Australian Broker Call

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March 22, 2022

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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

AMC  AMCOR PLC

Paper & Packaging

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Overnight Price: $15.50

Credit Suisse rates AMC as Neutral (3) -

Credit Suisse sees no immediate impact from proposed changes to the Packaging and Packaging Waste Directive (PPWD), by the European Commission. 

While the company derives 25% of revenue from its Western European flexible packaging operations, it could take many years for developments to unfold, explains the analyst.

The amended PPWD could tighten definitions of recyclabiity and labelling, notes the broker, which could incentivise Amcor's customers to invest in waste management schemes. The Neutral rating and $16 target are retained.

Target price is $16.00 Current Price is $15.50 Difference: $0.5
If AMC meets the Credit Suisse target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $18.07, suggesting upside of 17.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Credit Suisse forecasts a full year FY22 dividend of 68.93 cents and EPS of 108.47 cents.
At the last closing share price the estimated dividend yield is 4.45%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.29.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 108.4, implying annual growth of N/A.

Current consensus DPS estimate is 65.8, implying a prospective dividend yield of 4.3%.

Current consensus EPS estimate suggests the PER is 14.2.

Forecast for FY23:

Credit Suisse forecasts a full year FY23 dividend of 74.33 cents and EPS of 113.52 cents.
At the last closing share price the estimated dividend yield is 4.80%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.65.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 113.5, implying annual growth of 4.7%.

Current consensus DPS estimate is 67.6, implying a prospective dividend yield of 4.4%.

Current consensus EPS estimate suggests the PER is 13.6.

This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.

Market Sentiment: 0.6

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

ASB  AUSTAL LIMITED

Commercial Services & Supplies

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Overnight Price: $2.02

Citi rates ASB as Buy (1) -

Citi reassures investors the retirement of some Freedom class littoral combat (LCSs) by the US Navy due to design issues is unlikely to impact Austal-built Independence class LCSs. The design of both ships is quite different.

In addition, the broker's research indicates the US Navy has continued to commission Independence class LCSs. The $2.35 target and Buy rating are uchanged.

Target price is $2.35 Current Price is $2.02 Difference: $0.33
If ASB meets the Citi target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $2.28, suggesting upside of 14.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Citi forecasts a full year FY22 dividend of 8.00 cents and EPS of 22.40 cents.
At the last closing share price the estimated dividend yield is 3.96%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.02.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 20.6, implying annual growth of -8.6%.

Current consensus DPS estimate is 7.7, implying a prospective dividend yield of 3.9%.

Current consensus EPS estimate suggests the PER is 9.7.

Forecast for FY23:

Citi forecasts a full year FY23 dividend of 8.00 cents and EPS of 19.00 cents.
At the last closing share price the estimated dividend yield is 3.96%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.63.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 19.3, implying annual growth of -6.3%.

Current consensus DPS estimate is 9.3, implying a prospective dividend yield of 4.7%.

Current consensus EPS estimate suggests the PER is 10.4.

Market Sentiment: 0.7

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

AWC  ALUMINA LIMITED

Aluminium, Bauxite & Alumina

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Overnight Price: $1.99

Macquarie rates AWC as Neutral (3) -

Macquarie notes alumina prices have risen to US$528/t from US$345/t earlier this year and feels the market may be tighter over the near term due to the recent alumina export ban by Australia.

The broker notes a 10% move in alumina prices has the potential to change Alumina Ltd's earnings by 20-43%. A Neutral rating is maintained in recognition of potential near-term trade flow uncertainty from the export ban. The $2.00 target is unchanged.

Target price is $2.00 Current Price is $1.99 Difference: $0.01
If AWC meets the Macquarie target it will return approximately 1% (excluding dividends, fees and charges).

Current consensus price target is $2.15, suggesting upside of 7.5% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY22:

Macquarie forecasts a full year FY22 dividend of 21.76 cents and EPS of 25.79 cents.
At the last closing share price the estimated dividend yield is 10.93%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 7.72.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 19.1, implying annual growth of N/A.

Current consensus DPS estimate is 15.8, implying a prospective dividend yield of 7.9%.

Current consensus EPS estimate suggests the PER is 10.5.

Forecast for FY23:

Macquarie forecasts a full year FY23 dividend of 19.33 cents and EPS of 19.95 cents.
At the last closing share price the estimated dividend yield is 9.71%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.98.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 14.7, implying annual growth of -23.0%.

Current consensus DPS estimate is 17.3, implying a prospective dividend yield of 8.7%.

Current consensus EPS estimate suggests the PER is 13.6.

This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.

Market Sentiment: 0.6

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

LIC  LIFESTYLE COMMUNITIES LIMITED

Infra & Property Developers

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Overnight Price: $17.36

UBS rates LIC as Initiation of coverage with Neutral (3) -

UBS initiates coverage on Lifestyle Communities, noting the company is its preferred manufactured housing estates exposure given strong sector focus, consistent strategy and proven long-term growth. 

Recent increased funding should drive a 27-50% increase in development settlements, with the company guiding to 1,100-1,300 units settled over FY22-24, but the broker expects an aging population will support further demand. 

The broker likes the company's strong customer value proposition, with 50% of sales made on referrals, and its focus on affordability. 

The broker initiates with a Neutral rating and a target price of $17.75.

Target price is $17.75 Current Price is $17.36 Difference: $0.39
If LIC meets the UBS target it will return approximately 2% (excluding dividends, fees and charges).

Market Sentiment: 0.0

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

LNK  LINK ADMINISTRATION HOLDINGS LIMITED

Wealth Management & Investments

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Overnight Price: $5.15

Ord Minnett rates LNK as Hold (3) -

Following an update by Link Administration, the $5.50 takeover bid by Dye and Durham for Link Administration appears to be on-track, according to Ord Minnett.  The Hold rating and $5.50 target are retained.

However, the sale of the banking and credit management (BCM) division is proving difficult and may not result in any upside for shareholders, suggests the analyst.

The broker notes there may be some floor support for the company should the takeover not proceed due to a non-binding bid for the Retirement and Superannuation Solutions Retirement division from global investor FNZ Group.

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 $5.15 Difference: $0.35
If LNK meets the Ord Minnett target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $5.55, suggesting upside of 7.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Ord Minnett forecasts a full year FY22 dividend of 10.00 cents and EPS of 22.00 cents.
At the last closing share price the estimated dividend yield is 1.94%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 23.41.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 19.1, implying annual growth of N/A.

Current consensus DPS estimate is 9.7, implying a prospective dividend yield of 1.9%.

Current consensus EPS estimate suggests the PER is 27.1.

Forecast for FY23:

Ord Minnett forecasts a full year FY23 dividend of 13.00 cents and EPS of 26.00 cents.
At the last closing share price the estimated dividend yield is 2.52%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 19.81.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 25.5, implying annual growth of 33.5%.

Current consensus DPS estimate is 13.2, implying a prospective dividend yield of 2.6%.

Current consensus EPS estimate suggests the PER is 20.3.

Market Sentiment: 0.0

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

MQG  MACQUARIE GROUP LIMITED

Wealth Management & Investments

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Overnight Price: $195.01

Morgan Stanley rates MQG as Overweight (1) -

Morgan Stanley feels tailwinds for Macquarie Group's Commodities and Global Markets division may be more than cyclical and the broker has increasing confidence around the opportunity in the renewable energy space.

As a result of rising energy price volatility, Morgan Stanley increases its earnings forecasts. However, should private markets activity remain subdued for longer there is considered to be downside risk to FY23 earnings.

The Overweight rating is retained and the target price rises to $245 from $242. Industry view: Attractive.

Target price is $245.00 Current Price is $195.01 Difference: $49.99
If MQG meets the Morgan Stanley target it will return approximately 26% (excluding dividends, fees and charges).

Current consensus price target is $220.80, suggesting upside of 11.8% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY22:

Morgan Stanley forecasts a full year FY22 dividend of 687.00 cents and EPS of 1170.00 cents.
At the last closing share price the estimated dividend yield is 3.52%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.67.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 1124.6, implying annual growth of 33.4%.

Current consensus DPS estimate is 649.4, implying a prospective dividend yield of 3.3%.

Current consensus EPS estimate suggests the PER is 17.6.

Forecast for FY23:

Morgan Stanley forecasts a full year FY23 dividend of 640.00 cents and EPS of 1074.00 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 18.16.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 1035.6, implying annual growth of -7.9%.

Current consensus DPS estimate is 643.4, implying a prospective dividend yield of 3.3%.

Current consensus EPS estimate suggests the PER is 19.1.

Market Sentiment: 0.5

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

QUB  QUBE HOLDINGS LIMITED

Transportation & Logistics

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Overnight Price: $3.05

Credit Suisse rates QUB as Outperform (1) -

Qube Holdings has confirmed a $400m off-market buyback whereby shareholders may offer shares at between a -5% and -14% discount to the current market price. The after tax benefit will vary according to the shareholders individual tax circumstances, notes Credit Suisse.

The buyback proceeds received by shareholders are a $1.61/share capital component and a fully franked dividend equal to the buyback price less $1.61/share.

The Outperform rating and $3.55 target are retained.

Target price is $3.55 Current Price is $3.05 Difference: $0.5
If QUB meets the Credit Suisse target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $3.32, suggesting upside of 9.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Credit Suisse forecasts a full year FY22 dividend of 6.30 cents and EPS of 9.99 cents.
At the last closing share price the estimated dividend yield is 2.07%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 30.53.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 9.6, implying annual growth of 98.8%.

Current consensus DPS estimate is 6.2, implying a prospective dividend yield of 2.0%.

Current consensus EPS estimate suggests the PER is 31.7.

Forecast for FY23:

Credit Suisse forecasts a full year FY23 dividend of 6.90 cents and EPS of 11.56 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 26.38.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 11.2, implying annual growth of 16.7%.

Current consensus DPS estimate is 7.0, implying a prospective dividend yield of 2.3%.

Current consensus EPS estimate suggests the PER is 27.1.

Market Sentiment: 0.5

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


UBS rates QUB as Neutral (3) -

Qube Holdings has confirmed a $400m off-market buyback in what UBS notes is just part of broader company strategy to deploy the $1.67bn in proceeds from the Moorebank Logistics Park sale, estimating a further $600-700m will be available for growth initiatives. 

The buyback will be priced at a -5-14%% discount to market, comprising $1.61 per share and a fully franked dividend. The company estimates eligible super funds could realise as much as a 6% premium to market. 

The Neutral rating and $3.30 target are retained.

Target price is $3.30 Current Price is $3.05 Difference: $0.25
If QUB meets the UBS target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $3.32, suggesting upside of 9.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

UBS forecasts a full year FY22 dividend of 6.00 cents and EPS of 10.00 cents.
At the last closing share price the estimated dividend yield is 1.97%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 30.50.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 9.6, implying annual growth of 98.8%.

Current consensus DPS estimate is 6.2, implying a prospective dividend yield of 2.0%.

Current consensus EPS estimate suggests the PER is 31.7.

Forecast for FY23:

UBS forecasts a full year FY23 dividend of 7.00 cents and EPS of 12.00 cents.
At the last closing share price the estimated dividend yield is 2.30%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 25.42.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 11.2, implying annual growth of 16.7%.

Current consensus DPS estimate is 7.0, implying a prospective dividend yield of 2.3%.

Current consensus EPS estimate suggests the PER is 27.1.

Market Sentiment: 0.5

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

RIO  RIO TINTO LIMITED

Bulks

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Overnight Price: $110.44

Macquarie rates RIO as Outperform (1) -

Macquarie notes alumina prices have risen to US$528/t from US$345/t earlier this year and feels the market may be tighter over the near term due to the recent alumina export ban by Australia.

The broker notes aluminium accounts for around 25% of its valuation for Rio Tinto. While the company has a 80% stake in Queensland Alumina Ltd in a joint venture with Russia’s Rusal, this exposure is less than 1% of the company's valuation, explains the analyst.

The Outperform rating and $140 target are retained.

Target price is $140.00 Current Price is $110.44 Difference: $29.56
If RIO meets the Macquarie target it will return approximately 27% (excluding dividends, fees and charges).

Current consensus price target is $116.36, suggesting upside of 2.1% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY22:

Macquarie forecasts a full year FY22 dividend of 1278.55 cents and EPS of 1880.12 cents.
At the last closing share price the estimated dividend yield is 11.58%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 5.87.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 1534.2, implying annual growth of N/A.

Current consensus DPS estimate is 1088.6, implying a prospective dividend yield of 9.6%.

Current consensus EPS estimate suggests the PER is 7.4.

Forecast for FY23:

Macquarie forecasts a full year FY23 dividend of 882.55 cents and EPS of 1304.77 cents.
At the last closing share price the estimated dividend yield is 7.99%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 8.46.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 1045.0, implying annual growth of -31.9%.

Current consensus DPS estimate is 789.2, implying a prospective dividend yield of 6.9%.

Current consensus EPS estimate suggests the PER is 10.9.

This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.

Market Sentiment: 0.3

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


Morgan Stanley rates RIO as Overweight (1) -

Following the Australian government ban on exports of alumina and aluminum ores, including bauxite, to Russia, Morgan Stanley estimates Rio Tinto's revenue exposure is less than 0.05% and less than 1% of earnings (EBITDA).

The Overweight rating and target price of $122.50 are retained. Industry view: Attractive.

Target price is $122.50 Current Price is $110.44 Difference: $12.06
If RIO meets the Morgan Stanley target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $116.36, suggesting upside of 2.1% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY22:

Morgan Stanley forecasts a full year FY22 dividend of 1405.60 cents and EPS of 1752.94 cents.
At the last closing share price the estimated dividend yield is 12.73%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 6.30.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 1534.2, implying annual growth of N/A.

Current consensus DPS estimate is 1088.6, implying a prospective dividend yield of 9.6%.

Current consensus EPS estimate suggests the PER is 7.4.

Forecast for FY23:

Morgan Stanley forecasts a full year FY23 EPS of 929.86 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.88.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 1045.0, implying annual growth of -31.9%.

Current consensus DPS estimate is 789.2, implying a prospective dividend yield of 6.9%.

Current consensus EPS estimate suggests the PER is 10.9.

This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.

Market Sentiment: 0.3

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

S32  SOUTH32 LIMITED

Mining

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Overnight Price: $4.88

Macquarie rates S32 as Outperform (1) -

Macquarie notes alumina prices have risen to US$528/t from US$345/t earlier this year and feels the market may be tighter over the near term due to the recent alumina export ban by Australia.

The broker notes a 10% move in alumina prices translates to a 1-4% earnings change for South32. Apart from alumina, the company is considered to have earnings upside from buoyant coking coal and base metal prices.

South32 is Macquarie's preferred large-cap miner. The $7.00 target and Outperform rating are unchanged.

Target price is $7.00 Current Price is $4.88 Difference: $2.12
If S32 meets the Macquarie target it will return approximately 43% (excluding dividends, fees and charges).

Current consensus price target is $5.38, suggesting upside of 6.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Macquarie forecasts a full year FY22 dividend of 39.06 cents and EPS of 83.53 cents.
At the last closing share price the estimated dividend yield is 8.00%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 5.84.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 70.4, implying annual growth of N/A.

Current consensus DPS estimate is 29.0, implying a prospective dividend yield of 5.7%.

Current consensus EPS estimate suggests the PER is 7.2.

Forecast for FY23:

Macquarie forecasts a full year FY23 dividend of 41.36 cents and EPS of 82.71 cents.
At the last closing share price the estimated dividend yield is 8.47%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 5.90.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 60.4, implying annual growth of -14.2%.

Current consensus DPS estimate is 27.2, implying a prospective dividend yield of 5.4%.

Current consensus EPS estimate suggests the PER is 8.4.

This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.

Market Sentiment: 1.0

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

STA  STRANDLINE RESOURCES LIMITED

Mineral Sands

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Overnight Price: $0.35

Morgans rates STA as Add (1) -

After a recent site visit to Strandline Resources' Coburn mineral sands project, Morgans believes construction is being well managed.

The broker leaves its underlying cost and production assumptions unchanged. However, the target rises to $0.62 from $0.52 due to a tight market for mineral sands and spot pricing above industry forecasts. The Add rating is unchanged.

Target price is $0.62 Current Price is $0.35 Difference: $0.27
If STA meets the Morgans target it will return approximately 77% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY22:

Morgans forecasts a full year FY22 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 87.50.

Forecast for FY23:

Morgans forecasts a full year FY23 dividend of 1.50 cents and EPS of 1.60 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 21.87.

Market Sentiment: 1.0

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

SWM  SEVEN WEST MEDIA LIMITED

Print, Radio & TV

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Overnight Price: $0.63

UBS rates SWM as Buy (1) -

Continuing momentum in the ad market could offer 15% upside to UBS's $315m base earnings forecast for Seven West Media. The media company grew year-on-year earnings 30% in the first half, with two-thirds attributed to free-to-air ad revenue strength. 

The free-to-air and broadcaster-video-on-demand ad markets grew a combined 17% in the first half, up 14% on pre-covid levels. Following a strong second half start, UBS expects 5% growth in free-to-air and more than 50% growth in broadcaster-video-on-demand.

Earnings per share forecasts are upgraded 11% and 8% for FY22 and FY23. 

The Buy rating and $0.95 target price are retained.

Target price is $0.95 Current Price is $0.63 Difference: $0.32
If SWM meets the UBS target it will return approximately 51% (excluding dividends, fees and charges).

Current consensus price target is $0.88, suggesting upside of 31.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

UBS forecasts a full year FY22 dividend of 0.00 cents and EPS of 11.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 5.73.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 11.7, implying annual growth of -43.4%.

Current consensus DPS estimate is 0.3, implying a prospective dividend yield of 0.4%.

Current consensus EPS estimate suggests the PER is 5.7.

Forecast for FY23:

UBS forecasts a full year FY23 dividend of 0.00 cents and EPS of 13.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 4.85.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 12.0, implying annual growth of 2.6%.

Current consensus DPS estimate is 1.1, implying a prospective dividend yield of 1.6%.

Current consensus EPS estimate suggests the PER is 5.6.

Market Sentiment: 0.9

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

WEB  WEBJET LIMITED

Travel, Leisure & Tourism

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Overnight Price: $5.57

Ord Minnett rates WEB as Buy (1) -

Ord Minnett advocates a buy into weakness (given ongoing volatilty) approach for Webjet shares. While the upcoming FY22 result (March year end) will be weaker than initially expected, strong demand for 2023 Northern Hemisphere summer holiday travel is forecast.

Additionally, the analyst estimates the B2B and B2C divisions should win material market share. 

The broker raises its target to $7.51 from $7.31 and maintains its Buy rating.

Target price is $7.51 Current Price is $5.57 Difference: $1.94
If WEB meets the Ord Minnett target it will return approximately 35% (excluding dividends, fees and charges).

Current consensus price target is $6.17, suggesting upside of 11.2% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY22:

Ord Minnett forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 23.50 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 23.70.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -12.4, implying annual growth of N/A.

Current consensus DPS estimate is 2.6, implying a prospective dividend yield of 0.5%.

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

Forecast for FY23:

Ord Minnett forecasts a full year FY23 dividend of 0.00 cents and EPS of 11.20 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 49.73.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 18.1, implying annual growth of N/A.

Current consensus DPS estimate is 4.0, implying a prospective dividend yield of 0.7%.

Current consensus EPS estimate suggests the PER is 30.7.

Market Sentiment: 0.4

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
AWC Alumina Ltd $2.00 Macquarie 2.00 2.00 0.00%
MQG Macquarie Group $197.58 Morgan Stanley 245.00 242.00 1.24%
RIO Rio Tinto $113.98 Morgan Stanley 122.50 126.50 -3.16%
STA Strandline Resources $0.40 Morgans 0.62 0.52 19.23%
WEB Webjet $5.55 Ord Minnett 7.51 7.31 2.74%
Summaries
AMC Amcor Neutral - Credit Suisse Overnight Price $15.50
ASB Austal Buy - Citi Overnight Price $2.02
AWC Alumina Ltd Neutral - Macquarie Overnight Price $1.99
LIC Lifestyle Communities Initiation of coverage with Neutral - UBS Overnight Price $17.36
LNK Link Administration Hold - Ord Minnett Overnight Price $5.15
MQG Macquarie Group Overweight - Morgan Stanley Overnight Price $195.01
QUB Qube Holdings Outperform - Credit Suisse Overnight Price $3.05
Neutral - UBS Overnight Price $3.05
RIO Rio Tinto Outperform - Macquarie Overnight Price $110.44
Overweight - Morgan Stanley Overnight Price $110.44
S32 South32 Outperform - Macquarie Overnight Price $4.88
STA Strandline Resources Add - Morgans Overnight Price $0.35
SWM Seven West Media Buy - UBS Overnight Price $0.63
WEB Webjet Buy - Ord Minnett Overnight Price $5.57
RATING SUMMARY
Rating No. Of Recommendations
1. Buy

9

3. Hold

5

Tuesday 22 March 2022

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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.