Australian Broker Call *Extra* Edition – Jan 20, 2022

This story features ARDEA RESOURCES LIMITED, and other companies. For more info SHARE ANALYSIS: ARL

An additional news report on the recommendation, valuation, forecast and opinion changes 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)

ARL   BGA   BXB   JBH   MCR   NIC   PGL   PPS   QPM   QUB   RBL   STA  

ARL    ARDEA RESOURCES LIMITED

Nickel – Overnight Price: $0.64

Petra Capital rates ((ARL)) as No Rating (-1) –

With nickel spot pricing at a decade high of US$22,200 per tonne and warehouse stocks approaching record lows as demand grows to support electric vehicle and lithium battery demand, Petra Capital expects conditions will support near-term high pricing. 

The broker notes while investment in new nickel developments and technology has accelerated this will likely have little impact on near-term production deficit. 

According to Petra Capital Ardea Resources is well placed to establish a meaningful nickel sulphide resource following recent discoveries, while its Kalgoorlie Nickel project holds a contained nickel resource of 5.9m tonnes. 

The Buy rating is retained and the target price increases to $2.56 from $1.21. 

This report was published on January 17, 2022.

Target price is $2.56 Current Price is $0.64 Difference: $1.92
If ARL meets the Petra Capital target it will return approximately 300% (excluding dividends, fees and charges).

Forecast for FY22:

Petra Capital forecasts a full year FY22 EPS of 0.00 cents.

Forecast for FY23:

Petra Capital forecasts a full year FY23 EPS of 0.00 cents.

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

BGA    BEGA CHEESE LIMITED

Dairy – Overnight Price: $5.19

Bell Potter rates ((BGA)) as Buy (1) –

Accounting for higher milk prices and increased supply chain costs Bega Cheese has provided FY22 guidance of $195-215m, a miss on Bell Potter's previously forecast $221m.

Bell Potter highlights ongoing impacts related to covid, including staff illness impacting plant operations and increased supply chain costs, were the major driver of the forecast shortfall.

The broker does anticipate a shelf price rise in the second half that would improve Bega Cheese's earnings outlook in FY23 and FY24. Underlying earnings forecasts are downgraded -7% and -4% for FY22 and FY23.

The Buy rating and target price of $6.35 are retained.

This report was published on January 18, 2022.

Target price is $6.35 Current Price is $5.19 Difference: $1.16
If BGA meets the Bell Potter target it will return approximately 22% (excluding dividends, fees and charges).
Current consensus price target is $5.55, suggesting upside of 7.0%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 14.00 cents and EPS of 21.90 cents.
At the last closing share price the estimated dividend yield is 2.70%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 23.70.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 22.3, implying annual growth of -18.4%.
Current consensus DPS estimate is 11.3, implying a prospective dividend yield of 2.2%.
Current consensus EPS estimate suggests the PER is 23.3.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 16.00 cents and EPS of 26.10 cents.
At the last closing share price the estimated dividend yield is 3.08%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 19.89.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 28.4, implying annual growth of 27.4%.
Current consensus DPS estimate is 13.0, implying a prospective dividend yield of 2.5%.
Current consensus EPS estimate suggests the PER is 18.3.

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

BXB    BRAMBLES LIMITED

Transportation & Logistics – Overnight Price: $10.41

Jarden rates ((BXB)) as Neutral (3) –

Jarden reports a mixed data bag for Brambles in October and November.

The broker's data shows lumber cost inflation resumed in November after falling for two months; wood pallet pricing continued to steam head as did US Linehaul Freight rates; retailer growth slowed to 4.3% in October; and diesel prices while softer, remain elevated.

Jarden expects tight pallet supply will drag on strong like-for-like volumes in the second half of 2022. 

Neutral rating and $11.14 target price retained. 

This report was published on January 18, 2022

Target price is $11.14 Current Price is $10.41 Difference: $0.73
If BXB meets the Jarden target it will return approximately 7% (excluding dividends, fees and charges).
Current consensus price target is $12.48, suggesting upside of 19.9%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Jarden forecasts a full year FY22 dividend of 32.86 cents and EPS of 48.62 cents.
At the last closing share price the estimated dividend yield is 3.16%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 21.41.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 56.4, implying annual growth of N/A.
Current consensus DPS estimate is 32.1, implying a prospective dividend yield of 3.1%.
Current consensus EPS estimate suggests the PER is 18.5.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 34.73 cents and EPS of 51.42 cents.
At the last closing share price the estimated dividend yield is 3.34%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 20.24.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 61.1, implying annual growth of 8.3%.
Current consensus DPS estimate is 35.2, implying a prospective dividend yield of 3.4%.
Current consensus EPS estimate suggests the PER is 17.0.

This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.7
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

JBH    JB HI-FI LIMITED

Consumer Electronics – Overnight Price: $49.02

Jarden rates ((JBH)) as Sell (5) –

JB Hi-Fi's December first-half result outpaced consensus by 13%, thanks to a high-quality sales-led result and a stellar performance from The Good Guys.

Jarden notes costs were well controlled amid a notable absence of supply chain problems.

No guidance was provided but Jarden says data suggests trends are solid, thanks to rising prices and pent-up demand arising from omicron-inspired supply shortages.

But the broker is cautious, expecting competition from the likes of Wesfarmers ((WES)) and others, and a shift from goods to services as omicron fades.

FY22 EPS rises 16%. Underweight rating retained. Target price rises to $51 from $49.

This report was published on January 18, 2021.

Target price is $51.00 Current Price is $49.02 Difference: $1.98
If JBH meets the Jarden target it will return approximately 4% (excluding dividends, fees and charges).
Current consensus price target is $54.88, suggesting upside of 12.0%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Jarden forecasts a full year FY22 dividend of 200.00 cents and EPS of 379.90 cents.
At the last closing share price the estimated dividend yield is 4.08%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.90.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 379.3, implying annual growth of -14.0%.
Current consensus DPS estimate is 248.8, implying a prospective dividend yield of 5.1%.
Current consensus EPS estimate suggests the PER is 12.9.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 188.00 cents and EPS of 321.50 cents.
At the last closing share price the estimated dividend yield is 3.84%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.25.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 342.1, implying annual growth of -9.8%.
Current consensus DPS estimate is 224.0, implying a prospective dividend yield of 4.6%.
Current consensus EPS estimate suggests the PER is 14.3.

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

MCR    MINCOR RESOURCES NL

Nickel – Overnight Price: $1.75

Petra Capital rates ((MCR)) as Hold (3) –

With nickel spot pricing at a decade high of US$22,200 per tonne and warehouse stocks approaching record lows as demand grows to support electric vehicle and lithium battery demand, Petra Capital expects conditions will support near-term high pricing. 

The broker while notes investment in new nickel developments and technology has accelerated this will likely have little impact on near-term production deficit. 

Mincor Resources reported first nickel ore production from its Northern Operations in December, while first production from Cassini is expected in March. Petra Capital notes resource expansion potential at both projects.

The Hold rating is retained and the target price increases to $2.11 from $1.30. 

This report was published on January 17, 2022.

Target price is $2.11 Current Price is $1.75 Difference: $0.36
If MCR meets the Petra Capital target it will return approximately 21% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY22:

Petra Capital forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 0.20 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 875.00.

Forecast for FY23:

Petra Capital forecasts a full year FY23 dividend of 0.00 cents and EPS of 18.40 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.51.

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

NIC    NICKEL MINES LIMITED

Nickel – Overnight Price: $1.58

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

With nickel spot pricing at a decade high of US$22,200 per tonne and warehouse stocks approaching record lows as demand grows to support electric vehicle and lithium battery demand, Petra Capital expects conditions will support near-term high pricing. 

The broker notes while investment in new nickel developments and technology has accelerated this will likely have little impact on near-term production deficit. 

Nickel Mines is targeting production startup at both its Angel Nickel and Oracle Nickel projects in 2022, driving a potential annual production of 100,000 tonnes. The company is also expanding strategic partnerships for participation in renewable energy projects. 

The Buy rating is retained and the target price increases to $3.28 from $1.88. 

This report was published on January 17, 2022.

Target price is $3.28 Current Price is $1.58 Difference: $1.7
If NIC meets the Petra Capital target it will return approximately 108% (excluding dividends, fees and charges).
Current consensus price target is $1.60, suggesting upside of 1.3%(ex-dividends)
The company's fiscal year ends in December.

Forecast for FY21:

Petra Capital forecasts a full year FY21 dividend of 5.34 cents and EPS of 7.88 cents.
At the last closing share price the estimated dividend yield is 3.38%.
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 8.7, implying annual growth of N/A.
Current consensus DPS estimate is 5.6, implying a prospective dividend yield of 3.5%.
Current consensus EPS estimate suggests the PER is 18.2.

Forecast for FY22:

Petra Capital forecasts a full year FY22 dividend of 5.34 cents and EPS of 9.48 cents.
At the last closing share price the estimated dividend yield is 3.38%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.66.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 11.9, implying annual growth of 36.8%.
Current consensus DPS estimate is 6.9, implying a prospective dividend yield of 4.4%.
Current consensus EPS estimate suggests the PER is 13.3.

This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.9
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

PGL    PROSPA GROUP LIMITED

Diversified Financials – Overnight Price: $0.84

Shaw and Partners rates ((PGL)) as Buy (1) –

Following a trading update, Shaw and Partners sees accelerating velocity for Prospa Group and lifts its target price to $1.60 from $1.50. There's considered enviable growth in originations and improving scalability of the technology platform.

Second quarter originations growth was 8% ahead of the broker's estimate, while first half earnings (EBITDA) guidance was 4% ahead. It's thought there will also be potentially significant positive impacts from recently released new products.

The Buy rating is maintained.

This report was published on January 18, 2021.

Target price is $1.60 Current Price is $0.84 Difference: $0.76
If PGL meets the Shaw and Partners target it will return approximately 90% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY22:

Shaw and Partners forecasts a full year FY22 dividend of 0.00 cents and EPS of 3.90 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 21.54.

Forecast for FY23:

Shaw and Partners forecasts a full year FY23 dividend of 0.00 cents and EPS of 5.60 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.00.

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

PPS    PRAEMIUM LIMITED

Wealth Management & Investments – Overnight Price: $1.39

Shaw and Partners rates ((PPS)) as Buy (1) –

Following a December quarter update by Praemium, Shaw and Partners notes very strong momentum though retains its existing forecasts. Every Australian-based metric was considered above expectations.

The analyst feels the current trajectory of funds under management growth and net inflows is likely to continue into the foreseeable future and awaits first half results on February 14 as the next catalyst.

The $1.80 target price and Buy rating are maintained.

This report was published on January 18, 2021.

Target price is $1.80 Current Price is $1.39 Difference: $0.41
If PPS meets the Shaw and Partners target it will return approximately 29% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY22:

Shaw and Partners forecasts a full year FY22 dividend of 0.00 cents and EPS of 1.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 139.00.

Forecast for FY23:

Shaw and Partners forecasts a full year FY23 dividend of 0.00 cents and EPS of 1.20 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 115.83.

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

QPM    QUEENSLAND PACIFIC METALS LIMITED

Nickel – Overnight Price: $0.20

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

With nickel spot pricing at a decade high of US$22,200 per tonne and warehouse stocks approaching record lows as demand grows to support electric vehicle and lithium battery demand, Petra Capital expects conditions will support near-term high pricing. 

The broker notes while investment in new nickel developments and technology has accelerated this will likely have little impact on near-term production deficit. 

Petra Capital notes Queensland Pacific Metals' TECH project is expected to produce 16,000 tonnes nickel per annum from 2024, while the DNi Process adopted at the project offers a low-cost, ESG-friendly solution for global nickel sulphide discoveries.

The Buy rating is retained and the target price increases to $0.55 from $0.39. 

This report was published on January 17, 2022.

Target price is $0.55 Current Price is $0.20 Difference: $0.35
If QPM meets the Petra Capital target it will return approximately 175% (excluding dividends, fees and charges).

Forecast for FY22:

Petra Capital forecasts a full year FY22 EPS of minus 0.60 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 33.33.

Forecast for FY23:

Petra Capital forecasts a full year FY23 EPS of minus 3.50 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 5.71.

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

QUB    QUBE HOLDINGS LIMITED

Transportation & Logistics – Overnight Price: $3.01

Jarden rates ((QUB)) as Buy (1) –

Jarden notes total container volume growth stalled in October, with NSW showing signs of weakness.

Beneath the headline figure, however, empty container movements declined, and total ship visits were up roughly 11.8% in October and November, suggesting industrial action and ship delays may have peaked.

Buy rating is unchanged. Target price is steady at $3.45.

This report was published January 18, 2022. 

Target price is $3.45 Current Price is $3.01 Difference: $0.44
If QUB meets the Jarden target it will return approximately 15% (excluding dividends, fees and charges).
Current consensus price target is $3.37, suggesting upside of 11.9%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Jarden forecasts a full year FY22 EPS of 9.10 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 33.08.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 8.9, implying annual growth of 84.3%.
Current consensus DPS estimate is 6.5, implying a prospective dividend yield of 2.2%.
Current consensus EPS estimate suggests the PER is 33.8.

Forecast for FY23:

Jarden forecasts a full year FY23 EPS of 10.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 30.10.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 10.5, implying annual growth of 18.0%.
Current consensus DPS estimate is 6.8, implying a prospective dividend yield of 2.3%.
Current consensus EPS estimate suggests the PER is 28.7.

Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

RBL    REDBUBBLE LIMITED

Software & Services – Overnight Price: $2.20

Jarden rates ((RBL)) as Neutral (3) –

Redbubble's December first-half trading update fell shy of Jarden's forecasts as competition intensified, and the company downgraded FY22 guidance to reflect continued margin headwinds,

While top line growth nudged out the broker's estimates, acquisition costs rose thanks to strong competition and higher shipping costs arising from supply-chain pressures.

Earnings (EBITDA) fell -38% short of the broker's forecasts.

Neutral rating retained. Target price falls to $2.60 from $3.73.

This report was published on January 18, 2022.

Target price is $2.60 Current Price is $2.20 Difference: $0.4
If RBL meets the Jarden target it will return approximately 18% (excluding dividends, fees and charges).
Current consensus price target is $3.23, suggesting upside of 46.8%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Jarden forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 5.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 44.00.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -3.7, 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 N/A.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 0.00 cents and EPS of 2.60 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 84.62.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 0.7, 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 314.3.

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

STA    STRANDLINE RESOURCES LIMITED

Mineral Sands – Overnight Price: $0.36

Shaw and Partners rates ((STA)) as Buy (1) –

Shaw and Partners is satisfied that Strandline Resources' Coburn Mineral Sands project is progressing well and is now just nine to ten months away from first production. It's felt the stock is materially undervalued in a tightening mineral sands market due to lack of supply.

Meanwhile, the company is continuing to progress its Tanzanian projects at Fungoni and Tajiri for which the market is ascribing no value, assesses the analyst.

The Buy rating and $0.71 target price are unchanged.

This report was published on January 18, 2021.

Target price is $0.71 Current Price is $0.36 Difference: $0.35
If STA meets the Shaw and Partners target it will return approximately 97% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY22:

Shaw and Partners forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 1.10 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 32.73.

Forecast for FY23:

Shaw and Partners forecasts a full year FY23 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 7.20.

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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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 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.

As part of emerging new trends overseas, The Australian Broker Call *Extra* Edition also includes providers of sponsored research. Readers should bear in mind, sponsored research, while not necessarily of lower quality, has the embedded complication that the company that is the subject of the research has paid for this research. Providers of sponsored research that can potentially be included in this Report are Breakaway Research, Edison Investment Research, Independent Investment Research, NDF Research, Pitt Street Research, and TMT Analytics.

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