Australian Broker Call *Extra* Edition – Oct 02, 2023

This story features CHAMPION IRON LIMITED, and other companies. For more info SHARE ANALYSIS: CIA

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

CIA   GNX   IAG   IPD   LRS   MEI   NUF   PMV   PPS   QBE   SLH   SUN   WIN  

CIA    CHAMPION IRON LIMITED

Iron Ore – Overnight Price: $6.30

Jarden rates ((CIA)) as Initiation of coverage with Buy (1) –

Jarden initiates coverage on Champion Iron with a Buy rating and $7.33 target. The broker points out iron ore with the lowest carbon footprint will likely receive increasing premiums into the future, given the pressure to produce "green" steel.

Champion Iron offers exposure via scalable low carbon production with options to further beneficiate its product. In the case of Bloom Lake, Canada, by virtue of abundant hydroelectricity, there is already some of the lowest carbon intensity iron ore produced globally.

This report was published on September 27, 2023.

Target price is $7.33 Current Price is $6.30 Difference: $1.03
If CIA meets the Jarden target it will return approximately 16% (excluding dividends, fees and charges).
The company's fiscal year ends in March.

Forecast for FY24:

Jarden forecasts a full year FY24 EPS of 59.72 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.55.

Forecast for FY25:

Jarden forecasts a full year FY25 EPS of 48.56 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.97.

This company reports in CAD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

GNX    GENEX POWER LIMITED

EV, Solar & Batteries – Overnight Price: $0.15

Canaccord Genuity rates ((GNX)) as Speculative Buy (1) –

One of 40 Tesla megapacks at Genex Power's Bouldercombe Battery Project has caught fire, with Tesla advising the battery should be allowed to burn out. At this stage no other megapacks appear to have been damaged.

Canaccord Genuity notes in 2021 the Neoen battery development in Victoria, which also uses the megapacks, had a fire during commission.

Genex Power has indicated it has insurance provisions in its contract with Tesla. Speculative Buy rating and $0.27 target maintained.

This report was published on September 27, 2023.

Target price is $0.27 Current Price is $0.15 Difference: $0.115
If GNX meets the Canaccord Genuity target it will return approximately 74% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY24:

Canaccord Genuity forecasts a full year FY24 dividend of 0.00 cents and EPS of minus 0.20 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 77.50.

Forecast for FY25:

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

IAG    INSURANCE AUSTRALIA GROUP LIMITED

Insurance – Overnight Price: $5.68

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

The Reserve Bank of New Zealand has produced a final policy consultation for general insurers, and for Insurance Australia Group, which operates subsidiaries and holds regulatory capital in New Zealand, Jarden assesses "contagion risks" are in focus.

The main risks largely relate to higher regulatory costs as the RBNZ takes a more proactive supervisory approach, as well as potential reductions in group capital and cost efficiencies should capacity to use intra-group transactions such as reinsurance and outside services change.

There also may be dividend restrictions when an insurance group is under pressure. Overweight rating and $6.15 target.

This report was published on September 27, 2023.

Target price is $6.15 Current Price is $5.68 Difference: $0.47
If IAG meets the Jarden target it will return approximately 8% (excluding dividends, fees and charges).
Current consensus price target is $5.85, suggesting upside of 3.0%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 27.00 cents and EPS of 37.70 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 15.07.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 34.9, implying annual growth of 2.9%.
Current consensus DPS estimate is 26.8, implying a prospective dividend yield of 4.7%.
Current consensus EPS estimate suggests the PER is 16.3.

Forecast for FY25:

Jarden forecasts a full year FY25 dividend of 31.00 cents and EPS of 43.00 cents.
At the last closing share price the estimated dividend yield is 5.46%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.21.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 39.3, implying annual growth of 12.6%.
Current consensus DPS estimate is 31.0, implying a prospective dividend yield of 5.5%.
Current consensus EPS estimate suggests the PER is 14.5.

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

IPD    IMPEDIMED LIMITED

Medical Equipment & Devices – Overnight Price: $0.17

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

ImpediMed's latest general meeting has a board overhaul as four current board members were voted out, to be replaced with four directors. In changes to the executive team a Chief Medical Officer was hired ahead of the vote and a Chief Commercial Officer is set to be appointed. 

Canaccord Genuity expects to see this change in leadership trigger a strategic review, but does point out that the company should be able to focus on its commercial execution story as a priority moving forwards. 

The Buy rating and target price of $0.21 are both retained.

This report was published on September 28, 2023.

Target price is $0.21 Current Price is $0.17 Difference: $0.035
If IPD meets the Canaccord Genuity target it will return approximately 20% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY24:

Canaccord Genuity forecasts a full year FY24 dividend of 0.00 cents and EPS of minus 1.10 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 15.91.

Forecast for FY25:

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

LRS    LATIN RESOURCES LIMITED

Mining – Overnight Price: $0.24

Canaccord Genuity rates ((LRS)) as Speculative Buy (1) –

A preliminary economic assessment of Latin Resources' Salinas has confirmed "attractive project economics" in Canaccord Genuity's view. The assessment outlines a two-stage production ramp up, with stage one production estimated at 220,000 tonnes annually and expanding to 525,000 tonnes annually from 2028. 

The assessment has cash costs -23% lower than the broker's earlier modeling, and the broker noted a "favourable operating cost structure relative to other markets".

The Speculative Buy rating and target price of $0.45 are both retained.

This report was published on September 28, 2023.

Target price is $0.45 Current Price is $0.24 Difference: $0.205
If LRS meets the Canaccord Genuity target it will return approximately 84% (excluding dividends, fees and charges).
The company's fiscal year ends in December.

Forecast for FY23:

Canaccord Genuity forecasts a full year FY23 dividend of 0.00 cents and EPS of 0.00 cents.

Forecast for FY24:

Canaccord Genuity forecasts a full year FY24 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

MEI    METEORIC RESOURCES NL

Overnight Price: $0.23

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

Meteoric Resources has further metallurgical results from its Caldeira rare earth project in Brazil and Petra Capital is impressed.

Given there are few operating ionic rare earth assets outside China the broker believes continued positive results will broaden investor interest ahead of the maiden mining study which is due in March.

Average leaching recoveries of 74% praseodymium and 78% neodymium have been flagged in clay zones. Petra Capital envisages potential to upgrade if the company can maintain leach results above 70% and reiterates a Buy rating and $0.32 target.

This report was published on September 28, 2023.

Target price is $0.32 Current Price is $0.23 Difference: $0.095
If MEI meets the Petra Capital target it will return approximately 42% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY24:

Petra Capital forecasts a full year FY24 dividend of 0.00 cents and EPS of minus 0.40 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 56.25.

Forecast for FY25:

Petra Capital forecasts a full year FY25 dividend of 0.00 cents and EPS of minus 0.60 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 37.50.

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

NUF    NUFARM LIMITED

Agriculture – Overnight Price: $4.75

Moelis rates ((NUF)) as Hold (3) –

Nufarm has felt the impacts of a agricultural chemical market oversupply in the second half of its financial year, with lowered full year earnings guidance reflective of the difficulties according to Moelis.

Where the company had previously guided to modest growth on its FY22 earnings of $447m, it now anticipates earnings between $430-440m. The broker expects a flow on impact to drive slightly lower crop protection margins in the coming financial year. 

The Hold rating is retained and the target price decreases to $5.01 from $5.47.

This report was published on September 28, 2023.

Target price is $5.01 Current Price is $4.75 Difference: $0.26
If NUF meets the Moelis target it will return approximately 5% (excluding dividends, fees and charges).
Current consensus price target is $6.44, suggesting upside of 35.6%(ex-dividends)
The company's fiscal year ends in September.

Forecast for FY23:

Moelis forecasts a full year FY23 dividend of 5.00 cents and EPS of 31.70 cents.
At the last closing share price the estimated dividend yield is 1.05%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.98.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 37.2, implying annual growth of 41.4%.
Current consensus DPS estimate is 10.1, implying a prospective dividend yield of 2.1%.
Current consensus EPS estimate suggests the PER is 12.8.

Forecast for FY24:

Moelis forecasts a full year FY24 dividend of 8.00 cents and EPS of 29.50 cents.
At the last closing share price the estimated dividend yield is 1.68%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.10.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 39.2, implying annual growth of 5.4%.
Current consensus DPS estimate is 11.1, implying a prospective dividend yield of 2.3%.
Current consensus EPS estimate suggests the PER is 12.1.

Market Sentiment: 0.6
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: $25.00

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

A resilient full year result from Premier Investments, as described by Petra Capital, was supported by a strong rebound from Smiggle in the second half with the brand reporting a year-on-year sales increase of 12.4%. 

Group-wide, retail earnings grew 6.4% year-on-year to $356.5m, and while sales have declined in the early weeks of the new financial year the Smiggle brand has delivered a strong start. 

The Buy rating is retained and the target price decreases to $29.50 from $29.80.

This report was published on September 29, 2023.

Target price is $29.50 Current Price is $25.00 Difference: $4.5
If PMV meets the Petra Capital target it will return approximately 18% (excluding dividends, fees and charges).
Current consensus price target is $25.19, suggesting upside of 0.8%(ex-dividends)
The company's fiscal year ends in July.

Forecast for FY24:

Petra Capital forecasts a full year FY24 dividend of 115.60 cents and EPS of 169.10 cents.
At the last closing share price the estimated dividend yield is 4.62%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.78.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 146.4, implying annual growth of -14.0%.
Current consensus DPS estimate is 103.5, implying a prospective dividend yield of 4.1%.
Current consensus EPS estimate suggests the PER is 17.1.

Forecast for FY25:

Petra Capital forecasts a full year FY25 dividend of 116.80 cents and EPS of 183.10 cents.
At the last closing share price the estimated dividend yield is 4.67%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.65.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 147.9, implying annual growth of 1.0%.
Current consensus DPS estimate is 108.0, implying a prospective dividend yield of 4.3%.
Current consensus EPS estimate suggests the PER is 16.9.

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

PPS    PRAEMIUM LIMITED

Wealth Management & Investments – Overnight Price: $0.59

Moelis rates ((PPS)) as Initiation of coverage with Buy (1) –

As the number three by scale specialist platform provider, Moelis initiates coverage on Praemium with the opinion that industry dynamics continue to create long-term opportunity for the company. 

Among other factors, the broker sees the divestment of the platform's loss-making United Kingdom operations in the last financial year, improving group profitability, and multiple strategic initiatives set to drive organic growth as likely to benefit shareholder returns.

Moelis initiates coverage on Praemium with a Buy rating and a target price of $0.92.

This report was published on September 28, 2023.

Target price is $0.92 Current Price is $0.59 Difference: $0.325
If PPS meets the Moelis target it will return approximately 55% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY24:

Moelis forecasts a full year FY24 dividend of 1.60 cents and EPS of 2.70 cents.
At the last closing share price the estimated dividend yield is 2.69%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 22.04.

Forecast for FY25:

Moelis forecasts a full year FY25 dividend of 1.90 cents and EPS of 3.20 cents.
At the last closing share price the estimated dividend yield is 3.19%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.59.

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

QBE    QBE INSURANCE GROUP LIMITED

Insurance – Overnight Price: $15.71

Jarden rates ((QBE)) as Buy (1) –

The Reserve Bank of New Zealand has produced a final policy consultation for general insurers, and for QBE Insurance, which operates as a branch in New Zealand, the proposal is for assets held to meet NZ solvency standards, reducing capital efficiency.

The main risks largely relate to higher regulatory costs as the RBNZ takes a more proactive supervisory approach, as well as potential reductions in group capital and cost efficiencies should capacity to use intra-group transactions such as reinsurance and outside services change.

There also may be dividend restrictions when an insurance group is under pressure. Buy rating and $20 target.

This report was published on September 27, 2023.

Target price is $20.00 Current Price is $15.71 Difference: $4.29
If QBE meets the Jarden target it will return approximately 27% (excluding dividends, fees and charges).
Current consensus price target is $17.11, suggesting upside of 8.9%(ex-dividends)
The company's fiscal year ends in December.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 105.28 cents and EPS of 141.22 cents.
At the last closing share price the estimated dividend yield is 6.70%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.12.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 137.6, implying annual growth of N/A.
Current consensus DPS estimate is 99.5, implying a prospective dividend yield of 6.3%.
Current consensus EPS estimate suggests the PER is 11.4.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 141.38 cents and EPS of 187.40 cents.
At the last closing share price the estimated dividend yield is 9.00%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 8.38.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 181.9, implying annual growth of 32.2%.
Current consensus DPS estimate is 120.7, implying a prospective dividend yield of 7.7%.
Current consensus EPS estimate suggests the PER is 8.6.

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

SLH    SILK LOGISTICS HOLDINGS LIMITED

Transportation & Logistics – Overnight Price: $1.85

Moelis rates ((SLH)) as Initiation of coverage with Buy (1) –

Moelis initiates coverage on Silk Logistics with a Buy rating and $2.75 target. The broker believes the business is well-positioned for growth with a tier one designation in port logistics, supported by the recent acquisition of Secon to bolster its Victorian presence.

Beyond the port the warehousing and distribution capability completes of a fully integrated service offering. Around 75% of warehouse revenue is from contracted customers with which the company has long-term relationships.

The stock is trading at an estimated 8.3x FY24 PE, representing a deep -55% discount to peers, the broker adds.

This report was published on September 27, 2023.

Target price is $2.75 Current Price is $1.85 Difference: $0.9
If SLH meets the Moelis target it will return approximately 49% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY24:

Moelis forecasts a full year FY24 dividend of 10.20 cents and EPS of 21.00 cents.
At the last closing share price the estimated dividend yield is 5.51%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 8.81.

Forecast for FY25:

Moelis forecasts a full year FY25 dividend of 12.80 cents and EPS of 26.10 cents.
At the last closing share price the estimated dividend yield is 6.92%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 7.09.

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

SUN    SUNCORP GROUP LIMITED

Insurance – Overnight Price: $13.97

Jarden rates ((SUN)) as Buy (1) –

The Reserve Bank of New Zealand has produced a final policy consultation for general insurers, and for Suncorp Group, which operates subsidiaries and holds regulatory capital in New Zealand, Jarden assesses "contagion risks" are in focus.

The main risks largely relate to higher regulatory costs as the RBNZ takes a more proactive supervisory approach, as well as potential reductions in group capital and cost efficiencies should capacity to use intra-group transactions such as reinsurance and outside services change.

There also may be dividend restrictions when an insurance group is under pressure. Buy rating and $15.15 target.

This report was published on September 27, 2023.

Target price is $15.15 Current Price is $13.97 Difference: $1.18
If SUN meets the Jarden target it will return approximately 8% (excluding dividends, fees and charges).
Current consensus price target is $15.23, suggesting upside of 9.0%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 71.00 cents and EPS of 109.80 cents.
At the last closing share price the estimated dividend yield is 5.08%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.72.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 107.2, implying annual growth of 17.9%.
Current consensus DPS estimate is 74.7, implying a prospective dividend yield of 5.3%.
Current consensus EPS estimate suggests the PER is 13.0.

Forecast for FY25:

Jarden forecasts a full year FY25 dividend of 121.60 cents and EPS of 106.60 cents.
At the last closing share price the estimated dividend yield is 8.70%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.11.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 111.7, implying annual growth of 4.2%.
Current consensus DPS estimate is 85.6, implying a prospective dividend yield of 6.1%.
Current consensus EPS estimate suggests the PER is 12.5.

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

WIN    WIDGIE NICKEL LIMITED

Overnight Price: $0.20

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

Petra Capital notes the significant resource of 168,000t of nickel that Widgie Nickel holds in the historically prolific Widgiemooltha Dome district of Western Australia.

Moving away from toll milling to a stand-alone 800,000tpa concentrator has lifted the broker's nickel valuation in dollar terms although lowered the per share value because of a significant increase in forecast dilution.

Forecast revenues from Faraday lithium sales are also pushed out to the second half of 2024. Buy rating maintained. Target is reduced to $0.54 from $0.88.

This report was published on September 28, 2023.

Target price is $0.54 Current Price is $0.20 Difference: $0.343
If WIN meets the Petra Capital target it will return approximately 174% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY24:

Petra Capital forecasts a full year FY24 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 65.67.

Forecast for FY25:

Petra Capital forecasts a full year FY25 dividend of 0.00 cents and EPS of 8.20 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 2.40.

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

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