Weekly Reports | May 10 2024
This story features DOMAIN HOLDINGS AUSTRALIA LIMITED, and other companies. For more info SHARE ANALYSIS: DHG
Broker Rating Changes (Post Thursday Last Week)
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DOMAIN HOLDINGS AUSTRALIA LIMITED ((DHG)) Upgrade to Buy from Overweight by Jarden.B/H/S: 0/0/0
Jarden lowers its target for Domain Holdings Australia to $3.70 from $3.75, but due to recent share price underperformance upgrades the rating to Buy from Overweight.
Among the broker's coverage of companies in the Online Classifieds category, Seek remains the top pick given the market is not currently allowing for the company's $2bn revenue aspiration in A&NZ and Asia by FY28.
The key swing factor Jarden sees for FY24 forecasts across all online classifieds stocks is 2H volumes. Domain has the highest sensitivity to volumes given its margin is lower than its peers, explains the broker.
EBOS GROUP LIMITED ((EBO)) Upgrade to Overweight from Neutral by Jarden.B/H/S: 0/0/0
Jarden is upbeat that Ebos Group should be able to re-establish its Australian presence in the PBS following the loss of the Chemist Warehouse contract from FY25 onward.
The broker considers growth will be forthcoming from the Hospital medicines segment, medical consumables, and a new 3PL contract as new facilities are constructed.
In re-casting the earnings outlook for growth in Wholesale, Medical Technoligies and Animal Care, Jarden forecasts a compound 5-year EPS growth rate of circa 7% and around 6% dividend annual growth.
Although more subdued than historically, the analyst expects other growth opportunities to emerge.
The rating is upgraded to Overweight and the target is set at NZ$38 from NZ$37.60.
LIGHT & WONDER INC ((LNW)) Upgrade to Buy from Overweight by Jarden.B/H/S: 0/0/0
The recent fall in the Light & Wonder share price is put down to macro concerns around a weaker US consumer, lower interest rate cuts, alongside a slowdown in gross gaming revenues and comments from Aristocrat Lesiure ((ALL)) on casino purchase intentions, according to Jarden.
There are no definitive signs of risks to the expected double digit earnings growth targets for FY25, while the company has grabbed market share gains in Australia from Aristocrat, alonsgide greater depth in the US games market.
There are no changes to forecasts at Jarden. The rating is upgraded to Buy from Overweight on the share price pullback and the target retained at $164.
MONASH IVF GROUP LIMITED ((MVF)) Upgrade to Overweight from Market Weight by Wilsons.B/H/S: 0/0/0
Wilsons points to a subdued March quarter for IVF which is characteristic for the time of the year, but an early Easter made the season even quieter, with Medicare data reporting an -8% fall in stimulated cycles.
The broker doesn't model quarterly results for Monash IVF, however Wilsons is expecting 7% increase from M&A over the 2H24. alongside a net 1% volume/price increase, as well as a $600,000 turnaround in Singapore EBITDA.
The rating is upgraded to Overweight, as the stock has traded sideways for 6 months, the valuation has plateaued and there is considered an intrinsic scarcity value in this particular segment of the healthcare services sector.
The target is lifted to $1.58 with potential upside to $1.80 as forecasts are cast out to FY26.
NICK SCALI LIMITED ((NCK)) Upgrade to Buy from Overweight by Jarden.B/H/S: 0/0/0
Jarden anticipates upside risk to overseas earnings for Nick Scali following the UK acquisition of Fabb Furniture and raises its target to $15.40 from $13.87. The rating is also upgraded to Buy from Overweight.
The broker expects short-term gross profit margin (GPM) synergies and material longer-term sales/store uplifts.
Potential synergies are so significant the broker believes the transaction could be EPS accretive in FY26, lending additional upside to Jarden's new forecast.
Also not incorporated into the analysts' current forecast for Nick Scali, is the broker's conservative prediction Fabb could increase its store footprint by two or three times.
| Order | Company | New Rating | Old Rating | Broker | |
|---|---|---|---|---|---|
| Upgrade | |||||
| 1 | DOMAIN HOLDINGS AUSTRALIA LIMITED | Buy | Buy | Jarden | |
| 2 | EBOS GROUP LIMITED | Buy | Neutral | Jarden | |
| 3 | LIGHT & WONDER INC | Buy | Buy | Jarden | |
| 4 | MONASH IVF GROUP LIMITED | Buy | Neutral | Wilsons | |
| 5 | NICK SCALI LIMITED | Buy | Buy | Jarden | |
Price Target Changes (Post Thursday Last Week)
| Company | Last Price | Broker | New Target | Old Target | Change | |
|---|---|---|---|---|---|---|
| AGY | Argosy Minerals | $0.13 | Petra Capital | 0.31 | 0.32 | -3.13% |
| ALK | Alkane Resources | $0.59 | Moelis | 0.95 | 1.00 | -5.00% |
| Petra Capital | 1.06 | 1.16 | -8.62% | |||
| AMC | Amcor | $15.59 | Jarden | 14.80 | 14.40 | 2.78% |
| ANG | Austin Engineering | $0.52 | Petra Capital | 0.60 | 0.52 | 15.38% |
| ANZ | ANZ Bank | $28.96 | Goldman Sachs | 27.69 | 27.85 | -0.57% |
| AQZ | Alliance Aviation Services | $3.11 | Wilsons | 4.47 | 4.35 | 2.76% |
| BLX | Beacon Lighting | $2.80 | Jarden | 2.90 | 2.70 | 7.41% |
| BRI | Big River Industries | $1.53 | Moelis | 2.00 | 2.29 | -12.66% |
| CIA | Champion Iron | $7.12 | Jarden | 7.95 | 7.76 | 2.45% |
| CKF | Collins Foods | $9.25 | Wilsons | 12.72 | 13.41 | -5.15% |
| CMM | Capricorn Metals | $4.71 | Jarden | 5.33 | 5.35 | -0.37% |
| COL | Coles Group | $16.18 | Goldman Sachs | 15.40 | 15.10 | 1.99% |
| CRD | Conrad Asia Energy | $0.85 | Wilsons | 1.97 | 2.41 | -18.26% |
| CRN | Coronado Global Resources | $1.10 | Goldman Sachs | 1.55 | 2.08 | -25.48% |
| DHG | Domain Holdings Australia | $3.09 | Jarden | 3.70 | 3.75 | -1.33% |
| HLO | Helloworld Travel | $2.48 | Jarden | 3.70 | 3.75 | -1.33% |
| IFL | Insignia Financial | $2.36 | Jarden | 2.95 | 3.00 | -1.67% |
| IGO | IGO | $8.07 | Goldman Sachs | 8.10 | 7.50 | 8.00% |
| IRE | Iress | $8.58 | Wilsons | 9.17 | 9.00 | 1.89% |
| KGN | Kogan.com | $4.70 | Jarden | 5.40 | 7.50 | -28.00% |
| MDR | MedAdvisor | $0.33 | Moelis | 0.41 | 0.38 | 7.89% |
| MIN | Mineral Resources | $77.68 | Goldman Sachs | 47.00 | 48.00 | -2.08% |
| MVF | Monash IVF | $1.51 | Wilsons | 1.58 | 1.45 | 8.97% |
| NAB | National Australia Bank | $33.68 | Goldman Sachs | 34.04 | 33.73 | 0.92% |
| NCK | Nick Scali | $14.88 | Jarden | 15.40 | 13.87 | 11.03% |
| ORG | Origin Energy | $9.95 | Jarden | 10.00 | 9.75 | 2.56% |
| PBH | PointsBet Holdings | $0.46 | Jarden | 1.15 | 1.05 | 9.52% |
| PPT | Perpetual | $22.21 | Jarden | 26.50 | 28.10 | -5.69% |
| PYC | PYC Therapeutics | $0.10 | Wilsons | 0.37 | 0.39 | -5.13% |
| QPM | Queensland Pacific Metals | $0.05 | Petra Capital | 0.11 | 0.15 | -26.67% |
| REA | REA Group | $187.55 | Jarden | 159.00 | 155.00 | 2.58% |
| RMD | ResMed | $32.61 | Jarden | 32.85 | 31.33 | 4.85% |
| RRL | Regis Resources | $2.14 | Goldman Sachs | 2.30 | 2.15 | 6.98% |
| RWC | Reliance Worldwide | $5.04 | Goldman Sachs | 5.35 | 5.00 | 7.00% |
| SDR | SiteMinder | $5.54 | Jarden | 6.02 | 5.48 | 9.85% |
| Wilsons | N/A | 5.40 | -100.00% | |||
| SFR | Sandfire Resources | $9.89 | Goldman Sachs | 8.20 | 7.20 | 13.89% |
| SFX | Sheffield Resources | $0.47 | Petra Capital | 1.11 | 1.27 | -12.60% |
| WGX | Westgold Resources | $2.22 | Canaccord Genuity | 3.25 | 2.65 | 22.64% |
| WOW | Woolworths Group | $30.73 | Goldman Sachs | 39.40 | 40.40 | -2.48% |
| XRO | Xero | $126.58 | Goldman Sachs | 156.00 | 152.00 | 2.63% |
| Company | Last Price | Broker | New Target | Old Target | Change | |
More Highlights
ANG AUSTIN ENGINEERING LIMITED
Mining Sector Contracting – Overnight Price: $0.51
Petra Capital rates ((ANG)) as Buy (1) –
Risks remain to the upside and Austin Engineering is well placed to deliver further EPS growth, suggests Petra Capital, with the AustBuy program a key upcoming catalyst.
Asia-Pacific is poised to be a significant contributor to near-term earnings, notes the broker, due to an anticipated margin recovery.
The analyst also expects further strong growth across both the North America and South America segments, reflecting stable end market demand, increased OEM order flows, and market share gains.
Buy rating is reiterated. Target rises to 60c from 52.
This report was published on May 1, 2024.
Target price is $0.60 Current Price is $0.51 Difference: $0.09
If ANG meets the Petra Capital target it will return approximately 18% (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 1.50 cents and EPS of 5.20 cents.
At the last closing share price the estimated dividend yield is 2.94%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.81.
Forecast for FY25:
Petra Capital forecasts a full year FY25 dividend of 2.00 cents and EPS of 6.50 cents.
At the last closing share price the estimated dividend yield is 3.92%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 7.85.
Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
DUG DUG TECHNOLOGY LIMITED
Cloud services – Overnight Price: $2.82
Wilsons rates ((DUG)) as Initiation of coverage with Overweight (1) –
Wilsons initiates coverage of Dug Technology with an Overweight rating and a $3.58 target price.
The broker is positive on the company due to its "globally competitive" Multi Parameter FWI technology in the Oil and Gas sectors which reported a 45% uplift in the 1H24 order book.
Management also opened a Dubai office which to Wilsons suggests there is potential Middle East demand.
Although the business is based on cyclical sectors, there is scope for Dug Technology to grow market share and its expertise in Liquid Immersion Cooling has growth potential in the data centre markets.
No guidance has been offered, but the analyst suggests there is upside potential to forecasts.
Overweight rating. Target price of $3.58.
This report was published on May 3, 2024.
Target price is $3.58 Current Price is $2.82 Difference: $0.76
If DUG meets the Wilsons target it will return approximately 27% (excluding dividends, fees and charges).
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 2.90 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 97.24.
Forecast for FY25:
Wilsons forecasts a full year FY25 dividend of 0.00 cents and EPS of 5.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 56.40.
Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
IPD IMPEDIMED LIMITED
Medical Equipment & Devices – Overnight Price: $0.08
Wilsons rates ((IPD)) as Overweight (1) –
Wilsons stresses private payer coverage is the leading indicator for investors to focus on for ImpediMed. Following 3Q results the broker highlights the expansion of this coverage is the most impressive aspect of the company's last two quarters.
Management reaffirmed its goal to have 85% private payors on board by June, and the analysts expect a powerful re-rating for the share price should this target be achieved.
Third quarter revenue was $2.6m, up from $2.3m in Q2, and was broadly in line with Wilsons' forecast. The company sold 18 SOZO systems,13 in the US, where the installed base reached 555 units.
The 20c target and Overweight rating are maintained.
This report was published on May 1, 2024.
Target price is $0.20 Current Price is $0.08 Difference: $0.12
If IPD meets the Wilsons target it will return approximately 150% (excluding dividends, fees and charges).
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 minus 1.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 8.00.
Forecast for FY25:
Wilsons forecasts a full year FY25 dividend of 0.00 cents and EPS of minus 0.70 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 11.43.
Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
LNW LIGHT & WONDER INC
Gaming – Overnight Price: $150.00
Jarden rates ((LNW)) as Upgrade to Buy from Overweight (1) –
The recent fall in the Light & Wonder share price is put down to macro concerns around a weaker US consumer, lower interest rate cuts, alongside a slowdown in gross gaming revenues and comments from Aristocrat Lesiure ((ALL)) on casino purchase intentions, according to Jarden.
There are no definitive signs of risks to the expected double digit earnings growth targets for FY25, while the company has grabbed market share gains in Australia from Aristocrat, alonsgide greater depth in the US games market.
There are no changes to forecasts at Jarden. The rating is upgraded to Buy from Overweight on the share price pullback and the target retained at $164.
This report was published on May 2, 2024.
Target price is $164.00 Current Price is $150.00 Difference: $14
If LNW meets the Jarden target it will return approximately 9% (excluding dividends, fees and charges).
Current consensus price target is $163.00, suggesting upside of 8.7%(ex-dividends)
The company's fiscal year ends in December.
Forecast for FY24:
Jarden forecasts a full year FY24 dividend of 0.00 cents and EPS of 436.30 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 34.38.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 631.0, implying annual growth of 133.8%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 23.8.
Forecast for FY25:
Jarden forecasts a full year FY25 dividend of 0.00 cents and EPS of 553.40 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 27.11.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 779.0, implying annual growth of 23.5%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 19.3.
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
M7T MACH7 TECHNOLOGIES LIMITED
Healthcare services – Overnight Price: $0.69
Wilsons rates ((M7T)) as Overweight (1) –
Mach7 Technologies reported 3Q24 sales of $7.4m, with $5m generated from subscription licence revenue, another $1.7 in capital software licensing, and the balance from professional service fees ($0.7m).
Wilsons expects that the company can meet FY24 revenue guidance of $27m-$30m, while cost controls will assist in the company achieving cashflow breakeven in FY24.
A potential catalyst is the Veteran's Affairs NTP contract which should reinforce Mach7 Technologies' expertise in the imaging markets and open up other market opportunities, notes the broker. The transition to subscription models is seen as a positive for the company.
Wilsons maintains an Overweight rating and $1.05 target.
This report was published on April 30, 2024.
Target price is $1.05 Current Price is $0.69 Difference: $0.36
If M7T meets the Wilsons target it will return approximately 52% (excluding dividends, fees and charges).
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 minus 3.60 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 19.17.
Forecast for FY25:
Wilsons forecasts a full year FY25 dividend of 0.00 cents and EPS of minus 2.10 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 32.86.
Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
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CHARTS
For more info SHARE ANALYSIS: ALL - ARISTOCRAT LEISURE LIMITED
For more info SHARE ANALYSIS: DHG - DOMAIN HOLDINGS AUSTRALIA LIMITED
For more info SHARE ANALYSIS: EBO - EBOS GROUP LIMITED
For more info SHARE ANALYSIS: LNW - LIGHT & WONDER INC
For more info SHARE ANALYSIS: MVF - MONASH IVF GROUP LIMITED
For more info SHARE ANALYSIS: NCK - NICK SCALI LIMITED