Australian Broker Call *Extra* Edition – Jul 06, 2021

This story features ALTIUM, and other companies. For more info SHARE ANALYSIS: ALU

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)

ALU   AX1   AZJ   CRN   DOC   EHL   EXP   FDV   FLT   GNC (2)   IPH   JHC   JRV   MAH   MND   MNF   NCK   NSR   NWH   PLT   PMV   RMD   SCP   SUL   TRS   TWE   WHC  

ALU    ALTIUM

Hardware & Equipment – Overnight Price: $36.18

Bell Potter rates ((ALU)) as Hold (3) –

Altium recently announced it had received a formal, non-binding, indicative and unsolicited proposal from Autodesk for the acquisition of 100% of Altium shares at $38.50.

The Altium Board said it considers the proposal, which equates to FY22 EV/Revenue and EV/earnings multiples of around 17x and circa 45x based on Bell Potter forecasts, as significantly undervalued.

Bell Potter's Hold remains unchanged.

The price target increases to $37.50 from $27.50 after increasing the premium the broker applies in the relative valuations to 50% from 10% given the unsolicited acquisition proposal.

This report was published on June 9, 2021.

Target price is $37.50 Current Price is $36.18 Difference: $1.32
If ALU meets the Bell Potter target it will return approximately 4% (excluding dividends, fees and charges).
Current consensus price target is $35.30, suggesting downside of -2.4%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Bell Potter forecasts a full year FY21 dividend of 50.82 cents and EPS of 43.06 cents.
At the last closing share price the estimated dividend yield is 1.40%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 84.02.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 44.6, implying annual growth of N/A.
Current consensus DPS estimate is 43.2, implying a prospective dividend yield of 1.2%.
Current consensus EPS estimate suggests the PER is 81.1.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 53.49 cents and EPS of 49.75 cents.
At the last closing share price the estimated dividend yield is 1.48%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 72.73.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 53.7, implying annual growth of 20.4%.
Current consensus DPS estimate is 46.4, implying a prospective dividend yield of 1.3%.
Current consensus EPS estimate suggests the PER is 67.4.

This company reports in USD. 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

AX1    ACCENT GROUP LIMITED

Apparel & Footwear – Overnight Price: $2.75

Jarden rates ((AX1)) as Initiation of coverage with Overweight (2) –

Jarden initiates coverage on Accent Group with an Overweight rating and a $3.00 price target.

The broker sees short-term upside in gross margins supported by lower promotional activity and premiumisation, minor FX tailwinds, and material store growth.

The broker also sees longer-term upside from category expansion, introducing apparel into stores, developing endless aisles and owned brands, loyalty programs, and increasing vertical range.

While marketplace threats are growing, Jarden sees Accent Group as one of the most advanced online operators in the broker's coverage.

Jarden forecasts second half FY21 earnings growth of circa 70% versus first half FY21 of 47%.

This report was issued June 9, 2021.

Target price is $3.00 Current Price is $2.75 Difference: $0.25
If AX1 meets the Jarden target it will return approximately 9% (excluding dividends, fees and charges).
Current consensus price target is $2.92, suggesting upside of 5.3%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Jarden forecasts a full year FY21 dividend of 14.40 cents and EPS of 17.00 cents.
At the last closing share price the estimated dividend yield is 5.24%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.18.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 13.9, implying annual growth of 34.8%.
Current consensus DPS estimate is 12.6, implying a prospective dividend yield of 4.5%.
Current consensus EPS estimate suggests the PER is 19.9.

Forecast for FY22:

Jarden forecasts a full year FY22 dividend of 12.20 cents and EPS of 14.70 cents.
At the last closing share price the estimated dividend yield is 4.44%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.71.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 14.8, implying annual growth of 6.5%.
Current consensus DPS estimate is 12.5, implying a prospective dividend yield of 4.5%.
Current consensus EPS estimate suggests the PER is 18.7.

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

AZJ    AURIZON HOLDINGS LIMITED

Transportation & Logistics – Overnight Price: $3.81

Jarden rates ((AZJ)) as Overweight (2) –

Despite flagging coal volume weakness, Aurizon Holdings maintained its FY21 guidance for underlying earnings of between $870m – $910m, and maintained that on average it can achieve $500m – $650m of free cash flow (FCF).

The outlook is more ambitious for the bulk business, for which Aurizon is targeting to double its earnings contribution from around $114m (based on Jarden estimates) in FY21 to around $200m-plus by FY30.

Jarden believes this will likely provide assurance to investors for the balance sheet outlook, should coal demand weaken. However, The broker questions whether the network business will be able to maintain its contribution to FCF in such a market.

Overweight rating and target price of $4.30 are both retained.

This report was first issued June 8, 2021.

Target price is $4.30 Current Price is $3.81 Difference: $0.49
If AZJ meets the Jarden target it will return approximately 13% (excluding dividends, fees and charges).
Current consensus price target is $4.59, suggesting upside of 19.1%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Jarden forecasts a full year FY21 dividend of 27.50 cents and EPS of 27.20 cents.
At the last closing share price the estimated dividend yield is 7.22%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.01.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 27.4, implying annual growth of -13.1%.
Current consensus DPS estimate is 28.0, implying a prospective dividend yield of 7.3%.
Current consensus EPS estimate suggests the PER is 14.1.

Forecast for FY22:

Jarden forecasts a full year FY22 dividend of 27.60 cents and EPS of 27.40 cents.
At the last closing share price the estimated dividend yield is 7.24%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.91.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 28.9, implying annual growth of 5.5%.
Current consensus DPS estimate is 29.1, implying a prospective dividend yield of 7.6%.
Current consensus EPS estimate suggests the PER is 13.3.

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

CRN    CORONADO GLOBAL RESOURCES INC

Coal – Overnight Price: $0.90

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

While cautious that operational issues earlier in the year at Curragh -the open-cut, central Qld coal mine- could have slipped into the current quarter impacting production and unit costs, Bell Potter has upgraded its coal price outlook and lifted Coronado Global Resources' earnings per share estimates.

The broker is now forecasting calendar year 2021 1.0cps, previously -2.5cps, and calendar year 2022 up 17%, with no change in forecast for calendar year 2023.

Bell Potter expects met coal price strength, which has rallied over 50% in a month due to firm demand and speculative interest, to remain while these dynamics are in play.

The broker believes the recently announced debt and equity refinance reduces balance sheet risks through the more flexible debt terms. 

Buy rating is unchanged, and target price increases to $1.10 from $0.95.

This report was published on June 10, 2021.

Target price is $1.10 Current Price is $0.90 Difference: $0.2
If CRN meets the Bell Potter target it will return approximately 22% (excluding dividends, fees and charges).
Current consensus price target is $1.15, suggesting upside of 23.9%(ex-dividends)
The company's fiscal year ends in December.

Forecast for FY21:

Bell Potter forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 1.34 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 67.31.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -1.1, 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 FY22:

Bell Potter forecasts a full year FY22 dividend of 7.36 cents and EPS of 12.30 cents.
At the last closing share price the estimated dividend yield is 8.17%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 7.32.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 7.6, implying annual growth of N/A.
Current consensus DPS estimate is 1.8, implying a prospective dividend yield of 1.9%.
Current consensus EPS estimate suggests the PER is 12.2.

This company reports in USD. 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

DOC    DOCTOR CARE ANYWHERE GROUP PLC

Healthcare services – Overnight Price: $0.90

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

Bell Potter believes the recently announced partnership between Doctor Care Anywhere and Nuffield Health -a large private network of acute and primary care services in the UK catering to private payers- will significantly expand the company's revenue base.

Nuffield Health runs 31 private hospitals, private healthcare clinics and 113 fitness and wellbeing clubs across the UK.

There are no changes to Bell Potter's short term earnings forecasts pending the announcement of further detail regarding financial arrangements with Nuffield.

But the broker expects the company to continue to experience rapid growth in revenues over the next 2 years.

The Buy rating is unchanged and target price is lowered to $1.70 from $1.95 to reflect the downward adjustment to international peer valuations in the sector.

This report was published on June 10, 2021.

Target price is $1.70 Current Price is $0.90 Difference: $0.8
If DOC meets the Bell Potter target it will return approximately 89% (excluding dividends, fees and charges).
The company's fiscal year ends in December.

Forecast for FY21:

Bell Potter forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 9.19 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 9.79.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 5.95 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 15.13.

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

EHL    EMECO HOLDINGS LIMITED

Mining Sector Contracting – Overnight Price: $1.08

Jarden rates ((EHL)) as Buy (1) –

Jarden has provided an update on the earnings and margin outlook for the mining and infrastructure services sector. According to the broker cautious sentiment may be overshadowing a potential strong cyclical upswing in mining activity, and Jarden takes a positive outlook on the sector.

Share prices of mining and infrastructure services companies are trading well below what Jarden would expect at this point in the cycle, based on previous cycle prices where companies were largely trading at a premium of roughly 2.6 times net tangible assets per share.

The broker also points to positive industry conditions, including capital expenditure, commodity prices and exploration.

Jarden highlights key risks to Emeco are lower Australian commodity export demand, inability to increase utilisation rates, equipment failure or supply chain impacts, and downturns in mining industry activity.

According to Jarden, Emeco is currently one of the best value companies in the sector for investors. Buy rating and target price of $1.55 retained.

This report was published on June 7, 2021.

Target price is $1.55 Current Price is $1.08 Difference: $0.47
If EHL meets the Jarden target it will return approximately 44% (excluding dividends, fees and charges).

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

EXP    EXPERIENCE CO LIMITED

Travel, Leisure & Tourism – Overnight Price: $0.30

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

Taking into consideration Experience Co's recent acquisitions as well as continuing international border closures, Canaccord Genuity updates forecasts on the company.

The broker is now forecasting underlying earnings for FY22 of $8.6m, down from $10.8m, and for FY23 of $18.9m, down from 19.5m. 

Canaccord Genuity is still guiding to full volume recovery by FY24, but notes that the company has proved its ability to activate local catchments and operate profitably from a domestic market. The broker is confident Experience Co will be able to execute strong earnings over the next three years, and build to levels exceeding FY19.

The Buy rating is retained and the target price increases to $0.32 from $0.25.

This report was published on June 10, 2021.

Target price is $0.32 Current Price is $0.30 Difference: $0.02
If EXP meets the Canaccord Genuity target it will return approximately 7% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY21:

Canaccord Genuity forecasts a full year FY21 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 30.00.

Forecast for FY22:

Canaccord Genuity forecasts a full year FY22 dividend of 0.00 cents and EPS of 0.00 cents.

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

FDV    FRONTIER DIGITAL VENTURES LIMITED

Online media & mobile platforms – Overnight Price: $1.43

Bell Potter rates ((FDV)) as Upgrade to Buy from Hold (1) –

After increasing the target price to $1.72 from $1.70 to reflect Frontier Digital Ventures Ltd's increased ownership in South American property portal, Infocasas -from 51% to 100%- Bell Potter has upgraded the company to a Buy from a Hold.

The broker sees this portfolio optimisation as a move to further expand on an already solid growth platform for FY21.

This report was published on June 10, 2021.

Target price is $1.72 Current Price is $1.43 Difference: $0.29
If FDV meets the Bell Potter target it will return approximately 20% (excluding dividends, fees and charges).
The company's fiscal year ends in December.

Forecast for FY21:

Bell Potter forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 2.30 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 62.17.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 0.30 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 476.67.

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

FLT    FLIGHT CENTRE TRAVEL GROUP LIMITED

Travel, Leisure & Tourism – Overnight Price: $15.75

Jarden rates ((FLT)) as Initiation of coverage with Neutral (3) –

Jarden initiates coverage on Flight Centre Travel Group with a Neutral rating and a price target of $16.10.

The broker believes the medium-term outlook from both an earnings and return on investment capital potential is higher today than it was pre-covid.

With near-term earnings likely to be volatile and hard to forecast, the broker believes consensus is too optimistic, and will remain Neutral until consensus recalibrates.

Jarden believes the next catalyst should be signs of travel bubbles through FY22.

The broker is looking for clarity over improving margin outlook, particularly with respect to airline commissions, and Australia beginning to reopen borders.

This report was issued June 9, 2021.

Target price is $16.10 Current Price is $15.75 Difference: $0.35
If FLT meets the Jarden target it will return approximately 2% (excluding dividends, fees and charges).
Current consensus price target is $16.97, suggesting upside of 7.5%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Jarden forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 186.70 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 8.44.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -176.8, 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 FY22:

Jarden forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 82.30 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 19.14.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -18.5, implying annual growth of N/A.
Current consensus DPS estimate is -0.7, implying a prospective dividend yield of -0.0%.
Current consensus EPS estimate suggests the PER is N/A.

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

GNC    GRAINCORP LIMITED

Agriculture – Overnight Price: $5.13

Bell Potter rates ((GNC)) as Downgrade to Hold from Buy (3) –

To reflect the high likelihood a seasonal peak in earnings is close to being reached, Bell Potter has downgraded GrainCorp to a Hold from a Buy.

To reflect the application of a lower multiple to through-the-cycle earnings, on the view the market is now de-rating earnings and no longer responsive to earnings upgrades at the perceived seasonal peak in earnings, Bell Potter has lowered the target price to $5.50 from $6.20.

Despite a record June crop forecast, Bell Potter notes historically the June report has proven the least accurate of the ABARES estimates, with a range of 69%-188% on variability since 2010.

The broker has upgraded net profit forecasts by 2% in FY22 and 4% in FY23, with the latter reflecting a higher assumed carryout.

This report was issued June 9, 2021.

Target price is $5.50 Current Price is $5.13 Difference: $0.37
If GNC meets the Bell Potter target it will return approximately 7% (excluding dividends, fees and charges).
Current consensus price target is $6.30, suggesting upside of 23.4%(ex-dividends)
The company's fiscal year ends in September.

Forecast for FY21:

Bell Potter forecasts a full year FY21 dividend of 23.00 cents and EPS of 43.20 cents.
At the last closing share price the estimated dividend yield is 4.48%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.87.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 41.2, implying annual growth of 48.0%.
Current consensus DPS estimate is 20.2, implying a prospective dividend yield of 4.0%.
Current consensus EPS estimate suggests the PER is 12.4.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 18.00 cents and EPS of 48.60 cents.
At the last closing share price the estimated dividend yield is 3.51%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.56.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 39.9, implying annual growth of -3.2%.
Current consensus DPS estimate is 24.3, implying a prospective dividend yield of 4.8%.
Current consensus EPS estimate suggests the PER is 12.8.

Market Sentiment: 0.8
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

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Wilsons rates ((GNC)) as Market Weight (3) –

After adjusting for non-core crops and adding in a nominal summer crop, the ABARES forecast implies an FY22 east coast crop volume at 22.0Mt, compared to the 10-year historical average at 18.5Mt and Wilsons' current FY22 forecast at 20.0Mt.

Given it remains very early in the season to forecast yield, the broker believes the area forecast is of particular interest.

Wilsons notes ABARES forecast at 10.8Mha is actually above last year, which delivered a record crop and 14% above the 10-year historical average at 9.5Mha.

Wilsons' market-weight rating and price target of $5.36 are both unchanged but currently under review.

This report was published on June 8, 2021.

Target price is $5.36 Current Price is $5.13 Difference: $0.23
If GNC meets the Wilsons target it will return approximately 4% (excluding dividends, fees and charges).
Current consensus price target is $6.30, suggesting upside of 23.4%(ex-dividends)
The company's fiscal year ends in September.

Forecast for FY21:

Wilsons forecasts a full year FY21 dividend of 16.00 cents and EPS of 42.30 cents.
At the last closing share price the estimated dividend yield is 3.12%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.13.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 41.2, implying annual growth of 48.0%.
Current consensus DPS estimate is 20.2, implying a prospective dividend yield of 4.0%.
Current consensus EPS estimate suggests the PER is 12.4.

Forecast for FY22:

Wilsons forecasts a full year FY22 dividend of 16.00 cents and EPS of 38.10 cents.
At the last closing share price the estimated dividend yield is 3.12%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.46.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 39.9, implying annual growth of -3.2%.
Current consensus DPS estimate is 24.3, implying a prospective dividend yield of 4.8%.
Current consensus EPS estimate suggests the PER is 12.8.

Market Sentiment: 0.8
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

IPH    IPH LIMITED

Legal – Overnight Price: $7.76

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

A stronger Australian dollar will cause around an -$11m drag on IPH's second half FY21 underlying earnings, with Bell Potter pointing to final underlying earnings of around $59m.

Despite this, the broker highlights earnings before this effect would have been closer to $70m, implying 6.5% year-on-year growth.

Without considering impacts of the Australian dollar, Bell Potter calculates the Australian and New Zealand sector to have contributed around $1.2m and the Asian sector to have contributed around $1.5m to earnings.

The broker points to this underlying business as evidence of IPH continuing to perform resiliently. The Buy rating and target price of $8.15 are retained.

This report was published on June 8, 2021.

Target price is $8.15 Current Price is $7.76 Difference: $0.39
If IPH meets the Bell Potter target it will return approximately 5% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY21:

Bell Potter forecasts a full year FY21 dividend of 28.10 cents and EPS of 34.10 cents.
At the last closing share price the estimated dividend yield is 3.62%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 22.76.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 29.40 cents and EPS of 38.10 cents.
At the last closing share price the estimated dividend yield is 3.79%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 20.37.

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

JHC    JAPARA HEALTHCARE LIMITED

Aged Care & Seniors – Overnight Price: $1.25

Jarden rates ((JHC)) as Buy (1) –

Japara Healthcare has received a revised proposal from Calvary, offering an increased price per share of $1.20 from $1.04. The offer is still lower than Jarden's calculated implied equity value per share of $1.39.

The non-binding indicative proposal is for Calvary to acquire all shares in Japara Healthcare and is conditional on all Japara directors voting in favour of the offer.

Jarden highlights value in Japara's approximate $45m in real estate as land holdings portfolio, with the asset sale of that portfolio potentially reducing current leverage by -20%.

The broker also notes overlaying an existing operating platform and increasing benefit from scale could see potential cost savings of -$10-20m per annum.

The Buy rating is retained and the target price increases to $1.35 from $1.33.

This report was published on June 7, 2021.

Target price is $1.35 Current Price is $1.25 Difference: $0.1
If JHC meets the Jarden target it will return approximately 8% (excluding dividends, fees and charges).
Current consensus price target is $1.00, suggesting downside of -20.9%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Jarden forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 6.70 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 18.66.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -4.9, 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 FY22:

Jarden forecasts a full year FY22 dividend of 0.70 cents and EPS of 1.70 cents.
At the last closing share price the estimated dividend yield is 0.56%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 73.53.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 1.3, implying annual growth of N/A.
Current consensus DPS estimate is 1.8, implying a prospective dividend yield of 1.4%.
Current consensus EPS estimate suggests the PER is 96.9.

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

JRV    JERVOIS MINING LIMITED

New Battery Elements – Overnight Price: $0.62

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

 Shaw and Partners upgrades the price target on Jervois Mining to $0.78 from $0.52 to include $301m (34cps) for the recently acquired SMP nickel and cobalt refinery in Brazil and associated trading business.

The broker has increased earnings forecasts in FY23, FY24, and FY25 by 42%, 75% and 222% respectively.

Shaw assumes the SMP refinery restarts in FY23 at a production rate of 10ktpa nickel and 2ktpa cobalt for a capital cost of US$50m.

The broker believes Jervois is a relatively unique opportunity for investors to gain exposure to the battery metal thematic, namely nickel and cobalt.

The Buy rating is retained.

This report was published on June 10, 2021. 

Target price is $0.78 Current Price is $0.62 Difference: $0.16
If JRV meets the Shaw and Partners target it will return approximately 26% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY21:

Shaw and Partners forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 1.50 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 41.33.

Forecast for FY22:

Shaw and Partners forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 1.80 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 34.44.

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

MAH    MACMAHON HOLDINGS LIMITED

Mining Sector Contracting – Overnight Price: $0.20

Jarden rates ((MAH)) as Buy (1) –

Jarden has provided an update on the earnings and margin outlook for the mining and infrastructure services sector. According to the broker cautious sentiment may be overshadowing a potential strong cyclical upswing in mining activity, and Jarden takes a positive outlook on the sector.

Share prices of mining and infrastructure services companies are trading well below what Jarden would expect at this point in the cycle, based on previous cycle prices where companies were largely trading at a premium of roughly 2.6 times net tangible assets per share.

The broker also points to positive industry conditions, including capital expenditure, commodity prices and exploration.

Jarden highlights key risks to MacMahon are downturns in mining industry activity, sovereign risks in Indonesia or other offshore markets, and industry cost inflation, in particular higher labour costs.

According to Jarden, MacMahon is currently one of the best value companies in the sector for investors.

Jarden retains a Buy rating with a target price of $0.35.

This report was published on June 7, 2021.

Target price is $0.35 Current Price is $0.20 Difference: $0.15
If MAH meets the Jarden target it will return approximately 75% (excluding dividends, fees and charges).

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

MND    MONADELPHOUS GROUP LIMITED

Mining Sector Contracting – Overnight Price: $10.48

Jarden rates ((MND)) as Overweight (2) –

Jarden has provided an update on the earnings and margin outlook for the mining and infrastructure services sector. According to the broker cautious sentiment may be overshadowing a potential strong cyclical upswing in mining activity, and Jarden takes a positive outlook on the sector.

Share prices of mining and infrastructure services companies are trading well below what Jarden would expect at this point in the cycle, based on previous cycle prices where companies were largely trading at a premium of roughly 2.6 times net tangible assets per share.

The broker also points to positive industry conditions, including capital expenditure, commodity prices and exploration.

Jarden highlights key risks to Monadelphous are a reduction in maintenance activity, earlier-than-forecast rollover in commodity cycles, cost overruns, and contract specific setbacks.

According to Jarden, Monadelphous is operating at a premium to its underlying net tangible value but below historical averages.

Overweight rating and $13.55 target retained.

This report was published on June 7, 2021.

Target price is $13.55 Current Price is $10.48 Difference: $3.07
If MND meets the Jarden target it will return approximately 29% (excluding dividends, fees and charges).
Current consensus price target is $12.40, suggesting upside of 18.1%(ex-dividends)

Forecast for FY21:

Current consensus EPS estimate is 59.5, implying annual growth of 53.9%.
Current consensus DPS estimate is 45.9, implying a prospective dividend yield of 4.4%.
Current consensus EPS estimate suggests the PER is 17.6.

Forecast for FY22:

Current consensus EPS estimate is 65.0, implying annual growth of 9.2%.
Current consensus DPS estimate is 52.0, implying a prospective dividend yield of 5.0%.
Current consensus EPS estimate suggests the PER is 16.2.

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

MNF    MNF GROUP LIMITED

Telecommunication – Overnight Price: $5.25

Moelis rates ((MNF)) as Buy (1) –

Domestic reseller Vonex Ltd ((VN8)) has signed a terms sheet to acquire part of MNF Group's direct retail business for $31m, with transaction completion expected by 31 July 2021.

Vonex will also enter an exclusive wholesale supply agreement with MNF Group for its numbers and minutes, which is expected to retain circa $3m p.a. in long term revenue for MNF.

In addition to repositioning the group as a pure wholesale provider, Moelis also believes the sale helps reposition MNF Group as a higher growth, higher quality company that is more easily comparable to overseas peers.

After re-basing earnings post the direct segment sale to Vonex, the broker believes the MNF Group can grow earnings at around 14% compound annual growth rate, previously 9% p.a.

Buy rating is retained and target price increases to $6.28.

This report was published on June 9, 2021.

Target price is $6.28 Current Price is $5.25 Difference: $1.03
If MNF meets the Moelis target it will return approximately 20% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY21:

Moelis forecasts a full year FY21 dividend of 8.10 cents and EPS of 18.90 cents.
At the last closing share price the estimated dividend yield is 1.54%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 27.78.

Forecast for FY22:

Moelis forecasts a full year FY22 dividend of 8.50 cents and EPS of 18.90 cents.
At the last closing share price the estimated dividend yield is 1.62%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 27.78.

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

NCK    NICK SCALI LIMITED

Furniture & Renovation – Overnight Price: $11.36

Jarden rates ((NCK)) as Initiation of coverage with Underweight (2) –

Jarden initiates coverage on Nick Scali with a relative Underweight and target price of $11.10.

Despite consensus underestimating slowing momentum, as covid demand pull forward is cycled, the broker notes the recent launch of online has been very strong.

Jarden expects the strong pricing online to expand into adjacent categories to grow the retailer's addressable market and be accretive to gross margins.

The broker sees Nick Scali as a strong retailer with industry leading margins, a growing online offer, adjacent categories opportunities, and strong property backing.

Jarden's FY21 estimates are in line with guidance of $120m earnings, and $80.2m net profit.

This report was issued June 9, 2021.

Target price is $11.10 Current Price is $11.36 Difference: minus $0.26 (current price is over target).
If NCK meets the Jarden target it will return approximately minus 2% (excluding dividends, fees and charges – negative figures indicate an expected loss).
The company's fiscal year ends in June.

Forecast for FY21:

Jarden forecasts a full year FY21 dividend of 79.00 cents and EPS of 99.00 cents.
At the last closing share price the estimated dividend yield is 6.95%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.47.

Forecast for FY22:

Jarden forecasts a full year FY22 dividend of 54.00 cents and EPS of 67.40 cents.
At the last closing share price the estimated dividend yield is 4.75%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.85.

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

NSR    NATIONAL STORAGE REIT

REITs – Overnight Price: $2.06

Goldman Sachs rates ((NSR)) as Sell (5) –

National Storage REIT's FY21 earnings per share (EPS) guidance range was increased to 8.5-8.6cps, up from 8.1-8.5cps. 

The REIT also announced a $325m equity raise to strengthen its balance sheet, provide investment capacity and funding flexibility, and introduced FY22 EPS growth guidance of at least 8%.

Despite a positive operating outlook for the REIT's organic growth, Goldman Sachs believes the equity raise, to bring the gearing range below its target range of 25%-40%, may impact EPS growth.

In the broker's view, the extended time for developments to reach stabilisation, combined with higher shares on issue post the announced equity raise, may be a headwind for earnings contributions going forward.

The Sell rating is unchanged and the target price is increased to $1.71 from $1.58.

This report was published on June 8, 2021.

Target price is $1.71 Current Price is $2.06 Difference: minus $0.35 (current price is over target).
If NSR meets the Goldman Sachs target it will return approximately minus 17% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $2.04, suggesting downside of -2.7%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Goldman Sachs forecasts a full year FY21 EPS of 8.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 25.75.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 8.4, implying annual growth of -43.4%.
Current consensus DPS estimate is 8.1, implying a prospective dividend yield of 3.9%.
Current consensus EPS estimate suggests the PER is 25.0.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 EPS of 9.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 22.89.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 9.0, implying annual growth of 7.1%.
Current consensus DPS estimate is 8.7, implying a prospective dividend yield of 4.1%.
Current consensus EPS estimate suggests the PER is 23.3.

Market Sentiment: -0.1
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

NWH    NRW HOLDINGS LIMITED

Mining Sector Contracting – Overnight Price: $1.49

Jarden rates ((NWH)) as Overweight (2) –

Jarden has provided an update on the earnings and margin outlook for the mining and infrastructure services sector. According to the broker cautious sentiment may be overshadowing a potential strong cyclical upswing in mining activity, and Jarden takes a positive outlook on the sector. 

Share prices of mining and infrastructure services companies are trading well below what Jarden would expect at this point in the cycle, based on previous cycle prices where companies were largely trading at a premium of roughly 2.6 times net tangible assets per share. 

The broker also points to positive industry conditions, including capital expenditure, commodity prices and exploration. 

Jarden highlights key risks to NRW Holdings are low conversation rates on pipeline projects, impacts of cost inflation on profitability margins, and intensified competition in civil and contract mining. 

Jarden rates the stock as Overweight with a target price of $3.40.

This report was published on June 7, 2021.

Target price is $3.40 Current Price is $1.49 Difference: $1.91
If NWH meets the Jarden target it will return approximately 128% (excluding dividends, fees and charges).

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

PLT    PLENTI GROUP LIMITED

Business & Consumer Credit – Overnight Price: $1.34

Shaw and Partners rates ((PLT)) as Initiation of coverage with Buy (1) –

Shaw and Partners initiates coverage of Plenti Group with a Buy recommendation and price target of $1.74.

According to the broker, Plenti is an innovative, technology-led and high growth consumer lender across automotive, renewable and personal lending.

Plenti’s loan book reached $614m at fourth quarter FY21 up 62% year-on-year and disclosed a loan book of $685m at 24th May.

As well as being supportive of an acceleration on Shaw's estimates, the broker also believes the company has likely been overlooked by the market.

Shaw believes Plenti presents a compelling opportunity to invest in a fintech lender with a premium quality loan book, accelerating and diversified originations, favourable net interest margins and high return on equity at scale.

This report was issued June 9, 2021.

Target price is $1.74 Current Price is $1.34 Difference: $0.4
If PLT meets the Shaw and Partners target it will return approximately 30% (excluding dividends, fees and charges).
The company's fiscal year ends in March.

Forecast for FY22:

Shaw and Partners forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 6.30 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 21.27.

Forecast for FY23:

Shaw and Partners forecasts a full year FY23 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 134.00.

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

PMV    PREMIER INVESTMENTS LIMITED

Apparel & Footwear – Overnight Price: $27.57

Jarden rates ((PMV)) as Initiation of coverage with Overweight (2) –

Jarden initiates coverage of Premier Investments with an Overweight recommendation and a target price of $30.20.

The broker bases its recommendation on the company coming out of covid with a cleaner balance sheet, and a more capital light growth model via Smiggle wholesale and online.

Also contributing to Jarden's outlook are global growth opportunities through Peter Alexander, leveraging off global Smiggle distribution, and apparel brands which have growing ability to expand into new channels.

For FY21, Jarden is forecasting retail earnings of $323.7m versus recent company commentary noting it was confident in its ability to meet consensus at $318m. While risk has increased given the recent Melbourne lockdown, the broker believe targets should still be achievable.

Nearer term, the broker sees key catalysts being consensus upgrades into FY22 on underestimation of the reopening benefit, further news of more wholesale doors for Smiggle and likely currency tailwinds (15-20%) for cost of goods sold.

This report was issued June 9, 2021.

Target price is $30.20 Current Price is $27.57 Difference: $2.63
If PMV meets the Jarden target it will return approximately 10% (excluding dividends, fees and charges).
Current consensus price target is $27.22, suggesting downside of -0.0%(ex-dividends)
The company's fiscal year ends in July.

Forecast for FY21:

Jarden forecasts a full year FY21 dividend of 60.00 cents and EPS of 151.90 cents.
At the last closing share price the estimated dividend yield is 2.18%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.15.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 158.7, implying annual growth of 82.6%.
Current consensus DPS estimate is 88.5, implying a prospective dividend yield of 3.3%.
Current consensus EPS estimate suggests the PER is 17.2.

Forecast for FY22:

Jarden forecasts a full year FY22 dividend of 70.00 cents and EPS of 122.70 cents.
At the last closing share price the estimated dividend yield is 2.54%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 22.47.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 126.2, implying annual growth of -20.5%.
Current consensus DPS estimate is 89.0, implying a prospective dividend yield of 3.3%.
Current consensus EPS estimate suggests the PER is 21.6.

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

RMD    RESMED INC

Medical Equipment & Devices – Overnight Price: $32.95

Goldman Sachs rates ((RMD)) as Neutral (3) –

With vaccine roll-out progressing well in most key markets, ResMed sees scope to reach pre-covid levels of new patient starts within the next two quarters.

In Goldman Sachs' view, evidence of this recovery is the key factor to support a sustained re-rating in the stock.

With cost growth now increasing and revenues not yet normalised, Goldman Sachs sees scope for near-term margin pressure.

However, the broker notes management's keenness to emphasise the target to continue to deliver positive operating leverage through the mid/longer-term.

The Neutral rating and the target of $28.40 are both retained.

This report was published on June 9, 2021. 

Target price is $28.40 Current Price is $32.95 Difference: minus $4.55 (current price is over target).
If RMD meets the Goldman Sachs target it will return approximately minus 14% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $30.82, suggesting downside of -4.7%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Goldman Sachs forecasts a full year FY21 dividend of 21.40 cents and EPS of 70.88 cents.
At the last closing share price the estimated dividend yield is 0.65%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 46.49.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 70.6, implying annual growth of N/A.
Current consensus DPS estimate is 21.1, implying a prospective dividend yield of 0.7%.
Current consensus EPS estimate suggests the PER is 45.8.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 dividend of 21.40 cents and EPS of 76.22 cents.
At the last closing share price the estimated dividend yield is 0.65%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 43.23.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 81.9, implying annual growth of 16.0%.
Current consensus DPS estimate is 22.8, implying a prospective dividend yield of 0.7%.
Current consensus EPS estimate suggests the PER is 39.5.

This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

SCP    SHOPPING CENTRES AUSTRALASIA PROPERTY GROUP RE LIMITED

REITs – Overnight Price: $2.46

Moelis rates ((SCP)) as Buy (1) –

Shopping Centres Australasia expects net tangible assets (NTA) to increase by 11%, to $2.50 from $2.25, while second half FY21 distribution of 6.70cpu implies a full-year distribution of 12.40cpu.

Neighbourhood cap rates compressed to 5.75% from 6.25%, while sub regional cap rates compressed to 6.41% from 6.84%.

The group has acquired a further two properties: Mt Isa for $44m at a cap rate of 7.50%, and Warnbro Petrol Station for $5.1m at a cap rate of 5.69%. The company has also entered into an agreement to acquire Marketplace Raymond Terrace for $87.5m.

Moelis expects gearing to remain below 29%, with Marketplace Raymond Terrace likely to be somewhat funded by the dividend reinvestment plan.

With a low-cost, internalised management structure the group has historically traded at a premium to NTA averaging roughly 10%, and the broker hence views current levels as an attractive entry.

The Buy rating is retained and the target price increases to $2.68 from $2.64.

The report was published on June 10, 2021.

Target price is $2.68 Current Price is $2.46 Difference: $0.22
If SCP meets the Moelis target it will return approximately 9% (excluding dividends, fees and charges).
Current consensus price target is $2.46, suggesting downside of -0.6%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Moelis forecasts a full year FY21 dividend of 12.40 cents and EPS of 14.50 cents.
At the last closing share price the estimated dividend yield is 5.04%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.97.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 13.9, implying annual growth of 56.2%.
Current consensus DPS estimate is 12.3, implying a prospective dividend yield of 5.0%.
Current consensus EPS estimate suggests the PER is 17.8.

Forecast for FY22:

Moelis forecasts a full year FY22 dividend of 14.90 cents and EPS of 17.00 cents.
At the last closing share price the estimated dividend yield is 6.06%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.47.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 15.8, implying annual growth of 13.7%.
Current consensus DPS estimate is 14.4, implying a prospective dividend yield of 5.8%.
Current consensus EPS estimate suggests the PER is 15.6.

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

SUL    SUPER RETAIL GROUP LIMITED

Automobiles & Components – Overnight Price: $12.78

Jarden rates ((SUL)) as Initiation of coverage with Underweight (2) –

Jarden initiates coverage on Super retail Group with an Underweight rating and a $12.20 price target.

The broker is forecasting second half FY21 sales growth of around 31% due to MacPac and BCF, and expects second half FY21 earnings growth of 100% versus first half FY21 of 112%.

At around 5x FY22, with risk of heightened competition from marketplaces, Jarden sees risk that the multiple moves closer to historical levels in the high teens.

Coupled with risk around heightened capex and falling return in capital invested, the broker views risk to the downside.

To become more positive, Jarden would need to see the group move more aggressively into right-to-play categories, leveraging its existing data/supply-chain capabilities, which are top-quartile in the mid-cap retail space.

 This report was issued June 9, 2021.

Target price is $12.20 Current Price is $12.78 Difference: minus $0.58 (current price is over target).
If SUL meets the Jarden target it will return approximately minus 5% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $13.54, suggesting upside of 7.6%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Jarden forecasts a full year FY21 dividend of 104.00 cents and EPS of 161.50 cents.
At the last closing share price the estimated dividend yield is 8.14%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 7.91.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 129.8, implying annual growth of 132.7%.
Current consensus DPS estimate is 74.2, implying a prospective dividend yield of 5.9%.
Current consensus EPS estimate suggests the PER is 9.7.

Forecast for FY22:

Jarden forecasts a full year FY22 dividend of 56.00 cents and EPS of 86.00 cents.
At the last closing share price the estimated dividend yield is 4.38%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.86.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 88.7, implying annual growth of -31.7%.
Current consensus DPS estimate is 56.8, implying a prospective dividend yield of 4.5%.
Current consensus EPS estimate suggests the PER is 14.2.

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

TRS    REJECT SHOP LIMITED

Household & Personal Products – Overnight Price: $5.62

Jarden rates ((TRS)) as Buy (1) –

The Reject Shop is guiding to FY21 sales of $776-778m and underlying earnings of $8-10m, citing trading impacts and freight delays and costs as impacting results.

Jarden has cut its FY21 underlying earnings forecast by around -26% accordingly, now predicting a total of $8.5m, and cut FY22 forecasts similarly in anticipation of slow recovery of consumer spending. Despite weaker-than-expected sales, Jarden notes that operating de-leverage was better than sales would imply.

Jarden considers long-term prospects of The Reject Shop continue to improve. The Buy rating is retained and the target price decreases to $10.00 from $11.00.

This report was published on June 4, 2021.

Target price is $10.00 Current Price is $5.62 Difference: $4.38
If TRS meets the Jarden target it will return approximately 78% (excluding dividends, fees and charges).
Current consensus price target is $7.50, suggesting upside of 32.5%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Jarden forecasts a full year FY21 dividend of 0.00 cents and EPS of 13.30 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 42.26.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 17.6, implying annual growth of 391.6%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 32.2.

Forecast for FY22:

Jarden forecasts a full year FY22 dividend of 0.00 cents and EPS of 26.50 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 21.21.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 29.6, implying annual growth of 68.2%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 19.1.

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

TWE    TREASURY WINE ESTATES LIMITED

Food, Beverages & Tobacco – Overnight Price: $11.49

Goldman Sachs rates ((TWE)) as Neutral (3) –

Treasury Wine Estates took market share in May with a decline of -5.3% against a market down -14%, with both volume and price driving the outperformance.

While Chinese imports were down -8.6% in April, and -94.8% year-on-year on a value basis, Australian alcohol exports are showing greater resilience, which to Goldman Sachs suggests alternate market focus from industry.

Key upside risks flagged by Goldman Sachs include declines in the AUD/USD FX rate, a faster recovery of trading in the US operations,  improvement in China tariff scenario, and tangible progress on the company's proposed demerger of Penfolds.

The Neutral rating and target price of $10.60 are both retained.

This report was published on June 8, 2021. 

Target price is $10.60 Current Price is $11.49 Difference: minus $0.89 (current price is over target).
If TWE meets the Goldman Sachs target it will return approximately minus 8% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $10.94, suggesting downside of -4.8%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Goldman Sachs forecasts a full year FY21 dividend of 27.00 cents and EPS of 41.00 cents.
At the last closing share price the estimated dividend yield is 2.35%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 28.02.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 41.7, implying annual growth of 15.1%.
Current consensus DPS estimate is 22.0, implying a prospective dividend yield of 1.9%.
Current consensus EPS estimate suggests the PER is 27.6.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 dividend of 30.00 cents and EPS of 46.00 cents.
At the last closing share price the estimated dividend yield is 2.61%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 24.98.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 44.1, implying annual growth of 5.8%.
Current consensus DPS estimate is 23.6, implying a prospective dividend yield of 2.1%.
Current consensus EPS estimate suggests the PER is 26.1.

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

WHC    WHITEHAVEN COAL LIMITED

Coal – Overnight Price: $2.05

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

While strengthening thermal coal prices are mitigating the ongoing issues relating to the Narrabri longwall ground conditions and Whitehaven Coal's highly geared balance sheet, Bell Potter remains cautious near term on quarterly production performance, product quality and hence price realisation.

The net impacts to the broker's earnings per share estimates from coal price upgrades, adjustments to unit costs and realised prices include FY21 -8.4cps, previously -5.7cps, FY22 up 130%, and FY23 up 61%.

Bell Potter believes Whitehaven Coal's assets should de-risk as Maules Creek in-pit dumping ramps up and autonomous haulage is optimised in second half FY21, and as the Narrabri longwall returns to shallower and less complex coal geology in 2022.

Buy rating is retained with the target price increasing to $2.40 from $2.25.

This report was published on June 10, 2021.

Target price is $2.40 Current Price is $2.05 Difference: $0.35
If WHC meets the Bell Potter target it will return approximately 17% (excluding dividends, fees and charges).
Current consensus price target is $2.44, suggesting upside of 15.4%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY21:

Bell Potter forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 8.40 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 24.40.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -6.3, 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 FY22:

Bell Potter forecasts a full year FY22 dividend of 6.00 cents and EPS of 17.20 cents.
At the last closing share price the estimated dividend yield is 2.93%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.92.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 16.4, implying annual growth of N/A.
Current consensus DPS estimate is 4.0, implying a prospective dividend yield of 1.9%.
Current consensus EPS estimate suggests the PER is 12.9.

Market Sentiment: 0.9
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

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