Daily Market Reports | May 30 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.
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COMPANIES DISCUSSED IN THIS ISSUE
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The number next to the symbol represents the number of brokers covering it for this report -(if more than 1)
APE CHL EOS ERD GLN INA LLL MEI NUF RSG TRS WOR XRO (2)
TRS REJECT SHOP LIMITED
Household & Personal Products - Overnight Price: $3.24
Jarden rates ((TRS)) as Buy (1) -
Reject Shop reported FY24 EBIT guidance between $4.0-$5.5m, -3% below the Jarden analyst's midpoint forecast. That analyst notes ongoing positive like-for-like (LFL) sales growth of 2.7% year-to-date.
The company is performing well with the new range, and competition from Temu, according to Jarden, and it should do well as customers trade down with the higher rate environment.
EBITDA forecasts are cut by -2% to -7% for FY24-FY26 with more significant net profit reductions over the same period, due to a -100bps decline in margins from the consumables mix, notes the broker.
Buy rating unchanged. Target lowered to $6 from $6.70.
This report was published on May 23, 2024.
Target price is $6.00 Current Price is $3.24 Difference: $2.76
If TRS meets the Jarden target it will return approximately 85% (excluding dividends, fees and charges).
Current consensus price target is $4.18, suggesting upside of 29.1%(ex-dividends)
The company's fiscal year ends in June.
Forecast for FY24:
Jarden forecasts a full year FY24 dividend of 10.00 cents and EPS of 12.30 cents.
At the last closing share price the estimated dividend yield is 3.09%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 26.34.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 13.6, implying annual growth of -49.9%.
Current consensus DPS estimate is 9.7, implying a prospective dividend yield of 3.0%.
Current consensus EPS estimate suggests the PER is 23.8.
Forecast for FY25:
Jarden forecasts a full year FY25 dividend of 18.00 cents and EPS of 29.30 cents.
At the last closing share price the estimated dividend yield is 5.56%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.06.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 23.8, implying annual growth of 75.0%.
Current consensus DPS estimate is 13.3, implying a prospective dividend yield of 4.1%.
Current consensus EPS estimate suggests the PER is 13.6.
Market Sentiment: 0.7
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
WOR WORLEY LIMITED
Energy Sector Contracting - Overnight Price: $14.82
Goldman Sachs rates ((WOR)) as Upgrade to Buy from Neutral (1) -
Goldman Sachs upgrades Worley to Buy from Neutral after a -6% decline in share price over the last six months, when the ASX200 climbed by 11% over the same time frame.
The company is well-placed to benefit from the energy transition, reiterates the broker, and the outlook remains supported by capex being deployed by customers in this area.
The broker's target edges up by 1% to $17.50.
This report was published on May 24, 2024.
Target price is $17.50 Current Price is $14.82 Difference: $2.68
If WOR meets the Goldman Sachs target it will return approximately 18% (excluding dividends, fees and charges).
Current consensus price target is $18.27, suggesting upside of 23.3%(ex-dividends)
The company's fiscal year ends in June.
Forecast for FY24:
Goldman Sachs forecasts a full year FY24 dividend of 52.00 cents and EPS of 68.00 cents.
At the last closing share price the estimated dividend yield is 3.51%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 21.79.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 76.2, implying annual growth of 982.4%.
Current consensus DPS estimate is 51.6, implying a prospective dividend yield of 3.5%.
Current consensus EPS estimate suggests the PER is 19.4.
Forecast for FY25:
Goldman Sachs forecasts a full year FY25 dividend of 58.00 cents and EPS of 85.00 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 17.44.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 93.4, implying annual growth of 22.6%.
Current consensus DPS estimate is 55.9, implying a prospective dividend yield of 3.8%.
Current consensus EPS estimate suggests the PER is 15.9.
Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
XRO XERO LIMITED
Accountancy - Overnight Price: $132.66
Jarden rates ((XRO)) as Overweight (2) -
Despite a "strong" FY24 result, Jarden was surprised by the 9% jump in Xero's share price on the day of release.
The broker was disappointed FY25 guidance for the company's opex ratio was for a flat year-on-year outcome, due to higher product design and development costs.
FY24 earnings marked a 2% beat against forecasts by the broker and consensus due to a lower full-year operating cost ratio than guidance.
Regardless, Jarden expects the higher rate of near-term investment may drive stronger long-term outcomes. The target rises to $144 from $141 and the Overweight rating is unchanged.
This report was published on May 24, 2024.
Target price is $144.00 Current Price is $132.66 Difference: $11.34
If XRO meets the Jarden target it will return approximately 9% (excluding dividends, fees and charges).
Current consensus price target is $138.58, suggesting upside of 4.5%(ex-dividends)
The company's fiscal year ends in March.
Forecast for FY25:
Jarden forecasts a full year FY25 dividend of 46.95 cents and EPS of 154.88 cents.
At the last closing share price the estimated dividend yield is 0.35%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 85.65.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 121.1, 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 109.5.
Forecast for FY26:
Jarden forecasts a full year FY26 dividend of 106.46 cents and EPS of 210.89 cents.
At the last closing share price the estimated dividend yield is 0.80%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 62.91.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 127.5, implying annual growth of 5.3%.
Current consensus DPS estimate is 14.3, implying a prospective dividend yield of 0.1%.
Current consensus EPS estimate suggests the PER is 104.0.
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
Wilsons rates ((XRO)) as Downgrade to Market Weight from Overweight (3) -
Following FY24 results, Wilsons raises its target for Xero to $131.63 from $126.93 and downgrades to Market Weight from Overweight on valuation.
Operating expenses as a percentage of revenue ratio was 73% (68% in H2), thereby beating FY24 guidance for "around 75%". However, management is now guiding to 73% in FY25, suggesting to the broker the return of some costs.
Incrementally slower subscriber growth over the past three years means Xero is slightly more reliant on price rises to maintain high double-digit topline growth, note the analysts.
This report was published on May 27, 2024.
Target price is $131.63 Current Price is $132.66 Difference: minus $1.03 (current price is over target).
If XRO meets the Wilsons target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $138.58, suggesting upside of 4.5%(ex-dividends)
The company's fiscal year ends in March.
Forecast for FY25:
Wilsons forecasts a full year FY25 dividend of 0.00 cents and EPS of 230.48 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 57.56.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 121.1, 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 109.5.
Forecast for FY26:
Wilsons forecasts a full year FY26 dividend of 0.00 cents and EPS of 289.90 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 45.76.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 127.5, implying annual growth of 5.3%.
Current consensus DPS estimate is 14.3, implying a prospective dividend yield of 0.1%.
Current consensus EPS estimate suggests the PER is 104.0.
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
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