Australian Broker Call *Extra* Edition – Feb 08, 2022

This story features A2 MILK COMPANY LIMITED, and other companies. For more info SHARE ANALYSIS: A2M

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)

A2M   ELO   EVN   FBU   IGO   KED   LBY   OZL   RWC   SDF   SHV   SOM   SRV   TNE   TNT   WPR  

A2M    A2 MILK COMPANY LIMITED

Dairy – Overnight Price: $5.35

Jarden rates ((A2M)) as Neutral (3) –

a2 Milk Company is hopeful for improved prospects in the second half, after an expectedly weak first half. Jarden is expecting first half infant milk formula revenue could be down -23% on the previous comparable period, and total revenue down -13%. 

The company noted its mix favoured English label infant milk formula, and pricing for this appears stable, but Jarden notes uncertainty over second half results remains given the difficulty of determining continuing volume decline among other headwinds.

The broker will look to any full year guidance revisions from the company as key to the second half outlook, but remains more conservative currently. Revenue forecasts reduce -9%, -7% and -4% respectively. 

The Neutral rating is retained and the target price decreases to NZ$6.40 from NZ$6.60.

This report was published on February 1, 2022.

Current Price is $5.35. Target price not assessed.
Current consensus price target is $6.15, suggesting upside of 15.0%(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 13.28 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 40.28.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 15.1, 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 35.4.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 0.00 cents and EPS of 16.58 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 32.27.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 20.9, implying annual growth of 38.4%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 25.6.

This company reports in NZD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.2
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

ELO    ELMO SOFTWARE LIMITED

Jobs & Skilled Labour Services – Overnight Price: $4.00

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

Shaw and Partners reiterates its Buy rating and $8.50 price target for Elmo Software following a 1H business update confirming top line growth rates are returning to pre-covid levels. Additionally, operating leverage is arising from a moderation in cost growth.

First half annual recurring revenue (ARR) was $98.3m compared to Shaw's $95m estimate.

The analyst feels current funding levels will see the company through to break even.

This report was published on February 1, 2022.

Target price is $8.50 Current Price is $4.00 Difference: $4.5
If ELO meets the Shaw and Partners target it will return approximately 113% (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 49.20 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 8.13.

Forecast for FY23:

Shaw and Partners forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 33.10 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 12.08.

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

EVN    EVOLUTION MINING LIMITED

Gold & Silver – Overnight Price: $3.62

JP Morgan rates ((EVN)) as Upgrade to Overweight from Neutral (1) –

Evolution Mining's 4Q production and costs were a -8% and -6% miss versus JP Morgans forecasts due to both covid and weather impacts. Nonetheless, the broker upgrades its rating to Overweight from Neutral on recent share price and gold price weakness.

For another quarter Red Lake experienced poor production and costs though management believes in upside from here as asset development rates continue to rise.

In making a case for gold more generally, the company cites the potential for higher inflation and heightened tensions in Eastern Europe. The target price rises to $4.60 from $4.50.

This report was published on January 31, 2022.

Target price is $4.60 Current Price is $3.62 Difference: $0.98
If EVN meets the JP Morgan target it will return approximately 27% (excluding dividends, fees and charges).
Current consensus price target is $4.21, suggesting upside of 16.3%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

JP Morgan forecasts a full year FY22 dividend of 10.00 cents and EPS of 24.00 cents.
At the last closing share price the estimated dividend yield is 2.76%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.08.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 20.1, implying annual growth of -0.5%.
Current consensus DPS estimate is 4.6, implying a prospective dividend yield of 1.3%.
Current consensus EPS estimate suggests the PER is 18.0.

Forecast for FY23:

JP Morgan forecasts a full year FY23 dividend of 12.00 cents and EPS of 43.00 cents.
At the last closing share price the estimated dividend yield is 3.31%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 8.42.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 24.4, implying annual growth of 21.4%.
Current consensus DPS estimate is 6.3, implying a prospective dividend yield of 1.7%.
Current consensus EPS estimate suggests the PER is 14.8.

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

FBU    FLETCHER BUILDING LIMITED

Building Products & Services – Overnight Price: $5.86

JP Morgan rates ((FBU)) as Downgrade to Neutral from Overweight (3) –

JP Morgan believes the macro backdrop remains supportive for the building materials sector in 2022. However, to counter mounting supply chain risks, the broker prefers companies with a strong track record of execution, relative pricing power and local manufacturing.

For Fletcher Building, the analyst believes volume increases and cost savings are largely factored-in. It's thought price rises in excess of cost inflation will be required to drive upwards earnings revisions from here.

As a result, the broker lowers its rating to Neutral from Overweight and the target price falls to NZ$6.85 from NZ$8.25.

This report was published on February 4, 2022.

Current Price is $5.86. Target price not assessed.
Current consensus price target is $8.60, suggesting upside of 46.8%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

JP Morgan forecasts a full year FY22 dividend of 28.26 cents and EPS of 48.04 cents.
At the last closing share price the estimated dividend yield is 4.82%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.20.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 46.5, implying annual growth of N/A.
Current consensus DPS estimate is 29.2, implying a prospective dividend yield of 5.0%.
Current consensus EPS estimate suggests the PER is 12.6.

Forecast for FY23:

JP Morgan forecasts a full year FY23 dividend of 31.09 cents and EPS of 51.81 cents.
At the last closing share price the estimated dividend yield is 5.30%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.31.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 50.9, implying annual growth of 9.5%.
Current consensus DPS estimate is 33.3, implying a prospective dividend yield of 5.7%.
Current consensus EPS estimate suggests the PER is 11.5.

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

IGO    IGO LIMITED

Nickel – Overnight Price: $12.01

JP Morgan rates ((IGO)) as Overweight (1) –

Both 1H earnings (EBITDA) and profit were a beat versus JP Morgan's forecasts, following better-than expected outcomes at Nova. However, capex guidance for Greenbushes was materially higher than the analyst had forecast.

The broker maintains its Overweight rating on valuation support and in the wake of a recent share price pullback.

The analyst's FY22 and FY23 profit forecasts are increased by 19% and 10% to incorporate higher forward-curve-based nickel prices. The target rises to $12.90 from $12.30.

This report was published on February 1, 2022.

Target price is $12.90 Current Price is $12.01 Difference: $0.89
If IGO meets the JP Morgan target it will return approximately 7% (excluding dividends, fees and charges).
Current consensus price target is $10.70, suggesting downside of -10.9%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

JP Morgan forecasts a full year FY22 dividend of 10.00 cents and EPS of 47.00 cents.
At the last closing share price the estimated dividend yield is 0.83%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 25.55.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 46.4, implying annual growth of 92.1%.
Current consensus DPS estimate is 11.0, implying a prospective dividend yield of 0.9%.
Current consensus EPS estimate suggests the PER is 25.9.

Forecast for FY23:

JP Morgan forecasts a full year FY23 dividend of 45.00 cents and EPS of 129.00 cents.
At the last closing share price the estimated dividend yield is 3.75%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.31.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 103.0, implying annual growth of 122.0%.
Current consensus DPS estimate is 24.2, implying a prospective dividend yield of 2.0%.
Current consensus EPS estimate suggests the PER is 11.7.

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

KED    KEYPATH EDUCATION INTERNATIONAL INC

Overnight Price: $2.50

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

Shaw and Partners initiates coverage on Keypath Education International, a provider of online management services for universities in North America, Asia Pacific and Europe, offering investors exposure to the online education segment. 

Keypath Education offers traditional education institutions access to digital infrastructures and upfront capital to support online learning, for a share of student tuition revenue. 

Shaw expects revenue to increase to more than $240m by FY26, a compound annual growth rate of 25%, but notes upside risk includes the signing of more partners, new program launched, new students enrolments, and improved revenue and cost per student. 

The broker initiates with a Buy rating and a target price of $4.65.

This report was published on February 2, 2022.

Target price is $4.65 Current Price is $2.50 Difference: $2.15
If KED meets the Shaw and Partners target it will return approximately 86% (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 9.80 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 25.51.

Forecast for FY23:

Shaw and Partners forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 5.90 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 42.37.

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

LBY    LAYBUY GROUP HOLDINGS, LIMITED

Business & Consumer Credit – Overnight Price: $0.15

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

Laybuy Group's December-quarter result fell short of Bell Potter's forecasts, despite reporting record gross merchandising value and meeting management's targets, thanks to slowing customer growth and fraud-related defaults (the latter was pre-announced).

About 1200 merchants were added in the quarter, taking the total to 12,900 but customer growth in A&NZ and Britain rose a disappointing 5%. Cash outflows rose due to receivables growth, which management expects will unwind in the March quarter.

Management expects mitigation should reduce fraud-related default and maintains guidance. 

Bell Potter downgrades to Hold from Buy and cuts EPS estimates, spying high funding and dilution risks given market capitalisation versus cash-burn, after the sector's recent derating. Target price falls to 24c from 85c.

This report was published on February 1, 2022.

Target price is $0.24 Current Price is $0.15 Difference: $0.09
If LBY meets the Bell Potter target it will return approximately 60% (excluding dividends, fees and charges).
The company's fiscal year ends in March.

Forecast for FY21:

Bell Potter forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 14.50 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 1.03.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 8.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 1.88.

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

OZL    OZ MINERALS LIMITED

Copper – Overnight Price: $25.02

JP Morgan rates ((OZL)) as Neutral (3) –

While OZ Minerals' 4Q production was in-line with JP Morgans expectations, the broker reduces its FY22 earnings estimates by -15% on higher-than-expected guidance for costs. The target price falls to $24 from $27, while the Neutral rating is unchanged.

Commentary from the company pointed to higher freight rates, inflationary pressures and higher treatment and refining charges (TC/RC) in 2022.

The broker prefers OZ Minerals over Sandfire Resources ((SFR)) for copper exposure, though sees the ASX copper space as expensive.

This report was published on January 28, 2022.

Target price is $24.00 Current Price is $25.02 Difference: minus $1.02 (current price is over target).
If OZL meets the JP Morgan target it will return approximately minus 4% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $24.99, suggesting downside of -0.1%(ex-dividends)
The company's fiscal year ends in December.

Forecast for FY21:

JP Morgan forecasts a full year FY21 dividend of 49.00 cents and EPS of 176.00 cents.
At the last closing share price the estimated dividend yield is 1.96%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.22.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 161.1, implying annual growth of 147.0%.
Current consensus DPS estimate is 27.8, implying a prospective dividend yield of 1.1%.
Current consensus EPS estimate suggests the PER is 15.5.

Forecast for FY22:

JP Morgan forecasts a full year FY22 dividend of 48.00 cents and EPS of 161.00 cents.
At the last closing share price the estimated dividend yield is 1.92%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.54.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 156.8, implying annual growth of -2.7%.
Current consensus DPS estimate is 27.0, implying a prospective dividend yield of 1.1%.
Current consensus EPS estimate suggests the PER is 16.0.

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

RWC    RELIANCE WORLDWIDE CORP. LIMITED

Building Products & Services – Overnight Price: $5.17

JP Morgan rates ((RWC)) as Neutral (3) –

JP Morgan believes the macro backdrop remains supportive for the building materials sector in 2022. However, to counter mounting supply chain risks, the broker prefers companies with a strong track record of execution, relative pricing power and local manufacturing.

For Reliance Worldwide Corp, the analyst sees not only supply chain pressure but also elevated commodity price pressure.

A large proportion of production in Australia and China (via the EZ-FLO acquisition) is transported to the US. As a result, JP Morgan lowers its target price to $5.30 from $6.10 and retains its Neutral rating.

This report was published on January 31, 2022.

Target price is $5.30 Current Price is $5.17 Difference: $0.13
If RWC meets the JP Morgan target it will return approximately 3% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY22:

JP Morgan forecasts a full year FY22 dividend of 14.00 cents and EPS of 20.00 cents.
At the last closing share price the estimated dividend yield is 2.71%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 25.85.

Forecast for FY23:

JP Morgan forecasts a full year FY23 dividend of 16.00 cents and EPS of 23.00 cents.
At the last closing share price the estimated dividend yield is 3.09%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 22.48.

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

SDF    STEADFAST GROUP LIMITED

Insurance – Overnight Price: $4.81

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

Jarden initiates coverage on insurance broker Steadfast Group with an Overweight rating and a $5.20 target price. There's expected to be positive premium rate momentum for the industry and the potential for the company to grow by acquistion.

In addition to a hardening commercial rate cycle (over 85% of gross written premium is commercial insurance), network optimisation has improved broker earnings (EBITA) margins, explains the analyst.

Overall, Jarden sees a very attractive potential total shareholder return for the company.

This report was published on February 2, 2022.

Target price is $5.20 Current Price is $4.81 Difference: $0.39
If SDF meets the Jarden target it will return approximately 8% (excluding dividends, fees and charges).
Current consensus price target is $5.42, suggesting upside of 12.7%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Jarden forecasts a full year FY22 dividend of 12.90 cents and EPS of 21.00 cents.
At the last closing share price the estimated dividend yield is 2.68%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 22.90.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 19.1, implying annual growth of 15.4%.
Current consensus DPS estimate is 12.5, implying a prospective dividend yield of 2.6%.
Current consensus EPS estimate suggests the PER is 25.2.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 14.10 cents and EPS of 22.20 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 21.67.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 21.0, implying annual growth of 9.9%.
Current consensus DPS estimate is 12.0, implying a prospective dividend yield of 2.5%.
Current consensus EPS estimate suggests the PER is 22.9.

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

SHV    SELECT HARVESTS LIMITED

Agriculture – Overnight Price: $5.50

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

Despite rising kernel prices, Bell Potter notes Californian producers' crop receipts have fallen sharply and suspects they may become forced sellers ahead of the new season.

But given Select Harvests' -40% share-price slump since September, the broker upgrades to Buy from Hold.

Target price falls to $7.10 from $7.60 in anticipation of price pressures.

This report was published on February 1, 2022.

Target price is $7.10 Current Price is $5.50 Difference: $1.6
If SHV meets the Bell Potter target it will return approximately 29% (excluding dividends, fees and charges).
The company's fiscal year ends in September.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 10.00 cents and EPS of 23.90 cents.
At the last closing share price the estimated dividend yield is 1.82%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 23.01.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 14.00 cents and EPS of 33.10 cents.
At the last closing share price the estimated dividend yield is 2.55%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.62.

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

SOM    SOMNOMED LIMITED

Medical Equipment & Devices – Overnight Price: $2.06

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

SomnoMed has announced plans to launch a new oral appliance featuring on-board therapy data capture.

Wilsons believes this launch may help oral appliance therapy (OAT) attain greater market share in the US. Utilisation of these devices in preference to continuous positive airway pressure (CPAP) machines currently lags that in other jurisdictions. 

Making data available to prescribing sleep physicians may increase adoption and encourage broader reimbursement cover for SomnoMed’s medical device business, explains the broker.

The Market Weight rating and $2.40 target price are retained.

This report was published on January 31, 2022.

Target price is $2.40 Current Price is $2.06 Difference: $0.34
If SOM meets the Wilsons target it will return approximately 17% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY22:

Wilsons forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 4.10 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 50.24.

Forecast for FY23:

Wilsons forecasts a full year FY23 dividend of 0.00 cents and EPS of 4.40 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 46.82.

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

SRV    SERVCORP LIMITED

Commercial Services & Supplies – Overnight Price: $3.58

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

Shaw and partners initiates coverage on Servcorp, the provider of workplace solutions, with a Buy rating and $6 target price. The company hasn't missed a dividend since listing on the ASX in 1999 and holds circa 30% of its market cap in cash and fixed rate securities.

The analyst likes the recovery story, after the company was impacted by reduced CBD occupancy rates and less demand for ancillary services during the pandemic. These include meeting room bookings and printing.

The company is trading on less than half the multiple of UK-listed competitor IWG Plc, estimates the broker, which invites the potential that a major competitor could launch a takeover bid.

This report was published on January 31, 2022.

Target price is $6.00 Current Price is $3.58 Difference: $2.42
If SRV meets the Shaw and Partners target it will return approximately 68% (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 18.00 cents and EPS of 28.00 cents.
At the last closing share price the estimated dividend yield is 5.03%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.79.

Forecast for FY23:

Shaw and Partners forecasts a full year FY23 dividend of 20.00 cents and EPS of 32.30 cents.
At the last closing share price the estimated dividend yield is 5.59%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.08.

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

TNE    TECHNOLOGY ONE LIMITED

IT & Support – Overnight Price: $10.20

Shaw and Partners rates ((TNE)) as Upgrade to Buy from Hold (1) –

Shaw and Partners upgrades its rating to Buy from Hold for TechnologyOne, as current multiples are now at the lower end of the historical range.

Over time, the broker sees material earnings growth and margin expansion along with potential upside from UK market penetration. There's also considered to be upside should the company enter new geographies, including the US.

The target price rises to $11.90 from $11.75.

This report was published on February 1, 2022.

Target price is $11.90 Current Price is $10.20 Difference: $1.7
If TNE meets the Shaw and Partners target it will return approximately 17% (excluding dividends, fees and charges).
Current consensus price target is $11.83, suggesting upside of 16.0%(ex-dividends)
The company's fiscal year ends in September.

Forecast for FY22:

Shaw and Partners forecasts a full year FY22 dividend of 14.90 cents and EPS of 27.10 cents.
At the last closing share price the estimated dividend yield is 1.46%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 37.64.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 26.4, implying annual growth of 16.6%.
Current consensus DPS estimate is 16.2, implying a prospective dividend yield of 1.6%.
Current consensus EPS estimate suggests the PER is 38.6.

Forecast for FY23:

Shaw and Partners forecasts a full year FY23 dividend of 16.00 cents and EPS of 30.00 cents.
At the last closing share price the estimated dividend yield is 1.57%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 34.00.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 29.3, implying annual growth of 11.0%.
Current consensus DPS estimate is 18.6, implying a prospective dividend yield of 1.8%.
Current consensus EPS estimate suggests the PER is 34.8.

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

TNT    TESSERENT LIMITED

IT & Support – Overnight Price: $0.16

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

Shaw and Partners reiterates its Buy rating and $0.35 target price for Tesserent following a broadly positive 2Q cashflow report and trading update.

The broker points out organic earnings growth remains high at 30% versus the previous corresponding period.

The analyst derives comfort around FY22 earnings from management's expectation for historical seasonality, and thus a strong 2H. 

This report was published on February 1, 2022.

Target price is $0.35 Current Price is $0.16 Difference: $0.19
If TNT meets the Shaw and Partners target it will return approximately 119% (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 0.70 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 22.86.

Forecast for FY23:

Shaw and Partners forecasts a full year FY23 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 16.00.

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

WPR    WAYPOINT REIT LIMITED

REITs – Overnight Price: $2.74

Moelis rates ((WPR)) as Buy (1) –

Waypoint REIT's second half valuation update revealed portfolio cap rate compression to 5.15%, and Moelis expects the net tangible assets to have increased 6-7% in the half. 

Share buybacks saw the company return around $170m to shareholders in the second half, or around 8% of net tangible assets. Moelis notes the stock price should be attractive to investors given the discount to peers. 

The Buy rating is retained and the target price increases to $3.06 from $2.88. 

This report was published on February 1, 2022.

Target price is $3.06 Current Price is $2.74 Difference: $0.32
If WPR meets the Moelis target it will return approximately 12% (excluding dividends, fees and charges).
Current consensus price target is $2.88, suggesting upside of 5.0%(ex-dividends)
The company's fiscal year ends in December.

Forecast for FY21:

Moelis forecasts a full year FY21 dividend of 16.70 cents and EPS of 16.70 cents.
At the last closing share price the estimated dividend yield is 6.09%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.41.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 16.2, implying annual growth of -57.5%.
Current consensus DPS estimate is 16.1, implying a prospective dividend yield of 5.9%.
Current consensus EPS estimate suggests the PER is 16.9.

Forecast for FY22:

Moelis forecasts a full year FY22 dividend of 16.60 cents and EPS of 16.60 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 16.51.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 16.3, implying annual growth of 0.6%.
Current consensus DPS estimate is 16.4, implying a prospective dividend yield of 6.0%.
Current consensus EPS estimate suggests the PER is 16.8.

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

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