In Case You Missed It – BC Extra Upgrades & Downgrades – 01-03-24

This story features BRAVURA SOLUTIONS LIMITED, and other companies. For more info SHARE ANALYSIS: BVS

Broker Rating Changes (Post Thursday Last Week)

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BRAVURA SOLUTIONS LIMITED ((BVS)) Upgrade to Overweight from Market Weight by Wilsons.B/H/S: 0/0/0

New leadership at Bravura Solutions has delivered a more upbeat result for the 1H24 according to Wilsons.

Revenue growth beat the broker's forecast by 3% with a 7% rise. Wealth Management and Funds Administration achieved 8% and 5% revenue growth respectively.

Some $40m of cost out savings in FY24 are expected, as the business is "re-set", including a -20% decline in the employee count.

Management reconfirmed FY24 revenue guidance of circa $249m, in line with FY23 and Wilsons increases EPS forecasts for FY24 and FY25.

The stock is upgraded to Overweight from Market Weight with an accompanying lift in the target price to $1.51 from $0.69.

CAR GROUP LIMITED ((CAR)) Upgrade to Buy from Neutral by Goldman Sachs.B/H/S: 0/0/0

After reviewing 1H results for the classifieds market segment on the ASX, Goldman Sachs notes management at CAR Group and REA Group are accelerating growth investment.

The broker points out these two companies have the strongest 2024 revenue outlook, by contrast to Domain Holdings Australia and Seek where opex guidance is unchanged and lowered, respectively.

CAR Group grew market share in the 1H and the analysts are increasingly confident in earnings momentum both domestically and globally.

Goldmans rating is upgraded to Buy from Neutral and the target increased by 19% to $39.40.

RELIANCE WORLDWIDE CORP. LIMITED ((RWC)) Upgrade to Overweight from Neutral by Jarden.B/H/S: 0/0/0

A better than expected first half result from Reliance Worldwide, with adjusted earnings a 3% beat to market forecasts.

Guidance was broadly retained, but Jarden points out risk balance has shifted from downside in European operations to upside in US operations. Some risk remains in Europe, but the broker found the manufacturing shift and improved cash flows encouraging.

The company also improved its leverage to both the US and Australian markets, successfully transferring its manufacturing footprint to the US. The broker considers Reliance Worldwide better placed to handle near-term uncertainty.

The rating is upgraded to Overweight from Neutral and the target price increases to $5.30 from $4.10.

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ARN MEDIA LIMITED ((A1N)) Downgrade to Market Weight from Overweight by Wilsons.B/H/S: 0/0/0

The 2023 results from ARN Media continue to highlight a tough advertising market, Wilsons asserts, with the attempted takeover of Southern Cross Media ((SXL)) remaining the focus over the next few months.

Audio revenue was in line with the broker's estimates and group EBIT slightly weaker. Estimates for 2024 are downgraded slightly because of revenue timing while small upgrades are made to FY25-26 forecasts.

Wilsons downgrades to Market Weight from Overweight and lowers the target to $0.92 from $1.24.

CORPORATE TRAVEL MANAGEMENT LIMITED ((CTD)) Downgrade to Market Weight from Overweight by Wilsons.B/H/S: 0/0/0

Corporate Travel Management's H1 performance missed Wilsons' forecasts by a mile, or two, with the UK Bridging Contract but one reason why.

Conditions overall seem to have improved in H2, but management still revised FY24 guidance downwards, by a few miles.

The company also disclosed more details about its 5-year plan, which the broker welcomes. The objective is to double EBITDA between FY24 to FY29.

Wilsons believes the heavy disappointment this season now means time is needed to rebuild investors' confidence. The broker downgrades its rating to Market Weight from Overweight, also inspired by the share price, and reduces its price target to $15.25 (was $21.31).

NATIONAL STORAGE REIT ((NSR)) Downgrade to Hold from Buy by Moelis.B/H/S: 0/0/0

National Storage REIT's interim earnings met Moelis' expectations, rising 6% over the previous corresponding period.

There was a slight reduction in occupancy, down -0.7% over the 6-month period to 84.1%, notes the analyst, as well as an additional 13 sites have been added, totaling $124m.

Management reconfirmed FY24 guidance of 11.3cps and there are no major changes to the broker's forecasts.

The rating is downgraded to Hold from Buy and the target price is lowered to $2.38 from $2.41.

PROPEL FUNERAL PARTNERS LIMITED ((PFP)) Downgrade to Hold from Buy by Moelis.B/H/S: 0/0/0

Propel Funeral Partners reported strong 1H24 results including 17.4% growth in total funeral volumes, highlights Moelis.

Management confirmed FY24 revenue and EBITDA guidance and the broker is expecting 2% growth in organic death volumes, compared to a -9.8% contraction in the 1H24 and then returning to 2% annual growth from FY25 onwards.

The target price is raised to $5.64 from $5.40 and the rating downgraded to Hold from Buy due to valuation.

Order	Company	New Rating	Old Rating	Broker
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1	BRAVURA SOLUTIONS LIMITED	Buy	Neutral	Wilsons
2	CAR GROUP LIMITED	Buy	Neutral	Goldman Sachs
3	RELIANCE WORLDWIDE CORP. LIMITED	Buy	Neutral	Jarden
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4	ARN MEDIA LIMITED	Neutral	Buy	Wilsons
5	CORPORATE TRAVEL MANAGEMENT LIMITED	Neutral	Buy	Wilsons
6	NATIONAL STORAGE REIT	Neutral	Buy	Moelis
7	PROPEL FUNERAL PARTNERS LIMITED	Neutral	Buy	Moelis

Price Target Changes (Post Thursday Last Week)

Company		Last Price	Broker	New Target	Old Target	Change
A1N	ARN Media	$0.85	Wilsons	0.92	1.24	-25.81%
ALD	Ampol	$39.40	Goldman Sachs	36.80	37.10	-0.81%
ARB	ARB Corp	$41.44	Wilsons	45.69	35.30	29.43%
ASG	Autosports Group	$2.33	Wilsons	3.85	3.78	1.85%
AUB	AUB Group	$30.22	Goldman Sachs	32.50	32.00	1.56%
			Jarden	32.95	32.50	1.38%
BBN	Baby Bunting	$1.58	Wilsons	2.00	2.10	-4.76%
BEN	Bendigo & Adelaide Bank	$9.68	Goldman Sachs	9.74	9.57	1.78%
			Jarden	9.40	9.50	-1.05%
BLD	Boral	$5.99	Jarden	5.80	5.35	8.41%
BSL	BlueScope Steel	$22.84	Goldman Sachs	25.50	26.40	-3.41%
			Jarden	24.60	26.40	-6.82%
BVS	Bravura Solutions	$1.24	Wilsons	1.51	0.69	118.84%
CAR	CAR Group	$36.76	Goldman Sachs	39.40	33.00	19.39%
CDA	Codan	$10.23	Canaccord Genuity	10.83	6.18	75.24%
			Moelis	10.22	8.52	19.95%
CNI	Centuria Capital	$1.62	Jarden	1.80	1.60	12.50%
CRN	Coronado Global Resources	$1.36	Goldman Sachs	2.08	1.85	12.43%
CTD	Corporate Travel Management	$15.86	Wilsons	15.25	21.31	-28.44%
EHL	Emeco Holdings	$0.67	Canaccord Genuity	0.99	0.97	2.06%
			Jarden	0.95	1.10	-13.64%
EVS	EnviroSuite	$0.06	Moelis	0.10	0.12	-16.67%
			Wilsons	0.11	0.13	-15.38%
FCL	Fineos Corp	$1.66	Moelis	2.21	2.57	-14.01%
GDI	GDI Property	$0.61	Moelis	1.00	1.09	-8.26%
GPT	GPT Group	$4.35	Jarden	4.70	4.40	6.82%
GQG	GQG Partners	$2.19	Goldman Sachs	2.40	N/A	–
HMC	HMC Capital	$7.01	Jarden	7.00	6.00	16.67%
HUB	Hub24	$39.04	Moelis	41.99	38.93	7.86%
			Wilsons	42.63	40.00	6.58%
IDX	Integral Diagnostics	$2.21	Wilsons	2.12	2.00	6.00%
IGO	IGO	$7.94	Jarden	9.65	9.61	0.42%
ILU	Iluka Resources	$6.85	Canaccord Genuity	7.50	7.00	7.14%
IMD	Imdex	$2.12	Jarden	2.00	2.05	-2.44%
INA	Ingenia Communities	$4.84	Goldman Sachs	4.40	4.30	2.33%
			Jarden	5.45	4.70	15.96%
			Moelis	4.93	4.18	17.94%
IPH	IPH	$6.33	Petra Capital	10.50	10.70	-1.87%
IRE	Iress	$7.85	Wilsons	8.00	8.16	-1.96%
JDO	Judo Capital	$1.25	Goldman Sachs	1.69	1.63	3.68%
KMD	KMD Brands	$0.49	Canaccord Genuity	0.57	0.68	-16.18%
MAH	Macmahon	$0.19	Canaccord Genuity	0.28	0.25	12.00%
			Jarden	0.26	0.24	8.33%
MGH	Maas Group	$4.82	Wilsons	4.67	4.44	5.18%
MMS	McMillan Shakespeare	$21.90	Canaccord Genuity	21.80	19.60	11.22%
MP1	Megaport	$14.47	Goldman Sachs	14.85	12.90	15.12%
NDO	Nido Education	$0.96	Moelis	1.36	1.40	-2.86%
			Wilsons	1.45	1.41	2.84%
NHC	New Hope	$4.70	Goldman Sachs	3.50	3.60	-2.78%
NSR	National Storage REIT	$2.26	Moelis	2.38	2.41	-1.24%
NWL	Netwealth Group	$19.15	Jarden	15.55	15.00	3.67%
			Wilsons	20.50	18.40	11.41%
OML	oOh!media	$1.85	Goldman Sachs	1.62	1.59	1.89%
ORA	Orora	$2.68	Jarden	3.20	3.30	-3.03%
PFP	Propel Funeral Partners	$5.81	Moelis	5.64	5.40	4.44%
PRN	Perenti	$0.91	Canaccord Genuity	1.25	1.20	4.17%
			Moelis	1.25	1.35	-7.41%
PWR	Peter Warren Automotive	$2.22	Moelis	2.60	2.76	-5.80%
QBE	QBE Insurance	$17.29	Goldman Sachs	18.65	18.52	0.70%
QIP	Qantm Intellectual Property	$1.33	Petra Capital	1.76	1.57	12.10%
REA	REA Group	$194.11	Goldman Sachs	201.00	204.00	-1.47%
RED	Red 5	$0.33	Petra Capital	0.42	0.40	5.00%
RWC	Reliance Worldwide	$5.48	Goldman Sachs	5.00	4.70	6.38%
			Jarden	5.30	4.10	29.27%
SGF	SG Fleet	$2.83	Canaccord Genuity	3.58	3.43	4.37%
SGM	Sims	$12.24	Goldman Sachs	14.00	16.20	-13.58%
SHL	Sonic Healthcare	$29.85	Jarden	28.88	31.20	-7.44%
SHM	Shriro	$0.80	Petra Capital	0.90	1.44	-37.50%
SIQ	Smartgroup Corp	$10.97	Canaccord Genuity	10.65	10.20	4.41%
STX	Strike Energy	$0.22	Wilsons	0.34	0.53	-35.85%
THL	Tourism Holdings Rentals	$3.24	Wilsons	4.05	5.06	-19.96%
WBC	Westpac	$26.35	Goldman Sachs	23.46	22.85	2.67%
			Jarden	23.50	23.00	2.17%
WDS	Woodside Energy	$30.36	Goldman Sachs	32.40	N/A	–
Company		Last Price	Broker	New Target	Old Target	Change

More Highlights

EHL    EMECO HOLDINGS LIMITED

Mining Sector Contracting – Overnight Price: $0.64

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

Emeco Holdings posted a first half result that was in line with expectations. Canaccord Genuity now expects EBITDA growth in FY24 of 12% while expenditure on growth will decline in FY25.

Specific guidance was not provided yet management noted it is comfortable with the consensus view for EBITDA of $280m.

The broker expects rental earnings will improve in the second half given the production outlook for bulks and gold. Buy rating unchanged. Target edges up to $0.99 from $0.97.

This report was published on February 21, 2024.

Target price is $0.99 Current Price is $0.64 Difference: $0.35
If EHL meets the Canaccord Genuity target it will return approximately 55% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY24:

Canaccord Genuity forecasts a full year FY24 dividend of 1.80 cents and EPS of 13.40 cents.
At the last closing share price the estimated dividend yield is 2.81%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 4.78.

Forecast for FY25:

Canaccord Genuity forecasts a full year FY25 dividend of 4.40 cents and EPS of 14.60 cents.
At the last closing share price the estimated dividend yield is 6.88%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 4.38.

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

IPH    IPH LIMITED

Legal – Overnight Price: $6.33

Petra Capital rates ((IPH)) as Buy (1) –

Petra Capital assesses that IPH reported a slight miss on the 1H24 EBITDA results due to a softer Asian performance.

Canada performed well and there is an ongoing turnaround in the A&NZ operations.

Adjusting for the update, the broker lowered EPS forecasts by -3.2% for FY24 and -1.4% for FY25 due to slightly reduced growth estimates from Asia.

A Buy rating is retained and the target is lowered to $10.50 from $10.80.

This report was published on February 23, 2024.

Target price is $10.50 Current Price is $6.33 Difference: $4.17
If IPH meets the Petra Capital target it will return approximately 66% (excluding dividends, fees and charges).
Current consensus price target is $8.91, suggesting upside of 40.8%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY24:

Petra Capital forecasts a full year FY24 dividend of 34.00 cents and EPS of 43.60 cents.
At the last closing share price the estimated dividend yield is 5.37%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.52.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 45.4, implying annual growth of 58.6%.
Current consensus DPS estimate is 34.8, implying a prospective dividend yield of 5.5%.
Current consensus EPS estimate suggests the PER is 13.9.

Forecast for FY25:

Petra Capital forecasts a full year FY25 dividend of 36.50 cents and EPS of 48.20 cents.
At the last closing share price the estimated dividend yield is 5.77%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.13.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 48.9, implying annual growth of 7.7%.
Current consensus DPS estimate is 37.2, implying a prospective dividend yield of 5.9%.
Current consensus EPS estimate suggests the PER is 12.9.

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

NDO    NIDO EDUCATION LIMITED

Childcare – Overnight Price: $0.98

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

Nido Education's maiden results release as a listed company have slightly exceeded prospectus guidance at the earnings line, but Canaccord Genuity notes all focus is on the year ahead. Pre-AASB earnings came in at $0.3m, and average occupancy 75.4%.

With 24 of the company's 52 centres acquired alongside its public listing in October, Canaccord Genuity points out these result are not the most meaningful, given limited contribution.

The company provided no guidance for the coming year, but confirmed it is progressing in line with prospectus target of earnings of $28m. Canaccord Genuity sits 2% higher.

The Buy rating and target price of $1.30 are retained.

This report was published on February 21, 2024.

Target price is $1.30 Current Price is $0.98 Difference: $0.315
If NDO meets the Canaccord Genuity target it will return approximately 32% (excluding dividends, fees and charges).
The company's fiscal year ends in December.

Forecast for FY24:

Canaccord Genuity forecasts a full year FY24 dividend of 3.20 cents and EPS of 6.70 cents.
At the last closing share price the estimated dividend yield is 3.25%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.70.

Forecast for FY25:

Canaccord Genuity forecasts a full year FY25 dividend of 3.40 cents and EPS of 7.10 cents.
At the last closing share price the estimated dividend yield is 3.45%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.87.

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

ORA    ORORA LIMITED

Paper & Packaging – Overnight Price: $2.65

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

Orora's 1H earnings (EBIT) were in line with forecasts by Goldman Sachs and consensus, despite lower-than-expected revenues, which imply strong margin outcomes. Profit missed the broker's estimate on higher interest and tax expenses than anticipated.

North American earnings beat the broker's forecast by 2%, with a strong margin of around 5%, while Australian earnings missed the consensus estimate by -1%, with volume growth for Cans offsetting softness for Glass.

Management reiterated guidance for FY24 earnings (excluding the Saverglass contribution) to exceed FY23's earnings. Guidance was also confirmed for ongoing margin accretion due to account profitability and a focus on costs.

The Buy rating and and $3.50 target are maintained.

This report was published on February 20, 2024.

Target price is $3.50 Current Price is $2.65 Difference: $0.85
If ORA meets the Goldman Sachs target it will return approximately 32% (excluding dividends, fees and charges).
Current consensus price target is $3.03, suggesting upside of 14.2%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 14.00 cents and EPS of 20.00 cents.
At the last closing share price the estimated dividend yield is 5.28%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.25.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 17.7, implying annual growth of -13.6%.
Current consensus DPS estimate is 11.9, implying a prospective dividend yield of 4.5%.
Current consensus EPS estimate suggests the PER is 15.0.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 15.00 cents and EPS of 21.00 cents.
At the last closing share price the estimated dividend yield is 5.66%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.62.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 20.5, implying annual growth of 15.8%.
Current consensus DPS estimate is 14.0, implying a prospective dividend yield of 5.3%.
Current consensus EPS estimate suggests the PER is 12.9.

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

QIP    QANTM INTELLECTUAL PROPERTY LIMITED

Legal – Overnight Price: $1.15

Petra Capital rates ((QIP)) as Buy (1) –

Qantm Intellectual Property's pre-guided December-half result appears to have pleased Petra Capital, revenue and earnings all rising strongly on the previous corresponding period, thanks to "respectable" performances across divisions.

The broker observes strong operating cash generation and low capital expenditure drove an increase in the company's dividend to 4.9c from 2.8c the previous year (an 80% payout ratio). The broker forecasts an FY24 dividend yield of 6.3% and FY25 yield of 7.2%.

Net debt fell -33.4% year on year. Buy rating retained. Target price is $1.76 (it was $1.57 in December). 

This report was published on February 21, 2024.

Target price is $1.76 Current Price is $1.15 Difference: $0.61
If QIP meets the Petra Capital target it will return approximately 53% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY24:

Petra Capital forecasts a full year FY24 dividend of 6.10 cents and EPS of 12.80 cents.
At the last closing share price the estimated dividend yield is 5.30%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 8.98.

Forecast for FY25:

Petra Capital forecasts a full year FY25 dividend of 7.50 cents and EPS of 13.40 cents.
At the last closing share price the estimated dividend yield is 6.52%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 8.58.

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

RTR    RUMBLE RESOURCES LIMITED

Mining – Overnight Price: $0.07

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

Overweight rating retained as Rumble Resources announced further significant high-grade Zn-Pb sulphide mineralisation has been intersected along strike of the "exciting" new Mato Prospect discovery at Earaheedy.

Wilsons welcomes the news and highlights Earaheedy is one of the largest zinc sulphide discoveries globally in the past decade.

The broker points at the results of the DMS/Ore Sorting test work as the next key catalyst for the stock. Wilsons sees a possibility the economic potential of the resource might be significantly enlarged. Target 40c.

This report was published on February 22, 2024.

Target price is $0.40 Current Price is $0.07 Difference: $0.331
If RTR meets the Wilsons target it will return approximately 480% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY23:

Wilsons forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 0.60 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 11.50.

Forecast for FY24:

Wilsons forecasts a full year FY24 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 17.25.

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

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