Australian Broker Call

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July 08, 2021

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COMPANIES DISCUSSED IN THIS ISSUE

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The number next to the symbol represents the number of brokers covering it for this report -(if more than 1).

Last Updated: 05:00 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
ABP - Abacus Property Downgrade to Hold from Accumulate Ord Minnett
WTC - WiseTech Global Downgrade to Neutral from Outperform Macquarie
ABP  ABACUS PROPERTY GROUP

REITs

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Overnight Price: $3.23

UPDATED

Ord Minnett rates ABP as Downgrade to Hold from Accumulate (3) -

Abacus Property has acquired a $160m portfolio of self-storage assets in Sydney's northern suburbs. Ord Minnett assumes the initial yield on the transaction is very tight, at around 3-3.5%, reflecting the premium locations.

The acquisition is included in modelling and has meant Abacus Property has fully utilised its December capital raising.

Ord Minnett downgrades to Hold from Accumulate, given the recent run up in the share price. Target is $3.20.

This stock is not covered in-house by Ord Minnett. Instead, the broker whitelabels research by JP Morgan.

Target price is $3.20 Current Price is $3.23 Difference: minus $0.03 (current price is over target).
If ABP meets the Ord Minnett target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.05, suggesting downside of -4.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Ord Minnett forecasts a full year FY21 dividend of 17.00 cents and EPS of 17.70 cents.
At the last closing share price the estimated dividend yield is 5.26%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.25.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 17.4, implying annual growth of 33.5%.

Current consensus DPS estimate is 16.4, implying a prospective dividend yield of 5.1%.

Current consensus EPS estimate suggests the PER is 18.3.

Forecast for FY22:

Ord Minnett forecasts a full year FY22 dividend of 18.00 cents and EPS of 20.00 cents.
At the last closing share price the estimated dividend yield is 5.57%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.15.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 18.4, implying annual growth of 5.7%.

Current consensus DPS estimate is 17.3, implying a prospective dividend yield of 5.4%.

Current consensus EPS estimate suggests the PER is 17.3.

Market Sentiment: 0.3

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

AD8  AUDINATE GROUP LIMITED

Hardware & Equipment

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Overnight Price: $8.39

Morgan Stanley rates AD8 as Overweight (1) -

Morgan Stanley considers Audinate a high-quality name that has the best potential among small-mid cap stocks for a FY22 upgrade.

The broker observes more sustained growth momentum, noting record sales in the second and third quarters as end-use customers invested in technology to support a post-pandemic "normal".

The rating is Overweight with a target of $10. Industry view: In-line.

Target price is $10.00 Current Price is $8.39 Difference: $1.61
If AD8 meets the Morgan Stanley target it will return approximately 19% (excluding dividends, fees and charges).

Current consensus price target is $10.03, suggesting upside of 16.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Morgan Stanley forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 4.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 209.75.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -3.6, implying annual growth of N/A.

Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.

Current consensus EPS estimate suggests the PER is N/A.

Forecast for FY22:

Morgan Stanley forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 3.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 279.67.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -1.6, implying annual growth of N/A.

Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.

Current consensus EPS estimate suggests the PER is N/A.

Market Sentiment: 1.0

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

AGI  AINSWORTH GAME TECHNOLOGY LIMITED

Gaming

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Overnight Price: $1.19

Macquarie rates AGI as Outperform (1) -

Whilst the company’s share price has risen 290% since the start of November 2020, Macquarie continues to see it as cheap. North American casino revenues are testing record highs and the GameAccount network agreement is considered to be supporting digital.

The broker points to significant operating leverage from improving volumes. Also, earnings quality is considered better, due to growth within gaming operations and digital.

The analyst revises up EPS forecasts, with the main driver relating to Australian dollar forecasts. For FY23, the rate is assumed to fall to US74c from US77c. The target price lifts to $1.30 from $1.10 and the Outperform rating is unchanged.

Target price is $1.30 Current Price is $1.19 Difference: $0.11
If AGI meets the Macquarie target it will return approximately 9% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY21:

Macquarie forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 3.60 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 33.06.

Forecast for FY22:

Macquarie forecasts a full year FY22 dividend of 0.00 cents and EPS of 3.70 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 32.16.

Market Sentiment: 0.0

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

AGL  AGL ENERGY LIMITED

Infrastructure & Utilities

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Overnight Price: $8.15

Credit Suisse rates AGL as Underperform (5) -

Credit Suisse pulls forward -$50m in wholesale price decreases. The target is reduced to $6.70 from $6.80 and an Underperform rating is maintained, with the broker anticipating further downgrades to consensus FY22 and FY23 earnings forecasts.

The broker also notes the proposed structural separation will leave Accel with tremendous leverage to wholesale electricity prices.

Target price is $6.70 Current Price is $8.15 Difference: minus $1.45 (current price is over target).
If AGL meets the Credit Suisse target it will return approximately minus 18% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $8.33, suggesting upside of 2.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Credit Suisse forecasts a full year FY21 dividend of 66.07 cents and EPS of 85.09 cents.
At the last closing share price the estimated dividend yield is 8.11%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.58.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 85.4, implying annual growth of -46.1%.

Current consensus DPS estimate is 67.4, implying a prospective dividend yield of 8.3%.

Current consensus EPS estimate suggests the PER is 9.6.

Forecast for FY22:

Credit Suisse forecasts a full year FY22 dividend of 35.00 cents and EPS of 46.71 cents.
At the last closing share price the estimated dividend yield is 4.29%.
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 57.2, implying annual growth of -33.0%.

Current consensus DPS estimate is 43.0, implying a prospective dividend yield of 5.3%.

Current consensus EPS estimate suggests the PER is 14.3.

Market Sentiment: -0.5

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

AX1  ACCENT GROUP LIMITED

Apparel & Footwear

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Overnight Price: $2.82

Citi rates AX1 as Neutral (3) -

In a review of small-cap retail under coverage, Citi's preference remains the housing retailers. Undemanding FY22 consensus forecasts aren't considered to be appropriately reflecting improvements in housing churn and house prices.

The broker sees downside risk for store based retailers from recent lockdowns, for upcoming trading updates. This, when many retailers are cycling strong comps from the pcp and the consumer may have reduced disposable income, given stimulus has largely finished.

The analyst believes the FY22 price earnings ratio fairly factors-in the numerous new growth opportunities the company is pursuing. Citi forecasts FY21 core profit will increase by 40% to $78m. The Neutral rating and $3.10 target are retained.

Target price is $3.10 Current Price is $2.82 Difference: $0.28
If AX1 meets the Citi target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $2.92, suggesting upside of 6.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Citi forecasts a full year FY21 dividend of 12.00 cents and EPS of 13.80 cents.
At the last closing share price the estimated dividend yield is 4.26%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 20.43.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 13.9, implying annual growth of 34.8%.

Current consensus DPS estimate is 12.6, implying a prospective dividend yield of 4.6%.

Current consensus EPS estimate suggests the PER is 19.8.

Forecast for FY22:

Citi forecasts a full year FY22 dividend of 12.50 cents and EPS of 14.40 cents.
At the last closing share price the estimated dividend yield is 4.43%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 19.58.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 14.8, implying annual growth of 6.5%.

Current consensus DPS estimate is 12.5, implying a prospective dividend yield of 4.5%.

Current consensus EPS estimate suggests the PER is 18.6.

Market Sentiment: 0.0

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

BBN  BABY BUNTING GROUP LIMITED

Apparel & Footwear

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Overnight Price: $5.74

Citi rates BBN as Buy (1) -

In a review of small-cap retail under coverage, Citi's preference remains the housing retailers. Undemanding FY22 consensus forecasts aren't considered to be appropriately reflecting improvements in housing churn and house prices.

The broker sees downside risk for upcoming trading updates for store based retailers from recent lockdowns. This, when many retailers are cycling strong comparatives from pcp and the consumer may have reduced disposable income, given stimulus has largely finished.

The Buy rating and $6.22 target are retained by Citi, as it involves less discretionary spending with limited competition. There are also considered new growth opportunities in shopping centres and related baby services, and the  rollout in New Zealand.

The analyst forecasts FY21 core profit to increase by 52% to $29m.

Target price is $6.22 Current Price is $5.74 Difference: $0.48
If BBN meets the Citi target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $6.24, suggesting upside of 7.8% (ex-dividends)

The company's fiscal year ends in July.

Forecast for FY21:

Citi forecasts a full year FY21 dividend of 15.30 cents and EPS of 21.90 cents.
At the last closing share price the estimated dividend yield is 2.67%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 26.21.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 20.1, implying annual growth of 156.1%.

Current consensus DPS estimate is 14.5, implying a prospective dividend yield of 2.5%.

Current consensus EPS estimate suggests the PER is 28.8.

Forecast for FY22:

Citi forecasts a full year FY22 dividend of 18.00 cents and EPS of 25.70 cents.
At the last closing share price the estimated dividend yield is 3.14%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 22.33.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 23.4, implying annual growth of 16.4%.

Current consensus DPS estimate is 17.1, implying a prospective dividend yield of 3.0%.

Current consensus EPS estimate suggests the PER is 24.7.

Market Sentiment: 1.0

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

BGA  BEGA CHEESE LIMITED

Dairy

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Overnight Price: $5.34

Morgans rates BGA as Add (1) -

Morgans notes competition is heating up, as opening farmgate milk prices for the new season are at record high levels and processors are effectively overpaying for milk. Margins would fall should global dairy prices fall materially or the Australian dollar rise, explains the broker.

The analyst feels the share price weakness more than reflects the extent of Morgans' earnings (EBITDA) downgrade of -6.7% for FY22. The target price falls to $6.35 from $6.80. The Add rating is unchanged.

Target price is $6.35 Current Price is $5.34 Difference: $1.01
If BGA meets the Morgans target it will return approximately 19% (excluding dividends, fees and charges).

Current consensus price target is $6.63, suggesting upside of 22.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Morgans forecasts a full year FY21 dividend of 11.00 cents and EPS of 14.00 cents.
At the last closing share price the estimated dividend yield is 2.06%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 38.14.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 16.4, implying annual growth of 67.9%.

Current consensus DPS estimate is 10.0, implying a prospective dividend yield of 1.9%.

Current consensus EPS estimate suggests the PER is 32.9.

Forecast for FY22:

Morgans forecasts a full year FY22 dividend of 12.00 cents and EPS of 25.00 cents.
At the last closing share price the estimated dividend yield is 2.25%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 21.36.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 28.4, implying annual growth of 73.2%.

Current consensus DPS estimate is 11.8, implying a prospective dividend yield of 2.2%.

Current consensus EPS estimate suggests the PER is 19.0.

Market Sentiment: 0.8

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

BLX  BEACON LIGHTING GROUP LIMITED

Furniture & Renovation

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Overnight Price: $1.80

Citi rates BLX as Buy (1) -

In a review of small-cap retail under coverage, Citi's preference remains the housing retailers. Undemanding FY22 consensus forecasts aren't considered to be appropriately reflecting improvements in housing churn and house prices.

The broker sees downside risk for upcoming trading updates for store based retailers from recent lockdowns. This, when many retailers are cycling strong comparatives from pcp and the consumer may have reduced disposable income, given stimulus has largely finished.

It is the broker's view that Beacon Lighting is emerging from FY21 with a stronger balance sheet that can be used to drive shareholder value. The Buy rating and $2.21 target price are retained.

Target price is $2.21 Current Price is $1.80 Difference: $0.41
If BLX meets the Citi target it will return approximately 23% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY21:

Citi forecasts a full year FY21 dividend of 8.20 cents and EPS of 16.30 cents.
At the last closing share price the estimated dividend yield is 4.56%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.04.

Forecast for FY22:

Citi forecasts a full year FY22 dividend of 5.50 cents and EPS of 10.50 cents.
At the last closing share price the estimated dividend yield is 3.06%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.14.

Market Sentiment: 0.5

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

CCX  CITY CHIC COLLECTIVE LIMITED

Apparel & Footwear

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Overnight Price: $5.23

Citi rates CCX as Neutral (3) -

In a review of small-cap retail under coverage, Citi's preference remains the housing retailers. Undemanding FY22 consensus forecasts aren't considered to be appropriately reflecting improvements in housing churn and house prices.

The broker sees downside risk for upcoming trading updates for store based retailers from recent lockdowns. This, when many retailers are cycling strong comparatives from pcp and the consumer may have reduced disposable income, given stimulus has largely finished.

Small-cap retailers with international exposure, such as City Chic Collective, are trading at higher multiples with more demanding consensus earnings forecasts, points out the broker. However, the company is preferred from these, given its greater online exposure.

The Neutral rating and $4.30 target are retained.

Target price is $4.30 Current Price is $5.23 Difference: minus $0.93 (current price is over target).
If CCX meets the Citi target it will return approximately minus 18% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.94, suggesting downside of -3.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Citi forecasts a full year FY21 dividend of 2.00 cents and EPS of 9.70 cents.
At the last closing share price the estimated dividend yield is 0.38%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 53.92.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 10.0, implying annual growth of 180.1%.

Current consensus DPS estimate is 0.5, implying a prospective dividend yield of 0.1%.

Current consensus EPS estimate suggests the PER is 51.0.

Forecast for FY22:

Citi forecasts a full year FY22 dividend of 6.00 cents and EPS of 15.30 cents.
At the last closing share price the estimated dividend yield is 1.15%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 34.18.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 14.2, implying annual growth of 42.0%.

Current consensus DPS estimate is 4.0, implying a prospective dividend yield of 0.8%.

Current consensus EPS estimate suggests the PER is 35.9.

Market Sentiment: 0.6

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

CGF  CHALLENGER LIMITED

Wealth Management & Investments

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Overnight Price: $5.95

UPDATED

Ord Minnett rates CGF as Hold (3) -

US life insurer Athene and Apollo Global Management will purchase a 15% stake in Challenger. Athene appears to have a similar business model and believes it can generate high returns on equity even in low interest-rate environments.

Ord Minnett considers this a strategic interest that could lead to a closer relationship with Challenger and/or become a longer-term play to obtain a board seat. Nevertheless, the broker believes there are unlikely to be any short-term benefits.

Hold rating and $5.50 target are maintained.

This stock is not covered in-house by Ord Minnett. Instead, the broker whitelabels research by JP Morgan.

Target price is $5.50 Current Price is $5.95 Difference: minus $0.45 (current price is over target).
If CGF meets the Ord Minnett target it will return approximately minus 8% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $5.92, suggesting downside of -1.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Ord Minnett forecasts a full year FY21 dividend of 17.50 cents and EPS of 39.00 cents.
At the last closing share price the estimated dividend yield is 2.94%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.26.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 41.3, implying annual growth of N/A.

Current consensus DPS estimate is 19.9, implying a prospective dividend yield of 3.3%.

Current consensus EPS estimate suggests the PER is 14.5.

Forecast for FY22:

Ord Minnett forecasts a full year FY22 dividend of 19.50 cents and EPS of 43.00 cents.
At the last closing share price the estimated dividend yield is 3.28%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.84.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 39.5, implying annual growth of -4.4%.

Current consensus DPS estimate is 22.4, implying a prospective dividend yield of 3.7%.

Current consensus EPS estimate suggests the PER is 15.1.

Market Sentiment: 0.1

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


UBS rates CGF as Neutral (3) -

Athene Holding and strategic partner Apollo Global Management have acquired a 15% majority stake in Challenger, taking the combined stake to an 18% economic interest. The price paid for the move is $720m which, UBS calculates, implies a $4bn valuation for Challenger.

The broker is not surprised by the transaction yet it is unclear as to the ultimate intention. All up, the involvement is considered a net positive for Challenger as it may open up opportunities to improve spread margins and returns. Neutral and $5.80 target retained.

Target price is $5.80 Current Price is $5.95 Difference: minus $0.15 (current price is over target).
If CGF meets the UBS target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $5.92, suggesting downside of -1.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

UBS forecasts a full year FY21 dividend of 20.00 cents and EPS of 36.00 cents.
At the last closing share price the estimated dividend yield is 3.36%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.53.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 41.3, implying annual growth of N/A.

Current consensus DPS estimate is 19.9, implying a prospective dividend yield of 3.3%.

Current consensus EPS estimate suggests the PER is 14.5.

Forecast for FY22:

UBS forecasts a full year FY22 dividend of 24.00 cents and EPS of 39.00 cents.
At the last closing share price the estimated dividend yield is 4.03%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.26.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 39.5, implying annual growth of -4.4%.

Current consensus DPS estimate is 22.4, implying a prospective dividend yield of 3.7%.

Current consensus EPS estimate suggests the PER is 15.1.

Market Sentiment: 0.1

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

COE  COOPER ENERGY LIMITED

Crude Oil

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Overnight Price: $0.25

Macquarie rates COE as Neutral (3) -

Macquarie strategists update estimates for slightly stronger Australian dollar oil prices, with Brent Oil rising to US$68.84 from US$68/bbl, and the Australian dollar to US0.77c from US0.76c.

Cooper Energy has already downgraded fourth quarter production, and Macquarie now expects the market to focus on FY22 guidance, and whether the company can purchase the Orbost gas plant from APA Group ((APA)).

The Neutral rating and $0.31 target are maintained.

Target price is $0.31 Current Price is $0.25 Difference: $0.06
If COE meets the Macquarie target it will return approximately 24% (excluding dividends, fees and charges).

Current consensus price target is $0.37, suggesting upside of 48.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Macquarie forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 1.70 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 14.71.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -3.6, implying annual growth of N/A.

Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.

Current consensus EPS estimate suggests the PER is N/A.

Forecast for FY22:

Macquarie forecasts a full year FY22 dividend of 0.00 cents and EPS of 0.28 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 89.29.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 0.8, implying annual growth of N/A.

Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.

Current consensus EPS estimate suggests the PER is 31.3.

Market Sentiment: 0.4

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

CVN  CARNARVON PETROLEUM LIMITED

Crude Oil

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Overnight Price: $0.28

Macquarie rates CVN as Neutral (3) -

Macquarie strategists update estimates for slightly stronger Australian dollar oil prices, with Brent Oil rising to US$68.84 from US$68/bbl, and the Australian dollar to US0.77c from US0.76c.

Macquarie points out Carnarvon Petroleum shares are up 17% since the Dorado project reached front-end engineering and design (FEED) in late June.  

The company will need to conduct a selldown of its -20% stake, and also access debt finance ahead of the final investment decision (FID), explains the analyst. The Neutral rating is unchanged and the target price increases to $0.31 from $0.29.

Target price is $0.31 Current Price is $0.28 Difference: $0.03
If CVN meets the Macquarie target it will return approximately 11% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY21:

Macquarie forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 0.42 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 66.67.

Forecast for FY22:

Macquarie forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 0.81 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 34.57.

Market Sentiment: 0.5

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

DTC  DAMSTRA HOLDINGS LIMITED

Software & Services

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Overnight Price: $0.85

Morgan Stanley rates DTC as Equal-weight (3) -

Damstra has renewed the NBN contract for a further 3-6 years at similar levels of revenue per annum. Morgan Stanley considers this a clear positive, providing long-term certainty albeit not being materially incremental.

Equal-weight rating with a target of $1.25. Industry view: In-line.

Target price is $1.25 Current Price is $0.85 Difference: $0.4
If DTC meets the Morgan Stanley target it will return approximately 47% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY21:

Morgan Stanley forecasts a full year FY21 dividend of 0.00 cents and EPS of 0.40 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 212.50.

Forecast for FY22:

Morgan Stanley forecasts a full year FY22 dividend of 0.00 cents and EPS of 2.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 42.50.

Market Sentiment: 0.0

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

KAR  KAROON ENERGY LIMITED

Crude Oil

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Overnight Price: $1.37

Macquarie rates KAR as Outperform (1) -

Macquarie strategists update estimates for slightly stronger Australian dollar oil prices, with Brent to US$68.84 from US$68/bbl, and the Australian dollar to US0.77c from US0.76c.

Karoon Energy is one of the broker's preferences in the small-mid-cap space. It is seen as the cleanest way for investors to add exposure to strong near-term oil prices. The Outperform rating and $1.60 target are maintained.

Target price is $1.60 Current Price is $1.37 Difference: $0.23
If KAR meets the Macquarie target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $1.85, suggesting upside of 35.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Macquarie forecasts a full year FY21 dividend of 0.00 cents and EPS of 8.32 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.47.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 7.3, implying annual growth of N/A.

Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.

Current consensus EPS estimate suggests the PER is 18.8.

Forecast for FY22:

Macquarie forecasts a full year FY22 dividend of 0.00 cents and EPS of 10.54 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.00.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 14.3, implying annual growth of 95.9%.

Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.

Current consensus EPS estimate suggests the PER is 9.6.

Market Sentiment: 1.0

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

LOV  LOVISA HOLDINGS LIMITED

Luxury

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Overnight Price: $15.90

Citi rates LOV as Neutral (3) -

In a review of small-cap retail under coverage, Citi's preference remains the housing retailers. Undemanding FY22 consensus forecasts aren't considered to be appropriately reflecting improvements in housing churn and house prices.

The broker sees downside risk for upcoming trading updates for store based retailers from recent lockdowns. This, when many retailers are cycling strong comparatives from pcp and the consumer may have reduced disposable income, given stimulus has largely finished.

Small-cap retailers with international exposure, such as Lovisa Holdings, are trading at higher multiples with more demanding consensus earnings forecasts, points out the broker. The Neutral rating and $13.30 target are retained.

The analyst remains cautious on the company’s key market, A&NZ (51% of group sales in 1H21), given lockdowns.

Target price is $13.30 Current Price is $15.90 Difference: minus $2.6 (current price is over target).
If LOV meets the Citi target it will return approximately minus 16% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $15.44, suggesting downside of -5.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Citi forecasts a full year FY21 dividend of 25.00 cents and EPS of 26.10 cents.
At the last closing share price the estimated dividend yield is 1.57%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 60.92.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 24.2, implying annual growth of 129.2%.

Current consensus DPS estimate is 29.0, implying a prospective dividend yield of 1.8%.

Current consensus EPS estimate suggests the PER is 67.1.

Forecast for FY22:

Citi forecasts a full year FY22 dividend of 30.00 cents and EPS of 44.70 cents.
At the last closing share price the estimated dividend yield is 1.89%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 35.57.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 39.9, implying annual growth of 64.9%.

Current consensus DPS estimate is 31.9, implying a prospective dividend yield of 2.0%.

Current consensus EPS estimate suggests the PER is 40.7.

Market Sentiment: 0.8

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

LTR  LIONTOWN RESOURCES LIMITED

New Battery Elements

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Overnight Price: $0.83

Macquarie rates LTR as Initiation of coverage with Outperform (1) -

Macquarie initiates coverage on Liontown Resources with an Outperform rating and $1.05 target price. The company owns one of the largest undeveloped, JORC-compliant spodumene projects in the world, named Kathleen Valley.

The broker notes the potential to produce circa 700ktpa of spodumene, large enough to underpin a fully-integrated lithium hydroxide refinery. The analyst's valuation assumes a two stage development of the spodumene mine and downstream hydroxide refinery.

The pre-feasibility study (PFS) outlined a $325m development that delivers 350ktpa of spodumene production capacity, with a mine life of 40 years.The release of a definitive feasibility study (DFS) is due in late 2021.

The company also owns a significant exploration tenement package that management plans to list separately via a de-merger. Additionally, there's another lithium deposit at Buldania.

Target price is $1.05 Current Price is $0.83 Difference: $0.22
If LTR meets the Macquarie target it will return approximately 27% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY21:

Macquarie forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 0.40 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 207.50.

Forecast for FY22:

Macquarie forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 0.50 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 166.00.

Market Sentiment: 1.0

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

MFG  MAGELLAN FINANCIAL GROUP LIMITED

Wealth Management & Investments

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Overnight Price: $53.81

Credit Suisse rates MFG as Neutral (3) -

Funds under management were $114bn, ahead of expectations. This was also the largest quarter of outflows on record.

Credit Suisse points out activist investors have now agitated for a transition to an open-ended vehicle to close the discount in loyalty units and expects this will likely lead to outflows of -$100-200m, signalling the scheme is not as lucrative as expected.

While the stock screens expensive in an historical context, Credit Suisse reiterates a Neutral rating as consensus fund flow expectations appear too high. Target is $54.

Target price is $54.00 Current Price is $53.81 Difference: $0.19
If MFG meets the Credit Suisse target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $51.34, suggesting downside of -0.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Credit Suisse forecasts a full year FY21 dividend of 214.00 cents and EPS of 239.00 cents.
At the last closing share price the estimated dividend yield is 3.98%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 22.51.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 233.4, implying annual growth of 6.9%.

Current consensus DPS estimate is 211.6, implying a prospective dividend yield of 4.1%.

Current consensus EPS estimate suggests the PER is 22.1.

Forecast for FY22:

Credit Suisse forecasts a full year FY22 dividend of 249.00 cents and EPS of 281.00 cents.
At the last closing share price the estimated dividend yield is 4.63%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 19.15.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 260.5, implying annual growth of 11.6%.

Current consensus DPS estimate is 238.2, implying a prospective dividend yield of 4.6%.

Current consensus EPS estimate suggests the PER is 19.8.

Market Sentiment: 0.1

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


Morgan Stanley rates MFG as Underweight (5) -

Outflows occurred in the June quarter, reversing the inflows of the March quarter. Total outflows of -$351m included -$260m in retail and -$91m in institutional.

Morgan Stanley estimates the Global Equity funds drove the bulk of the outflows and does not believe the share price captures the downside risk to consensus flows nor the increased volatility from growing principal investments.

Underweight rating and $39.60 target. Industry view: In-line. 

Target price is $39.60 Current Price is $53.81 Difference: minus $14.21 (current price is over target).
If MFG meets the Morgan Stanley target it will return approximately minus 26% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $51.34, suggesting downside of -0.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Morgan Stanley forecasts a full year FY21 dividend of 206.00 cents and EPS of 228.00 cents.
At the last closing share price the estimated dividend yield is 3.83%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 23.60.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 233.4, implying annual growth of 6.9%.

Current consensus DPS estimate is 211.6, implying a prospective dividend yield of 4.1%.

Current consensus EPS estimate suggests the PER is 22.1.

Forecast for FY22:

Morgan Stanley forecasts a full year FY22 dividend of 240.00 cents and EPS of 240.00 cents.
At the last closing share price the estimated dividend yield is 4.46%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 22.42.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 260.5, implying annual growth of 11.6%.

Current consensus DPS estimate is 238.2, implying a prospective dividend yield of 4.6%.

Current consensus EPS estimate suggests the PER is 19.8.

Market Sentiment: 0.1

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


Morgans rates MFG as Add (1) -

Magellan Financial Group closed FY21 with $113.9bn in funds under management (FUM), up 3.6% for the month, and 17.2% for the year. The group starts FY22 with FUM around 9.8% above average FY21 levels.

However, there were fourth quarter net outflows of -$351m, in part reflecting a weak relative performance in the Global fund. While this fund remains a challenge, Morgans feels base earnings are resilient, with longer-term growth options via new products. 

The broker upgrades FY21-23 EPS forecasts by 3.6%, 5.1% and 1.2%, respectively, and views the current valuation as reasonable. The target price is lowered to $58.05 from $58.26 and the Add rating is unchanged.

Target price is $58.05 Current Price is $53.81 Difference: $4.24
If MFG meets the Morgans target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $51.34, suggesting downside of -0.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Morgans forecasts a full year FY21 dividend of 210.00 cents and EPS of 232.00 cents.
At the last closing share price the estimated dividend yield is 3.90%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 23.19.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 233.4, implying annual growth of 6.9%.

Current consensus DPS estimate is 211.6, implying a prospective dividend yield of 4.1%.

Current consensus EPS estimate suggests the PER is 22.1.

Forecast for FY22:

Morgans forecasts a full year FY22 dividend of 231.00 cents and EPS of 252.00 cents.
At the last closing share price the estimated dividend yield is 4.29%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 21.35.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 260.5, implying annual growth of 11.6%.

Current consensus DPS estimate is 238.2, implying a prospective dividend yield of 4.6%.

Current consensus EPS estimate suggests the PER is 19.8.

Market Sentiment: 0.1

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


UBS rates MFG as Neutral (3) -

Net flows in the June quarter were down -$351m, weaker than UBS expected. A soft investment performance in recent months has affected flows.

UBS continues to envisage potential for performance volatility that will pose revenue risk over the short term and retains a Neutral rating. The broker notes the flagship Global Fund has now underperformed by -16.8% over one year and -1.2% per annum over three years.

The Infrastructure Fund has underperformed by -9.4% over one year and outperformed over 3-5 years. Target is reduced to $52.70 from $53.65.

Target price is $52.70 Current Price is $53.81 Difference: minus $1.11 (current price is over target).
If MFG meets the UBS target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $51.34, suggesting downside of -0.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

UBS forecasts a full year FY21 dividend of 224.00 cents and EPS of 231.00 cents.
At the last closing share price the estimated dividend yield is 4.16%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 23.29.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 233.4, implying annual growth of 6.9%.

Current consensus DPS estimate is 211.6, implying a prospective dividend yield of 4.1%.

Current consensus EPS estimate suggests the PER is 22.1.

Forecast for FY22:

UBS forecasts a full year FY22 dividend of 240.00 cents and EPS of 259.00 cents.
At the last closing share price the estimated dividend yield is 4.46%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 20.78.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 260.5, implying annual growth of 11.6%.

Current consensus DPS estimate is 238.2, implying a prospective dividend yield of 4.6%.

Current consensus EPS estimate suggests the PER is 19.8.

Market Sentiment: 0.1

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

MHJ  MICHAEL HILL INTERNATIONAL LIMITED

Luxury

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Overnight Price: $0.86

Citi rates MHJ as Neutral (3) -

In a review of small-cap retail under coverage, Citi's preference remains the housing retailers. Undemanding FY22 consensus forecasts aren't considered to be appropriately reflecting improvements in housing churn and house prices.

The broker sees downside risk for upcoming trading updates for store based retailers from recent lockdowns. This, when many retailers are cycling strong comparatives from pcp and the consumer may have reduced disposable income, given stimulus has largely finished.

The broker believes Michael Hill International is leveraged to the improving housing cycle and has a strong balance sheet, which could support potential M&A. Neutral rating and $0.93 target retained. The analyst forecasts FY21 core profit to increase by 186% to $43m.

Target price is $0.93 Current Price is $0.86 Difference: $0.07
If MHJ meets the Citi target it will return approximately 8% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY21:

Citi forecasts a full year FY21 dividend of 3.50 cents and EPS of 11.10 cents.
At the last closing share price the estimated dividend yield is 4.07%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 7.75.

Forecast for FY22:

Citi forecasts a full year FY22 dividend of 4.50 cents and EPS of 8.50 cents.
At the last closing share price the estimated dividend yield is 5.23%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.12.

Market Sentiment: 0.5

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

NCK  NICK SCALI LIMITED

Furniture & Renovation

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Overnight Price: $11.23

Citi rates NCK as Buy (1) -

In a review of small-cap retail under coverage, Citi's preference remains the housing retailers. Undemanding FY22 consensus forecasts aren't considered to be appropriately reflecting improvements in housing churn and house prices.

The broker sees downside risk for upcoming trading updates for store based retailers from recent lockdowns. This, when many retailers are cycling strong comparatives from pcp and the consumer may have reduced disposable income, given stimulus has largely finished.

Citi finds Nick Scali is emerging from FY21 with a stronger balance sheet that can be used to drive shareholder value. The Buy rating and $12.05 target price are retained. 

The stock is considered trading at an undemanding FY21 PE multiple, despite an attractive dividend yield.

Target price is $12.05 Current Price is $11.23 Difference: $0.82
If NCK meets the Citi target it will return approximately 7% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY21:

Citi forecasts a full year FY21 dividend of 80.00 cents and EPS of 96.20 cents.
At the last closing share price the estimated dividend yield is 7.12%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.67.

Forecast for FY22:

Citi forecasts a full year FY22 dividend of 48.60 cents and EPS of 59.00 cents.
At the last closing share price the estimated dividend yield is 4.33%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 19.03.

Market Sentiment: 1.0

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

ORG  ORIGIN ENERGY LIMITED

NatGas

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Overnight Price: $4.65

Credit Suisse rates ORG as Neutral (3) -

Credit Suisse does not expect Origin Energy to suffer the same earnings impact from June quarter spot electricity prices as AGL Energy ((AGL)) given good availability and models a -$15m impact.

The broker reduces integrated gas operating earnings forecast by -4.7% because of lower reported domestic gas prices in the third quarter and lower anticipated LNG exports in the fourth quarter.

For FY22 energy markets operating earnings forecasts are reduced by -10%. Target is raised to $4.50 from $4.20. Neutral maintained.

Target price is $4.50 Current Price is $4.65 Difference: minus $0.15 (current price is over target).
If ORG meets the Credit Suisse target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $5.06, suggesting upside of 10.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Credit Suisse forecasts a full year FY21 dividend of 25.00 cents and EPS of 16.07 cents.
At the last closing share price the estimated dividend yield is 5.38%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 28.94.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 19.3, implying annual growth of 308.9%.

Current consensus DPS estimate is 19.2, implying a prospective dividend yield of 4.2%.

Current consensus EPS estimate suggests the PER is 23.7.

Forecast for FY22:

Credit Suisse forecasts a full year FY22 dividend of 25.00 cents and EPS of 27.25 cents.
At the last closing share price the estimated dividend yield is 5.38%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.06.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 26.6, implying annual growth of 37.8%.

Current consensus DPS estimate is 18.1, implying a prospective dividend yield of 4.0%.

Current consensus EPS estimate suggests the PER is 17.2.

Market Sentiment: 0.6

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

OTW  OVER THE WIRE HOLDINGS LIMITED

Cloud services

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Overnight Price: $4.35

Ord Minnett rates OTW as Buy (1) -

A material hardware supply contract has been affected by manufacturing and shipping delays so will be recognised in FY22 rather than FY21. Cash flow will be affected to the tune of -$3m from revenue of $5m, as a 50% deposit was received.

FY21 guidance for revenue of $112m has been updated with EBITDA of $23.5m. As a result, Ord Minnett reduces FY21 estimates and raises outer year numbers. A Buy rating is maintained. Target rises to $4.82 from $4.77.

Target price is $4.82 Current Price is $4.35 Difference: $0.47
If OTW meets the Ord Minnett target it will return approximately 11% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY21:

Ord Minnett forecasts a full year FY21 dividend of 4.00 cents and EPS of 18.50 cents.
At the last closing share price the estimated dividend yield is 0.92%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 23.51.

Forecast for FY22:

Ord Minnett forecasts a full year FY22 dividend of 4.80 cents and EPS of 27.80 cents.
At the last closing share price the estimated dividend yield is 1.10%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.65.

Market Sentiment: 0.5

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

PNI  PINNACLE INVESTMENT MANAGEMENT GROUP LIMITED

Wealth Management & Investments

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Overnight Price: $11.29

Morgans rates PNI as Add (1) -

The group announced its share of FY21 performance fees, crystalised by seven affiliates, will be $19.5m. Morgans notes net inflows have been extremely strong in FY21, and expects another circa $1bn in net inflows over May/June.

Closing funds under management (FUM) is estimated to be $89bn by the broker, up 52% on the pcp. It's believed there's structural growth embedded in the business (maturing profile of existing affiliates and investment strategies) and future optionality from adding new affiliates.

The analyst upgrades FY21-23 EPS forecasts by 5.6%, 8.1% and 6%, respectively, which reflects a mark-to-market of FUM and higher performance fee assumptions. Thus, the target price rises to $11.85 from $11.14 and the Add rating is unchanged.

Target price is $11.85 Current Price is $11.29 Difference: $0.56
If PNI meets the Morgans target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $12.21, suggesting upside of 7.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Morgans forecasts a full year FY21 dividend of 24.00 cents and EPS of 34.00 cents.
At the last closing share price the estimated dividend yield is 2.13%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 33.21.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 34.2, implying annual growth of 81.5%.

Current consensus DPS estimate is 26.0, implying a prospective dividend yield of 2.3%.

Current consensus EPS estimate suggests the PER is 33.3.

Forecast for FY22:

Morgans forecasts a full year FY22 dividend of 31.00 cents and EPS of 39.00 cents.
At the last closing share price the estimated dividend yield is 2.75%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 28.95.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 40.4, implying annual growth of 18.1%.

Current consensus DPS estimate is 32.9, implying a prospective dividend yield of 2.9%.

Current consensus EPS estimate suggests the PER is 28.2.

Market Sentiment: 1.0

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

RRL  REGIS RESOURCES LIMITED

Gold & Silver

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Overnight Price: $2.58

Morgan Stanley rates RRL as Overweight (1) -

Duketon has multiple mines with high extension potential and Morgan Stanley assesses each year of underground life could add around 7-8c to valuation. Extra years for the open pits could add 2-9c.

Regis Resources also trades at a substantial gap to large ASX gold miners, the broker observes, despite being a low-cost, diversified producer with a strong operating history.

Overweight maintained. Target rises to $3.50 from $3.40. Industry view: Attractive.

Target price is $3.50 Current Price is $2.58 Difference: $0.92
If RRL meets the Morgan Stanley target it will return approximately 36% (excluding dividends, fees and charges).

Current consensus price target is $3.64, suggesting upside of 42.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Morgan Stanley forecasts a full year FY21 dividend of 6.00 cents and EPS of 30.00 cents.
At the last closing share price the estimated dividend yield is 2.33%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 8.60.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 27.7, implying annual growth of -26.8%.

Current consensus DPS estimate is 8.7, implying a prospective dividend yield of 3.4%.

Current consensus EPS estimate suggests the PER is 9.2.

Forecast for FY22:

Morgan Stanley forecasts a full year FY22 dividend of 9.00 cents and EPS of 25.00 cents.
At the last closing share price the estimated dividend yield is 3.49%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.32.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 34.6, implying annual growth of 24.9%.

Current consensus DPS estimate is 10.0, implying a prospective dividend yield of 3.9%.

Current consensus EPS estimate suggests the PER is 7.4.

Market Sentiment: 0.6

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

SFR  SANDFIRE RESOURCES LIMITED

Copper

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Overnight Price: $6.87

Macquarie rates SFR as Outperform (1) -

Macquarie believes securing the mining licence at the Motheo Copper project in Botswana is a key de-risking event for Sandfire Resources. Construction and production ramp-up timelines are now considered largely within the company's control.

Early site development work has already commenced with the construction of the mine camp well advanced. Management is scheduled to release the fourth quarter FY21 production result on 29 July and full year earnings result on 26 August.

The Outperform rating and $10 target are unchanged.

Target price is $10.00 Current Price is $6.87 Difference: $3.13
If SFR meets the Macquarie target it will return approximately 46% (excluding dividends, fees and charges).

Current consensus price target is $7.60, suggesting upside of 12.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Macquarie forecasts a full year FY21 dividend of 37.00 cents and EPS of 105.10 cents.
At the last closing share price the estimated dividend yield is 5.39%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 6.54.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 104.4, implying annual growth of 143.5%.

Current consensus DPS estimate is 35.4, implying a prospective dividend yield of 5.2%.

Current consensus EPS estimate suggests the PER is 6.5.

Forecast for FY22:

Macquarie forecasts a full year FY22 dividend of 11.00 cents and EPS of 99.60 cents.
At the last closing share price the estimated dividend yield is 1.60%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 6.90.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 101.2, implying annual growth of -3.1%.

Current consensus DPS estimate is 28.2, implying a prospective dividend yield of 4.2%.

Current consensus EPS estimate suggests the PER is 6.7.

Market Sentiment: 0.4

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


Morgan Stanley rates SFR as Overweight (1) -

Sandfire Resources has received its mining licence for the Motheo copper mine in Botswana. This is a de-risking development for a key project, Morgan Stanley asserts.

Motheo offers a continuation of production as DeGrussa closes in FY23. The broker values the project at $184m.

Sandfire Resources remains the preferred copper exposure on catalyst and valuation grounds. Overweight maintained. Target is $8.25. Industry view: Attractive.

Target price is $8.25 Current Price is $6.87 Difference: $1.38
If SFR meets the Morgan Stanley target it will return approximately 20% (excluding dividends, fees and charges).

Current consensus price target is $7.60, suggesting upside of 12.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Morgan Stanley forecasts a full year FY21 dividend of 45.00 cents and EPS of 126.00 cents.
At the last closing share price the estimated dividend yield is 6.55%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 5.45.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 104.4, implying annual growth of 143.5%.

Current consensus DPS estimate is 35.4, implying a prospective dividend yield of 5.2%.

Current consensus EPS estimate suggests the PER is 6.5.

Forecast for FY22:

Morgan Stanley forecasts a full year FY22 dividend of 37.00 cents and EPS of 105.00 cents.
At the last closing share price the estimated dividend yield is 5.39%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 6.54.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 101.2, implying annual growth of -3.1%.

Current consensus DPS estimate is 28.2, implying a prospective dividend yield of 4.2%.

Current consensus EPS estimate suggests the PER is 6.7.

Market Sentiment: 0.4

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

STX  STRIKE ENERGY LIMITED

NatGas

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Overnight Price: $0.33

Macquarie rates STX as Outperform (1) -

Macquarie strategists update estimates for slightly stronger Australian dollar oil prices, with Brent to US$68.84 from US$68/bbl, and the Australian dollar to US0.77c from US0.76c.

Strike Energy is one of the broker's preferences in the small-mid-cap space, for exposure to resource upside at West Erregulla and high impact exploration at South Erregulla. The Outperform rating and $0.60 target are maintained.

Any progress on fertiliser or geothermal projects could drive upside, given the market remains sceptical on these assets, explains the analyst.

Target price is $0.60 Current Price is $0.33 Difference: $0.27
If STX meets the Macquarie target it will return approximately 82% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY21:

Macquarie forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 0.40 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 82.50.

Forecast for FY22:

Macquarie forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 0.73 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 45.21.

Market Sentiment: 1.0

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

SVW  SEVEN GROUP HOLDINGS LIMITED

Diversified Financials

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Overnight Price: $20.32

Macquarie rates SVW as Outperform (1) -

Bunnings is now offering rental equipment from Coates Hire at 65 Bunnings stores across NSW and Victoria. Macquarie notes Bunnings provides strong distribution into trade and DIY channels.

The broker assesses the actual addressable market for Coates will depend on many factors. These include the scope and pace of store rollout, range of Coates products made available, pricing and the level of investment from Coates/Bunnings.

The analyst makes no changes to forecasts and retains the Outperform rating and $27.50 target price.

Target price is $27.50 Current Price is $20.32 Difference: $7.18
If SVW meets the Macquarie target it will return approximately 35% (excluding dividends, fees and charges).

Current consensus price target is $27.14, suggesting upside of 27.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Macquarie forecasts a full year FY21 dividend of 46.00 cents and EPS of 139.70 cents.
At the last closing share price the estimated dividend yield is 2.26%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.55.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 141.4, implying annual growth of 313.9%.

Current consensus DPS estimate is 46.3, implying a prospective dividend yield of 2.2%.

Current consensus EPS estimate suggests the PER is 15.1.

Forecast for FY22:

Macquarie forecasts a full year FY22 dividend of 46.00 cents and EPS of 152.20 cents.
At the last closing share price the estimated dividend yield is 2.26%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.35.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 156.6, implying annual growth of 10.7%.

Current consensus DPS estimate is 47.0, implying a prospective dividend yield of 2.2%.

Current consensus EPS estimate suggests the PER is 13.6.

Market Sentiment: 1.0

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

SXY  SENEX ENERGY LIMITED

Crude Oil

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Overnight Price: $3.55

Macquarie rates SXY as Outperform (1) -

Macquarie strategists update estimates for slightly stronger Australian dollar oil prices, with Brent to US$68.84 from US$68/bbl, and the Australian dollar to US0.77c from US0.76c.

The broker points out Senex Energy shares have been re-rating strongly in recent months, and now sees 10% upside to the newly-raised target (to $3.85 from $3.80). The Outperform rating is maintained.

Target price is $3.85 Current Price is $3.55 Difference: $0.3
If SXY meets the Macquarie target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $3.85, suggesting upside of 10.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Macquarie forecasts a full year FY21 dividend of 1.00 cents and EPS of 10.55 cents.
At the last closing share price the estimated dividend yield is 0.28%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 33.65.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 10.8, implying annual growth of N/A.

Current consensus DPS estimate is 7.0, implying a prospective dividend yield of 2.0%.

Current consensus EPS estimate suggests the PER is 32.2.

Forecast for FY22:

Macquarie forecasts a full year FY22 dividend of 5.20 cents and EPS of 36.81 cents.
At the last closing share price the estimated dividend yield is 1.46%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.64.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 25.0, implying annual growth of 131.5%.

Current consensus DPS estimate is 6.2, implying a prospective dividend yield of 1.8%.

Current consensus EPS estimate suggests the PER is 13.9.

Market Sentiment: 0.8

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

WTC  WISETECH GLOBAL LIMITED

Cloud services

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Overnight Price: $32.25

Macquarie rates WTC as Downgrade to Neutral from Outperform (3) -

Factoring in the latest container volumes statistics, Macquarie lowers the FY21-23 EPS forecasts by -6%,-1% and -3%, respectively. With limited visibility on catalysts in the coming six months Macquarie downgrades to Neutral from Outperform, ahead of the company’s results. 

The broker lowers the target price to $33 from $34, adjusting for the weaker-than-expected container volumes. Longer-term drivers such as a rebound in roll-out global customer growth and Cargowise Neo are considered to remain intact.

Target price is $33.00 Current Price is $32.25 Difference: $0.75
If WTC meets the Macquarie target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $32.73, suggesting upside of 4.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Macquarie forecasts a full year FY21 dividend of 5.60 cents and EPS of 28.10 cents.
At the last closing share price the estimated dividend yield is 0.17%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 114.77.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 30.1, implying annual growth of -40.2%.

Current consensus DPS estimate is 4.7, implying a prospective dividend yield of 0.1%.

Current consensus EPS estimate suggests the PER is 104.4.

Forecast for FY22:

Macquarie forecasts a full year FY22 dividend of 8.80 cents and EPS of 43.80 cents.
At the last closing share price the estimated dividend yield is 0.27%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 73.63.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 44.5, implying annual growth of 47.8%.

Current consensus DPS estimate is 6.9, implying a prospective dividend yield of 0.2%.

Current consensus EPS estimate suggests the PER is 70.6.

Market Sentiment: 0.3

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

Today's Price Target Changes
Company Last Price Broker New Target Prev Target Change
AGI Ainsworth Game Technology $1.19 Macquarie 1.30 1.10 18.18%
AGL AGL Energy $8.16 Credit Suisse 6.70 6.80 -1.47%
BGA Bega Cheese $5.40 Morgans 6.35 6.80 -6.62%
CVN Carnarvon Petroleum $0.29 Macquarie 0.31 0.29 6.90%
MFG Magellan Financial $51.62 Morgans 58.05 58.26 -0.36%
UBS 52.70 53.65 -1.77%
MHJ Michael Hill International $0.82 Citi 0.93 0.75 24.00%
ORG Origin Energy $4.57 Credit Suisse 4.50 4.20 7.14%
OTW Over The Wire $4.33 Ord Minnett 4.82 4.77 1.05%
PNI Pinnacle Investment Management $11.40 Morgans 11.85 11.14 6.37%
RRL Regis Resources $2.56 Morgan Stanley 3.50 3.40 2.94%
SXY Senex Energy $3.48 Macquarie 3.85 3.80 1.32%
WTC WiseTech Global $31.43 Macquarie 33.00 34.00 -2.94%
Summaries
ABP Abacus Property Downgrade to Hold from Accumulate - Ord Minnett Overnight Price $3.23
AD8 Audinate Group Overweight - Morgan Stanley Overnight Price $8.39
AGI Ainsworth Game Technology Outperform - Macquarie Overnight Price $1.19
AGL AGL Energy Underperform - Credit Suisse Overnight Price $8.15
AX1 Accent Group Neutral - Citi Overnight Price $2.82
BBN Baby Bunting Buy - Citi Overnight Price $5.74
BGA Bega Cheese Add - Morgans Overnight Price $5.34
BLX Beacon Lighting Buy - Citi Overnight Price $1.80
CCX City Chic Collective Neutral - Citi Overnight Price $5.23
CGF Challenger Hold - Ord Minnett Overnight Price $5.95
Neutral - UBS Overnight Price $5.95
COE Cooper Energy Neutral - Macquarie Overnight Price $0.25
CVN Carnarvon Petroleum Neutral - Macquarie Overnight Price $0.28
DTC Damstra Equal-weight - Morgan Stanley Overnight Price $0.85
KAR Karoon Energy Outperform - Macquarie Overnight Price $1.37
LOV Lovisa Neutral - Citi Overnight Price $15.90
LTR Liontown Resources Initiation of coverage with Outperform - Macquarie Overnight Price $0.83
MFG Magellan Financial Neutral - Credit Suisse Overnight Price $53.81
Underweight - Morgan Stanley Overnight Price $53.81
Add - Morgans Overnight Price $53.81
Neutral - UBS Overnight Price $53.81
MHJ Michael Hill International Neutral - Citi Overnight Price $0.86
NCK Nick Scali Buy - Citi Overnight Price $11.23
ORG Origin Energy Neutral - Credit Suisse Overnight Price $4.65
OTW Over The Wire Buy - Ord Minnett Overnight Price $4.35
PNI Pinnacle Investment Management Add - Morgans Overnight Price $11.29
RRL Regis Resources Overweight - Morgan Stanley Overnight Price $2.58
SFR Sandfire Resources Outperform - Macquarie Overnight Price $6.87
Overweight - Morgan Stanley Overnight Price $6.87
STX Strike Energy Outperform - Macquarie Overnight Price $0.33
SVW Seven Group Outperform - Macquarie Overnight Price $20.32
SXY Senex Energy Outperform - Macquarie Overnight Price $3.55
WTC WiseTech Global Downgrade to Neutral from Outperform - Macquarie Overnight Price $32.25
RATING SUMMARY
Rating No. Of Recommendations
1. Buy

17

3. Hold

14

5. Sell

2

Thursday 08 July 2021

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Disclaimer:
The content of this information does in no way reflect the opinions of FNArena, or of its journalists. In fact we don't have any opinion about 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 no guarantee is given that the daily report is accurate or complete. Investors should contact their personal adviser before making any investment decision.