Australian Broker Call *Extra* Edition – Feb 14, 2022

This story features CHARTER HALL SOCIAL INFRASTRUCTURE REIT, and other companies. For more info SHARE ANALYSIS: CQE

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)

CQE   EVO   EVS   GEM   ING   M7T   MFD   MGR   MMM   NAB   NST (2)   PTM   UMG (2)  

CQE    CHARTER HALL SOCIAL INFRASTRUCTURE REIT

Childcare – Overnight Price: $3.91

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

Cannacord Genuity sees positive supply/demand trends for the Long Day Care sector that should support occupancy growth in 2022. A slowing in development activity has coincided with a record number of children enrolled.

Moreover, the broker sees demand trends continuing due to favourable government regulatory changes and a mini baby boom in 2021.

The analyst retains a Buy rating and $3.69 target price for Charter Hall Social Infrastructure REIT. 

This report was published on February 11, 2022.

Target price is $3.69 Current Price is $3.91 Difference: minus $0.22 (current price is over target).
If CQE meets the Canaccord Genuity target it will return approximately minus 6% (excluding dividends, fees and charges – negative figures indicate an expected loss).
The company's fiscal year ends in June.

Forecast for FY22:

Canaccord Genuity forecasts a full year FY22 dividend of 17.00 cents and EPS of 17.70 cents.
At the last closing share price the estimated dividend yield is 4.35%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 22.09.

Forecast for FY23:

Canaccord Genuity forecasts a full year FY23 dividend of 18.00 cents and EPS of 18.80 cents.
At the last closing share price the estimated dividend yield is 4.60%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 20.80.

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

EVO    EVOLVE EDUCATION GROUP LIMITED

Education & Tuition – Overnight Price: $0.81

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

Cannacord Genuity sees positive supply/demand trends for the Long Day Care sector that should support occupancy growth in 2022. A slowing in development activity has coincided with a record number of children enrolled.

Moreover, the broker sees demand trends continuing due to favourable government regulatory changes and a mini baby boom in 2021.

The analyst retains a Buy rating and NZ$1.20 target price for Evolve Education Group.

This report was published on February 11, 2022.

Current Price is $0.81. Target price not assessed.

This company reports in NZD. 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

EVS    ENVIROSUITE LIMITED

Industrial Sector Contractors & Engineers – Overnight Price: $0.19

Sequoia rates ((EVS)) as Initiation of coverage with Buy (1) –

Sequoia Financial Group has initiated coverage on Envirosuite with a Buy (High Risk) rating and 23c target price, noting the company is trading below valuation, has an ESG profile, and that in the aviation industry from which it derives the bulk of its revenue is on the road to recovery.

Envirosuite is a provider of Software-as-a-service solutions that help mitigate corporate environmental effects such as noise, vibration, air and water quality, odour, and dust.

About 67% of the company's revenue is sourced from aviation; Omnis 34% and the newly established division of water (0.1%).

Sequoia notes the Envirosuite has 260 staff in 12 countries and 500 clients in 40 countries, having launched in 20011.

The broker observes that the company has a $4.2bn addressable market; that recent acquisitions are nearing integration completion; and the water division has signed with global consultancy GHD.

This report was published on February 11, 2022.

Target price is $0.23 Current Price is $0.19 Difference: $0.04
If EVS meets the Sequoia target it will return approximately 21% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY22:

Sequoia forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 0.80 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 23.75.

Forecast for FY23:

Sequoia forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 0.50 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 38.00.

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

GEM    G8 EDUCATION LIMITED

Childcare – Overnight Price: $1.16

Canaccord Genuity rates ((GEM)) as Hold (3) –

Cannacord Genuity sees positive supply/demand trends for the Long Day Care sector that should support occupancy growth in 2022. A slowing in development activity has coincided with a record number of children enrolled.

Moreover, the broker sees demand trends continuing due to favourable government regulatory changes and a mini baby boom in 2021.

The analyst retains a Hold rating and $1.07 target price for G8 Education.

This report was published on February 11, 2022.

Target price is $1.07 Current Price is $1.16 Difference: minus $0.09 (current price is over target).
If GEM meets the Canaccord Genuity target it will return approximately minus 8% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $1.15, suggesting downside of -1.7%(ex-dividends)
The company's fiscal year ends in December.

Forecast for FY21:

Canaccord Genuity forecasts a full year FY21 dividend of 3.00 cents and EPS of 6.00 cents.
At the last closing share price the estimated dividend yield is 2.59%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 19.33.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 4.7, implying annual growth of N/A.
Current consensus DPS estimate is 1.0, implying a prospective dividend yield of 0.9%.
Current consensus EPS estimate suggests the PER is 24.9.

Forecast for FY22:

Canaccord Genuity forecasts a full year FY22 dividend of 5.00 cents and EPS of 8.00 cents.
At the last closing share price the estimated dividend yield is 4.31%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.50.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 7.0, implying annual growth of 48.9%.
Current consensus DPS estimate is 5.0, implying a prospective dividend yield of 4.3%.
Current consensus EPS estimate suggests the PER is 16.7.

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

ING    INGHAMS GROUP LIMITED

Food, Beverages & Tobacco – Overnight Price: $3.56

Goldman Sachs rates ((ING)) as Downgrade to Neutral from Buy (3) –

Goldman Sachs expects covid-related pressures to continue to impact on Ingham Group margins given lengthy supply chains.

Ingham Group's near-term margins outlook is determined by feed prices contracted 3-9 months prior, with feed accounting for around 50% of the company's cost of goods sold, and the company is likely to face pricing pressure for the remainder of 2022. 

The broker has been Buy rated on Inghams Group since February 2020 but downgrades given limited upside to the current target price. 

The rating is downgraded to Neutral from Buy and the target price of $3.75 is retained. 

This report was published on February 11, 2022.

Target price is $3.75 Current Price is $3.56 Difference: $0.19
If ING meets the Goldman Sachs target it will return approximately 5% (excluding dividends, fees and charges).
Current consensus price target is $3.83, suggesting upside of 9.4%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 dividend of 16.00 cents and EPS of 23.00 cents.
At the last closing share price the estimated dividend yield is 4.49%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.48.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 22.2, implying annual growth of -1.0%.
Current consensus DPS estimate is 15.1, implying a prospective dividend yield of 4.3%.
Current consensus EPS estimate suggests the PER is 15.8.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 dividend of 20.00 cents and EPS of 29.00 cents.
At the last closing share price the estimated dividend yield is 5.62%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.28.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 27.1, implying annual growth of 22.1%.
Current consensus DPS estimate is 18.1, implying a prospective dividend yield of 5.2%.
Current consensus EPS estimate suggests the PER is 12.9.

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

M7T    MACH7 TECHNOLOGIES LIMITED

Healthcare services – Overnight Price: $0.79

Shaw and Partners rates ((M7T)) as Buy (1) –

Shaw & Partners reports that Mach7 Technologies has shot up in the KLAS rankings to No.2 and No.3 in the Universal Viewer and Vendor Neutral Archive segments. To the Universal Viewer Segment customer responses to "would you buy again?" the company received a 95% Yes.

The broker believes this is significant, noting KLAS is the go-to resource for Health IT buyers and says it adds weight to recent AGM comments that it was receiving more requests for proposals and tenders in FY22, over FY21.

Mach7 is one of the broker's top picks. Buy rating and $1.50 target price reiterated.

This report was published on February 11, 2022.

Target price is $1.50 Current Price is $0.79 Difference: $0.71
If M7T meets the Shaw and Partners target it will return approximately 90% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY22:

Shaw and Partners forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 1.70 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 46.47.

Forecast for FY23:

Shaw and Partners forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 0.80 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 98.75.

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

MFD    MAYFIELD CHILDCARE LIMITED

Childcare – Overnight Price: $1.16

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

Cannacord Genuity sees positive supply/demand trends for the Long Day Care sector that should support occupancy growth in 2022. A slowing in development activity has coincided with a record number of children enrolled.

Moreover, the broker sees demand trends continuing due to favourable government regulatory changes and a mini baby boom in 2021.

The analyst retains a Buy rating and $1.70 target price for Mayfield Childcare.

This report was published on February 11, 2022.

Target price is $1.70 Current Price is $1.16 Difference: $0.54
If MFD meets the Canaccord Genuity target it will return approximately 47% (excluding dividends, fees and charges).
The company's fiscal year ends in December.

Forecast for FY21:

Canaccord Genuity forecasts a full year FY21 dividend of 5.00 cents and EPS of 12.20 cents.
At the last closing share price the estimated dividend yield is 4.31%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.51.

Forecast for FY22:

Canaccord Genuity forecasts a full year FY22 dividend of 8.50 cents and EPS of 17.60 cents.
At the last closing share price the estimated dividend yield is 7.33%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 6.59.

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

MGR    MIRVAC GROUP

Infra & Property Developers – Overnight Price: $2.47

Jarden rates ((MGR)) as Downgrade to Neutral from Overweight (3) –

Mirvac Group's first half results were largely in line with Jarden's forecasts, but the broker was disappointed that the company issued no update to the full year outlook and continues to guide to earnings of 15.0 cents per share and a 10.2 cent per share dividend. 

The residential segment provided a strong contribution, with settlements up 21% on the previous comparable period and contracts on hand of $1.5bn compared to $1.2bn, but fixed rate mortgage increases and potential rate increases will add pressure in the second half.

The rating is downgraded to Neutral from Overweight and the target price decreases to $2.95 from $3.30.

This report was published on February 10, 2022.

Target price is $2.95 Current Price is $2.47 Difference: $0.48
If MGR meets the Jarden target it will return approximately 19% (excluding dividends, fees and charges).
Current consensus price target is $3.10, suggesting upside of 24.3%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Jarden forecasts a full year FY22 dividend of 10.20 cents and EPS of 15.30 cents.
At the last closing share price the estimated dividend yield is 4.13%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.14.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 14.4, implying annual growth of -37.1%.
Current consensus DPS estimate is 10.2, implying a prospective dividend yield of 4.1%.
Current consensus EPS estimate suggests the PER is 17.3.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 11.00 cents and EPS of 16.20 cents.
At the last closing share price the estimated dividend yield is 4.45%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.25.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 16.1, implying annual growth of 11.8%.
Current consensus DPS estimate is 11.3, implying a prospective dividend yield of 4.5%.
Current consensus EPS estimate suggests the PER is 15.5.

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

MMM    MARLEY SPOON AG

Consumer Products & Services – Overnight Price: $0.74

Sequoia rates ((MMM)) as Buy (1) –

Following 4Q results for Marley Spoon, Sequoia gains increased confidence from better than expected subscribers, price rises and a lower marketing spend.

Following 3Q results back on 28/10/21, the market had fears of a bigger post-covid slowdown and a blowout in costs, neither of which eventuated, points out the analyst. The share price has fallen -49% since that time and it's felt the derating is over.

The Buy rating is maintained and the target set at $1.55, up from $1.41.

This report was published on February 10, 2022.

Target price is $1.55 Current Price is $0.74 Difference: $0.81
If MMM meets the Sequoia target it will return approximately 109% (excluding dividends, fees and charges).
The company's fiscal year ends in December.

Forecast for FY21:

Sequoia forecasts a full year FY21 dividend of 0.00 cents and EPS of minus 27.57 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 2.68.

Forecast for FY22:

Sequoia forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 20.16 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 3.67.

This company reports in EUR. 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

NAB    NATIONAL AUSTRALIA BANK LIMITED

Banks – Overnight Price: $29.84

Goldman Sachs rates ((NAB)) as Buy (1) –

A strong first quarter for National Bank saw earnings from continuing operations increase to $1.80bn, up 12% on the previous quarter and 6% ahead of Goldman Sachs' expectations. 

Core bank business continues to perform well, and looking forward Goldman Sachs expects the bank to benefit from further economic recovery given high exposure to business banking and from an improving net interest margin assuming potential rate rises. 

Earnings per share forecasts increase 2.8%, 5.8% and 8.7% through to FY24. National Bank remains Goldman Sachs' preferred sector stock pick (it's on the broker's Conviction List).

The Buy rating is retained and the target price increases to $31.33 from $31.15. 

This report was published on February 10, 2022.

Target price is $31.33 Current Price is $29.84 Difference: $1.49
If NAB meets the Goldman Sachs target it will return approximately 5% (excluding dividends, fees and charges).
Current consensus price target is $30.86, suggesting upside of 2.2%(ex-dividends)
The company's fiscal year ends in September.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 dividend of 145.00 cents and EPS of 205.00 cents.
At the last closing share price the estimated dividend yield is 4.86%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.56.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 202.6, implying annual growth of 5.0%.
Current consensus DPS estimate is 142.7, implying a prospective dividend yield of 4.7%.
Current consensus EPS estimate suggests the PER is 14.9.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 dividend of 154.00 cents and EPS of 210.00 cents.
At the last closing share price the estimated dividend yield is 5.16%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.21.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 219.4, implying annual growth of 8.3%.
Current consensus DPS estimate is 153.7, implying a prospective dividend yield of 5.1%.
Current consensus EPS estimate suggests the PER is 13.8.

Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

NST    NORTHERN STAR RESOURCES LIMITED

Gold & Silver – Overnight Price: $8.50

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

First half results for Northern Star Resources were a -15% miss versus JP Morgans estimate for earnings (EBITDA), following non-cash inventory charges. The dividend was below 13cps expectations at 10cps.

Management maintained guidance. The broker rates the company as its key gold coverage pick and keeps its Overweight rating and $11 price target.

The analyst reduces the probability to 50% that the joint venture with Osisko on the Windfall Development project will proceed, after more cautious management commentary.

This report was published on February 11, 2022.

Target price is $11.00 Current Price is $8.50 Difference: $2.5
If NST meets the JP Morgan target it will return approximately 29% (excluding dividends, fees and charges).
Current consensus price target is $11.48, suggesting upside of 25.7%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

JP Morgan forecasts a full year FY22 dividend of 24.00 cents and EPS of 32.00 cents.
At the last closing share price the estimated dividend yield is 2.82%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 26.56.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 30.0, implying annual growth of -73.8%.
Current consensus DPS estimate is 23.3, implying a prospective dividend yield of 2.6%.
Current consensus EPS estimate suggests the PER is 30.4.

Forecast for FY23:

JP Morgan forecasts a full year FY23 dividend of 33.00 cents and EPS of 60.00 cents.
At the last closing share price the estimated dividend yield is 3.88%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.17.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 33.2, implying annual growth of 10.7%.
Current consensus DPS estimate is 26.5, implying a prospective dividend yield of 2.9%.
Current consensus EPS estimate suggests the PER is 27.5.

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

Northern Star Resources's FY22 December-half appears to have satisfied Shaw & Partners.

The company reports record cash earnings and the dividend rose 5%.

While the broker sharply downgrades FY22 EPS to reflect higher costs, the focus is on FY23. Key growth projects are progressing, guidance is steady and the broker remains upbeat.

Buy rating and $12 target price retained.

This report was published on February 11, 2022.

Target price is $12.00 Current Price is $8.50 Difference: $3.5
If NST meets the Shaw and Partners target it will return approximately 41% (excluding dividends, fees and charges).
Current consensus price target is $11.48, suggesting upside of 25.7%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Shaw and Partners forecasts a full year FY22 dividend of 20.00 cents and EPS of 22.40 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 37.95.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 30.0, implying annual growth of -73.8%.
Current consensus DPS estimate is 23.3, implying a prospective dividend yield of 2.6%.
Current consensus EPS estimate suggests the PER is 30.4.

Forecast for FY23:

Shaw and Partners forecasts a full year FY23 dividend of 22.00 cents and EPS of 50.60 cents.
At the last closing share price the estimated dividend yield is 2.59%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.80.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 33.2, implying annual growth of 10.7%.
Current consensus DPS estimate is 26.5, implying a prospective dividend yield of 2.9%.
Current consensus EPS estimate suggests the PER is 27.5.

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

PTM    PLATINUM ASSET MANAGEMENT LIMITED

Wealth Management & Investments – Overnight Price: $2.62

Bell Potter rates ((PTM)) as Downgrade to Sell from Hold (5) –

Bell Potter is tiring of Platinum Asset Management's failure to examine options to improve returns to shareholders – notably via a buyback.

The broker notes that yes, the funds themselves have been performing well but management fees, which contribute to the share price, are not, as the fund manager appears to be suffering from the global repositioning of funds arising from covid and ESG. 

Fund under management continue to be weak, the diversity of funds low, and Bell Potter can see no relief on the horizon.

Rating is downgraded from Hold to Sell. Target price falls to $2.22 from $3.60.

This report was published on February 11, 2022.

Target price is $2.22 Current Price is $2.62 Difference: minus $0.4 (current price is over target).
If PTM meets the Bell Potter target it will return approximately minus 15% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $2.76, suggesting upside of 7.0%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 21.00 cents and EPS of 20.30 cents.
At the last closing share price the estimated dividend yield is 8.02%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.91.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 23.6, implying annual growth of -16.2%.
Current consensus DPS estimate is 22.0, implying a prospective dividend yield of 8.5%.
Current consensus EPS estimate suggests the PER is 10.9.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 19.00 cents and EPS of 18.80 cents.
At the last closing share price the estimated dividend yield is 7.25%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.94.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 22.6, implying annual growth of -4.2%.
Current consensus DPS estimate is 21.3, implying a prospective dividend yield of 8.3%.
Current consensus EPS estimate suggests the PER is 11.4.

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

UMG    UNITED MALT GROUP LIMITED

Agriculture – Overnight Price: $4.14

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

United Malt Group's AGM guidance was steady. Bell Potter tinkers with profit estimates to account for foreign currency fluctuations.

The broker believes the worst of covid is behind the company, but says share-price gains will rely on the company posting returns from its UK investments ahead of industry peer margins and on the company's execution of its transformation program.

Hold rating and $4.35 target price retained.

This report was published on February 11, 2022.

Target price is $4.35 Current Price is $4.14 Difference: $0.21
If UMG meets the Bell Potter target it will return approximately 5% (excluding dividends, fees and charges).
Current consensus price target is $4.82, suggesting upside of 15.3%(ex-dividends)
The company's fiscal year ends in September.

Forecast for FY22:

Bell Potter forecasts a full year FY22 dividend of 6.50 cents and EPS of 15.70 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 26.37.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 20.3, implying annual growth of 340.3%.
Current consensus DPS estimate is 12.4, implying a prospective dividend yield of 3.0%.
Current consensus EPS estimate suggests the PER is 20.6.

Forecast for FY23:

Bell Potter forecasts a full year FY23 dividend of 11.50 cents and EPS of 23.10 cents.
At the last closing share price the estimated dividend yield is 2.78%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.92.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 27.8, implying annual growth of 36.9%.
Current consensus DPS estimate is 16.8, implying a prospective dividend yield of 4.0%.
Current consensus EPS estimate suggests the PER is 15.0.

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 ((UMG)) as Overweight (1) –

United Malt Group's trading update was largely in line with previous commentary, with further volume growth and margin improvement a highlight. Wilsons notes ability to navigate operational challenges will support the delivery of earnings growth over a number of years. 

The company expects FY22 volumes to approach FY19 levels, and the broker expects processing volumes to increase 3% on the previous year. An expected $8-12m barley import cost impact in FY22 was reiterated. 

The Overweight rating and target price of $4.81 are retained. 

This report was published on February 14, 2022.

Target price is $4.81 Current Price is $4.14 Difference: $0.67
If UMG meets the Wilsons target it will return approximately 16% (excluding dividends, fees and charges).
Current consensus price target is $4.82, suggesting upside of 15.3%(ex-dividends)
The company's fiscal year ends in September.

Forecast for FY22:

Wilsons forecasts a full year FY22 dividend of 8.00 cents and EPS of 19.40 cents.
At the last closing share price the estimated dividend yield is 1.93%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 21.34.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 20.3, implying annual growth of 340.3%.
Current consensus DPS estimate is 12.4, implying a prospective dividend yield of 3.0%.
Current consensus EPS estimate suggests the PER is 20.6.

Forecast for FY23:

Wilsons forecasts a full year FY23 dividend of 13.00 cents and EPS of 26.20 cents.
At the last closing share price the estimated dividend yield is 3.14%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.80.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 27.8, implying annual growth of 36.9%.
Current consensus DPS estimate is 16.8, implying a prospective dividend yield of 4.0%.
Current consensus EPS estimate suggests the PER is 15.0.

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

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

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