Weekly Reports | Apr 12 2021
This story features PUSHPAY HOLDINGS LIMITED, and other companies. For more info SHARE ANALYSIS: PPH
Weekly update on stockbroker recommendation, target price, and earnings forecast changes.
By Mark Woodruff
Guide:
The FNArena database tabulates the views of seven major Australian and international stock brokers: Citi, Credit Suisse, Macquarie, Morgan Stanley, Morgans, Ord Minnett and UBS.
For the purpose of broker rating correlation, Outperform and Overweight ratings are grouped as Buy, Neutral is grouped with Hold and Underperform and Underweight are grouped as Sell to provide a Buy/Hold/Sell (B/H/S) ratio.
Ratings, consensus target price and forecast earnings tables are published at the bottom of this report.
Summary
Period: Monday April 5 to Friday April 9, 2021
Total Upgrades: 2
Total Downgrades: 1
Net Ratings Breakdown: Buy 54.43%; Hold 38.37%; Sell 7.21%
For the week ending Friday 9 April there were two upgrades and one downgrade to ASX-listed companies by brokers in the FNArena database.
There were no material changes to forecast target prices for the week.
Pushpay Holdings received the largest percentage increase in forecast earnings by brokers last week. Ord Minnett upgraded the rating to Hold from Lighten and lowered the target price to $1.95 from $4.45. While highlighting that a stock sell-down may be over, after several key holders completed transactions, the broker suspects competitor offerings are closing the gap, particularly in the small and medium church segments. However, Ord Minnett notes the company's CCB acquisition adds an important opportunity to capture a larger share of existing and new customer digital spend beyond the giving platform.
A technical glitch has put Crown Resorts atop the table for earnings downgrades, so best to ignore.
The second placed Western Areas released third-quarter preliminary production numbers that either met or exceeded broker forecasts. Reasons for the outperformance included a drawdown in stocks, better grades and an improved performance from the Forrestania project. Of course the prevailing nickel price helps and prompted the analyst to raise earnings forecasts for FY22 and FY23 by 80% and 55%, respectively.
Total Buy recommendations take up 54.43% of the total, versus 38.37% on Neutral/Hold, while Sell ratings account for the remaining 7.21%.
Upgrade
PUSHPAY HOLDINGS LIMITED ((PPH)) Upgrade to Hold from Lighten by Ord Minnett .B/H/S: 1/3/0
Ord Minnett upgrades the rating to Hold from Lighten. The target price is lowered to $1.95 from $4.45 due to caution over one-off benefits of covid-19 and front book growth in FY22 and beyond. New customer acquisition is expected to become more difficult.
The analyst highlights total customers remained flat between FY20 and 1H FY21 and suspects that competitor offerings are closing the
gap, particularly in the small and medium church segments.
One positive is that sell-downs from several key holders have now largely completed removing an overhang of stock, explains the broker.
RESOLUTE MINING LIMITED ((RSG)) Upgrade to Neutral from Underperform by Macquarie .B/H/S: 0/2/0
Macquarie upgrades its rating on Resolute Mining to Neutral from Underperform with the target rising to $0.50 from $0.45.
Resolute Mining's updated life of mine (LOM) plan for the Syama operation shows expected production to be 176kozpa over the next 11 years.
The miner expects production from the Tabakoroni underground mine from 2024-30. Production from the mine is expected to replace oxide production from 2024 onwards and is better than Macquarie expected.
Downgrade
BLUESCOPE STEEL LIMITED ((BSL)) Downgrade to Neutral from Buy by Citi .B/H/S: 3/3/0
Steel prices across the US and Asia have pushed higher and Citi suspects BlueScope Steel will perform better than guidance in the second half. The broker believes FY22 will shape up as a stellar year for the company.
North Star spreads are now at US$860/t compared with a long-term average of US$317/t.
The short-term outlook for China's steel demand and pricing is also robust and for BlueScope Steel's export pricing the broker estimates a current spot spread on hot rolled coil of $580/t.
Citi increases earnings (EBIT) estimates by 38% for FY22. Rating is downgraded to Neutral from Buy and the target is raised to $21.00 from $19.50.
| Total Recommendations |
Recommendation Changes |
|
Broker Recommendation Breakup |
|
Broker Rating |
||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Recommendation |
|||||||||||||||||||||||||||||||||||
Positive Change Covered by > 2 Brokers
|
|||||||||||||||||||||||||||||||||||
Negative Change Covered by > 2 Brokers
|
Target Price |
||||||||||||||||||||||||||||||||||||||||||
Positive Change Covered by > 2 Brokers
|
||||||||||||||||||||||||||||||||||||||||||
Negative Change Covered by > 2 Brokers
|
Earning Forecast |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Positive Change Covered by > 2 Brokers
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Negative Change Covered by > 2 Brokers
|
Technical limitations
If you are reading this story through a third party distribution channel and you cannot see charts included, we apologise, but technical limitations are to blame.
Find out why FNArena subscribers like the service so much: "Your Feedback (Thank You)" – Warning this story contains unashamedly positive feedback on the service provided.
Click to view our Glossary of Financial Terms
CHARTS
For more info SHARE ANALYSIS: BSL - BLUESCOPE STEEL LIMITED
For more info SHARE ANALYSIS: PPH - PUSHPAY HOLDINGS LIMITED
For more info SHARE ANALYSIS: RSG - RESOLUTE MINING LIMITED