Australian Broker Call
January 24, 2017
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COMPANIES DISCUSSED IN THIS ISSUE
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Last Updated: 12:32 PM
Your daily news report on the latest recommendation, valuation, forecast and opinion changes.
This report includes concise but limited reviews of research recently published by Stockbrokers, 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.
For more info about the different terms used by stockbrokers, as well as the different methodologies behind similar sounding ratings, download our guide HERE
Today's Upgrades and Downgrades
| BXB - | BRAMBLES | Upgrade to Buy from Neutral | UBS |
| SPO - | SPOTLESS | Downgrade to Neutral from Buy | Citi |
| VRL - | VILLAGE ROADSHOW | Downgrade to Neutral from Buy | Citi |
Morgan Stanley rates AMP as Overweight (1) -
The broker has marked its wealth manager valuations to market ahead of results season.
AMP offers a de-risked Life division and a transition to a higher growth, less capital intensive business which the broker believes should drive a re-rating. As valuation is undemanding on a 6% yield, AMP is the broker's preference in the space. Overweight retained, target rises to $5.85 from $5.70.
Industry view: In-line.
Target price is $5.85 Current Price is $4.99 Difference: $0.86
If AMP meets the Morgan Stanley target it will return approximately 17% (excluding dividends, fees and charges).
Current consensus price target is $5.31, suggesting upside of 6.9% (ex-dividends)
The company's fiscal year ends in December.
Forecast for FY16:
Morgan Stanley forecasts a full year FY16 dividend of 28.00 cents and EPS of minus 9.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 14.1, implying annual growth of -57.7%. Current consensus DPS estimate is 28.3, implying a prospective dividend yield of 5.7%. Current consensus EPS estimate suggests the PER is 35.2. |
Forecast for FY17:
Morgan Stanley forecasts a full year FY17 dividend of 30.00 cents and EPS of 34.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 34.4, implying annual growth of 144.0%. Current consensus DPS estimate is 29.4, implying a prospective dividend yield of 5.9%. Current consensus EPS estimate suggests the PER is 14.4. |
Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Morgan Stanley rates BEN as Underweight (5) -
The broker has increased Bendelaide forecast earnings by 5% thanks to a better Homesafe contribution. But after a 30% run-up for the stock price, the broker sees valuation as stretched, requiring a strong result next month.
The bank's payout ratio is elevated and there is no surplus capital. The broker sees declining margins and believes Homesafe revenues to be unsustainable.
Underweight rating retained. Target rises to 10.00 from $9.40. In-Line industry view.
Target price is $10.00 Current Price is $12.58 Difference: minus $2.58 (current price is over target).
If BEN meets the Morgan Stanley target it will return approximately minus 21% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $10.76, suggesting downside of -14.5% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Morgan Stanley forecasts a full year FY17 dividend of 68.00 cents and EPS of 83.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 85.5, implying annual growth of -10.6%. Current consensus DPS estimate is 68.3, implying a prospective dividend yield of 5.4%. Current consensus EPS estimate suggests the PER is 14.7. |
Forecast for FY18:
Morgan Stanley forecasts a full year FY18 dividend of 68.00 cents and EPS of 85.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 85.9, implying annual growth of 0.5%. Current consensus DPS estimate is 68.8, implying a prospective dividend yield of 5.5%. Current consensus EPS estimate suggests the PER is 14.7. |
Market Sentiment: -0.7
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
UBS rates BLD as Re-initiate coverage with Buy rating (1) -
The stock is observed to be trading at a steep 25% discount to the All Industrials ex-financials on FY18 price/earnings estimates, which is significantly below the historical trading range.
UBS believes this is largely attributable to the proposed acquisition of Headwaters, reflecting the size of the transaction and concerns around coal-linked fly ash and regulatory approvals.
The catalysts that is expected to drive a re-rating towards the broker's price target include regulatory approvals, delivery on FY17 expectations and evidence of synergy execution. UBS re-initiates coverage with a Buy rating and $6.90 target.
Target price is $6.90 Current Price is $5.55 Difference: $1.35
If BLD meets the UBS target it will return approximately 24% (excluding dividends, fees and charges).
Current consensus price target is $6.33, suggesting upside of 8.8% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
UBS forecasts a full year FY17 dividend of 19.70 cents and EPS of 32.90 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 35.1, implying annual growth of 2.6%. Current consensus DPS estimate is 23.6, implying a prospective dividend yield of 4.1%. Current consensus EPS estimate suggests the PER is 16.6. |
Forecast for FY18:
UBS forecasts a full year FY18 dividend of 23.40 cents and EPS of 39.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 40.1, implying annual growth of 14.2%. Current consensus DPS estimate is 25.2, implying a prospective dividend yield of 4.3%. Current consensus EPS estimate suggests the PER is 14.5. |
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Citi rates BXB as Buy (1) -
Citi finds the sudden profit warning, and in particular the lack of clarity on FY17 guidance "concerning". But the analysts also think this should prove no more than a temporary blip in an otherwise solid long term growth story.
As such, the shellacking the shares received yesterday are labeled an "over-reaction". Citi sticks to its Buy rating and lowers the valuation/target to $12.33 from $13.89.
Target price is $12.33 Current Price is $10.34 Difference: $1.99
If BXB meets the Citi target it will return approximately 19% (excluding dividends, fees and charges).
Current consensus price target is $12.05, suggesting upside of 15.2% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Citi forecasts a full year FY17 dividend of 28.26 cents and EPS of 51.03 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 57.3, implying annual growth of N/A. Current consensus DPS estimate is 33.2, implying a prospective dividend yield of 3.2%. Current consensus EPS estimate suggests the PER is 18.3. |
Forecast for FY18:
Citi forecasts a full year FY18 dividend of 28.26 cents and EPS of 56.12 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 63.0, implying annual growth of 9.9%. Current consensus DPS estimate is 35.2, implying a prospective dividend yield of 3.4%. Current consensus EPS estimate suggests the PER is 16.6. |
This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Deutsche Bank rates BXB as Buy (1) -
The company has downgraded its expectations for sales and underlying profit in the first half, now expecting constant currency revenue growth of 5% and EBIT of 3%.
Deutsche Bank downgrades its estimates in line with the trading update and lowers the target to $13.20 from $14.40. Buy rating retained.
While management has indicated the issues with inventory de-stocking peaked in December, the broker is concerned the second half is likely to experience a continuation of the trends.
Target price is $13.20 Current Price is $10.34 Difference: $2.86
If BXB meets the Deutsche Bank target it will return approximately 28% (excluding dividends, fees and charges).
Current consensus price target is $12.05, suggesting upside of 15.2% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Deutsche Bank forecasts a full year FY17 dividend of 29.47 cents and EPS of 52.24 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 57.3, implying annual growth of N/A. Current consensus DPS estimate is 33.2, implying a prospective dividend yield of 3.2%. Current consensus EPS estimate suggests the PER is 18.3. |
Forecast for FY18:
Deutsche Bank forecasts a full year FY18 dividend of 29.47 cents and EPS of 58.93 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 63.0, implying annual growth of 9.9%. Current consensus DPS estimate is 35.2, implying a prospective dividend yield of 3.4%. Current consensus EPS estimate suggests the PER is 16.6. |
This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Macquarie rates BXB as Outperform (1) -
The company has announced it does not expect to reach FY17 guidance for constant currency, underlying sales growth of 7-9% and underlying profit growth of 9-11%.
Macquarie considers the share price reaction excessive, in the light of the strong growth outlook and what are short-term rather than structural concerns. The company has noted the impact of de-stocking by US retailers, which has impacted margins via increased pallet repair, storage and transport costs.
Following the fall in the share price, Macquarie considers the stock a good buying opportunity and maintains an Outperform rating. Target is reduced to $12.65.
Target price is $12.65 Current Price is $10.34 Difference: $2.31
If BXB meets the Macquarie target it will return approximately 22% (excluding dividends, fees and charges).
Current consensus price target is $12.05, suggesting upside of 15.2% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Macquarie forecasts a full year FY17 dividend of 31.34 cents and EPS of 56.93 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 57.3, implying annual growth of N/A. Current consensus DPS estimate is 33.2, implying a prospective dividend yield of 3.2%. Current consensus EPS estimate suggests the PER is 18.3. |
Forecast for FY18:
Macquarie forecasts a full year FY18 dividend of 34.83 cents and EPS of 63.49 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 63.0, implying annual growth of 9.9%. Current consensus DPS estimate is 35.2, implying a prospective dividend yield of 3.4%. Current consensus EPS estimate suggests the PER is 16.6. |
This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Morgan Stanley rates BXB as Equal-weight (3) -
Brambles' guidance downgrade effectively means a 7% miss of the prior midpoint. The broker is surprised at the downgrade, noting positive US sales and inventory data, suggesting something else is amiss.
This implies further downside risk, but Brambles is now trading on a PE discount to the sector that is the biggest in five years. Hence the broker retains Equal-weight. Target falls to $11.34 from $13.47. Industry view: Attractive.
Target price is $11.34 Current Price is $10.34 Difference: $1
If BXB meets the Morgan Stanley target it will return approximately 10% (excluding dividends, fees and charges).
Current consensus price target is $12.05, suggesting upside of 15.2% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Morgan Stanley forecasts a full year FY17 dividend of 36.70 cents and EPS of 58.93 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 57.3, implying annual growth of N/A. Current consensus DPS estimate is 33.2, implying a prospective dividend yield of 3.2%. Current consensus EPS estimate suggests the PER is 18.3. |
Forecast for FY18:
Morgan Stanley forecasts a full year FY18 dividend of 46.34 cents and EPS of 66.97 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 63.0, implying annual growth of 9.9%. Current consensus DPS estimate is 35.2, implying a prospective dividend yield of 3.4%. Current consensus EPS estimate suggests the PER is 16.6. |
This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
UBS rates BXB as Upgrade to Buy from Neutral (1) -
A lack of disclosure and a poor explanation from management for the surprise downgrade to guidance has driven a sharp correction in the share price, UBS observes.
The impact of US retailer de-stocking experienced in December is without anecdotal support and how long the impact continues is uncertain. The broker notes the company is waiting to see January numbers before assessing the likely full year impact.
UBS takes the view that the de-stocking represents a one-off step change in earnings. Despite the uncertainty, UBS believes the business model is intact and upgrades to Buy from Neutral. Target is reduced to $11.60 from $12.60.
Target price is $11.60 Current Price is $10.34 Difference: $1.26
If BXB meets the UBS target it will return approximately 12% (excluding dividends, fees and charges).
Current consensus price target is $12.05, suggesting upside of 15.2% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
UBS forecasts a full year FY17 dividend of 38.84 cents and EPS of 72.33 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 57.3, implying annual growth of N/A. Current consensus DPS estimate is 33.2, implying a prospective dividend yield of 3.2%. Current consensus EPS estimate suggests the PER is 18.3. |
Forecast for FY18:
UBS forecasts a full year FY18 dividend of 44.20 cents and EPS of 80.36 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 63.0, implying annual growth of 9.9%. Current consensus DPS estimate is 35.2, implying a prospective dividend yield of 3.4%. Current consensus EPS estimate suggests the PER is 16.6. |
This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Morgans - Cessation of coverage
Forecast for FY16:
Morgans forecasts a full year FY16 dividend of 0.00 cents and EPS of minus 1.30 cents. |
Forecast for FY17:
Morgans forecasts a full year FY17 dividend of 0.00 cents and EPS of minus 1.30 cents. |
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Morgan Stanley rates CGF as Equal-weight (3) -
The broker has marked its wealth manager valuations to market ahead of results season.
The broker retains Equal-weight on Challenger, which has managed to retain margins and book growth despite market volatility, falling yields and competition from term deposits, thanks to help from regulation and a broadening footprint. Target rises to $10.50 from $9.70.
Industry view: In-line.
Target price is $10.50 Current Price is $10.81 Difference: minus $0.31 (current price is over target).
If CGF meets the Morgan Stanley target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $10.12, suggesting downside of -7.4% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Morgan Stanley forecasts a full year FY17 dividend of 35.80 cents and EPS of 66.40 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 65.0, implying annual growth of 11.1%. Current consensus DPS estimate is 34.5, implying a prospective dividend yield of 3.2%. Current consensus EPS estimate suggests the PER is 16.8. |
Forecast for FY18:
Morgan Stanley forecasts a full year FY18 dividend of 38.90 cents and EPS of 72.30 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 71.1, implying annual growth of 9.4%. Current consensus DPS estimate is 37.3, implying a prospective dividend yield of 3.4%. Current consensus EPS estimate suggests the PER is 15.4. |
Market Sentiment: 0.1
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Credit Suisse rates CPU as Outperform (1) -
Credit Suisse has reviewed the growth drivers which should assist the company's earnings over the next few years. The broker's forecasts assume around 30% growth in net profit by FY19. Consensus forecasts are considered to be too low.
Credit Suisse highlights that higher rates account for only a small part of its forecast earnings growth for Computershare. An Outperform rating is retained. Target is $13.25.
Target price is $13.25 Current Price is $12.46 Difference: $0.79
If CPU meets the Credit Suisse target it will return approximately 6% (excluding dividends, fees and charges).
Current consensus price target is $10.92, suggesting downside of -12.4% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Credit Suisse forecasts a full year FY17 dividend of 45.54 cents and EPS of 71.97 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 69.3, implying annual growth of N/A. Current consensus DPS estimate is 36.6, implying a prospective dividend yield of 2.9%. Current consensus EPS estimate suggests the PER is 18.0. |
Forecast for FY18:
Credit Suisse forecasts a full year FY18 dividend of 50.90 cents and EPS of 83.51 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 74.4, implying annual growth of 7.4%. Current consensus DPS estimate is 39.6, implying a prospective dividend yield of 3.2%. Current consensus EPS estimate suggests the PER is 16.7. |
This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Credit Suisse rates CTX as Outperform (1) -
Credit Suisse reviews the Caltex/Mobil failed bid from 2009. In this light, the broker considers the BP/Woolworths ((WOW)) marriage is bad for the consumer and it is hard to see how the transaction would not put upward pressure on retail margins.
The upside risk is a failure of BP's bid, or even delays, which would have a material positive impact on Caltex earnings. Nevertheless, ultimately, Credit Suisse expects the deal is likely to proceed.
Outperform retained. Target is $39.70.
Target price is $39.70 Current Price is $30.00 Difference: $9.7
If CTX meets the Credit Suisse target it will return approximately 32% (excluding dividends, fees and charges).
Current consensus price target is $34.16, suggesting upside of 13.2% (ex-dividends)
The company's fiscal year ends in December.
Forecast for FY16:
Credit Suisse forecasts a full year FY16 dividend of 103.00 cents and EPS of 205.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 203.6, implying annual growth of -12.6%. Current consensus DPS estimate is 102.5, implying a prospective dividend yield of 3.4%. Current consensus EPS estimate suggests the PER is 14.8. |
Forecast for FY17:
Credit Suisse forecasts a full year FY17 dividend of 116.00 cents and EPS of 232.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 224.5, implying annual growth of 10.3%. Current consensus DPS estimate is 116.5, implying a prospective dividend yield of 3.9%. Current consensus EPS estimate suggests the PER is 13.4. |
Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Macquarie rates FBU as Underperform (5) -
Macquarie suspects the construction cycle in New Zealand is close to historical peaks in terms of volumes, so margin expansion is the key to the company's performance from here. However, nominal pricing for manufactured building/construction products remains weak.
The company's strategy to diversify away from manufacturing is a logical response but the broker believes it increases the risk profile of the group.
On this basis, the broker retains an Underperform rating. Target is NZ$8.07.
Current Price is $9.90. Target price not assessed.
Current consensus price target is $11.73, suggesting upside of 19.2% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Macquarie forecasts a full year FY17 dividend of 37.51 cents and EPS of 58.61 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 63.9, implying annual growth of N/A. Current consensus DPS estimate is 40.3, implying a prospective dividend yield of 4.1%. Current consensus EPS estimate suggests the PER is 15.4. |
Forecast for FY18:
Macquarie forecasts a full year FY18 dividend of 38.45 cents and EPS of 57.11 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 67.2, implying annual growth of 5.2%. Current consensus DPS estimate is 42.3, implying a prospective dividend yield of 4.3%. Current consensus EPS estimate suggests the PER is 14.6. |
This company reports in NZD. 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
Credit Suisse rates FXJ as Outperform (1) -
Credit Suisse believes the company is committed to reducing its print exposure and 2017 could be a year of significant progress. Growth at Domain is expected to re-accelerate, driven by easing listing headwinds and price increases.
The broker introduces a bull/bear case valuation methodology. The bull case valuation is $1.50 and the bear case $0.79. The share price risk is, therefore, significantly weighted to the upside, in the broker's view.
Credit Suisse retains an Outperform rating and $1.10 target.
Target price is $1.10 Current Price is $0.86 Difference: $0.245
If FXJ meets the Credit Suisse target it will return approximately 29% (excluding dividends, fees and charges).
Current consensus price target is $0.93, suggesting upside of 9.5% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Credit Suisse forecasts a full year FY17 dividend of 4.00 cents and EPS of 5.87 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 6.0, implying annual growth of N/A. Current consensus DPS estimate is 3.9, implying a prospective dividend yield of 4.6%. Current consensus EPS estimate suggests the PER is 14.2. |
Forecast for FY18:
Credit Suisse forecasts a full year FY18 dividend of 4.00 cents and EPS of 5.69 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 6.2, implying annual growth of 3.3%. Current consensus DPS estimate is 4.0, implying a prospective dividend yield of 4.7%. Current consensus EPS estimate suggests the PER is 13.7. |
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Morgans rates GNC as Hold (3) -
Winter crop receivals exceeded expectations. Morgans believes this has positive implications for the company's business units and upgrades forecasts.
The broker believes structural threats from increased competition have been over-stated and guidance at the AGM will demonstrate the strong leverage to a large crop.
The broker retains a Hold recommendation. Target is raised to $9.70 from $9.55.
Target price is $9.70 Current Price is $9.31 Difference: $0.39
If GNC meets the Morgans target it will return approximately 4% (excluding dividends, fees and charges).
Current consensus price target is $9.79, suggesting upside of 3.3% (ex-dividends)
The company's fiscal year ends in September.
Forecast for FY17:
Morgans forecasts a full year FY17 dividend of 29.00 cents and EPS of 59.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 60.7, implying annual growth of 532.3%. Current consensus DPS estimate is 27.1, implying a prospective dividend yield of 2.9%. Current consensus EPS estimate suggests the PER is 15.6. |
Forecast for FY18:
Morgans forecasts a full year FY18 dividend of 30.00 cents and EPS of 60.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 59.1, implying annual growth of -2.6%. Current consensus DPS estimate is 29.7, implying a prospective dividend yield of 3.1%. Current consensus EPS estimate suggests the PER is 16.0. |
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Morgan Stanley rates IFL as Equal-weight (3) -
The broker has marked its wealth manager valuations to market ahead of results season.
IOOF is "running hard to stand still", the broker suggests, and beholden to market movements beyond any M&A and synergies. A strong balance sheet does suggest to the broker that in the absence of M&A, a buyback is possible. Equal-weight retained. Target rises to $8.80 from $8.00.
Industry view: In-line.
Target price is $8.80 Current Price is $9.09 Difference: minus $0.29 (current price is over target).
If IFL meets the Morgan Stanley target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $8.60, suggesting downside of -5.7% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Morgan Stanley forecasts a full year FY17 dividend of 51.50 cents and EPS of 57.40 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 56.5, implying annual growth of -13.9%. Current consensus DPS estimate is 53.2, implying a prospective dividend yield of 5.8%. Current consensus EPS estimate suggests the PER is 16.1. |
Forecast for FY18:
Morgan Stanley forecasts a full year FY18 dividend of 56.50 cents and EPS of 63.20 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 62.1, implying annual growth of 9.9%. Current consensus DPS estimate is 56.3, implying a prospective dividend yield of 6.2%. Current consensus EPS estimate suggests the PER is 14.7. |
Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Ord Minnett rates PGH as Initiation of coverage with Accumulate (2) -
The packaging company is envisaged set to return to positive organic growth as the macroeconomic headwinds in agriculture, dairy and mining ease. Ord Minnett initiates coverage of the stock with a Accumulate rating and $7.05 target.
The return of organic growth, coupled with the full benefit of the 2015 efficiency program and earnings from acquisitions, are expected to help the company deliver the highest level of earnings growth across the broker's packaging coverage.
Target price is $7.05 Current Price is $6.51 Difference: $0.54
If PGH meets the Ord Minnett target it will return approximately 8% (excluding dividends, fees and charges).
Current consensus price target is $6.62, suggesting downside of -1.1% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Ord Minnett forecasts a full year FY17 dividend of 24.00 cents and EPS of 36.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 36.6, implying annual growth of 26.2%. Current consensus DPS estimate is 24.4, implying a prospective dividend yield of 3.6%. Current consensus EPS estimate suggests the PER is 18.3. |
Forecast for FY18:
Ord Minnett forecasts a full year FY18 dividend of 28.00 cents and EPS of 43.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 41.8, implying annual growth of 14.2%. Current consensus DPS estimate is 27.8, implying a prospective dividend yield of 4.1%. Current consensus EPS estimate suggests the PER is 16.0. |
Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Morgans rates RBL as Add (1) -
The company has downgraded its guidance range for FY17 after some unfavourable trends, especially in currency, signalling it was impossible to achieve prospectus forecasts.
Redbubble is now forecasting 22-29% revenue growth, down from the 52% indicated in the prospectus. As Morgans had already factored in slower growth, it makes few changes to valuation or forecasts.
Morgans retains an Add rating. Target is raised to $1.29 from $1.27.
Target price is $1.29 Current Price is $0.95 Difference: $0.34
If RBL meets the Morgans target it will return approximately 36% (excluding dividends, fees and charges).
The company's fiscal year ends in June.
Forecast for FY17:
Morgans forecasts a full year FY17 dividend of 0.00 cents and EPS of minus 6.00 cents. |
Forecast for FY18:
Morgans forecasts a full year FY18 dividend of 0.00 cents and EPS of minus 3.00 cents. |
Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Ord Minnett rates SCP as Accumulate (2) -
The company disclosed a 4.9% interest in Charter Hall Retail ((CQR)) with the stated purpose of reinvesting the proceeds from the sale of its NZ portfolio in complimentary assets to fill a temporary earnings void.
It appears to Ord Minnett that the company may look to leverage the stake to effect a transaction involving either a merger or takeover of management rights, but the stockbroker believes the company will struggle to advance on either front.
Ord Minnett believes investors would be better served by controlling their own allocations between the stocks, keeping the vehicles separate. Accumulate recommendation retained. Target is $2.36.
Target price is $2.36 Current Price is $2.17 Difference: $0.19
If SCP meets the Ord Minnett target it will return approximately 9% (excluding dividends, fees and charges).
Current consensus price target is $2.10, suggesting downside of -4.6% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Ord Minnett forecasts a full year FY17 dividend of 13.00 cents and EPS of 15.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 14.4, implying annual growth of -43.3%. Current consensus DPS estimate is 12.9, implying a prospective dividend yield of 5.9%. Current consensus EPS estimate suggests the PER is 15.2. |
Forecast for FY18:
Ord Minnett forecasts a full year FY18 dividend of 14.00 cents and EPS of 15.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 15.1, implying annual growth of 4.9%. Current consensus DPS estimate is 13.4, implying a prospective dividend yield of 6.1%. Current consensus EPS estimate suggests the PER is 14.5. |
Market Sentiment: -0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Credit Suisse rates SDA as Re-initiate with Outperform (1) -
Following a change of analyst, Credit Suisse resumes coverage of the stock with an Outperform rating and $4.10 target. The broker considers the deal with CapRock is transformative at an attractive price.
FY17 and FY18 earnings per share estimates are raised by 1% and 16% respectively. While there is substantial upside if the company can successfully integrate the new business the broker recognises several potential risks including ongoing energy sector weakness, a stretched balance sheet and potential price erosion in end-user markets.
Target price is $4.10 Current Price is $3.65 Difference: $0.45
If SDA meets the Credit Suisse target it will return approximately 12% (excluding dividends, fees and charges).
Current consensus price target is $4.45, suggesting upside of 20.0% (ex-dividends)
The company's fiscal year ends in December.
Forecast for FY16:
Credit Suisse forecasts a full year FY16 dividend of 9.26 cents and EPS of 18.24 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 17.0, implying annual growth of N/A. Current consensus DPS estimate is 7.1, implying a prospective dividend yield of 1.9%. Current consensus EPS estimate suggests the PER is 21.8. |
Forecast for FY17:
Credit Suisse forecasts a full year FY17 dividend of 14.43 cents and EPS of 26.94 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 24.7, implying annual growth of 45.3%. Current consensus DPS estimate is 10.2, implying a prospective dividend yield of 2.8%. Current consensus EPS estimate suggests the PER is 15.0. |
Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Citi rates SPO as Downgrade to Neutral from Buy (3) -
Citi analysts have updated their analysis and there's now an expectation the company's interim report is poised for disappointment. Estimates have been reduced by no less than -30% for this year and next.
Dividend payout ratio has fallen too. Price target dives to $1.07 from $1.80. Downgrade to Neutral from Buy.
Target price is $1.07 Current Price is $0.99 Difference: $0.085
If SPO meets the Citi target it will return approximately 9% (excluding dividends, fees and charges).
Current consensus price target is $1.11, suggesting upside of 14.2% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Citi forecasts a full year FY17 dividend of 4.00 cents and EPS of 8.60 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 9.9, implying annual growth of -10.8%. Current consensus DPS estimate is 6.5, implying a prospective dividend yield of 6.7%. Current consensus EPS estimate suggests the PER is 9.8. |
Forecast for FY18:
Citi forecasts a full year FY18 dividend of 4.00 cents and EPS of 8.90 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 10.6, implying annual growth of 7.1%. Current consensus DPS estimate is 6.8, implying a prospective dividend yield of 7.0%. Current consensus EPS estimate suggests the PER is 9.2. |
Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Morgan Stanley rates STO as Overweight (1) -
Santos' 2016 production came in at the high end of guidance. Costs continue to trend lower, with cash flow breakeven now at US$38/bbl, the broker notes, down from $47/bbl at the beginning of the year. If the trend continues, the broker would expect an upgrade to reserves, particularly in the Cooper.
With the bulk of cost-outs being structural rather than cyclical, the broker believes Santos is at the start of a turnaround story. Overweight retained. Target dips to $4.96 from $5.17.
Target price is $4.96 Current Price is $4.02 Difference: $0.94
If STO meets the Morgan Stanley target it will return approximately 23% (excluding dividends, fees and charges).
Current consensus price target is $4.61, suggesting upside of 15.5% (ex-dividends)
The company's fiscal year ends in December.
Forecast for FY16:
Morgan Stanley forecasts a full year FY16 dividend of 1.34 cents and EPS of 5.36 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 3.2, implying annual growth of N/A. Current consensus DPS estimate is 0.2, implying a prospective dividend yield of 0.1%. Current consensus EPS estimate suggests the PER is 124.8. |
Forecast for FY17:
Morgan Stanley forecasts a full year FY17 dividend of 4.02 cents and EPS of 10.72 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 19.6, implying annual growth of 512.5%. Current consensus DPS estimate is 4.0, implying a prospective dividend yield of 1.0%. Current consensus EPS estimate suggests the PER is 20.4. |
This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Citi rates SUN as Neutral (3) -
The bankinsurer has flagged a few minor negatives ahead of the interim report and Citi analysts conclude market consensus forecasts are to be scaled back.
The analysts reiterate the view new reinsurance does not seem to materially improve the chances of Suncorp staying within its hazards allowance. Estimates have reduced. Neutral.
Target price is $13.15 Current Price is $12.92 Difference: $0.23
If SUN meets the Citi target it will return approximately 2% (excluding dividends, fees and charges).
Current consensus price target is $13.45, suggesting upside of 4.3% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Citi forecasts a full year FY17 dividend of 76.00 cents and EPS of 95.40 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 94.8, implying annual growth of 16.4%. Current consensus DPS estimate is 75.6, implying a prospective dividend yield of 5.9%. Current consensus EPS estimate suggests the PER is 13.6. |
Forecast for FY18:
Citi forecasts a full year FY18 dividend of 80.00 cents and EPS of 99.40 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 96.9, implying annual growth of 2.2%. Current consensus DPS estimate is 77.6, implying a prospective dividend yield of 6.0%. Current consensus EPS estimate suggests the PER is 13.3. |
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Ord Minnett rates SUN as Accumulate (2) -
The company has updated on natural peril claims costs for the first half as well as of the disposal of its NZ motor insurance business. Natural hazard claims costs will be $40m above the half-year allowance of $310m.
Ord Minnett notes the upward revision to over-claims but considers the net amount small, although there is a risk that any further increases will erode reinsurance layers that are less well covered. The broker retains an Accumulate rating and $14.60 target.
Target price is $14.60 Current Price is $12.92 Difference: $1.68
If SUN meets the Ord Minnett target it will return approximately 13% (excluding dividends, fees and charges).
Current consensus price target is $13.45, suggesting upside of 4.3% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Ord Minnett forecasts a full year FY17 dividend of 66.00 cents and EPS of 83.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 94.8, implying annual growth of 16.4%. Current consensus DPS estimate is 75.6, implying a prospective dividend yield of 5.9%. Current consensus EPS estimate suggests the PER is 13.6. |
Forecast for FY18:
Ord Minnett forecasts a full year FY18 dividend of 73.00 cents and EPS of 98.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 96.9, implying annual growth of 2.2%. Current consensus DPS estimate is 77.6, implying a prospective dividend yield of 6.0%. Current consensus EPS estimate suggests the PER is 13.3. |
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
UBS rates SUN as Buy (1) -
The company has provided a natural hazard cost update as well as details on the NZ motor business disposal.
UBS notes the details signal that the $40m of catastrophe costs above the $310m allowance for the half, while insignificant in terms of net profit, suggest that "over-cap" claims for the February 2011 earthquake surged again towards the end of 2016.
A Buy rating is maintained. Target is steady at $14.25.
Target price is $14.25 Current Price is $12.92 Difference: $1.33
If SUN meets the UBS target it will return approximately 10% (excluding dividends, fees and charges).
Current consensus price target is $13.45, suggesting upside of 4.3% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
UBS forecasts a full year FY17 dividend of 80.00 cents and EPS of 100.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 94.8, implying annual growth of 16.4%. Current consensus DPS estimate is 75.6, implying a prospective dividend yield of 5.9%. Current consensus EPS estimate suggests the PER is 13.6. |
Forecast for FY18:
UBS forecasts a full year FY18 dividend of 84.00 cents and EPS of 101.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 96.9, implying annual growth of 2.2%. Current consensus DPS estimate is 77.6, implying a prospective dividend yield of 6.0%. Current consensus EPS estimate suggests the PER is 13.3. |
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Citi rates VRL as Downgrade to Neutral from Buy (3) -
As Village Roadshow has reported attendance at its Theme Parks has been adversely impacted by Dreamworld’s incident over at competitor Ardent Leisure ((AAD)), Citi analysts have downgraded to Neutral from Buy. Citi analysts estimate Village’s total theme park attendance is down -6% since the incident.
The stockbroker finds the short term outlook clouded, with the impact on the international and interstate customers yet to reveal itself. Estimates have been cut. Price target falls to $3.85 (was $5.40) also taking into account lower valuation multiples.
Target price is $3.85 Current Price is $4.03 Difference: minus $0.18 (current price is over target).
If VRL meets the Citi target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $4.50, suggesting upside of 12.5% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Citi forecasts a full year FY17 dividend of 24.00 cents and EPS of 26.30 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 23.6, implying annual growth of 140.8%. Current consensus DPS estimate is 27.0, implying a prospective dividend yield of 6.8%. Current consensus EPS estimate suggests the PER is 16.9. |
Forecast for FY18:
Citi forecasts a full year FY18 dividend of 28.00 cents and EPS of 30.80 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 32.8, implying annual growth of 39.0%. Current consensus DPS estimate is 27.4, implying a prospective dividend yield of 6.9%. Current consensus EPS estimate suggests the PER is 12.2. |
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Deutsche Bank rates VRL as Buy (1) -
Deutsche Bank continues to believe that the long-term positive structural drives for Village Roadshow will compensate for any near-term impact from the Dreamworld incident.
The more relevant concern for the broker is the high level of gearing and weak free cash flow. Deutsche Bank envisages the need to reduce debt through asset sales or an equity issue, and considers the company has meaningful latent asset value which could deliver valuation upside through divestment.
Buy retained. Target slips to $4.60 from $4.75.
Target price is $4.60 Current Price is $4.03 Difference: $0.57
If VRL meets the Deutsche Bank target it will return approximately 14% (excluding dividends, fees and charges).
Current consensus price target is $4.50, suggesting upside of 12.5% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Deutsche Bank forecasts a full year FY17 dividend of 28.00 cents and EPS of 24.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 23.6, implying annual growth of 140.8%. Current consensus DPS estimate is 27.0, implying a prospective dividend yield of 6.8%. Current consensus EPS estimate suggests the PER is 16.9. |
Forecast for FY18:
Deutsche Bank forecasts a full year FY18 dividend of 30.00 cents and EPS of 32.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 32.8, implying annual growth of 39.0%. Current consensus DPS estimate is 27.4, implying a prospective dividend yield of 6.9%. Current consensus EPS estimate suggests the PER is 12.2. |
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Macquarie rates VRL as Neutral (3) -
At this juncture, Macquarie is not convinced the first half result will provide enough of a catalyst for the stock to re-rate and retains a Neutral rating.
Theme parks and film distribution are expected to have weak results, and cinema exhibition is the main unknown in the broker's view, following a flat box office and slowing momentum. The target is reduced to $4.18 from $4.70.
Target price is $4.18 Current Price is $4.03 Difference: $0.15
If VRL meets the Macquarie target it will return approximately 4% (excluding dividends, fees and charges).
Current consensus price target is $4.50, suggesting upside of 12.5% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY17:
Macquarie forecasts a full year FY17 dividend of 28.00 cents and EPS of 28.10 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 23.6, implying annual growth of 140.8%. Current consensus DPS estimate is 27.0, implying a prospective dividend yield of 6.8%. Current consensus EPS estimate suggests the PER is 16.9. |
Forecast for FY18:
Macquarie forecasts a full year FY18 dividend of 24.00 cents and EPS of 34.30 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 32.8, implying annual growth of 39.0%. Current consensus DPS estimate is 27.4, implying a prospective dividend yield of 6.9%. Current consensus EPS estimate suggests the PER is 12.2. |
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Summaries
| AMP - | AMP | Overweight - Morgan Stanley | Overnight Price $4.99 |
| BEN - | BENDIGO AND ADELAIDE BANK | Underweight - Morgan Stanley | Overnight Price $12.58 |
| BLD - | BORAL | Re-initiate coverage with Buy rating - UBS | Overnight Price $5.55 |
| BXB - | BRAMBLES | Buy - Citi | Overnight Price $10.34 |
| Buy - Deutsche Bank | Overnight Price $10.34 | ||
| Outperform - Macquarie | Overnight Price $10.34 | ||
| Equal-weight - Morgan Stanley | Overnight Price $10.34 | ||
| Upgrade to Buy from Neutral - UBS | Overnight Price $10.34 | ||
| BYE - | BYRON ENERGY | Cessation of coverage - Morgans | Overnight Price $0.14 |
| CGF - | CHALLENGER | Equal-weight - Morgan Stanley | Overnight Price $10.81 |
| CPU - | COMPUTERSHARE | Outperform - Credit Suisse | Overnight Price $12.46 |
| CTX - | CALTEX AUSTRALIA | Outperform - Credit Suisse | Overnight Price $30.00 |
| FBU - | FLETCHER BUILDING | Underperform - Macquarie | Overnight Price $9.90 |
| FXJ - | FAIRFAX MEDIA | Outperform - Credit Suisse | Overnight Price $0.86 |
| GNC - | GRAINCORP | Hold - Morgans | Overnight Price $9.31 |
| IFL - | IOOF HOLDINGS | Equal-weight - Morgan Stanley | Overnight Price $9.09 |
| PGH - | PACT GROUP | Initiation of coverage with Accumulate - Ord Minnett | Overnight Price $6.51 |
| RBL - | REDBUBBLE | Add - Morgans | Overnight Price $0.95 |
| SCP - | SHOPPING CENTRES AUS | Accumulate - Ord Minnett | Overnight Price $2.17 |
| SDA - | SPEEDCAST INTERN | Re-initiate with Outperform - Credit Suisse | Overnight Price $3.65 |
| SPO - | SPOTLESS | Downgrade to Neutral from Buy - Citi | Overnight Price $0.99 |
| STO - | SANTOS | Overweight - Morgan Stanley | Overnight Price $4.02 |
| SUN - | SUNCORP | Neutral - Citi | Overnight Price $12.92 |
| Accumulate - Ord Minnett | Overnight Price $12.92 | ||
| Buy - UBS | Overnight Price $12.92 | ||
| VRL - | VILLAGE ROADSHOW | Downgrade to Neutral from Buy - Citi | Overnight Price $4.03 |
| Buy - Deutsche Bank | Overnight Price $4.03 | ||
| Neutral - Macquarie | Overnight Price $4.03 |
RATING SUMMARY
| Rating | No. Of Recommendations |
| 1. Buy | 14 |
| 2. Accumulate | 3 |
| 3. Hold | 8 |
| 5. Sell | 2 |
Tuesday 24 January 2017
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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
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should contact their personal adviser before making any investment decision.
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