Daily Market Reports | Mar 21 2024
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)
ABB BGL BMN CXO DYL FSG IMD LIC LNW LTR OBM PLS PRU PYC RMS (2) RRL SKC SKO SLC SOM TAH TIE TWE
ABB AUSSIE BROADBAND LIMITED
Telecommunication - Overnight Price: $3.70
Wilsons rates ((ABB)) as Overweight (1) -
Wilsons remains Overweight-rated on Aussie Broadband after the loss of the wholesale internet services contract with Origin Energy ((ORG)), given ongoing solid organic growth will likely be blended with a consistent ‘cadence’ of M&A.
The removal of the contract from forecasts from October 1 this year reduces the broker's FY25 and FY26 earnings (EBITDA) estimates by -8%. The target falls to $4.77 from $5.80 partly due to a lower valuation multiple.
This report was published on March 15, 2024.
Target price is $4.77 Current Price is $3.70 Difference: $1.07
If ABB meets the Wilsons target it will return approximately 29% (excluding dividends, fees and charges).
The company's fiscal year ends in June.
Forecast for FY24:
Wilsons forecasts a full year FY24 dividend of 0.00 cents and EPS of 15.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 24.67.
Forecast for FY25:
Wilsons forecasts a full year FY25 dividend of 0.00 cents and EPS of 21.70 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.05.
Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
BGL BELLEVUE GOLD LIMITED
Gold & Silver - Overnight Price: $1.84
Canaccord Genuity rates ((BGL)) as Buy (1) -
Canaccord Genuity points to the incongruity of recent record highs for both Australian dollar and US dollar gold prices and the ASX Gold Index which is currently around -13% below the 52-week high.
In a similar vein, gold companies under research coverage by the broker are all trading below their respective 52-week highs at an average discount of around -18%.
In selecting appropriate company exposures, the broker prefers those either in, or entering a free cash flow (FCF) harvest period. In the screening process, favourable mining jurisdictions and reasonable liquidity/market capitalisation were also looked upon favourably.
Canaccord prefers Buy-rated Perseus Mining, Regis Resources and Ramelius Resources. Bellevue Gold, which is on the cusp of commercial production, is also recommended as a Speculative Buy.
The target for Bellevue Gold is maintained at $1.80.
This report was published on March 13, 2024.
Target price is $1.80 Current Price is $1.84 Difference: minus $0.04 (current price is over target).
If BGL meets the Canaccord Genuity target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).
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 9.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 20.44.
Forecast for FY25:
Canaccord Genuity forecasts a full year FY25 dividend of 0.00 cents and EPS of 25.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 7.36.
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
BMN BANNERMAN ENERGY LIMITED
Uranium - Overnight Price: $3.23
Canaccord Genuity rates ((BMN)) as Speculative Buy (1) -
A Scoping Study for higher throughput and operating life cases at Bannerman Energy's Etango Uranium project in Namibia has been completed.
Options have been evaluated for a post ramp-up expansion in capacity to 6.7mlb per year or an extension of operating life to 27 years.
These are logical options, suggests Canaccord Genuity, given circa 225mlb of resources and Etango-8 open pit project's current capacity of 3.5mlb per year.
The Speculative Buy rating is maintained and the target increased to $3.71 from $3.59.
This report was published on March 18, 2024.
Target price is $3.71 Current Price is $3.23 Difference: $0.48
If BMN meets the Canaccord Genuity target it will return approximately 15% (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 6.69 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 48.31.
Forecast for FY25:
Canaccord Genuity forecasts a full year FY25 dividend of 0.00 cents and EPS of minus 6.99 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 46.21.
Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
CXO CORE LITHIUM LIMITED
New Battery Elements - Overnight Price: $0.17
Wilsons rates ((CXO)) as Underweight (5) -
Core Lithium has released interim results and announced two key management and board changes, with the resignation of non-executive director Andrea Hall and CEO Gareth Manderson set to step down.
Adjusted earnings (EBITDA) of around $15m fell short of the $30m expected by consensus.
The broker considers operational ‘hurdles’ on the path back to full operations at Finniss are now operational ‘mountains’ and removes any resumption in mining at Finniss from forecasts indefinitely.
Wilsons suggests Core Lithium should now be viewed as a lithium explorer, rather than a producer, (albeit with the added bonus of a constructed processing plant), unless lithium spodumene pricing rises well above the broker's forecast.
The Underweight rating is unchanged and the target falls to 10c from 15c.
In summary, Wilsons believes the prior ‘minimum viable project’ approach taken by Core Lithium to project development was incorrect. The outcome was fast-tracking of economic and technical studies, which were not sufficiently robust in the face of pricing volatility.
This report was published on March 15, 2024.
Target price is $0.10 Current Price is $0.17 Difference: minus $0.065 (current price is over target).
If CXO meets the Wilsons target it will return approximately minus 39% (excluding dividends, fees and charges - negative figures indicate an expected loss).
The company's fiscal year ends in June.
Forecast for FY24:
Wilsons 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 82.50.
Forecast for FY25:
Wilsons forecasts a full year FY25 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 165.00.
Market Sentiment: -0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
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