Australian Broker Call
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January 06, 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: 03:10 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
| AMC - | Amcor | Downgrade to Neutral from Buy | Citi |
| BOQ - | Bank Of Queensland | Upgrade to Buy from Neutral | Citi |
| NAB - | National Australia Bank | Downgrade to Neutral from Buy | Citi |
Overnight Price: $15.08
Citi rates AMC as Downgrade to Neutral from Buy (3) -
With a preference for more cyclical companies for the calendar year ahead, Citi has decided to, in its own choice of words, move to the sidelines by downgrading to Neutral from Buy.
Amcor's operations have almost no exposure to industrial activity, unlike other packaging companies, and in the context of the nascent economic recovery this has now become a negative given this translates into less upside potential.
Citi's price target has fallen to $16.80 from $17.90. The analysts continue to acknowledge positives stemming from Amcor's attractive dividend yield, balance sheet flexibility, and high-quality portfolio, plus synergies from the Bemis operations.
Target price is $16.80 Current Price is $14.70 Difference: $2.1
If AMC meets the Citi target it will return approximately 14% (excluding dividends, fees and charges).
Current consensus price target is $17.37, suggesting upside of 15.4% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY21:
Citi forecasts a full year FY21 dividend of 67.94 cents and EPS of 101.19 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 91.7, implying annual growth of N/A. Current consensus DPS estimate is 60.9, implying a prospective dividend yield of 4.0%. Current consensus EPS estimate suggests the PER is 16.4. |
Forecast for FY22:
Citi forecasts a full year FY22 dividend of 67.94 cents and EPS of 112.75 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 98.1, implying annual growth of 7.0%. Current consensus DPS estimate is 63.2, implying a prospective dividend yield of 4.2%. Current consensus EPS estimate suggests the PER is 15.4. |
This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $22.97
Citi rates ANZ as Buy (1) -
Banking analysts at Citi have used their first sector update in 2021 to express ongoing confidence that bank share prices will continue their recovery on improving operational context.
Citi remains convinced Net Interest Margins, or NIMs, will no longer decline while market forecasts for loan losses will prove too bearish.
The analysts also believe stock picking remains key for investors and the broker's revised ranking order now has Westpac on number one, followed by ANZ Bank, Bank of Queensland, National Australia Bank, then CommBank, with Bendalaide Bank least preferred.
The broker's price target for ANZ Bank has lifted to $26.50 from $23.75. Buy rating retained.
Target price is $26.50 Current Price is $22.78 Difference: $3.72
If ANZ meets the Citi target it will return approximately 16% (excluding dividends, fees and charges).
Current consensus price target is $24.14, suggesting upside of 1.1% (ex-dividends)
The company's fiscal year ends in September.
Forecast for FY21:
Citi forecasts a full year FY21 dividend of 120.00 cents and EPS of 176.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 160.7, implying annual growth of 21.1%. Current consensus DPS estimate is 97.4, implying a prospective dividend yield of 4.1%. Current consensus EPS estimate suggests the PER is 14.9. |
Forecast for FY22:
Citi forecasts a full year FY22 dividend of 140.00 cents and EPS of 179.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 181.0, implying annual growth of 12.6%. Current consensus DPS estimate is 123.2, implying a prospective dividend yield of 5.2%. Current consensus EPS estimate suggests the PER is 13.2. |
Market Sentiment: 0.9
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $9.42
Citi rates BEN as Neutral (3) -
Banking analysts at Citi have used their first sector update in 2021 to express ongoing confidence that bank share prices will continue their recovery on improving operational context.
Citi remains convinced Net Interest Margins, or NIMs, will no longer decline while market forecasts for loan losses will prove too bearish.
The analysts also believe stock picking remains key for investors and the broker's revised ranking order now has Westpac on number one, followed by ANZ Bank, Bank of Queensland, National Australia Bank, then CommBank, with Bendalaide Bank least preferred.
The broker's price target has lifted to $10 from $7.25. Neutral/High Risk rating retained.
Target price is $10.00 Current Price is $9.40 Difference: $0.6
If BEN meets the Citi target it will return approximately 6% (excluding dividends, fees and charges).
Current consensus price target is $8.51, suggesting downside of -13.4% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY21:
Citi forecasts a full year FY21 dividend of 52.00 cents and EPS of 63.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 54.0, implying annual growth of -9.5%. Current consensus DPS estimate is 34.3, implying a prospective dividend yield of 3.5%. Current consensus EPS estimate suggests the PER is 18.2. |
Forecast for FY22:
Citi forecasts a full year FY22 dividend of 52.00 cents and EPS of 64.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 57.8, implying annual growth of 7.0%. Current consensus DPS estimate is 39.8, implying a prospective dividend yield of 4.0%. Current consensus EPS estimate suggests the PER is 17.0. |
Market Sentiment: -0.1
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $7.70
Citi rates BOQ as Upgrade to Buy from Neutral (1) -
Banking analysts at Citi have used their first sector update in 2021 to express ongoing confidence that bank share prices will continue their recovery on improving operational context.
Citi remains convinced Net Interest Margins, or NIMs, will no longer decline while market forecasts for loan losses will prove too bearish.
The analysts also believe stock picking remains key for investors and the broker's revised ranking order now has Westpac on number one, followed by ANZ Bank, Bank of Queensland, National Australia Bank, then CommBank, with Bendalaide Bank least preferred.
The broker's price target for Bank of Queensland has lifted to 8.50 from $7.25. Buy (upgrade from Neutral).
Target price is $8.50 Current Price is $7.70 Difference: $0.8
If BOQ meets the Citi target it will return approximately 10% (excluding dividends, fees and charges).
Current consensus price target is $7.33, suggesting downside of -9.2% (ex-dividends)
The company's fiscal year ends in August.
Forecast for FY21:
Citi forecasts a full year FY21 dividend of 46.00 cents and EPS of 58.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 51.4, implying annual growth of 96.2%. Current consensus DPS estimate is 27.6, implying a prospective dividend yield of 3.4%. Current consensus EPS estimate suggests the PER is 15.7. |
Forecast for FY22:
Citi forecasts a full year FY22 dividend of 48.00 cents and EPS of 61.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 57.1, implying annual growth of 11.1%. Current consensus DPS estimate is 38.1, implying a prospective dividend yield of 4.7%. Current consensus EPS estimate suggests the PER is 14.1. |
Market Sentiment: 0.1
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $83.23
Citi rates CBA as Neutral (3) -
Banking analysts at Citi have used their first sector update in 2021 to express ongoing confidence that bank share prices will continue their recovery on improving operational context.
Citi remains convinced Net Interest Margins, or NIMs, will no longer decline while market forecasts for loan losses will prove too bearish.
The analysts also believe stock picking remains key for investors and the broker's revised ranking order now has Westpac on number one, followed by ANZ Bank, Bank of Queensland, National Australia Bank, then CommBank, with Bendalaide Bank least preferred.
The broker's price target for CommBank has lifted to $82.50 from $71. Neutral rating retained.
Target price is $82.50 Current Price is $82.90 Difference: minus $0.4 (current price is over target).
If CBA meets the Citi target it will return approximately minus 0% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $72.64, suggesting downside of -14.6% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY21:
Citi forecasts a full year FY21 dividend of 360.00 cents and EPS of 470.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 412.4, implying annual growth of -0.1%. Current consensus DPS estimate is 284.3, implying a prospective dividend yield of 3.3%. Current consensus EPS estimate suggests the PER is 20.6. |
Forecast for FY22:
Citi forecasts a full year FY22 dividend of 380.00 cents and EPS of 503.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 448.6, implying annual growth of 8.8%. Current consensus DPS estimate is 330.9, implying a prospective dividend yield of 3.9%. Current consensus EPS estimate suggests the PER is 19.0. |
Market Sentiment: -0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $0.46
Macquarie rates DCN as Underperform (5) -
Dacian Gold had experienced some processing disruption during the December quarter but the gold miner's quarterly performance still managed to slightly outpace Macquarie's expectations, such as in production volume and net cash position.
While forecasts have lifted and management remains confident the merger with NTM Gold will conclude in March, Macquarie retains a subdued outlook for gold, and thus the rating remains Underperform. Price target unchanged at 34c.
Target price is $0.34 Current Price is $0.49 Difference: minus $0.15 (current price is over target).
If DCN meets the Macquarie target it will return approximately minus 31% (excluding dividends, fees and charges - negative figures indicate an expected loss).
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 0.20 cents. |
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 1.10 cents. |
Market Sentiment: -1.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $22.69
Citi rates NAB as Downgrade to Neutral from Buy (3) -
Banking analysts at Citi have used their first sector update in 2021 to express ongoing confidence that bank share prices will continue their recovery on improving operational context.
Citi remains convinced Net Interest Margins, or NIMs, will no longer decline while market forecasts for loan losses will prove too bearish.
The analysts also believe stock picking remains key for investors and the broker's revised ranking order now has Westpac on number one, followed by ANZ Bank, Bank of Queensland, National Australia Bank, then CommBank, with Bendalaide Bank least preferred.
The broker's price target for National Australia Bank has lifted to $24.75 from $23.75. The rating has been downgraded to Neutral from Buy. NAB was prior to today's update the broker's most preferred sector exposure.
Target price is $24.75 Current Price is $22.41 Difference: $2.34
If NAB meets the Citi target it will return approximately 10% (excluding dividends, fees and charges).
Current consensus price target is $22.22, suggesting downside of -3.8% (ex-dividends)
The company's fiscal year ends in September.
Forecast for FY21:
Citi forecasts a full year FY21 dividend of 130.00 cents and EPS of 163.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 145.7, implying annual growth of 20.5%. Current consensus DPS estimate is 95.1, implying a prospective dividend yield of 4.1%. Current consensus EPS estimate suggests the PER is 15.9. |
Forecast for FY22:
Citi forecasts a full year FY22 dividend of 140.00 cents and EPS of 174.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 158.6, implying annual growth of 8.9%. Current consensus DPS estimate is 112.4, implying a prospective dividend yield of 4.9%. Current consensus EPS estimate suggests the PER is 14.6. |
Market Sentiment: 0.1
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $1.84
Macquarie rates RMS as Neutral (3) -
Ramelius Resources's December quarter production beat both its own guidance as well as Macquarie's forecast. The analysts are forecasting a flat production profile for the second half.
Earnings estimate for FY21 has been increased while the price target remains unchanged at $1.90. Neutral rating retained.
Target price is $1.90 Current Price is $1.77 Difference: $0.13
If RMS meets the Macquarie target it will return approximately 7% (excluding dividends, fees and charges).
The company's fiscal year ends in June.
Forecast for FY21:
Macquarie forecasts a full year FY21 dividend of 2.00 cents and EPS of 18.70 cents. |
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 3.00 cents and EPS of 11.40 cents. |
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $19.52
Citi rates WBC as Buy (1) -
Banking analysts at Citi have used their first sector update in 2021 to express ongoing confidence that bank share prices will continue their recovery on improving operational context.
Citi remains convinced Net Interest Margins, or NIMs, will no longer decline while market forecasts for loan losses will prove too bearish.
The analysts also believe stock picking remains key for investors and the broker's revised ranking order now has Westpac on number one, followed by ANZ Bank, Bank of Queensland, National Australia Bank, then CommBank, with Bendalaide Bank least preferred.
The broker's price target for Westpac has lifted to $26 from $23.50. Buy rating retained.
Target price is $26.00 Current Price is $19.37 Difference: $6.63
If WBC meets the Citi target it will return approximately 34% (excluding dividends, fees and charges).
Current consensus price target is $22.03, suggesting upside of 8.7% (ex-dividends)
The company's fiscal year ends in September.
Forecast for FY21:
Citi forecasts a full year FY21 dividend of 130.00 cents and EPS of 173.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 145.7, implying annual growth of 101.0%. Current consensus DPS estimate is 96.4, implying a prospective dividend yield of 4.8%. Current consensus EPS estimate suggests the PER is 13.9. |
Forecast for FY22:
Citi forecasts a full year FY22 dividend of 130.00 cents and EPS of 175.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 160.4, implying annual growth of 10.1%. Current consensus DPS estimate is 114.6, implying a prospective dividend yield of 5.7%. Current consensus EPS estimate suggests the PER is 12.6. |
Market Sentiment: 0.9
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 | |
| AMC | Amcor | $15.06 | Citi | 16.80 | 17.90 | -6.15% |
| ANZ | ANZ Banking Group | $23.87 | Citi | 26.50 | 23.75 | 11.58% |
| BEN | Bendigo And Adelaide Bank | $9.83 | Citi | 10.00 | 7.25 | 37.93% |
| BOQ | Bank Of Queensland | $8.07 | Citi | 8.50 | 7.25 | 17.24% |
| CBA | Commbank | $85.07 | Citi | 82.50 | 71.00 | 16.20% |
| NAB | National Australia Bank | $23.10 | Citi | 24.75 | 23.50 | 5.32% |
| WBC | Westpac Banking | $20.26 | Citi | 26.00 | 23.50 | 10.64% |
Summaries
| AMC | Amcor | Downgrade to Neutral from Buy - Citi | Overnight Price $15.08 |
| ANZ | ANZ Banking Group | Buy - Citi | Overnight Price $22.97 |
| BEN | Bendigo And Adelaide Bank | Neutral - Citi | Overnight Price $9.42 |
| BOQ | Bank Of Queensland | Upgrade to Buy from Neutral - Citi | Overnight Price $7.70 |
| CBA | Commbank | Neutral - Citi | Overnight Price $83.23 |
| DCN | Dacian Gold | Underperform - Macquarie | Overnight Price $0.46 |
| NAB | National Australia Bank | Downgrade to Neutral from Buy - Citi | Overnight Price $22.69 |
| RMS | Ramelius Resources | Neutral - Macquarie | Overnight Price $1.84 |
| WBC | Westpac Banking | Buy - Citi | Overnight Price $19.52 |
RATING SUMMARY
| Rating | No. Of Recommendations |
| 1. Buy | 3 |
| 3. Hold | 5 |
| 5. Sell | 1 |
Thursday 07 January 2021
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