In Case You Missed It – BC Extra Upgrades & Downgrades – 08-12-23

Weekly Reports | Dec 08 2023

Broker Rating Changes (Post Friday Last Week)


TEMPLE & WEBSTER GROUP LIMITED ((TPW)) Upgrade to Buy from Overweight by Jarden.B/H/S: 0/0/0

Following an AGM trading update, Jarden upgrades its rating on preferred small cap pick Temple & Webster to Buy from Overweight and raises its target to $8.56 from $6.59.

Up to November 27 in FY24, the broker notes 23% year-on-year revenue growth and significant market share gains, against a category 
that is down -5-10% year-on-year.

The analysts feel current valuation multiples do not reflect latent earning power, as Temple & Webster is currently in a period of investment.

After making forecast revenue increases, partially offset by increased marketing costs (to reflect accelerated growth), the broker raises EPS forecasts across FY24-26 by 7%, 7% and 14%, respectively.


FISHER & PAYKEL HEALTHCARE CORPORATION LIMITED ((FPH)) Downgrade to Underweight from Neutral by Jarden.B/H/S: 0/0/0

While Jarden assesses a "solid" 1H result for Fisher & Paykel Healthcare, the rating is downgraded to Underweight from Neutral, largely due to valuation.

A key standout, in the broker's opinion, was the 26% revenue increase in Homecare, underpinned by strength for obstructive sleep apnea (OSA) masks, especially the ongoing popularity for the Evora mask.

Management maintained revenue guidance of circa NZ$1.7bn, which implies to the analysts a softer 2H revenue outlook.

The target price decreases to NZ$22.00 from NZ$22.50.

GENTRACK GROUP LIMITED ((GTK)) Downgrade to Underweight from Neutral by Jarden.B/H/S: 0/0/0

A strong full year result from Gentrack Group, says Jarden, not delivering metrics ahead of estimates but also issuing an upgrade to FY24 guidance. Underlying revenue grew 42% year-on-year, with total revenue NZ$11m ahead of guidance.

Gentrack Group is now guiding to revenue of at least NZ$170m in the coming year, and the broker feels the phrasing of this suggests confidence in a near-term outlook. Jarden expects the company has a reasonable line of sight on potential pipeline conversion.

The rating is downgraded to Underweight from Neutral and the target price increases to NZ$5.00 from NZ$3.90.

PEOPLEIN LIMITED ((PPE)) Downgrade to Market Weight from Overweight by Wilsons.B/H/S: 0/0/0

Wilsons slashes its target for PeopleIN to $1.39 from $2.80 on uncertain earnings visibility, and downgrades its rating to Market Weight from Overweight following a "sombre" AGM trading update.

Management noted a “significant decline” in business confidence across multiple sectors and a declining economic backdrop, though expects the wider downturn will be relatively short-lived, especially in health.

The broker believes management should now adjust to what may be a prolonged downturn in several sectors. The company is targeting efficiencies where possible, notes Wilsons, to realign the cost base with reduced margins.

The full story is for FNArena subscribers only. To read the full story plus enjoy a free two-week trial to our service SIGN UP HERE

If you already had your free trial, why not join as a paying subscriber? CLICK HERE