Australian Broker Call
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October 04, 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
| PME - | Pro Medicus | Upgrade to Hold from Reduce | Morgans |
Overnight Price: $8.71
Morgan Stanley rates 360 as Overweight (1) -
Morgan Stanley homes in on US data, calculating 8.1% growth quarter on quarter in September and a 71.2% rise in downloads over the year. The broker assesses the numbers suggest comfortably on track.
App store revenue trends appears stronger than downloads yet the broker does not place too much importance on absolute numbers, preferring to check the direction is consistent with membership monetisation and higher conversion.
Overweight rating and $10.50 target price retained. Industry view: In-line.
Target price is $10.50 Current Price is $8.71 Difference: $1.79
If 360 meets the Morgan Stanley target it will return approximately 21% (excluding dividends, fees and charges).
The company's fiscal year ends in December.
Forecast for FY21:
Morgan Stanley forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 14.62 cents. |
Forecast for FY22:
Morgan Stanley forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 18.61 cents. |
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
Overnight Price: $6.26
Credit Suisse rates A2M as Underperform (5) -
Formula pricing was stable in September compared with August in China. Credit Suisse observes marketing activity is increasing to coincide with the Double 9 shopping holiday ahead of the Double 11.
A chat group which distributes coupons and new promotions has been trialed and the company is now experimenting with daigou and the new 400g "trial" tin. Underperform rating and target price of $5.50.
Target price is $5.50 Current Price is $6.26 Difference: minus $0.76 (current price is over target).
If A2M meets the Credit Suisse target it will return approximately minus 12% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $6.09, suggesting downside of -4.6% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Credit Suisse forecasts a full year FY22 dividend of 0.00 cents and EPS of 15.01 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 16.0, 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 39.9. |
Forecast for FY23:
Credit Suisse forecasts a full year FY23 dividend of 0.00 cents and EPS of 19.69 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 23.0, implying annual growth of 43.8%. Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A. Current consensus EPS estimate suggests the PER is 27.7. |
This company reports in NZD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.2
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
ACF ACROW FORMWORK AND CONSTRUCTION SERVICES LIMITED
Building Products & Services
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Overnight Price: $0.44
Morgans rates ACF as Add (1) -
After announcing a strong start to FY22 Acrow Formwork and Construction Services has upgraded FY22 earnings (EBITDA) growth guidance to 25% from 20% and underlying profit growth to 50% from 40%. The Add rating is unchanged.
As a result, Morgans lifts its FY22 estimates and increases its target price to $0.58 from $0.56. Secured hire contracts are considered a good lead indicator to the future performance of the business and these contract wins jumped 51% to $12.8m in the first quarter.
Target price is $0.58 Current Price is $0.44 Difference: $0.14
If ACF meets the Morgans target it will return approximately 32% (excluding dividends, fees and charges).
The company's fiscal year ends in June.
Forecast for FY22:
Morgans forecasts a full year FY22 dividend of 2.20 cents and EPS of 5.70 cents. |
Forecast for FY23:
Morgans forecasts a full year FY23 dividend of 2.50 cents and EPS of 6.30 cents. |
Market Sentiment: 1.0
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: $5.44
Citi rates BBN as Buy (1) -
Ahead of the AGM, Citi expects Baby Bunting to report a relatively stronger update compared with most listed peers because of the non-discretionary nature of its products.
The broker forecasts first half like-for-like sales growth of 0.3%. Buy rating and $5.98 target maintained.
Target price is $5.98 Current Price is $5.44 Difference: $0.54
If BBN meets the Citi target it will return approximately 10% (excluding dividends, fees and charges).
Current consensus price target is $6.34, suggesting upside of 15.2% (ex-dividends)
The company's fiscal year ends in July.
Forecast for FY22:
Citi forecasts a full year FY22 dividend of 17.20 cents and EPS of 23.40 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 22.5, implying annual growth of 65.2%. Current consensus DPS estimate is 15.9, implying a prospective dividend yield of 2.9%. Current consensus EPS estimate suggests the PER is 24.4. |
Forecast for FY23:
Citi forecasts a full year FY23 dividend of 21.60 cents and EPS of 29.40 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 27.0, implying annual growth of 20.0%. Current consensus DPS estimate is 19.2, implying a prospective dividend yield of 3.5%. Current consensus EPS estimate suggests the PER is 20.4. |
Market Sentiment: 0.8
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
JHG JANUS HENDERSON GROUP PLC
Wealth Management & Investments
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Overnight Price: $56.56
Credit Suisse rates JHG as Neutral (3) -
Credit Suisse marks to market to account for equity market movements through the September quarter. Estimates for earnings per share are downgraded by -1% for 2021-23.
Target is raised to $59.00 from $57.50 because of FX movements. Neutral maintained.
Target price is $59.00 Current Price is $56.56 Difference: $2.44
If JHG meets the Credit Suisse target it will return approximately 4% (excluding dividends, fees and charges).
Current consensus price target is $58.83, suggesting upside of 2.8% (ex-dividends)
The company's fiscal year ends in December.
Forecast for FY21:
Credit Suisse forecasts a full year FY21 dividend of 202.07 cents and EPS of 539.75 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 553.9, implying annual growth of N/A. Current consensus DPS estimate is 209.8, implying a prospective dividend yield of 3.7%. Current consensus EPS estimate suggests the PER is 10.3. |
Forecast for FY22:
Credit Suisse forecasts a full year FY22 dividend of 212.71 cents and EPS of 545.07 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 557.8, implying annual growth of 0.7%. Current consensus DPS estimate is 220.9, implying a prospective dividend yield of 3.9%. Current consensus EPS estimate suggests the PER is 10.3. |
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
Overnight Price: $0.45
Citi rates MGX as Buy (1) -
Mount Gibson has suspended the Shine project because of the adverse trajectory of iron ore prices. The project will be placed on care & maintenance pending an improvement in conditions.
Shine reserves total 2.8mt and grade 59.4% iron. In adjusting its model, Citi reduces the target to $0.60 from $0.65 and maintains a Buy/High Risk rating.
Target price is $0.60 Current Price is $0.45 Difference: $0.15
If MGX meets the Citi target it will return approximately 33% (excluding dividends, fees and charges).
The company's fiscal year ends in June.
Forecast for FY22:
Citi forecasts a full year FY22 dividend of 2.00 cents and EPS of 6.40 cents. |
Forecast for FY23:
Citi forecasts a full year FY23 dividend of 5.00 cents and EPS of 20.60 cents. |
Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $41.74
Morgan Stanley rates MIN as Underweight (5) -
Albemarle, which owns 60%, has indicated the re-start of Wodgina is dependent on the acquisition of associated conversion capacity. To this end company has acquired a Chinese lithium converter to add conversion capacity at its Chinese operations.
This is expected to begin commercial production in the second half of 2022. Mineral Resources has previously indicated that Wodgina would take around six months to re-start production. Underweight. The target price is $41.00. Industry view In-Line.
Target price is $41.00 Current Price is $41.74 Difference: minus $0.74 (current price is over target).
If MIN meets the Morgan Stanley target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $57.50, suggesting upside of 33.7% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Morgan Stanley forecasts a full year FY22 dividend of 132.30 cents and EPS of 265.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 518.3, implying annual growth of -23.0%. Current consensus DPS estimate is 250.1, implying a prospective dividend yield of 5.8%. Current consensus EPS estimate suggests the PER is 8.3. |
Forecast for FY23:
Morgan Stanley forecasts a full year FY23 dividend of 128.30 cents and EPS of 257.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 394.1, implying annual growth of -24.0%. Current consensus DPS estimate is 187.1, implying a prospective dividend yield of 4.4%. Current consensus EPS estimate suggests the PER is 10.9. |
Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
PME PRO MEDICUS LIMITED
Medical Equipment & Devices
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Overnight Price: $54.09
Morgans rates PME as Upgrade to Hold from Reduce (3) -
Morgans upgrades its rating to Hold from Reduce given recent share price weakness and the belief the current price represents fair value. This also comes on the signing of a seven year $40m contract which adds $5.7m in annual recurring revenue (ARR) once implemented.
The contract with US-based Novant Health for workflow and viewer products offers further upside as study volumes increase. Novant is an integrated delivery network which services 15 medical centres and hundreds of outpatient facilities. The target of $54.49 is unchanged.
Target price is $54.49 Current Price is $54.09 Difference: $0.4
If PME meets the Morgans target it will return approximately 1% (excluding dividends, fees and charges).
The company's fiscal year ends in June.
Forecast for FY22:
Morgans forecasts a full year FY22 dividend of 19.00 cents and EPS of 42.00 cents. |
Forecast for FY23:
Morgans forecasts a full year FY23 dividend of 22.00 cents and EPS of 49.00 cents. |
Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
PTM PLATINUM ASSET MANAGEMENT LIMITED
Wealth Management & Investments
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Overnight Price: $3.47
Credit Suisse rates PTM as Underperform (5) -
Credit Suisse marks to market to account for equity market movements through the September quarter. Estimates for earnings per share are downgraded by -4% and -7% for FY22 and FY23, respectively.
Target is reduced to $3.30 from $3.85 and an Underperform rating is maintained.
Target price is $3.30 Current Price is $3.47 Difference: minus $0.17 (current price is over target).
If PTM meets the Credit Suisse target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $3.71, suggesting upside of 6.7% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Credit Suisse forecasts a full year FY22 dividend of 22.00 cents and EPS of 23.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 23.3, implying annual growth of -17.3%. Current consensus DPS estimate is 22.8, implying a prospective dividend yield of 6.6%. Current consensus EPS estimate suggests the PER is 14.9. |
Forecast for FY23:
Credit Suisse forecasts a full year FY23 dividend of 22.00 cents and EPS of 22.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 23.4, implying annual growth of 0.4%. Current consensus DPS estimate is 23.7, implying a prospective dividend yield of 6.8%. Current consensus EPS estimate suggests the PER is 14.9. |
Market Sentiment: -0.8
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 | |
| 360 | Life360 | $8.37 | Morgan Stanley | 10.50 | 9.80 | 7.14% |
| ACF | Acrow Formwork and Construction Services | $0.45 | Morgans | 0.58 | 0.56 | 3.57% |
| JHG | Janus Henderson | $57.22 | Credit Suisse | 59.00 | 57.50 | 2.61% |
| MGX | Mount Gibson Iron | $0.45 | Citi | 0.60 | 1.15 | -47.83% |
| PTM | Platinum Asset Management | $3.48 | Credit Suisse | 3.30 | 3.85 | -14.29% |
Summaries
| 360 | Life360 | Overweight - Morgan Stanley | Overnight Price $8.71 |
| A2M | a2 Milk Co | Underperform - Credit Suisse | Overnight Price $6.26 |
| ACF | Acrow Formwork and Construction Services | Add - Morgans | Overnight Price $0.44 |
| BBN | Baby Bunting | Buy - Citi | Overnight Price $5.44 |
| JHG | Janus Henderson | Neutral - Credit Suisse | Overnight Price $56.56 |
| MGX | Mount Gibson Iron | Buy - Citi | Overnight Price $0.45 |
| MIN | Mineral Resources | Underweight - Morgan Stanley | Overnight Price $41.74 |
| PME | Pro Medicus | Upgrade to Hold from Reduce - Morgans | Overnight Price $54.09 |
| PTM | Platinum Asset Management | Underperform - Credit Suisse | Overnight Price $3.47 |
RATING SUMMARY
| Rating | No. Of Recommendations |
| 1. Buy | 4 |
| 3. Hold | 2 |
| 5. Sell | 3 |
Monday 04 October 2021
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