Australian Broker Call *Extra* Edition – May 23, 2024

Daily Market Reports | May 23 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)

AGN   AGY   ALL   ARB   AZL   BEN (2)   BRE   BXB   CGF   CPU   CSR   DDR   GNC   GNG   GSS   IPL (2)   KAR   MAQ   MEI   MYX   OML   QBE   TLX   XRO  

OML    OOH!MEDIA LIMITED

Out of Home Advertising - Overnight Price: $1.53

Goldman Sachs rates ((OML)) as Neutral (3) -

The 1Q24 trading update from oOh!media with 1% revenue growth was in line with the Goldman Sachs analyst's forecast.

Backing out the lost Vicinity contract, revenue growth was 6%, below the industry's 9%, while April revenues showed modest growth, with limited visibility for May and June, notes the broker.

Management expects improved performance in the 2H24 with input from new assets like Woollahra and Sydney Metro.

Goldman Sachs points to advertising market headwinds and elevated contract re-tenders affecting gross profit margins as a risk for the company.

A Neutral rating is maintained. Target price is raised 3% to $1.67.

This report was published on May 17, 2024.

Target price is $1.67 Current Price is $1.53 Difference: $0.135
If OML meets the Goldman Sachs target it will return approximately 9% (excluding dividends, fees and charges).
Current consensus price target is $1.93, suggesting upside of 26.0%(ex-dividends)
The company's fiscal year ends in December.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 6.00 cents and EPS of 11.00 cents.
At the last closing share price the estimated dividend yield is 3.91%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.95.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 10.7, implying annual growth of 69.8%.
Current consensus DPS estimate is 6.1, implying a prospective dividend yield of 4.0%.
Current consensus EPS estimate suggests the PER is 14.3.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 6.00 cents and EPS of 13.00 cents.
At the last closing share price the estimated dividend yield is 3.91%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.81.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 12.7, implying annual growth of 18.7%.
Current consensus DPS estimate is 6.2, implying a prospective dividend yield of 4.1%.
Current consensus EPS estimate suggests the PER is 12.0.

Market Sentiment: 0.5
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: $17.86

Jarden rates ((QBE)) as Buy (1) -

Jarden believes there is 7% upside risk to consensus forecasts for QBE Insurance. The run-off of the non-core US book, combined with an improving North American combined operating ratio (COR) outlook, is expected to support a group FY25 COR of circa 92%.

The analysts' EPS forecasts rise after trimming the COR outlook to 93.3% for FY24 and 92.7% for FY25, and the target rises to $21.50 from $21.00.

The Buy rating is maintained.

This report was published on May 16, 2024.

Target price is $21.50 Current Price is $17.86 Difference: $3.64
If QBE meets the Jarden target it will return approximately 20% (excluding dividends, fees and charges).
Current consensus price target is $18.72, suggesting upside of 4.9%(ex-dividends)
The company's fiscal year ends in December.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 96.00 cents and EPS of 190.95 cents.
At the last closing share price the estimated dividend yield is 5.38%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.35.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 178.5, implying annual growth of N/A.
Current consensus DPS estimate is 81.6, implying a prospective dividend yield of 4.6%.
Current consensus EPS estimate suggests the PER is 10.0.

Forecast for FY25:

Jarden forecasts a full year FY25 dividend of 97.00 cents and EPS of 195.06 cents.
At the last closing share price the estimated dividend yield is 5.43%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.16.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 182.9, implying annual growth of 2.5%.
Current consensus DPS estimate is 83.5, implying a prospective dividend yield of 4.7%.
Current consensus EPS estimate suggests the PER is 9.8.

This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

TLX    TELIX PHARMACEUTICALS LIMITED

Pharmaceuticals & Biotech/Lifesciences - Overnight Price: $15.78

Wilsons rates ((TLX)) as Overweight (1) -

Wilsons is confident reflecting Telix Pharmaceuticals has in place a strategy to become a fully integrated radiopharmaceutical developer.

The analyst views more upside potential if the company’s therapeutic assets, such as TLX591, are commercialised independently rather than out-licensed, ultimately offering more value for shareholders.

Looking ahead, the broker also anticipates catalysts from the 'ILL2CCIX' strategy and US Medicare pricing reforms.

Recent M&A activity in the sector and the strong R&D pipeline position the shares for potential inclusion in the ASX100, notes Wilsons.

Overweight rating and the target is raised to $20.

This report was published on May 20, 2024.

Target price is $20.00 Current Price is $15.78 Difference: $4.22
If TLX meets the Wilsons target it will return approximately 27% (excluding dividends, fees and charges).
The company's fiscal year ends in December.

Forecast for FY24:

Wilsons forecasts a full year FY24 dividend of 0.00 cents and EPS of 10.10 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 156.24.

Forecast for FY25:

Wilsons forecasts a full year FY25 dividend of 0.00 cents and EPS of 20.80 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 75.87.

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

XRO    XERO LIMITED

Accountancy - Overnight Price: $124.00

Jarden rates ((XRO)) as Upgrade to Overweight from Neutral (2) -

In a report published before today's market update, Jarden believes Xero is now well placed to produce meaningful free cash flow as operating leverage emerges, and is capable of still balancing growth and profitability.

While the current valuation is not cheap, upside risk is asymmetric, suggest the analysts.

Payments of dividends will likely commence in FY25, according to the broker, and revenue should almost triple on a 10-year view.

Software-as-a-service (SaaS) economics are expected to drive significant operating leverage, and Jarden assumes an earnings (EBIT) margin expansion to around 40% in the long-term from 6% in FY23.

The target rises to $141 from $110 and the broker's rating is upgraded to Overweight from Neutral.

This report was published on May 16, 2024.

Target price is $141.00 Current Price is $124.00 Difference: $17
If XRO meets the Jarden target it will return approximately 14% (excluding dividends, fees and charges).
Current consensus price target is $127.25, suggesting downside of -2.2%(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 96.96 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 127.89.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 69.0, 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 188.6.

Forecast for FY25:

Jarden forecasts a full year FY25 dividend of 50.01 cents and EPS of 175.06 cents.
At the last closing share price the estimated dividend yield is 0.40%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 70.83.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 112.0, implying annual growth of 62.3%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 116.2.

This company reports in NZD. 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

Disclaimer:
The content of this information does in no way reflect the opinions of FNArena, or of its journalists. In fact we don't have any opinion about the stock market, its value, future direction or individual shares. FNArena solely reports about what the main experts in the market note, believe and comment on. By doing so we believe we provide experienced, intelligent investors with a valuable tool that helps them in making up their own minds, reading market trends and getting a feel for what is happening beneath the surface.

This document is provided for informational purposes only. It does not constitute an offer to sell or a solicitation to buy any security or other financial instrument. FNArena employs very experienced journalists who base their work on information believed to be reliable and accurate, though no guarantee is given that the daily report is accurate or complete. Investors should contact their personal adviser before making any investment decision.

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.