Australian Broker Call *Extra* Edition – Feb 22, 2024

This story features A2 MILK COMPANY LIMITED, and other companies. For more info SHARE ANALYSIS: A2M

An additional news report on the recommendation, valuation, forecast and opinion changes and updates for ASX-listed equities.

In addition to The Australian Broker Call Report, which is published and updated daily (Mon-Fri), FNArena has now added The Australian Broker Call *Extra* Edition, featuring additional sources of research and insights on ASX-listed stocks, also enlarging the number of stocks that make up the FNArena universe.

One key difference is the *Extra* Edition will not be updated daily, but merely "regularly" depending on availability of suitable quality content. As such, the *Extra* Edition tries to build a bridge between daily updates via the Australian Broker Call Report and ad hoc news stories, that are not always timely for investors hungry for the next information update.

Investors using the *Extra* Edition as a source of input for their own share market research should thus take into account that information after publication may not be up to date, or yet awaiting another update by FNArena's team of journalists.

Similar to The Australian Broker Call Report, this *Extra* Edition includes concise but limited reviews of research recently published by Stockbrokers and other experts, 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 of this Report.

The Australian Broker Call *Extra* Edition is a summary that has been prepared independently of the sources identified. Readers will check the full text of the recommendations and consult a Licenced Advisor before making any investment decision.

The copyright of this Report is owned by the publisher. Readers will not copy, forward or disseminate this Report to any other person. For more vital information about the sources included, see the bottom of this Report.

COMPANIES DISCUSSED IN THIS ISSUE

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

A2M   COH   DOW   DTL   IDX   IMD   IPL   MFG   MGH   OML   ORG   ORI   RUL   TLS (2)   TWE  

A2M    A2 MILK COMPANY LIMITED

Dairy – Overnight Price: $5.70

Wilsons rates ((A2M)) as Downgrade to Market Weight from Overweight (3) –

Wilsons believes a2 Milk Co's management deserves credit for delivering a robust first half result amid a contracting China infant milk formula market, alongside significant channel mix changes.

First half revenue of $812m represented a 4% year-on-year increase, whlie earnings of $113m represented a 5% year-on-year increase, with the result underpinned by stronger China revenue. 

A guidance upgrade has the company expecting low to mid-single digit sales growth over the full year. 

The rating is downgraded to Market Weight from Overweight and the target price increases to $5.85 from $5.47.

This report was published on February 20, 2024.

Target price is $5.85 Current Price is $5.70 Difference: $0.15
If A2M meets the Wilsons target it will return approximately 3% (excluding dividends, fees and charges).
Current consensus price target is $6.08, suggesting upside of 6.7%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY24:

Wilsons forecasts a full year FY24 dividend of 0.00 cents and EPS of 22.14 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 25.74.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 22.2, implying annual growth of N/A.
Current consensus DPS estimate is 0.9, implying a prospective dividend yield of 0.2%.
Current consensus EPS estimate suggests the PER is 25.7.

Forecast for FY25:

Wilsons forecasts a full year FY25 dividend of 0.00 cents and EPS of 22.98 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 24.81.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 26.6, implying annual growth of 19.8%.
Current consensus DPS estimate is 4.7, implying a prospective dividend yield of 0.8%.
Current consensus EPS estimate suggests the PER is 21.4.

This company reports in NZD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

COH    COCHLEAR LIMITED

Medical Equipment & Devices – Overnight Price: $341.07

Wilsons rates ((COH)) as Overweight (1) –

Cochlear's pre-guided December-half result outpaced Wilsons' forecast.

The broker observes strong structural tailwinds building for Cochlear, leading it to waive discounted cash flow valuations in this instance, rather than miss out on outperformance.

These include: improving conversion rates for adults/seniors; earlier intervention for paediatrics; and SSD. Add in the highly prospective N8 launch and the observation the company seems to be nabbing more than its fair share of the market, and Wilsons likes what it sees.

On the downside, expense growth jumped 24%, the broker suspecting this may relate to near-term projects.

The buy-back is on hold. Overweight rating retained. Target price rises 15% to $365 from $318.46.

This report was published on February 20, 2024.

Target price is $365.00 Current Price is $341.07 Difference: $23.93
If COH meets the Wilsons target it will return approximately 7% (excluding dividends, fees and charges).
Current consensus price target is $258.08, suggesting downside of -24.3%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY24:

Wilsons forecasts a full year FY24 dividend of 420.00 cents and EPS of 594.60 cents.
At the last closing share price the estimated dividend yield is 1.23%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 57.36.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 603.0, implying annual growth of 31.9%.
Current consensus DPS estimate is 417.2, implying a prospective dividend yield of 1.2%.
Current consensus EPS estimate suggests the PER is 56.6.

Forecast for FY25:

Wilsons forecasts a full year FY25 dividend of 470.50 cents and EPS of 675.60 cents.
At the last closing share price the estimated dividend yield is 1.38%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 50.48.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 677.1, implying annual growth of 12.3%.
Current consensus DPS estimate is 470.6, implying a prospective dividend yield of 1.4%.
Current consensus EPS estimate suggests the PER is 50.4.

Market Sentiment: -0.8
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

DOW    DOWNER EDI LIMITED

Industrial Sector Contractors & Engineers – Overnight Price: $5.09

Goldman Sachs rates ((DOW)) as Neutral (3) –

Goldman Sachs highlights risk management and project discipline were more evident in 1H results for Downer EDI, while an additional -$75m of cost-out raises confidence the FY25 margin target will be met.

The earnings (EBIT) margin widened by 30bps (to 2.5%) on the previous corresponding period, and management expects the FY24 margin will be an improvement on the 2.6% achieved in FY23.

The 1H performance of Utilities exceeded the broker's forecast, and management is targeting further 2H improvement as low-margin contracts run-off.

The target rises to $4.80 from $4.20 partly due to the broker's higher earnings forecast, a valuation roll-forward and a lower assumed discount as Goldman's confidence in the turnaround grows.

This report was published on February 16, 2024.

Target price is $4.80 Current Price is $5.09 Difference: minus $0.29 (current price is over target).
If DOW meets the Goldman Sachs target it will return approximately minus 6% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $5.13, suggesting upside of 0.9%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 18.00 cents and EPS of 26.00 cents.
At the last closing share price the estimated dividend yield is 3.54%.
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 27.0, implying annual growth of N/A.
Current consensus DPS estimate is 15.5, implying a prospective dividend yield of 3.0%.
Current consensus EPS estimate suggests the PER is 18.9.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 24.00 cents and EPS of 36.00 cents.
At the last closing share price the estimated dividend yield is 4.72%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.14.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 37.2, implying annual growth of 37.8%.
Current consensus DPS estimate is 21.7, implying a prospective dividend yield of 4.3%.
Current consensus EPS estimate suggests the PER is 13.7.

Market Sentiment: 0.2
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

DTL    DATA#3 LIMITED.

IT & Support – Overnight Price: $7.60

Goldman Sachs rates ((DTL)) as Neutral (3) –

While Data#3 reported a strong 1H revenue result, largely driven by interest income, Goldman Sachs notes underlying earnings (EBITDA) were softer-than-expected.

The broker highlights demand for networking equipment has softened as customers digest the unwind of supply chain constraints in the wake of covid. This headwind is not anticipated to be lasting, given long-term structural tailwinds for spending on the cloud.

Outside of Networking, management commentary was generally positive, in the analyst's opinion, regarding both a recovery for End-User-Computer demand, along with ongoing strength for Software and Services.

The target falls by -2% to $8.10. Neutral.

This report was published on February 16, 2024.

Target price is $8.10 Current Price is $7.60 Difference: $0.5
If DTL meets the Goldman Sachs target it will return approximately 7% (excluding dividends, fees and charges).
Current consensus price target is $8.03, suggesting upside of 5.7%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 25.50 cents and EPS of 27.80 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 27.34.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 28.0, implying annual growth of 16.9%.
Current consensus DPS estimate is 24.6, implying a prospective dividend yield of 3.2%.
Current consensus EPS estimate suggests the PER is 27.1.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 28.40 cents and EPS of 30.90 cents.
At the last closing share price the estimated dividend yield is 3.74%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 24.60.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 31.3, implying annual growth of 11.8%.
Current consensus DPS estimate is 27.1, implying a prospective dividend yield of 3.6%.
Current consensus EPS estimate suggests the PER is 24.3.

Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

IDX    INTEGRAL DIAGNOSTICS LIMITED

Medical Equipment & Devices – Overnight Price: $2.22

Canaccord Genuity rates ((IDX)) as Buy (1) –

Integral Diagnostics' December-half revenue met Canaccord Genuity's forecasts and the company's November guidance update while net profit after tax edged out consensus' and the broker's forecasts.

Overall, the broker views it as in line but underwhelming.

The broker observes the company is cycling off more challenging geographic comps compared to peers and high wages persisted, eroding earnings (EBITDA) margins.

The balance sheet is tight but improving and a represents a further drag on earnings given high interest rates observes the broker.

Hold rating retained on valuation, the broker spying better value elsewhere. Target price is steady at $2.10.

This report was published on February 20, 2024.

Target price is $2.10 Current Price is $2.22 Difference: minus $0.12 (current price is over target).
If IDX meets the Canaccord Genuity target it will return approximately minus 5% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $2.26, suggesting upside of 1.9%(ex-dividends)

Forecast for FY24:

Current consensus EPS estimate is 7.8, implying annual growth of -27.5%.
Current consensus DPS estimate is 6.2, implying a prospective dividend yield of 2.8%.
Current consensus EPS estimate suggests the PER is 28.5.

Forecast for FY25:

Current consensus EPS estimate is 11.0, implying annual growth of 41.0%.
Current consensus DPS estimate is 8.1, implying a prospective dividend yield of 3.6%.
Current consensus EPS estimate suggests the PER is 20.2.

Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

IMD    IMDEX LIMITED

Mining Sector Contracting – Overnight Price: $1.97

Canaccord Genuity rates ((IMD)) as Buy (1) –

Canaccord Genuity has described first half results from Imdex as 'impressive'. The company reported earnings of $71.0m, up 14% year-on-year. The recent Devico acquisition supported metrics from the Americas, delivering 18% year-on-year revenue growth.

Given company commentary for steady activity over the second half and average revenue per unit gains, the broker anticipates second half revenue growth. Canaccord Genuity anticipates the heightened gross margins that appeared towards the end of the first half will carry into the new period.

The Buy rating is retained and the target price increases to $2.25 from $2.10.

This report was published on February 20, 2024.

Target price is $2.25 Current Price is $1.97 Difference: $0.285
If IMD meets the Canaccord Genuity target it will return approximately 15% (excluding dividends, fees and charges).
Current consensus price target is $2.18, suggesting upside of 10.7%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY24:

Canaccord Genuity forecasts a full year FY24 dividend of 3.60 cents and EPS of 11.10 cents.
At the last closing share price the estimated dividend yield is 1.83%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.70.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 11.2, implying annual growth of 40.9%.
Current consensus DPS estimate is 3.3, implying a prospective dividend yield of 1.7%.
Current consensus EPS estimate suggests the PER is 17.5.

Forecast for FY25:

Canaccord Genuity forecasts a full year FY25 dividend of 4.40 cents and EPS of 12.80 cents.
At the last closing share price the estimated dividend yield is 2.24%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.35.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 12.7, implying annual growth of 13.4%.
Current consensus DPS estimate is 3.9, implying a prospective dividend yield of 2.0%.
Current consensus EPS estimate suggests the PER is 15.5.

Market Sentiment: 0.8
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

IPL    INCITEC PIVOT LIMITED

Agriculture – Overnight Price: $2.65

Goldman Sachs rates ((IPL)) as Buy (1) –

In the wake of Cyclone Kirrily, and its impact on supply chains for Phosphate Hill, explains Goldman Sachs, Incitec Pivot lowers its FY24 production guidance to between 730-770kt from 780-820kt.

As part of the trading update, management noted the company's overall financial performance remained broadly in line with prior expectations.

The broker's Buy rating and $3.25 target are maintained.

This report was published on February 16, 2024.

Target price is $3.25 Current Price is $2.65 Difference: $0.6
If IPL meets the Goldman Sachs target it will return approximately 23% (excluding dividends, fees and charges).
Current consensus price target is $3.08, suggesting upside of 16.4%(ex-dividends)
The company's fiscal year ends in September.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 10.00 cents and EPS of 19.00 cents.
At the last closing share price the estimated dividend yield is 3.77%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.95.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 21.3, implying annual growth of -26.1%.
Current consensus DPS estimate is 18.8, implying a prospective dividend yield of 7.1%.
Current consensus EPS estimate suggests the PER is 12.4.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 11.00 cents and EPS of 22.00 cents.
At the last closing share price the estimated dividend yield is 4.15%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.05.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 19.2, implying annual growth of -9.9%.
Current consensus DPS estimate is 12.5, implying a prospective dividend yield of 4.7%.
Current consensus EPS estimate suggests the PER is 13.8.

Market Sentiment: 0.3
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 – Overnight Price: $8.70

Goldman Sachs rates ((MFG)) as Neutral (3) –

Magellan Financial's adjusted profit for the 1H (ex the impact of realised gains) was in line with Goldman Sachs forecast, while statutory profit was a material beat.

The broker notes funds management operating expenses are tracking in line with FY24 guidance of between $97.5-$102.5m.

The 29.4cps interim dividend was broadly in line with the analysts' forecast.

Following minor changes to earnings estimates, Goldman's target rises to $8.75 from $8.55, and the Neutral rating for Magellan Financial is maintained.

This report was published on February 21, 2024.

Target price is $8.75 Current Price is $8.70 Difference: $0.05
If MFG meets the Goldman Sachs target it will return approximately 1% (excluding dividends, fees and charges).
Current consensus price target is $8.91, suggesting upside of 2.4%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 99.00 cents and EPS of 88.00 cents.
At the last closing share price the estimated dividend yield is 11.38%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.89.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 89.5, implying annual growth of -10.5%.
Current consensus DPS estimate is 59.6, implying a prospective dividend yield of 6.9%.
Current consensus EPS estimate suggests the PER is 9.7.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 55.00 cents and EPS of 64.00 cents.
At the last closing share price the estimated dividend yield is 6.32%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.59.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 68.4, implying annual growth of -23.6%.
Current consensus DPS estimate is 56.9, implying a prospective dividend yield of 6.5%.
Current consensus EPS estimate suggests the PER is 12.7.

Market Sentiment: -0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

MGH    MAAS GROUP HOLDINGS LIMITED

Building Products & Services – Overnight Price: $4.19

Goldman Sachs rates ((MGH)) as Neutral (3) –

Goldman Sachs assesses a strong 1H result for Maas Group, with earnings (EBITDA) an 8% beat against the consensus forecast.

Construction Materials segment earnings eclipsed the broker's estimate by 27% as organic earnings rose by 23% on the previous corresponding period, driven by both price and volume.

The analyst also highlights a turnaround for the Civil Construction & Hire segment after a weather-challenged 1H of FY23. Residential real estate remains challenged, notes Goldman, with management continuing to expect flat settlements in FY24 versus FY23.

FY24 underlying earnings guidance of between $190-210m was reiterated.

The target rises to $3.10 from $2.90. Neutral.

This report was published on February 16, 2024.

Target price is $3.10 Current Price is $4.19 Difference: minus $1.09 (current price is over target).
If MGH meets the Goldman Sachs target it will return approximately minus 26% (excluding dividends, fees and charges – negative figures indicate an expected loss).
The company's fiscal year ends in June.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 EPS of 25.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.76.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 EPS of 29.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.45.

Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

OML    OOH!MEDIA LIMITED

Out of Home Advertising – Overnight Price: $1.81

Canaccord Genuity rates ((OML)) as Buy (1) –

oOh!media's FY23 full-year result sharply outpaced consensus and Canaccord Genuity's forecasts, the company posting a strong beat in gross margins despite rising operating expenditure.

Management expects to hold these margins in 2024 (and market share) despite the abatement of covid period abatements. The company posted 97% cash conversion.

The broker observes an acceleration in momentum in the first few weeks of 2024 (the first quarter being traditionally slow), which it believes augurs well for the year, expecting a further ramp-up in the first quarter and second-half of the year. Add the rollout of Woollahra and Sydney Metro assets, and the revenue outlook appears strong, opines the broker.

EPS forecasts rise 1% in FY24 and 3% in FY25. DPS forecasts rise 20%.

Buy rating retained. Target price rises to $2 from $1.90.

This report was published on February 20, 2024.

Target price is $2.00 Current Price is $1.81 Difference: $0.185
If OML meets the Canaccord Genuity target it will return approximately 10% (excluding dividends, fees and charges).
Current consensus price target is $1.84, suggesting upside of 1.2%(ex-dividends)
The company's fiscal year ends in December.

Forecast for FY24:

Canaccord Genuity forecasts a full year FY24 dividend of 6.00 cents and EPS of 12.00 cents.
At the last closing share price the estimated dividend yield is 3.31%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.13.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 9.8, implying annual growth of 55.6%.
Current consensus DPS estimate is 5.4, implying a prospective dividend yield of 3.0%.
Current consensus EPS estimate suggests the PER is 18.5.

Forecast for FY25:

Canaccord Genuity forecasts a full year FY25 dividend of 6.00 cents and EPS of 13.00 cents.
At the last closing share price the estimated dividend yield is 3.31%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.96.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 13.0, implying annual growth of 32.7%.
Current consensus DPS estimate is 6.4, implying a prospective dividend yield of 3.5%.
Current consensus EPS estimate suggests the PER is 14.0.

Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

ORG    ORIGIN ENERGY LIMITED

Infrastructure & Utilities – Overnight Price: $8.86

Jarden rates ((ORG)) as Overweight (2) –

After a period of research restriction on Origin Energy during the attempted takeover by Brookfield Asset Management and EIG, Jarden resumes with a $9.20 target and Overweight rating.

Results for H1 revealed an underlying profit beat of 17% against the consensus forecast, notes the broker. This outcome was driven by higher-than-expected gas gross profit, along with an electricity gross profit of $950m compared to the consensus estimate for $655m.

Jarden notes APLNG has continued to perform strongly, with production rates exceeding the company's expectations.

The 27.5cps interim dividend was 36% above the consensus estimate.

The analysts anticipate an improving outlook driven by potential for higher energy market earnings.

This report was published on February 16, 2024.

Target price is $9.20 Current Price is $8.86 Difference: $0.34
If ORG meets the Jarden target it will return approximately 4% (excluding dividends, fees and charges).
Current consensus price target is $9.08, suggesting upside of 2.5%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 44.50 cents and EPS of 65.00 cents.
At the last closing share price the estimated dividend yield is 5.02%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.63.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 75.2, implying annual growth of 22.6%.
Current consensus DPS estimate is 52.8, implying a prospective dividend yield of 6.0%.
Current consensus EPS estimate suggests the PER is 11.8.

Forecast for FY25:

Jarden forecasts a full year FY25 dividend of 41.50 cents and EPS of 78.80 cents.
At the last closing share price the estimated dividend yield is 4.68%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.24.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 81.6, implying annual growth of 8.5%.
Current consensus DPS estimate is 58.0, implying a prospective dividend yield of 6.5%.
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

ORI    ORICA LIMITED

Mining Sector Contracting – Overnight Price: $16.85

Goldman Sachs rates ((ORI)) as Buy (1) –

Providing further balance sheet flexibility, highlights Goldman Sachs, Orica has announced the sale of 66ha of surplus land at Deer Park to UniSuper for $260m.

In an important operational update, suggest the analysts, management noted the ammonia plant turnaround (a six-yearly event) is on track. The first stage was completed as planned and the plant resumed operations last November.

The Buy rating and $19.90 target are maintained.

This report was published on February 16, 2024.

Target price is $19.90 Current Price is $16.85 Difference: $3.05
If ORI meets the Goldman Sachs target it will return approximately 18% (excluding dividends, fees and charges).
Current consensus price target is $18.05, suggesting upside of 7.1%(ex-dividends)
The company's fiscal year ends in September.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 47.00 cents and EPS of 94.00 cents.
At the last closing share price the estimated dividend yield is 2.79%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.93.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 94.5, implying annual growth of 45.1%.
Current consensus DPS estimate is 50.6, implying a prospective dividend yield of 3.0%.
Current consensus EPS estimate suggests the PER is 17.8.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 55.00 cents and EPS of 110.00 cents.
At the last closing share price the estimated dividend yield is 3.26%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.32.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 110.2, implying annual growth of 16.6%.
Current consensus DPS estimate is 58.7, implying a prospective dividend yield of 3.5%.
Current consensus EPS estimate suggests the PER is 15.3.

Market Sentiment: 0.7
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

RUL    RPMGLOBAL HOLDINGS LIMITED

Mining Sector Contracting – Overnight Price: $1.95

Moelis rates ((RUL)) as Buy (1) –

RPMGlobal has reported continued strong annual recurring revenue growth in the first half, and has already flagged an expected strong cashflow skew to the second half.

Annual recurring revenue grew $58m over the half, with the Australia Pacific and EMEA regions continuing to grow strongly. Full year guidance was reaffirmed, also confirming a stronger second half earnings margin performance.

The Buy rating is retained and the target price increases to $2.15 from $2.04.

This report was published on February 18, 2024.

Target price is $2.15 Current Price is $1.95 Difference: $0.205
If RUL meets the Moelis target it will return approximately 11% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY24:

Moelis forecasts a full year FY24 dividend of 0.00 cents and EPS of 5.80 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 33.53.

Forecast for FY25:

Moelis forecasts a full year FY25 dividend of 0.00 cents and EPS of 5.80 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 33.53.

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

TLS    TELSTRA GROUP LIMITED

Telecommunication – Overnight Price: $3.89

Goldman Sachs rates ((TLS)) as Buy (1) –

An in-line first half result from Telstra Group, says Goldman Sachs, with earnings, net profit and dividends per share all within 1% of the broker's forecasts. Full year guidance was narrowed to the lower end of range.

The depth of weakness from the company's network applications and services business was a key negative for the broker, although attributed to cyclical weakness. The company is reviewing products, and the broker expects cost savings to be identifed by end of financial year.

The Buy rating is retained and the target price decreases to $4.55.

This report was published on February 16, 2024.

Target price is $4.55 Current Price is $3.89 Difference: $0.66
If TLS meets the Goldman Sachs target it will return approximately 17% (excluding dividends, fees and charges).
Current consensus price target is $4.38, suggesting upside of 12.7%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 18.00 cents and EPS of 17.00 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 22.88.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 18.3, implying annual growth of 9.6%.
Current consensus DPS estimate is 18.0, implying a prospective dividend yield of 4.6%.
Current consensus EPS estimate suggests the PER is 21.3.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 19.00 cents and EPS of 19.00 cents.
At the last closing share price the estimated dividend yield is 4.88%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 20.47.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 19.8, implying annual growth of 8.2%.
Current consensus DPS estimate is 18.8, implying a prospective dividend yield of 4.8%.
Current consensus EPS estimate suggests the PER is 19.6.

Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

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Jarden rates ((TLS)) as Buy (1) –

A highlight for Jarden from Telstra Group's 1H results was 6% growth in mobile service revenue, which drove 13% growth in total Mobile earnings (EBITDA), 7% ahead of the broker's forecast.

Underlying earnings for the group in the 1H  grew by 3.1% to $4,016m, falling -0.9% short of the consensus forecast.

The broker's upgrades to earnings forecasts for Mobile are offset by a weaker-than-expected performance by the network applications and services (NAS) business.

NAS earnings fell by -85% year-on-year due to high-margin calling declines, professional services weakness, cost overhangs and lower resale and equipment margins, explains the analyst.

A 9cps interim dividend was declared.

The broker's Buy rating and $4.40 target are maintained.

This report was published on February 16, 2024.

Target price is $4.40 Current Price is $3.89 Difference: $0.51
If TLS meets the Jarden target it will return approximately 13% (excluding dividends, fees and charges).
Current consensus price target is $4.38, suggesting upside of 12.7%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 18.00 cents and EPS of 17.00 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 22.88.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 18.3, implying annual growth of 9.6%.
Current consensus DPS estimate is 18.0, implying a prospective dividend yield of 4.6%.
Current consensus EPS estimate suggests the PER is 21.3.

Forecast for FY25:

Jarden forecasts a full year FY25 dividend of 20.00 cents and EPS of 19.40 cents.
At the last closing share price the estimated dividend yield is 5.14%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 20.05.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 19.8, implying annual growth of 8.2%.
Current consensus DPS estimate is 18.8, implying a prospective dividend yield of 4.8%.
Current consensus EPS estimate suggests the PER is 19.6.

Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

TWE    TREASURY WINE ESTATES LIMITED

Food, Beverages & Tobacco – Overnight Price: $11.78

Goldman Sachs rates ((TWE)) as Buy (1) –

First half results from Treasury Wine Estates were largely in line with expectations from Goldman Sachs, as management continues to guide to full year earnings growth in the mid to high-single digit range. 

While the broker's forecast of earnings of $644m represents the lower end of guidance, it still implies high second half growth expectations, including 16% year-on-year sales growth and 17% year-on-year earnings growth. 

With an expedited review of tarriffs on Australian wine imports continuing, the company is ready to pursue several key initiatives if tariffs are removed. A determination is anticipated in March.

The Buy rating is retained and the target price increases to $12.60 from $12.40.

This report was published on February 16, 2024.

Target price is $12.60 Current Price is $11.78 Difference: $0.82
If TWE meets the Goldman Sachs target it will return approximately 7% (excluding dividends, fees and charges).
Current consensus price target is $13.10, suggesting upside of 11.2%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 34.00 cents and EPS of 51.00 cents.
At the last closing share price the estimated dividend yield is 2.89%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 23.10.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 52.4, implying annual growth of 50.1%.
Current consensus DPS estimate is 35.3, implying a prospective dividend yield of 3.0%.
Current consensus EPS estimate suggests the PER is 22.5.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 42.00 cents and EPS of 59.00 cents.
At the last closing share price the estimated dividend yield is 3.57%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 19.97.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 63.0, implying annual growth of 20.2%.
Current consensus DPS estimate is 42.7, implying a prospective dividend yield of 3.6%.
Current consensus EPS estimate suggests the PER is 18.7.

Market Sentiment: 0.7
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

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