Australian Broker Call *Extra* Edition – Nov 01, 2024

Daily Market Reports | Nov 01 2024

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)

BSL   CMM   CRD   DTL   FFM   GOR   IEL   JHX   KAR (2)   KLS   LTR   LYC   MAH   PDN   PLS   PMV (3)   QBE   RMS   RSG   SDV   SFR (2)   SKO   STN   TPW   VAU (2)   VSL   WOW   XRO  

VAU    VAULT MINERALS LIMITED

Gold & Silver - Overnight Price: $0.40

Canaccord Genuity rates ((VAU)) as Buy (1) -

Vault Minerals' Q3 results revealed a -7% quarter-on-quarter drop in sales (in line with forecasts by Canaccord Genuity and consensus), though Deflector achieved record throughput and maintained cost (AISC) control.

With 122koz hedged through FY26 and strong cash flow, the company is well positioned, suggest the analysts.

Canaccord Genuity reiterates its Buy rating, keeping the target at 51c due to expected performance improvements.

This report was published on October 30, 2024.

Target price is $0.51 Current Price is $0.40 Difference: $0.115
If VAU meets the Canaccord Genuity target it will return approximately 29% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY25:

Canaccord Genuity 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 7.90.

Forecast for FY26:

Canaccord Genuity forecasts a full year FY26 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 7.90.

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

Jarden rates ((VAU)) as Overweight (2) -

Overall, Vault Minerals posted a solid operational Sep Q, Jarden suggests, with a focus on setting up King of the Hills for the full year and a pick-up in planned exploration and resource extension drilling. Production was -2.5% below forecast but costs were a 4% beat.

The company noted with the reserves and resources statement that it has commenced studies focused on debottlenecking design work to lift throughput sustainably to 6mtpa during FY26.

Underground resource delineation should be a short-term valuation driver, Jarden suggests. Overweight and 42c target retained.

This report was published on October 29, 2024.

Target price is $0.42 Current Price is $0.40 Difference: $0.025
If VAU meets the Jarden target it will return approximately 6% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY25:

Jarden forecasts a full year FY25 dividend of 0.00 cents and EPS of 4.40 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 8.98.

Forecast for FY26:

Jarden forecasts a full year FY26 dividend of 0.00 cents and EPS of 3.30 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.97.

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

VSL    VULCAN STEEL LIMITED

Steel & Scrap - Overnight Price: $7.46

Jarden rates ((VSL)) as Neutral (3) -

Post the recent Vulcan Steel first half market update, at which the company indicated that first quarter of FY25 was down -30% on the prior year in earnings terms, Jarden updates its numbers for a softer-than-expected first half, with a softer recovery now anticipated in the second half.

As Jarden broadly retains its FY27 estimates, the reduced cost of capital parameters more than offset the near-term earnings reduction and the broker increases its target price to NZ$8.05 from NZ$7.80.

Due to modest downside potential to target, Jarden retains a Neutral rating.

This report was published on October 29, 2024.

Current Price is $7.46. Target price not assessed.
The company's fiscal year ends in June.

Forecast for FY25:

Jarden forecasts a full year FY25 dividend of 22.08 cents and EPS of 17.85 cents.
At the last closing share price the estimated dividend yield is 2.96%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 41.79.

Forecast for FY26:

Jarden forecasts a full year FY26 dividend of 35.61 cents and EPS of 39.66 cents.
At the last closing share price the estimated dividend yield is 4.77%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.81.

This company reports in NZD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

WOW    WOOLWORTHS GROUP LIMITED

Food, Beverages & Tobacco - Overnight Price: $29.96

Goldman Sachs rates ((WOW)) as Buy (1) -

Goldman Sachs downgrades Woolworths Group forecasts due to lower margin guidance and challenges in its core Australian Food segment.

The company announced 1Q25 sales which were in line with expectations at growth of 3.8% in Australia, but EBIT guidance for 1H25 indicates erosion in margins of circa -60bps, the broker highlights.

Management plans to tighten promotional spending, reduce support costs, and enhance productivity to counteract these pressures.

Target price declines to $36.20 from $38.90 with Goldman Sachs pointing to risks around the ACCC inquiry and ongoing cost inflation, while growth in online and Retail Media may support longer-term profitability.

The broker's earnings forecasts are cut by -8% and -5%, for FY25/FY26, respectively.

This report was published on October 30, 2024.

Target price is $36.20 Current Price is $29.96 Difference: $6.24
If WOW meets the Goldman Sachs target it will return approximately 21% (excluding dividends, fees and charges).
Current consensus price target is $34.12, suggesting upside of 13.9%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 96.00 cents and EPS of 128.00 cents.
At the last closing share price the estimated dividend yield is 3.20%.
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 135.0, implying annual growth of 1425.4%.
Current consensus DPS estimate is 96.3, implying a prospective dividend yield of 3.2%.
Current consensus EPS estimate suggests the PER is 22.2.

Forecast for FY26:

Goldman Sachs forecasts a full year FY26 dividend of 110.00 cents and EPS of 147.00 cents.
At the last closing share price the estimated dividend yield is 3.67%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 20.38.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 149.3, implying annual growth of 10.6%.
Current consensus DPS estimate is 105.3, implying a prospective dividend yield of 3.5%.
Current consensus EPS estimate suggests the PER is 20.1.

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

XRO    XERO LIMITED

Accountancy - Overnight Price: $149.50

Jarden rates ((XRO)) as Overweight (2) -

In previewing Xero's first half results, Jarden retains Overweight due to perceived asymmetric upside. The four key areas of focus are subscriber growth, revenue, opex ratio and free cash flow.

Jarden sees asymmetric upside risk to Xero's valuation if it can execute above forecasts, particularly in North America. The broker has an upside scenario valuation of $284, downside of $55 and  base case of $132.

Target rises to $151 from $144.

This report was published on October 29, 2024.

Target price is $151.00 Current Price is $149.50 Difference: $1.5
If XRO meets the Jarden target it will return approximately 1% (excluding dividends, fees and charges).
Current consensus price target is $164.60, suggesting upside of 10.1%(ex-dividends)
The company's fiscal year ends in March.

Forecast for FY25:

Jarden forecasts a full year FY25 dividend of 0.00 cents and EPS of 157.34 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 95.02.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 137.4, 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 108.8.

Forecast for FY26:

Jarden forecasts a full year FY26 dividend of 110.42 cents and EPS of 218.07 cents.
At the last closing share price the estimated dividend yield is 0.74%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 68.56.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 184.0, implying annual growth of 33.9%.
Current consensus DPS estimate is 13.4, implying a prospective dividend yield of 0.1%.
Current consensus EPS estimate suggests the PER is 81.3.

This company reports in NZD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.8
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Disclaimer:
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 experienced, 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.

Decisions about inclusions in this Report are made independently of the providers of stock market research and at full discretion of the team of journalists responsible for content at FNArena. Inclusion does not equal endorsement, in any way, shape or form. This Report is provided for informational purposes only.