

Target price is $0.23 Current Price is $0.12 Difference: $0.11
If IPD meets the Wilsons target it will return approximately 92% (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 13.33.

Forecast for FY24:

Wilsons 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 17.14.

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

IPH    IPH LIMITED

Legal – Overnight Price: $8.20

Goldman Sachs rates ((IPH)) as Neutral (3) –

IPH has quantified the preliminary financial implications of the cyber breach which include one-off costs of -$2-2.5m as well as a service  charge shortfall of around $4.4m in March.

Goldman Sachs adjusts estimates accordingly and also takes the opportunity to refresh FX estimates.

It remains unclear if the breach will have a lasting impact on the company's competitive profile but the broker interprets the swift response to mean there should be little lasting impact. Neutral rating and $10.45 target maintained.

This report was published on April 17, 2023.

Target price is $10.45 Current Price is $8.20 Difference: $2.25
If IPH meets the Goldman Sachs target it will return approximately 27% (excluding dividends, fees and charges).
Current consensus price target is $10.74, suggesting upside of 30.9%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 dividend of 31.00 cents and EPS of 42.00 cents.
At the last closing share price the estimated dividend yield is 3.78%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 19.52.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 42.8, implying annual growth of 77.7%.
Current consensus DPS estimate is 31.7, implying a prospective dividend yield of 3.9%.
Current consensus EPS estimate suggests the PER is 19.2.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 35.00 cents and EPS of 47.00 cents.
At the last closing share price the estimated dividend yield is 4.27%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.45.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 44.9, implying annual growth of 4.9%.
Current consensus DPS estimate is 33.0, implying a prospective dividend yield of 4.0%.
Current consensus EPS estimate suggests the PER is 18.3.

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

LAU    LINDSAY AUSTRALIA LIMITED

Transportation & Logistics – Overnight Price: $1.31

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

Lindsay Australia has substantially upgraded FY23 EBITDA guidance, by 26% to $85-90m. The company has flagged strong demand for its transport business, driven by the collapse of Scott's Logistics and the exit of smaller operators.

Wilsons raises estimates for FY23-25 by 10-19%, noting that, by acquiring a material portion of the Scott's fleet at a discount, the company has captured the supply dynamics. Overweight maintained. Target is lifted to $1.51 from $1.35.

This report was published on April 17, 2023.

Target price is $1.51 Current Price is $1.31 Difference: $0.195
If LAU meets the Wilsons target it will return approximately 15% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY23:

Wilsons forecasts a full year FY23 dividend of 4.90 cents and EPS of 11.80 cents.
At the last closing share price the estimated dividend yield is 3.73%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.14.

Forecast for FY24:

Wilsons forecasts a full year FY24 dividend of 6.60 cents and EPS of 13.10 cents.
At the last closing share price the estimated dividend yield is 5.02%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.04.

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

TCL    TRANSURBAN GROUP LIMITED

Infrastructure & Utilities – Overnight Price: $14.74

Goldman Sachs rates ((TCL)) as Sell (5) –

Transurban Group's traffic update for the third quarter shows all jurisdictions increased 12-15%. Some disruptions occurred, associated with ongoing construction activities in the wider Sydney network and planned work in Melbourne and Montreal.

Goldman Sachs still considers the valuation full and the Sell rating and $13.50 target are unchanged.

This report was published on April 17, 2023.

Target price is $13.50 Current Price is $14.74 Difference: minus $1.24 (current price is over target).
If TCL meets the Goldman Sachs target it will return approximately minus 8% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $14.53, suggesting downside of -1.4%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 dividend of 58.00 cents and EPS of 14.00 cents.
At the last closing share price the estimated dividend yield is 3.93%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 105.29.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 21.6, implying annual growth of 3275.0%.
Current consensus DPS estimate is 57.2, implying a prospective dividend yield of 3.9%.
Current consensus EPS estimate suggests the PER is 68.2.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 63.00 cents and EPS of 31.00 cents.
At the last closing share price the estimated dividend yield is 4.27%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 47.55.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 30.2, implying annual growth of 39.8%.
Current consensus DPS estimate is 61.8, implying a prospective dividend yield of 4.2%.
Current consensus EPS estimate suggests the PER is 48.8.

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

TLX    TELIX PHARMACEUTICALS LIMITED

Pharmaceuticals & Biotech/Lifesciences – Overnight Price: $9.37

Jarden rates ((TLX)) as Buy (1) –

Jarden was impressed with the quarterly results from Telix Pharmaceuticals, particularly as there was increased competition from Novatis. ILLUCCIX sales maintained momentum and should deliver a beat to consensus expectations for the first half.

The broker expects investors will focus on the top line and this should mean the shares are well supported. Buy rating and $8.78 target maintained.

This report was published on April 17, 2023.

Target price is $8.78 Current Price is $9.37 Difference: minus $0.59 (current price is over target).
If TLX meets the Jarden target it will return approximately minus 6% (excluding dividends, fees and charges – negative figures indicate an expected loss).
The company's fiscal year ends in December.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 10.20 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 91.86.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 0.00 cents and EPS of 2.50 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 374.80.

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

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