Australian Broker Call *Extra* Edition – Nov 21, 2023

This story features BLUE ENERGY LIMITED, and other companies. For more info SHARE ANALYSIS: BLU

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)

BLU   DHG   DTL   LNW   NAB   NHF   NWS   ORI   PNR   PPE   REA   SUN   SVR   SYA   VVA   WDS   WIN   XRO  

BLU    BLUE ENERGY LIMITED

NatGas – Overnight Price: $0.02

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

Following repairs to an oil cooling motor and a pressure build up test, Blue Energy announces gas production at the Sapphire Pilot Program in the North Bowen Basin has resumed after an around two-month hiatus.

Buy rating. The target falls to 12c (prior target not disclosed) after the removal of the broker's risked upside case and a reduction in assumed price for a future equity raise.

This report was published on November 13, 2023.

Target price is $0.12 Current Price is $0.02 Difference: $0.098
If BLU meets the Petra Capital target it will return approximately 445% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY23:

Petra Capital forecasts a full year FY23 dividend of 0.00 cents and EPS of minus 0.10 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 22.00.

Forecast for FY24:

Petra Capital forecasts a full year FY24 dividend of 0.00 cents and EPS of 0.00 cents.

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

DHG    DOMAIN HOLDINGS AUSTRALIA LIMITED

Real Estate – Overnight Price: $3.63

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

Goldman Sachs reduces its price target for Domain Holdings Australia to $3.50 from $3.60 on lower FY24-FY26 earnings (EBITDA) forecasts incorporating more normalised listing volumes for Sydney and Melbourne.

A strong Q1 recovery in Sydney and Melbourne listings was offset by continued softness in broader national volumes, explains the broker.

Q2 could see a further controllable yield increase, after a 13% Q1 rise, due to a better than expected Platinum Edge uptake and a small yield contribution from new depth customers, suggest the analysts.

The Neutral rating is unchanged.

This report was published on November 13, 2023.

Target price is $3.50 Current Price is $3.63 Difference: minus $0.13 (current price is over target).
If DHG meets the Goldman Sachs target it will return approximately minus 4% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $3.27, suggesting downside of -9.9%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 4.00 cents and EPS of 7.40 cents.
At the last closing share price the estimated dividend yield is 1.10%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 49.05.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 9.1, implying annual growth of 119.8%.
Current consensus DPS estimate is 6.2, implying a prospective dividend yield of 1.7%.
Current consensus EPS estimate suggests the PER is 39.9.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 6.00 cents and EPS of 10.00 cents.
At the last closing share price the estimated dividend yield is 1.65%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 36.30.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 9.4, implying annual growth of 3.3%.
Current consensus DPS estimate is 6.8, implying a prospective dividend yield of 1.9%.
Current consensus EPS estimate suggests the PER is 38.6.

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

DTL    DATA#3 LIMITED.

IT & Support – Overnight Price: $7.60

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

While Data#3's key growth drivers including digital transformation and cyber spending remain in place, Goldman Sachs believes a lower normalised demand environment awaits, following the buoyant covid-impacted FY20-23 period.

A growing mix of services is expected to boost earnings (EBITDA) margins over the medium-to-long term.

The broker has become more conservative on margin growth across FY24-26 given the necessity for front-loaded investments into its Services franchise and management's anticipated pursuit of lower-margin deals to expand up-market.

The target falls to $7.65 from $7.95 and the rating is downgraded to Neutral from Buy.

This report was published on November 13, 2023.

Target price is $7.65 Current Price is $7.60 Difference: $0.05
If DTL meets the Goldman Sachs target it will return approximately 1% (excluding dividends, fees and charges).
Current consensus price target is $7.80, suggesting upside of 2.6%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 25.00 cents and EPS of 27.00 cents.
At the last closing share price the estimated dividend yield is 3.29%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 28.15.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 26.8, implying annual growth of 11.9%.
Current consensus DPS estimate is 23.5, implying a prospective dividend yield of 3.1%.
Current consensus EPS estimate suggests the PER is 28.4.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 28.00 cents and EPS of 31.00 cents.
At the last closing share price the estimated dividend yield is 3.68%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 24.52.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 29.9, implying annual growth of 11.6%.
Current consensus DPS estimate is 26.8, implying a prospective dividend yield of 3.5%.
Current consensus EPS estimate suggests the PER is 25.4.

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

LNW    LIGHT & WONDER INC

Gaming – Overnight Price: $132.46

Jarden rates ((LNW)) as Downgrade to Overweight from Buy (2) –

Double-digit Q3 revenue growth across all of Light & Wonder's three business segments, along with margin expansion, resulted in a 10% beat for adjusted earnings (EBITDA) against the consensus forecast, explains Jarden.

Scale is driving enhanced operational efficiencies, explain the analysts, with year-to-date adjusted earnings growing by more than 20%. The broker points out this outcome is well ahead of management's 15% compound annual growth rate (CAGR) ambition for FY23-FY25.

Jarden's target price rises to $141 from $136, while the rating is downgraded to Overweight from Buy on valuation after a period of share price outperformance.

This report was published on November 13, 2023.

Target price is $141.00 Current Price is $132.46 Difference: $8.54
If LNW meets the Jarden target it will return approximately 6% (excluding dividends, fees and charges).
The company's fiscal year ends in December.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 0.00 cents and EPS of 158.90 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 83.36.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 0.00 cents and EPS of 372.90 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 35.52.

Market Sentiment: 0.0
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: $27.93

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

National Australia Bank remains Jarden's preferred Australian bank exposure following FY23 results, given strong execution and a more favourable business mix than peers.

The FY23 net interest margin (NIM) and costs met the broker's expectations. It's felt the bank has managed margins best among peers. Bad and doubtful debts (BDDs) were a beat while markets income was softer than expected.

The target falls to $29.50 from $29.70. Overweight.

This report was published on November 11, 2023.

Target price is $29.50 Current Price is $27.93 Difference: $1.57
If NAB meets the Jarden target it will return approximately 6% (excluding dividends, fees and charges).
Current consensus price target is $27.87, suggesting downside of -0.2%(ex-dividends)
The company's fiscal year ends in September.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 167.00 cents and EPS of 215.50 cents.
At the last closing share price the estimated dividend yield is 5.98%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.96.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 216.3, implying annual growth of -8.5%.
Current consensus DPS estimate is 168.6, implying a prospective dividend yield of 6.0%.
Current consensus EPS estimate suggests the PER is 12.9.

Forecast for FY25:

Jarden forecasts a full year FY25 dividend of 169.00 cents and EPS of 221.00 cents.
At the last closing share price the estimated dividend yield is 6.05%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.64.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 222.5, implying annual growth of 2.9%.
Current consensus DPS estimate is 171.0, implying a prospective dividend yield of 6.1%.
Current consensus EPS estimate suggests the PER is 12.6.

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

NHF    NIB HOLDINGS LIMITED

Insurance – Overnight Price: $7.53

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

Policyholder growth for Australian residents health insurance (ARHI) for nib Holdings was 4.2% in the first four months of FY24 compared to guidance for 3-4%, though New Zealand policyholder growth was 2.7% compared to 3-4% guidance.

International inbound health insurance (IIHI) policy holder growth was 17.5%, while premium revenue growth of 24.7% is tracking ahead of the broker's FY24 forecast.

The analysts feel the impact of the lost Qantas Airways ((QAN)) contract on underlying operating profit is mitigated by that contract being relatively less profitable. A new white-label partnership with Woolworths Group ((WOW)) also reduces the negative effect.

The target slips to $8.40 from $8.75. Buy.

This report was published on November 13, 2023.

Target price is $8.40 Current Price is $7.53 Difference: $0.87
If NHF meets the Goldman Sachs target it will return approximately 12% (excluding dividends, fees and charges).
Current consensus price target is $8.26, suggesting upside of 9.7%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 29.00 cents and EPS of 41.00 cents.
At the last closing share price the estimated dividend yield is 3.85%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.37.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 45.3, implying annual growth of 9.4%.
Current consensus DPS estimate is 30.1, implying a prospective dividend yield of 4.0%.
Current consensus EPS estimate suggests the PER is 16.6.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 33.00 cents and EPS of 47.00 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 16.02.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 48.6, implying annual growth of 7.3%.
Current consensus DPS estimate is 31.4, implying a prospective dividend yield of 4.2%.
Current consensus EPS estimate suggests the PER is 15.5.

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

NWS    NEWS CORPORATION

Print, Radio & TV – Overnight Price: $33.28

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

Goldman Sachs increases its target for News Corp to $38.50 from $35.10 following broadly in-line 1Q results, largely driven by a standout Dow Jones performance. The Book Publishing performance also improved strongly, explains the broker.

Dow Jones subscribers grew by 8% to 5.3m and business-to-business (B2B) Professional Services revenue jumped by 14%, and is set to deliver more than 50% of the division's earnings in FY24, according to the analysts.

The Buy rating is maintained.

This report was published on November 13, 2023.

Target price is $38.50 Current Price is $33.28 Difference: $5.22
If NWS meets the Goldman Sachs target it will return approximately 16% (excluding dividends, fees and charges).
Current consensus price target is $35.33, suggesting upside of 6.2%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 15.08 cents and EPS of 101.49 cents.
At the last closing share price the estimated dividend yield is 0.45%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 32.79.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 115.6, implying annual growth of N/A.
Current consensus DPS estimate is 30.5, implying a prospective dividend yield of 0.9%.
Current consensus EPS estimate suggests the PER is 28.8.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 15.08 cents and EPS of 126.98 cents.
At the last closing share price the estimated dividend yield is 0.45%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 26.21.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 154.8, implying annual growth of 33.9%.
Current consensus DPS estimate is 30.5, implying a prospective dividend yield of 0.9%.
Current consensus EPS estimate suggests the PER is 21.5.

This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

ORI    ORICA LIMITED

Mining Sector Contracting – Overnight Price: $15.63

Jarden rates ((ORI)) as Buy (1) –

Orica's FY23 underlying earnings (EBIT) growth of 21% was a marginal beat against forecasts by consensus and Jarden due to strong re-contracting.

The three year return on net assets (RONA) guidance was also conservatively increased to 12-14% from 10.5-12.0%, in the broker's opinion, given the FY23 return was 12.6%.

The analysts expect FY24 improvement for the LATAM and EMEA regions. In FY23 mine closures and continuing supply interruptions from Russia-Ukraine impacted LATAM, while the broker is 19% more positive than consensus for EMEA's FY24 earnings.

The Buy rating and $17.10 target are maintained.

This report was published on November 11, 2023.

Target price is $17.10 Current Price is $15.63 Difference: $1.47
If ORI meets the Jarden target it will return approximately 9% (excluding dividends, fees and charges).
Current consensus price target is $17.73, suggesting upside of 13.4%(ex-dividends)
The company's fiscal year ends in September.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 49.70 cents and EPS of 89.90 cents.
At the last closing share price the estimated dividend yield is 3.18%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.39.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 95.8, implying annual growth of 47.1%.
Current consensus DPS estimate is 50.0, implying a prospective dividend yield of 3.2%.
Current consensus EPS estimate suggests the PER is 16.3.

Forecast for FY25:

Jarden forecasts a full year FY25 dividend of 56.30 cents and EPS of 101.20 cents.
At the last closing share price the estimated dividend yield is 3.60%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.44.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 110.6, implying annual growth of 15.4%.
Current consensus DPS estimate is 58.2, implying a prospective dividend yield of 3.7%.
Current consensus EPS estimate suggests the PER is 14.1.

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

PNR    PANTORO LIMITED

Gold & Silver – Overnight Price: $0.05

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

Pantoro will have a cash buffer as gold operations transition to positive free cash flow prior to the end of 2023, notes Petra Capital.

The company will receive a $30m upfront payment having agreed to sell lithium and base metals (non-core commodities) rights over the Norseman gold project to Mineral Resources ((MIN)). 

Pantoro will retain tenement ownership and rights to all precious metals plus other base and battery minerals.

The broker raises its target to 14c from 13c on the improved cash position. The Buy rating is maintained.

This report was published on November 13, 2023.

Target price is $0.14 Current Price is $0.05 Difference: $0.092
If PNR meets the Petra Capital target it will return approximately 192% (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 0.10 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 48.00.

Forecast for FY25:

Petra Capital forecasts a full year FY25 dividend of 0.00 cents and EPS of 0.80 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 6.00.

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

PPE    PEOPLEIN LIMITED

Jobs & Skilled Labour Services – Overnight Price: $1.48

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

While Petra Capital believes PeopleIN is well positioned for the medium-term, the broker's earnings forecasts fall due to deteriorating business sentiment and uncertainty created by the Australian government’s industrial relations bill.

September quarter domestic results from global peers such as Hays, Randstad and Adecco were also mixed, points out the analyst, providing negative read-throughs for PeopleIN.

Petra's target falls to $2.57 from $3.15 and the Buy rating is unchanged. The company's fully-franked dividend yield is considered attractive.

PeopleIN's AGM is due on November 27.

This report was published on November 13, 2023.

Target price is $2.57 Current Price is $1.48 Difference: $1.09
If PPE meets the Petra Capital target it will return approximately 74% (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 11.50 cents and EPS of 27.10 cents.
At the last closing share price the estimated dividend yield is 7.77%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 5.46.

Forecast for FY25:

Petra Capital forecasts a full year FY25 dividend of 13.00 cents and EPS of 30.90 cents.
At the last closing share price the estimated dividend yield is 8.78%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 4.79.

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

REA    REA GROUP LIMITED

Real Estate – Overnight Price: $160.25

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

Goldman Sachs increases its price target for REA Group to $179 from $175 due to improving listing volumes for the Residential business and a "robust" yield outlook.

The yields are benefiting from a 13% price increase, increasing Premium+ penetration, and an improving mix via listings outperformance in both Sydney and Melbourne.

While the Commercial outlook is improving there are still some challenges in Developer due to less projects, note the analysts.

The Buy rating is unchanged.

This report was published on November 13, 2023.

Target price is $179.00 Current Price is $160.25 Difference: $18.75
If REA meets the Goldman Sachs target it will return approximately 12% (excluding dividends, fees and charges).
Current consensus price target is $157.50, suggesting downside of -1.7%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 191.00 cents and EPS of 347.00 cents.
At the last closing share price the estimated dividend yield is 1.19%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 46.18.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 348.5, implying annual growth of 29.2%.
Current consensus DPS estimate is 199.2, implying a prospective dividend yield of 1.2%.
Current consensus EPS estimate suggests the PER is 46.0.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 234.00 cents and EPS of 425.00 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 37.71.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 403.1, implying annual growth of 15.7%.
Current consensus DPS estimate is 228.5, implying a prospective dividend yield of 1.4%.
Current consensus EPS estimate suggests the PER is 39.8.

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

SUN    SUNCORP GROUP LIMITED

Insurance – Overnight Price: $13.39

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

Suncorp Group's home lending contracted by -0.1% over the 1Q as management prioritised profitability over volumes during a period of ongoing competition. Management noted returning momentum and an increase in volume of applications. 

The Bank division's net interest margin (NIM) may fall below the FY24 guidance range, suggests the broker, given recent commentary on system NIMs during the recent bank reporting period.

The Business lending portfolio also contracted by around -0.9% in the 1Q.

The collective provision was unchanged, which suggests to the analysts no material deterioration is being assumed by management regarding the macroeconomic outlook.

Goldman Sachs retains its Buy rating and $15.13 target.

This report was published on November 13, 2023.

Target price is $15.13 Current Price is $13.39 Difference: $1.74
If SUN meets the Goldman Sachs target it will return approximately 13% (excluding dividends, fees and charges).
Current consensus price target is $15.23, suggesting upside of 13.7%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 75.00 cents and EPS of 105.00 cents.
At the last closing share price the estimated dividend yield is 5.60%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.75.

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 5.6%.
Current consensus EPS estimate suggests the PER is 12.5.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 80.00 cents and EPS of 113.00 cents.
At the last closing share price the estimated dividend yield is 5.97%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.85.

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 6.4%.
Current consensus EPS estimate suggests the PER is 12.0.

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

SVR    SOLVAR LIMITED

Business & Consumer Credit – Overnight Price: $1.04

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

Despite Solvar upwardly revising the bottom end of its net profit guidance following the first quarter, Canaccord Genuity has retained its own forecast at the bottom end of guidance. 

The company delivered better than expected loan book growth on as expected trading conditions. Solvar suggested it is managing exposure in New Zealand given economic conditions.

The broker continues to anticipate a loan book in excess of $1bn by June 2024. The Buy rating and target price of $1.55 are retained.

This report was published on November 14, 2023.

Target price is $1.55 Current Price is $1.04 Difference: $0.51
If SVR meets the Canaccord Genuity target it will return approximately 49% (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 9.00 cents and EPS of 12.00 cents.
At the last closing share price the estimated dividend yield is 8.65%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 8.67.

Forecast for FY25:

Canaccord Genuity forecasts a full year FY25 dividend of 10.00 cents and EPS of 15.00 cents.
At the last closing share price the estimated dividend yield is 9.62%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 6.93.

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

SYA    SAYONA MINING LIMITED

New Battery Elements – Overnight Price: $0.08

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

Petra Capital was not overly surprised by the pathway mapped out by North American lithium producer Sayona Mining in the Strategic Review and Operational update.

The broker always felt carbonate (as opposed to hydroxide) was the better alternative, and the update revealed the 75%-owned joint venture will go downstream with a Lithium Carbonate plant at the North American Lithium (NAL) project.

In partnership with a chemical company, the company has also shifted to a single integrated operation at the 60%-owned Moblam project in Quebec, from a mine-first-then-hydroxide plan.

The Buy rating and 34c are unchanged.

This report was published on November 13, 2023.

Target price is $0.34 Current Price is $0.08 Difference: $0.263
If SYA meets the Petra Capital target it will return approximately 342% (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 1.40 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 5.50.

Forecast for FY25:

Petra Capital forecasts a full year FY25 dividend of 0.00 cents and EPS of 2.10 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 3.67.

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

VVA    VIVA LEISURE LIMITED

Travel, Leisure & Tourism – Overnight Price: $1.36

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

Viva Leisure's trading update was in line with forecasts by consensus and Petra Capital. Management's emphasis on the pivotal brand in the company's portfolio of assets, ClubLime, contributed to the "positive" results, in the broker's view.

Annualised revenue of over $160m, as of October 23, closely aligns with the broker's FY24 forecast for $158.8m. No specific details on margins were provided.

The valuation indicated by Viva Leisure's share price on November 10 was well below a reasonable market valuation, suggests the broker, given the quality of management.

The $2.44 target and Buy rating are maintained.

This report was published on November 13, 2023.

Target price is $2.44 Current Price is $1.36 Difference: $1.08
If VVA meets the Petra Capital target it will return approximately 79% (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 12.20 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.15.

Forecast for FY25:

Petra Capital forecasts a full year FY25 dividend of 0.00 cents and EPS of 15.60 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 8.72.

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

WDS    WOODSIDE ENERGY GROUP LIMITED

NatGas – Overnight Price: $31.80

Jarden rates ((WDS)) as Underweight (4) –

Following Woodside Energy's investor briefing, Jarden lowers its target to $34 from $34.90 citing Scarborough progress uncertainty as the biggest near-term drag on the stock price. The Underweight rating is retained.

Also, management's production outlook was below both consensus and prior five-year projections, with the product mix (more gas, less liquids/LNG) contributing to 2024 free cash flow (FCF) estimates materially below prior forecasts.

While the company remains on-time and on-budget with Scarborough LNG, the broker cautions management is not forthcoming around impacts should delays continue for receiving the remaining Environmental Plan (EP) approvals.

This report was published on November 11, 2023.

Target price is $34.00 Current Price is $31.80 Difference: $2.2
If WDS meets the Jarden target it will return approximately 7% (excluding dividends, fees and charges).
Current consensus price target is $35.57, suggesting upside of 11.8%(ex-dividends)
The company's fiscal year ends in December.

Forecast for FY23:

Jarden forecasts a full year FY23 dividend of 203.59 cents and EPS of 255.77 cents.
At the last closing share price the estimated dividend yield is 6.40%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.43.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 242.2, implying annual growth of N/A.
Current consensus DPS estimate is 182.0, implying a prospective dividend yield of 5.7%.
Current consensus EPS estimate suggests the PER is 13.1.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 220.18 cents and EPS of 277.03 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 11.48.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 242.1, implying annual growth of -0.0%.
Current consensus DPS estimate is 169.8, implying a prospective dividend yield of 5.3%.
Current consensus EPS estimate suggests the PER is 13.1.

This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.1
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

WIN    WIDGIE NICKEL LIMITED

Nickel – Overnight Price: $0.17

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

After Petra Capital lowered its nickel price forecast, removed direct shipping ore (DSO) production and sales for FY25, and increased the size of a forecast equity raise for Widgie Nickel to $105m from $90m, the target falls to 40c from 54c.

The company's Mt Edwards Project provides lithium development optionality, while the significant nickel resource is developed, explains the broker.

The Buy rating is unchanged.

This report was published on November 13, 2023.

Target price is $0.40 Current Price is $0.17 Difference: $0.235
If WIN meets the Petra Capital target it will return approximately 142% (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 0.60 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 27.50.

Forecast for FY25:

Petra Capital forecasts a full year FY25 dividend of 0.00 cents and EPS of minus 0.70 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 23.57.

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

XRO    XERO LIMITED

Accountancy – Overnight Price: $100.54

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

Xero reported 1H subscriptions in line with the consensus forecast, while revenue and earnings (EBITDA) were both misses. 

Jarden felt more questions were posed than answered around management's US strategy, cost base and other revenue opportunities.

The broker's target falls to $108 from $129. Some 57% of the decline is due to changes in long-term earnings assumptions.

A  higher assumed weighted average cost of capital (WACC) and negative impacts from new currency forecasts accounted for -24% and -19%, respectively, of the negative move in target.

The Overweight rating is unchanged.

This report was published on November 13, 2023.

Target price is $108.00 Current Price is $100.54 Difference: $7.46
If XRO meets the Jarden target it will return approximately 7% (excluding dividends, fees and charges).
Current consensus price target is $110.62, suggesting upside of 10.0%(ex-dividends)
The company's fiscal year ends in March.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 0.00 cents and EPS of 79.19 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 126.96.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 59.7, 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 168.4.

Forecast for FY25:

Jarden forecasts a full year FY25 dividend of 0.00 cents and EPS of 126.56 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 79.44.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 98.8, implying annual growth of 65.5%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 101.8.

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

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