Australian Broker Call *Extra* Edition – Apr 28, 2023

This story features BREVILLE GROUP LIMITED, and other companies. For more info SHARE ANALYSIS: BRG

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)

AKE   BRG   BSL   CHL   CKF   LLL   LYC   NXS   RIC   TLS   WHC  

AKE    ALLKEM LIMITED

New Battery Elements – Overnight Price: $11.80

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

Canaccord Genuity found Allkem' March quarter production report mixed, with Olaroz production slightly ahead of estimates while sales were lower than expected.

The expected improvement at Mount Cattlin in the June quarter puts Alkem on track to hit the lower end of revised FY23 production guidance of 114-124,000t, the broker observes.

The broker makes slight revisions to its modelling and lowers the target to $18.50 from $19.80 as a result. Buy rating maintained.

This report was published on April 21, 2023.

Target price is $18.50 Current Price is $11.80 Difference: $6.7
If AKE meets the Canaccord Genuity target it will return approximately 57% (excluding dividends, fees and charges).
Current consensus price target is $15.80, suggesting upside of 33.9%(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 100.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.80.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 87.7, implying annual growth of 23.3%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 13.5.

Forecast for FY24:

Canaccord Genuity forecasts a full year FY24 dividend of 0.00 cents and EPS of 140.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 8.43.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 117.1, implying annual growth of 33.5%.
Current consensus DPS estimate is 6.7, implying a prospective dividend yield of 0.6%.
Current consensus EPS estimate suggests the PER is 10.1.

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

BRG    BREVILLE GROUP LIMITED

Household & Personal Products – Overnight Price: $20.02

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

Breville Group has limited direct exposure in Asia but Wilsons assesses there is significant upside potential in the region, particularly in China.

Going forward the broker does not expect a material change in inventory levels at this stage of the cycle.

Nevertheless, after accelerated investment to meet pandemic-related demand in FY22, and expenses consolidation in the first half of FY23, the broker believes there is significant headroom to fund the next stage of global expansion and now includes China in its forecasts.

Overweight maintained. Target rises to $25.00 from $23.50.

This report was published on April 26, 2023.

Target price is $25.00 Current Price is $20.02 Difference: $4.98
If BRG meets the Wilsons target it will return approximately 25% (excluding dividends, fees and charges).
Current consensus price target is $23.36, suggesting upside of 16.7%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

Wilsons forecasts a full year FY23 dividend of 30.00 cents and EPS of 76.70 cents.
At the last closing share price the estimated dividend yield is 1.50%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 26.10.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 75.9, implying annual growth of N/A.
Current consensus DPS estimate is 29.3, implying a prospective dividend yield of 1.5%.
Current consensus EPS estimate suggests the PER is 26.4.

Forecast for FY24:

Wilsons forecasts a full year FY24 dividend of 35.00 cents and EPS of 89.80 cents.
At the last closing share price the estimated dividend yield is 1.75%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 22.29.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 86.7, implying annual growth of 14.2%.
Current consensus DPS estimate is 33.6, implying a prospective dividend yield of 1.7%.
Current consensus EPS estimate suggests the PER is 23.1.

Market Sentiment: 0.7
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: $19.47

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

BlueScope Steel has upgraded second half underlying EBIT guidance to $700-770m. Jarden notes the market had already considered prior guidance conservative and increases its second half underlying performance by 17.6%, towards the high end of the new range.

Higher realised prices in Australia compared with expectations contributed to the upgrade. Yet the broker believes the impact on profitability will be modest because of increased input costs, specifically coking coal and iron ore.

Overweight rating maintained. Target is raised to $23.50 from $23.10.

This report was published on April 24, 2023.

Target price is $23.50 Current Price is $19.47 Difference: $4.03
If BSL meets the Jarden target it will return approximately 21% (excluding dividends, fees and charges).
Current consensus price target is $21.62, suggesting upside of 11.0%(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 247.00 cents.
At the last closing share price the estimated dividend yield is 2.57%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 7.88.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 247.7, implying annual growth of -56.7%.
Current consensus DPS estimate is 50.0, implying a prospective dividend yield of 2.6%.
Current consensus EPS estimate suggests the PER is 7.9.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 50.00 cents and EPS of 190.50 cents.
At the last closing share price the estimated dividend yield is 2.57%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.22.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 194.1, implying annual growth of -21.6%.
Current consensus DPS estimate is 50.0, implying a prospective dividend yield of 2.6%.
Current consensus EPS estimate suggests the PER is 10.0.

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

CHL    CAMPLIFY HOLDINGS LIMITED

Travel, Leisure & Tourism – Overnight Price: $1.95

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

Camplify has upgraded revenue expectations in its March quarter report and included a full contribution for the quarter from PaulCamper. Gross transaction value increased 269% and was ahead of Canaccord Genuity's forecasts.

Revenue increased 204% to $12.5m. The broker increases forecasts for FY23 in FY24 by 16% and 3%, respectively. The company has rebranded its global insurance product to MyWay and will launch this initially in Germany before rolling out globally.

The Buy rating and target price of $3.25 are retained.

This report was published on April 24, 2023.

Target price is $3.25 Current Price is $1.95 Difference: $1.305
If CHL meets the Canaccord Genuity target it will return approximately 67% (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 1.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 194.50.

Forecast for FY24:

Canaccord Genuity forecasts a full year FY24 dividend of 0.00 cents and EPS of minus 1.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 194.50.

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

CKF    COLLINS FOODS LIMITED

Food, Beverages & Tobacco – Overnight Price: $8.70

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

Wilsons expects second half same-store sales growth Collins Foods' KFC Australia segment at 5.3%. A read-through from Restaurant Brands sales in the first quarter suggest menu price increases can drive some improvement half on half.

Restaurant Brands has indicated inflation is easing, although still affecting margins. Wilsons points out this is the key source of risk to Collins Foods earnings in the near term. Overweight rating and $11.49 target maintained.

This report was published on April 24, 2023.

Target price is $11.49 Current Price is $8.70 Difference: $2.79
If CKF meets the Wilsons target it will return approximately 32% (excluding dividends, fees and charges).
Current consensus price target is $8.80, suggesting upside of 1.1%(ex-dividends)
The company's fiscal year ends in May.

Forecast for FY23:

Wilsons forecasts a full year FY23 dividend of 24.50 cents and EPS of 41.70 cents.
At the last closing share price the estimated dividend yield is 2.82%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 20.86.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 45.4, implying annual growth of -3.3%.
Current consensus DPS estimate is 24.3, implying a prospective dividend yield of 2.8%.
Current consensus EPS estimate suggests the PER is 19.2.

Forecast for FY24:

Wilsons forecasts a full year FY24 dividend of 27.50 cents and EPS of 47.20 cents.
At the last closing share price the estimated dividend yield is 3.16%.
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 42.9, implying annual growth of -5.5%.
Current consensus DPS estimate is 23.5, implying a prospective dividend yield of 2.7%.
Current consensus EPS estimate suggests the PER is 20.3.

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

LLL    LEO LITHIUM LIMITED

New Battery Elements – Overnight Price: $0.52

Canaccord Genuity rates ((LLL)) as Speculative Buy (1) –

Assays from drilling at Leo Lithium' Goulamina signal upside potential. Broad, high-grade the intercepts included 115m at 1.74% lithium from 148m, 73.5m at 1.6% from 199m and 71m at 2% from 18m. Mineralisation is open along strike at depth.

The project remains within budget and Canaccord Genuity calculates it is largely funded to production. Leo Lithium has flagged 2-3 direct shipping ore shipments totalling 60-90,000t in the second half of 2023 to project partner Ganfeng.

The broker now includes DSO in modelling and maintains a $1.90 target. Speculative Buy rating is reiterated.

This report was published on April 26, 2023.

Target price is $1.90 Current Price is $0.52 Difference: $1.385
If LLL meets the Canaccord Genuity target it will return approximately 269% (excluding dividends, fees and charges).
The company's fiscal year ends in December.

Forecast for FY23:

Canaccord Genuity forecasts a full year FY23 dividend of 0.00 cents and EPS of 0.00 cents.

Forecast for FY24:

Canaccord Genuity forecasts a full year FY24 dividend of 0.00 cents and EPS of 7.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 7.36.

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

LYC    LYNAS RARE EARTHS LIMITED

Rare Earth Minerals – Overnight Price: $6.49

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

March quarter production was in line with expectations while pricing was softer. Despite cash flow being lower than forecast, Canaccord Genuity observes Lynas Rare Earths has a healthy cash position and this should provide a buffer during elevated expenditure at Mount Weld and Kalgoorlie.

Canaccord Genuity now ponders whether all the negatives have been priced in, amid confirmation of production cuts in FY24 and more clarity on the ramp ups.

A Buy rating is maintained, with the broker highlighting the potential for a positive outcome from the appeal to the Malaysian ministry for a review of its operating license conditions. Target is reduced to $10 from $11.

This report was published on April 24, 2023.

Target price is $10.00 Current Price is $6.49 Difference: $3.51
If LYC meets the Canaccord Genuity target it will return approximately 54% (excluding dividends, fees and charges).
Current consensus price target is $7.54, suggesting upside of 16.2%(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 33.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 19.67.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 35.2, implying annual growth of -41.3%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 18.4.

Forecast for FY24:

Canaccord Genuity forecasts a full year FY24 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 108.17.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 30.4, implying annual growth of -13.6%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 21.3.

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

NXS    NEXT SCIENCE LIMITED

Pharmaceuticals & Biotech/Lifesciences – Overnight Price: $0.70

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

Next Science beat expectations in its March quarter report. Canaccord Genuity is impressed with recent success in the durable medical equipment (DME) strategy.

Meanwhile, the Direct sales force is growing rapidly. The main focus is the ongoing new account additions in DME and the ability for deeper penetration within existing accounts.

Moreover, clinical data for Xperience, if positive, could provide validation for a positive step-change in the commercial trajectory of the product. Buy rating retained. Target is steady at $0.85.

This report was published on April 24, 2023.

Target price is $0.85 Current Price is $0.70 Difference: $0.15
If NXS meets the Canaccord Genuity target it will return approximately 21% (excluding dividends, fees and charges).
The company's fiscal year ends in December.

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

RIC    RIDLEY CORPORATION LIMITED

Agriculture – Overnight Price: $2.18

Moelis rates ((RIC)) as Initiation of coverage with Buy (1) –

Moelis estimates Ridley Corp will grow its earnings at around 6.6% compounding over the next two years as much of growth is within the control of management such as supply chain optimisation.

The business can also continue to improve its earnings quality through bespoke product as well as a move into more consumer staple products. The broker initiates coverage with a Buy rating and $2.58 target believing the stock is undervalued compared with peers.

This report was published on April 26, 2023.

Target price is $2.58 Current Price is $2.18 Difference: $0.4
If RIC meets the Moelis target it will return approximately 18% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY23:

Moelis forecasts a full year FY23 dividend of 8.00 cents and EPS of 13.00 cents.
At the last closing share price the estimated dividend yield is 3.67%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.77.

Forecast for FY24:

Moelis forecasts a full year FY24 dividend of 8.00 cents and EPS of 13.00 cents.
At the last closing share price the estimated dividend yield is 3.67%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.77.

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

TLS    TELSTRA GROUP LIMITED

Telecommunication – Overnight Price: $4.35

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

Ahead of the July price rise, Goldman Sachs believes Telstra needs to ensure its postpaid/prepaid premium is correctly managed "to prevent significant 'spin-down' to prepaid". The broker now believes Telstra is more likely to fully utilise the CPI.

Goldman Sachs observes consensus mobile forecasts appear conservative while updated mobile pricing is expected to be announced in coming weeks. Buy rating reiterated. Target is $4.70.

This report was published on April 24, 2023.

Target price is $4.70 Current Price is $4.35 Difference: $0.35
If TLS meets the Goldman Sachs target it will return approximately 8% (excluding dividends, fees and charges).
Current consensus price target is $4.54, suggesting upside of 4.3%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 dividend of 17.00 cents and EPS of 17.00 cents.
At the last closing share price the estimated dividend yield is 3.91%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 25.59.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 16.1, implying annual growth of 12.1%.
Current consensus DPS estimate is 17.0, implying a prospective dividend yield of 3.9%.
Current consensus EPS estimate suggests the PER is 27.0.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 18.00 cents and EPS of 19.00 cents.
At the last closing share price the estimated dividend yield is 4.14%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 22.89.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 17.8, implying annual growth of 10.6%.
Current consensus DPS estimate is 17.7, implying a prospective dividend yield of 4.1%.
Current consensus EPS estimate suggests the PER is 24.4.

Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

WHC    WHITEHAVEN COAL LIMITED

Coal – Overnight Price: $7.29

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

March quarter results were weaker than Goldman Sachs expected. Guidance implies a step-up in production in the June quarter, driven by the move of the Narrabri longwall to the shallower part of the mine as well as a recovery at Maules Creek.

Whitehaven Coal has approved the 1mtpa Vickery early mining project with first production expected in mid 2024. The broker now adds this project to its base case but delays the ramp up to a larger scale by 12 months, to mid 2026.

Target is reduced to $7.80 from $8.00 and a Neutral rating is maintained.

This report was published on April 22, 2023.

Target price is $7.80 Current Price is $7.29 Difference: $0.51
If WHC meets the Goldman Sachs target it will return approximately 7% (excluding dividends, fees and charges).
Current consensus price target is $9.33, suggesting upside of 28.0%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 dividend of 48.00 cents and EPS of 287.00 cents.
At the last closing share price the estimated dividend yield is 6.58%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 2.54.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 310.3, implying annual growth of 57.0%.
Current consensus DPS estimate is 61.3, implying a prospective dividend yield of 8.4%.
Current consensus EPS estimate suggests the PER is 2.3.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 37.00 cents and EPS of 135.00 cents.
At the last closing share price the estimated dividend yield is 5.08%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 5.40.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 178.7, implying annual growth of -42.4%.
Current consensus DPS estimate is 48.4, implying a prospective dividend yield of 6.6%.
Current consensus EPS estimate suggests the PER is 4.1.

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

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