Australian Broker Call *Extra* Edition – Jun 17, 2024

This story features 3P LEARNING LIMITED, and other companies. For more info SHARE ANALYSIS: 3PL

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)

3PL   ADH   AKG   APE   BMN   BPT   CKF   CSL   CSR   CVW   CXM   DGH   DSK   KMD   LOV   LRK   QBE   RKN   WDS  

3PL    3P LEARNING LIMITED

Education & Tuition – Overnight Price: $1.24

Taylor Collison rates ((3PL)) as Speculative Buy (1) –

3P Learning’s strategy to accelerate growth in the US market, particularly through re-acquiring the school distribution rights to Reading-Eggs, appears to be on track, notes Taylor Collison.

Third-party web traffic and app download data show a significant increase in Reading-Eggs usage, with web traffic up by 36% year-on-year, and by 50% from February to May 31, explains the broker.

On the flipside, the broker notes a -37% reduction in web traffic in February and March for Mathletics, and a -12% decrease in app downloads from December to May, which could impact 3P Learning’s annual recurring revenue (ARR).

The analyst’s overall revenue growth estimate has been reduced to 5.8% from 10%. 

The Speculative Buy rating is maintained as the consumer environment may improve with Australian wages outgrowing inflation, potentially benefiting B2C growth, explains the broker. No target price is mentioned.

This report was published on June 14, 2024.

Target price is $1.64 Current Price is $1.24 Difference: $0.405
If 3PL meets the Taylor Collison target it will return approximately 33% (excluding dividends, fees and charges).
The company’s fiscal year ends in June.

Forecast for FY24:

Taylor Collison forecasts a full year FY24 dividend of 0.00 cents and EPS of 3.90 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 31.67.

Forecast for FY25:

Taylor Collison forecasts a full year FY25 dividend of 0.00 cents and EPS of 5.10 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 24.22.

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

ADH    ADAIRS LIMITED

Furniture & Renovation – Overnight Price: $1.81

Canaccord Genuity rates ((ADH)) as Hold (3) –

Improved trading in the Consumer Discretionary sector because of tax cuts and the cycling of weaker comparatives could continue until the 1H of FY25, but this view is already held by consensus, suggests Canaccord Genuity.

The broker retains a Neutral sector view ahead of the August reporting season. Scope for a lift in consumer sentiment, aided by improving real household income, is thought to be the key ingredient for a more sustained sector rally.

The analyst retains a Hold rating for Adairs and lowers the target price to $1.92 from $2.14 due to a lower assumed multiple.

This report was published on June 12, 2024.

Target price is $1.92 Current Price is $1.81 Difference: $0.11
If ADH meets the Canaccord Genuity target it will return approximately 6% (excluding dividends, fees and charges).
Current consensus price target is $2.20, suggesting upside of 23.6%(ex-dividends)
The company’s fiscal year ends in June.

Forecast for FY24:

Canaccord Genuity forecasts a full year FY24 dividend of 10.50 cents and EPS of 18.90 cents.
At the last closing share price the estimated dividend yield is 5.80%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 9.58.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 19.1, implying annual growth of -13.1%.
Current consensus DPS estimate is 7.8, implying a prospective dividend yield of 4.4%.
Current consensus EPS estimate suggests the PER is 9.3.

Forecast for FY25:

Canaccord Genuity forecasts a full year FY25 dividend of 14.50 cents and EPS of 23.80 cents.
At the last closing share price the estimated dividend yield is 8.01%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 7.61.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 23.3, implying annual growth of 22.0%.
Current consensus DPS estimate is 15.0, implying a prospective dividend yield of 8.4%.
Current consensus EPS estimate suggests the PER is 7.6.

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

AKG    ACADEMIES AUSTRALASIA GROUP LIMITED

Education & Tuition – Overnight Price: $0.18

Taylor Collison rates ((AKG)) as Speculative Buy (1) –

Taylor Collison maintains a cautiously positive long-term view on Academies Australasia, despite a further decrease in student visa approvals as industry regulation is increased.

The broker likes the company’s competitive market position and scale which alleviates the likelihood of the company being affected by proposed legislation.

Beginning in 2025, providers will be required to deliver a course to domestic students for a minimum of two years before they can apply to deliver courses to international students, explains the analyst.

The Speculative Buy rating is unchanged. No target price is mentioned.

This report was published on June 14, 2024.

Current Price is $0.18. Target price not assessed.
The company’s fiscal year ends in June.

Forecast for FY24:

Taylor Collison forecasts a full year FY24 dividend of 0.00 cents and EPS of minus 7.00 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is minus 2.57.

Forecast for FY25:

Taylor Collison forecasts a full year FY25 dividend of 0.00 cents and EPS of minus 2.40 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is minus 7.50.

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

APE    EAGERS AUTOMOTIVE LIMITED

Automobiles & Components – Overnight Price: $10.18

Wilsons rates ((APE)) as Market Weight (3) –

Eagers Automotive’s investor day highlighted strategic growth initiatives including the Automall property strategy, enhanced productivity through people and technology, and increased finance and insurance (F&I) penetration, explains Wilsons.

Potential upside from these initiatives is countered by the ongoing uncertainty on near-term profitability associated with the correction in vehicle supply and demand, explains the broker.

The Market Weight rating and $10.47 target are maintained.

This report was published on June 12, 2024.

Target price is $10.47 Current Price is $10.18 Difference: $0.29
If APE meets the Wilsons target it will return approximately 3% (excluding dividends, fees and charges).
Current consensus price target is $12.28, suggesting upside of 21.6%(ex-dividends)
The company’s fiscal year ends in December.

Forecast for FY24:

Wilsons forecasts a full year FY24 dividend of 66.00 cents and EPS of 96.90 cents.
At the last closing share price the estimated dividend yield is 6.48%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 10.51.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 96.9, implying annual growth of -12.5%.
Current consensus DPS estimate is 67.5, implying a prospective dividend yield of 6.7%.
Current consensus EPS estimate suggests the PER is 10.4.

Forecast for FY25:

Wilsons forecasts a full year FY25 dividend of 68.90 cents and EPS of 101.70 cents.
At the last closing share price the estimated dividend yield is 6.77%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 10.01.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 83.0, implying annual growth of -14.3%.
Current consensus DPS estimate is 69.0, implying a prospective dividend yield of 6.8%.
Current consensus EPS estimate suggests the PER is 12.2.

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

BMN    BANNERMAN ENERGY LIMITED

Uranium – Overnight Price: $4.02

Canaccord Genuity rates ((BMN)) as Speculative Buy (1) –

Canaccord Genuity remains bullish on the uranium market as restarts and brownfield expansions will likely prove insufficient to restore equilibrium to the market.

Increasing recognition of nuclear energy’s positive contributions to decarbonisation, energy security and the provision of economically dispatchable electricity will drive substantial demand growth, in the broker’s view.

While the U3O8 spot price is down slightly year-to-date, the more important contract price is 13% higher, note the analysts.

The Speculative Buy rating and $4.65 target are kept for Bannerman Energy.

Canaccord Genuity conducts research on six other ASX-listed uranium companies and further notes a number of juniors (not currently under coverage) which are making significant progress with their respective developments.

In alphabetical order these juniors are: Alligator Energy ((AGE)), Aura Energy ((AEE)), Berkeley Energia ((BKY)), Cauldron Energy ((CXU)), DevEx Resources ((DEV)), Elevate Uranium ((EVE)), Global Uranium and Enrichment ((GUE)), Laramide Resources ((LAM)), Orpheus Uranium ((ORP)) and Toro Energy ((TOE)).

This report was published on June 13, 2024.

Target price is $4.65 Current Price is $4.02 Difference: $0.63
If BMN meets the Canaccord Genuity target it will return approximately 16% (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 6.71 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is minus 59.94.

Forecast for FY25:

Canaccord Genuity forecasts a full year FY25 dividend of 0.00 cents and EPS of minus 7.01 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is minus 57.33.

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

BPT    BEACH ENERGY LIMITED

Crude Oil – Overnight Price: $1.59

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

Beach Energy anticipates non-cash impairments of between -$365-400m in its FY24 results due to poor performance in the Taranaki and Bass Basins, impacting reserves and leading to consensus forecast downgrades, explains Jarden.

The broker maintains its Overweight rating and target price of $1.75, expecting updates on the company’s revised growth strategy and cost-out activities at the upcoming investor briefing.

The financial outlook includes stable operating revenues and EBITDA growth, with a projected 76.2% increase in EPS for FY25, note the analysts.

This report was published on June 12, 2024.

Target price is $1.75 Current Price is $1.59 Difference: $0.155
If BPT meets the Jarden target it will return approximately 10% (excluding dividends, fees and charges).
Current consensus price target is $1.92, suggesting upside of 21.4%(ex-dividends)
The company’s fiscal year ends in June.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 4.50 cents and EPS of 12.80 cents.
At the last closing share price the estimated dividend yield is 2.82%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 12.46.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 15.8, implying annual growth of -10.1%.
Current consensus DPS estimate is 4.2, implying a prospective dividend yield of 2.7%.
Current consensus EPS estimate suggests the PER is 10.0.

Forecast for FY25:

Jarden forecasts a full year FY25 dividend of 6.50 cents and EPS of 22.70 cents.
At the last closing share price the estimated dividend yield is 4.08%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 7.03.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 24.4, implying annual growth of 54.4%.
Current consensus DPS estimate is 7.2, implying a prospective dividend yield of 4.6%.
Current consensus EPS estimate suggests the PER is 6.5.

Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena’s consensus calculations require a minimum of three sources

CKF    COLLINS FOODS LIMITED

Food, Beverages & Tobacco – Overnight Price: $9.19

Canaccord Genuity rates ((CKF)) as Hold (3) –

Improved trading in the Consumer Discretionary sector because of tax cuts and the cycling of weaker comparatives could continue until the 1H of FY25, but this view is already held by consensus, suggests Canaccord Genuity.

The broker retains a Neutral sector view ahead of the August reporting season. Scope for a lift in consumer sentiment, aided by improving real household income, is thought to be the key ingredient for a more sustained sector rally.

The analyst retains a Hold rating for Collins Foods and lowers the target price to $9.25 from $10.95 due to a lower assumed multiple.

This report was published on June 12, 2024.

Target price is $9.25 Current Price is $9.19 Difference: $0.06
If CKF meets the Canaccord Genuity target it will return approximately 1% (excluding dividends, fees and charges).
Current consensus price target is $12.13, suggesting upside of 32.9%(ex-dividends)
The company’s fiscal year ends in May.

Forecast for FY24:

Canaccord Genuity forecasts a full year FY24 dividend of 28.50 cents and EPS of 55.90 cents.
At the last closing share price the estimated dividend yield is 3.10%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 16.44.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 51.1, implying annual growth of 369.7%.
Current consensus DPS estimate is 27.9, implying a prospective dividend yield of 3.1%.
Current consensus EPS estimate suggests the PER is 17.8.

Forecast for FY25:

Canaccord Genuity forecasts a full year FY25 dividend of 30.00 cents and EPS of 59.40 cents.
At the last closing share price the estimated dividend yield is 3.26%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 15.47.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 62.7, implying annual growth of 22.7%.
Current consensus DPS estimate is 35.7, implying a prospective dividend yield of 3.9%.
Current consensus EPS estimate suggests the PER is 14.5.

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

CSL    CSL LIMITED

Pharmaceuticals & Biotech/Lifesciences – Overnight Price: $289.10

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

Based on Jarden’s survey of 208 CSL plasma collection centres across the US, the broker assumes by the end of June RIKA machines will be in roughly 85-95 centres, or around 50% higher than the company expected.

Installation of the machines to optimise plasma collection efficiency appears to be accelerating as confidence in its operability increases after several design changes, explain the analysts.

As the number of converted centres grows, it should allow margin benefits to flow sooner, and Jarden upgrades its Behring margins by 50bps from FY26 onwards.

The Overweight rating is retained and the target price is increased to $305.34 from $296.02.

This report was published on June 12, 2024.

Target price is $305.34 Current Price is $289.10 Difference: $16.24
If CSL meets the Jarden target it will return approximately 6% (excluding dividends, fees and charges).
Current consensus price target is $316.73, suggesting upside of 9.6%(ex-dividends)
The company’s fiscal year ends in June.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 393.29 cents and EPS of 824.85 cents.
At the last closing share price the estimated dividend yield is 1.36%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 35.05.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 930.3, implying annual growth of N/A.
Current consensus DPS estimate is 404.5, implying a prospective dividend yield of 1.4%.
Current consensus EPS estimate suggests the PER is 31.1.

Forecast for FY25:

Jarden forecasts a full year FY25 dividend of 457.32 cents and EPS of 1000.15 cents.
At the last closing share price the estimated dividend yield is 1.58%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 28.91.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 1172.2, implying annual growth of 26.0%.
Current consensus DPS estimate is 516.2, implying a prospective dividend yield of 1.8%.
Current consensus EPS estimate suggests the PER is 24.7.

This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.8
All consensus data are updated until yesterday. FNArena’s consensus calculations require a minimum of three sources

CSR    CSR LIMITED

Building Products & Services – Overnight Price: $8.96

Jarden rates ((CSR)) as Neutral (3) –

Jarden would be surprised by the emergence of any interlopers to disrupt the existing bid by Saint-Gobain for CSR, given the premium to valuation being offered.

In another positive milestone, according to the broker, management at CSR has confirmed Saint-Gobain has received written notice from the FIRB that it has no objections to the scheme, therefore satisfying the FIRB approval condition precedent.

The Neutral rating and $9.00 target are maintained. 

This report was published on June 12, 2024.

Target price is $9.00 Current Price is $8.96 Difference: $0.04
If CSR meets the Jarden target it will return approximately 0% (excluding dividends, fees and charges).
Current consensus price target is $8.60, suggesting downside of -4.1%(ex-dividends)
The company’s fiscal year ends in March.

Forecast for FY25:

Jarden forecasts a full year FY25 dividend of 32.10 cents and EPS of 45.90 cents.
At the last closing share price the estimated dividend yield is 3.58%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 19.52.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 39.3, implying annual growth of -18.9%.
Current consensus DPS estimate is 26.2, implying a prospective dividend yield of 2.9%.
Current consensus EPS estimate suggests the PER is 22.8.

Forecast for FY26:

Jarden forecasts a full year FY26 dividend of 39.30 cents and EPS of 56.20 cents.
At the last closing share price the estimated dividend yield is 4.39%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 15.94.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 43.3, implying annual growth of 10.2%.
Current consensus DPS estimate is 35.2, implying a prospective dividend yield of 3.9%.
Current consensus EPS estimate suggests the PER is 20.7.

Market Sentiment: -0.2
All consensus data are updated until yesterday. FNArena’s consensus calculations require a minimum of three sources

CVW    CLEARVIEW WEALTH LIMITED

Insurance – Overnight Price: $0.55

Taylor Collison rates ((CVW)) as Outperform (2) –

Taylor Collison points to Crescent Capital’s recent sell-down of 11.2% of Clearview Wealth’s shares which has improved liquidity, although a significant overhang remains.

For 3Q24, Clearview Wealth reported a 21% year-on-year increase in new business sales, marking the third consecutive year of growth in this quarter, highlights the broker.

The broker expects Clearview Wealth to maintain its dividend yield of approximately 5%.

Outperform rating and 90c target maintained.

This report was published on June 13, 2024.

Target price is $0.90 Current Price is $0.55 Difference: $0.355
If CVW meets the Taylor Collison target it will return approximately 65% (excluding dividends, fees and charges).
The company’s fiscal year ends in June.

Forecast for FY24:

Taylor Collison forecasts a full year FY24 dividend of 3.00 cents and EPS of 5.40 cents.
At the last closing share price the estimated dividend yield is 5.50%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 10.09.

Forecast for FY25:

Taylor Collison forecasts a full year FY25 dividend of 3.10 cents and EPS of 6.20 cents.
At the last closing share price the estimated dividend yield is 5.69%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 8.79.

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

CXM    CENTREX LIMITED

Mining – Overnight Price: $0.05

Taylor Collison rates ((CXM)) as Speculative Buy (1) –

Following an operations update for the Ardmore Phosphate mine in Queensland, Taylor Collison notes Centrex is aiming to complete the Stage 1.5 expansion plan by the end of 2024 to increase output to 625ktpa.

The broker highlights Ardmore will benefit from economies-of-scale with only modest capital expenditure required. The current output is considered a premium concentrate by international standards.

Several offtake agreements are in place with industry-leading trading and agricultural groups including Incitec Pivot ((IPL)), Samsung C&T, Ameropa AG, Ballance Agri-Nutrients and Ravensdown, observe the analysts.

The Speculative Buy rating is maintained. No 12-month target price or EPS forecasts were evident within the broker’s research note.

This report was published on June 14, 2024.

Current Price is $0.05. Target price not assessed.

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

DGH    DESANE GROUP HOLDINGS LIMITED

Real Estate – Overnight Price: $0.90

Taylor Collison rates ((DGH)) as Outperform (2) –

Taylor Collison continues to have a positive view on Desane Group which is trading around a  -46% discount to its NTA, with upcoming positive developments expected in 1H25 for its Penrith and Wacol properties.

The broker highlights its healthy balance sheet which should supports the development projects, minimising the impact of debt in the current interest rate environment.

Taylor Collison expects 2H24 revenue to be slightly lower than the group’s 1H24 results due to income generating securities being converted into cash.

Outperform rating unchanged. Speculative Investment. No target price is set by Taylor Collison.

This report was published on June 12, 2024.

Current Price is $0.90. Target price not assessed.
The company’s fiscal year ends in June.

Forecast for FY24:

Taylor Collison forecasts a full year FY24 dividend of 0.00 cents and EPS of 4.50 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 20.00.

Forecast for FY25:

Taylor Collison forecasts a full year FY25 dividend of 0.00 cents and EPS of minus 4.90 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is minus 18.37.

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

DSK    DUSK GROUP LIMITED

Household & Personal Products – Overnight Price: $0.69

Canaccord Genuity rates ((DSK)) as Hold (3) –

Improved trading in the Consumer Discretionary sector because of tax cuts and the cycling of weaker comparatives could continue until the 1H of FY25, but this view is already held by consensus, suggests Canaccord Genuity.

The broker retains a Neutral sector view ahead of the August reporting season. Scope for a lift in consumer sentiment, aided by improving real household income, is thought to be the key ingredient for a more sustained sector rally.

The analyst retains a Hold rating for Dusk Group and lowers the target price to 70c from 90c due to a lower assumed multiple.

This report was published on June 12, 2024.

Target price is $0.70 Current Price is $0.69 Difference: $0.015
If DSK meets the Canaccord Genuity target it will return approximately 2% (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 6.00 cents and EPS of 7.50 cents.
At the last closing share price the estimated dividend yield is 8.76%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 9.13.

Forecast for FY25:

Canaccord Genuity forecasts a full year FY25 dividend of 8.00 cents and EPS of 11.60 cents.
At the last closing share price the estimated dividend yield is 11.68%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 5.91.

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

KMD    KMD BRANDS LIMITED

Sports & Recreation – Overnight Price: $0.40

Canaccord Genuity rates ((KMD)) as Hold (3) –

Improved trading in the Consumer Discretionary sector because of tax cuts and the cycling of weaker comparatives could continue until the 1H of FY25, but this view is already held by consensus, suggests Canaccord Genuity.

The broker retains a Neutral sector view ahead of the August reporting season. Scope for a lift in consumer sentiment, aided by improving real household income, is thought to be the key ingredient for a more sustained sector rally.

The analyst retains a Hold rating for KMD Brands and lowers the target price to 42c from 52c due to a lower assumed multiple.

This report was published on June 12, 2024.

Target price is $0.42 Current Price is $0.40 Difference: $0.025
If KMD meets the Canaccord Genuity target it will return approximately 6% (excluding dividends, fees and charges).
Current consensus price target is $0.53, suggesting upside of 35.9%(ex-dividends)
The company’s fiscal year ends in July.

Forecast for FY24:

Canaccord Genuity forecasts a full year FY24 dividend of 0.83 cents and EPS of 0.83 cents.
At the last closing share price the estimated dividend yield is 2.11%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 47.48.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 2.3, implying annual growth of N/A.
Current consensus DPS estimate is 1.9, implying a prospective dividend yield of 4.9%.
Current consensus EPS estimate suggests the PER is 17.0.

Forecast for FY25:

Canaccord Genuity forecasts a full year FY25 dividend of 2.59 cents and EPS of 3.89 cents.
At the last closing share price the estimated dividend yield is 6.56%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 10.17.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 5.0, implying annual growth of 117.4%.
Current consensus DPS estimate is 3.2, implying a prospective dividend yield of 8.2%.
Current consensus EPS estimate suggests the PER is 7.8.

This company reports in NZD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena’s consensus calculations require a minimum of three sources

LOV    LOVISA HOLDINGS LIMITED

Retailing – Overnight Price: $31.26

Canaccord Genuity rates ((LOV)) as Hold (3) –

Improved trading in the Consumer Discretionary sector because of tax cuts and the cycling of weaker comparatives could continue until the 1H of FY25, but this view is already held by consensus, suggests Canaccord Genuity.

The broker retains a Neutral sector view ahead of the August reporting season. Scope for a lift in consumer sentiment, aided by improving real household income, is thought to be the key ingredient for a more sustained sector rally.

The analyst retains a Hold rating and $29 target for Lovisa Holdings.

This report was published on June 12, 2024.

Target price is $29.00 Current Price is $31.26 Difference: minus $2.26 (current price is over target).
If LOV meets the Canaccord Genuity target it will return approximately minus 7% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $31.01, suggesting upside of 0.2%(ex-dividends)
The company’s fiscal year ends in June.

Forecast for FY24:

Canaccord Genuity forecasts a full year FY24 dividend of 80.00 cents and EPS of 75.10 cents.
At the last closing share price the estimated dividend yield is 2.56%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 41.62.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 75.7, implying annual growth of 19.7%.
Current consensus DPS estimate is 72.2, implying a prospective dividend yield of 2.3%.
Current consensus EPS estimate suggests the PER is 40.9.

Forecast for FY25:

Canaccord Genuity forecasts a full year FY25 dividend of 85.00 cents and EPS of 90.90 cents.
At the last closing share price the estimated dividend yield is 2.72%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 34.39.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 100.8, implying annual growth of 33.2%.
Current consensus DPS estimate is 83.8, implying a prospective dividend yield of 2.7%.
Current consensus EPS estimate suggests the PER is 30.7.

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

LRK    LARK DISTILLING CO. LIMITED

Food, Beverages & Tobacco – Overnight Price: $0.87

Canaccord Genuity rates ((LRK)) as Speculative Buy (1) –

The shift in the domestic sales model for Lark Distilling Co to a Distributor Partner model, partnering with Spirits Platform (SP) starting 1 August, is expected to remove fixed costs and leverage SP’s larger sales force, notes Canaccord Genuity.

The broker points to lower than expected 4Q24 net sales revenue and estimates it will come in at $3.3m, below the previous estimate of $3.8m, due to weaker domestic B2B sales and the absence of the Dark Mofo festival in Hobart.

Lark Distilling Co is focusing on international expansion, particularly in Southeast Asia, with the aim for international markets to account for 50% of group sales by FY27, stresses the analyst.

The Speculative Buy rating and $1.60 price target are unchanged.

This report was published on June 12, 2024.

Target price is $1.60 Current Price is $0.87 Difference: $0.73
If LRK meets the Canaccord Genuity target it will return approximately 84% (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 6.00 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is minus 14.50.

Forecast for FY25:

Canaccord Genuity forecasts a full year FY25 dividend of 0.00 cents and EPS of minus 6.00 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is minus 14.50.

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: $18.31

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

Goldman Sachs sees upside risk to FY25 consensus for QBE Insurance’s combined operating ratio (COR) of 92.8%. A level below 92.5% is considered possible reflecting improvement from North America non-core and organic upside.

As per the broker, the COR indicates the profitability of an insurance company’s underwriting activities, with a level below 100% signifying an underwriting profit.

The analysts also note reinsurance markets are looking increasingly more positive, suggesting lower rates (particularly in upper layers),
which are supportive of direct insurer margins

The Buy rating and $20.90 target are unchanged.

This report was published on June 12, 2024.

Target price is $20.90 Current Price is $18.31 Difference: $2.59
If QBE meets the Goldman Sachs target it will return approximately 14% (excluding dividends, fees and charges).
Current consensus price target is $18.80, suggesting upside of 2.9%(ex-dividends)
The company’s fiscal year ends in December.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 62.00 cents and EPS of 185.98 cents.
At the last closing share price the estimated dividend yield is 3.39%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 9.85.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 178.7, implying annual growth of N/A.
Current consensus DPS estimate is 81.6, implying a prospective dividend yield of 4.5%.
Current consensus EPS estimate suggests the PER is 10.2.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 63.00 cents and EPS of 189.02 cents.
At the last closing share price the estimated dividend yield is 3.44%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 9.69.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 183.1, implying annual growth of 2.5%.
Current consensus DPS estimate is 83.5, implying a prospective dividend yield of 4.6%.
Current consensus EPS estimate suggests the PER is 10.0.

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

RKN    RECKON LIMITED

Accountancy – Overnight Price: $0.51

Taylor Collison rates ((RKN)) as Outperform (2) –

Taylor Collison assesses the recent billing integrations with Aderant and Elite which are anticipated to boost revenue for BillingQ in 2H24 for Reckon.

Reckon’s competitor Xero ((XRO)) recently announced price increases, widening the discount between the two to 36% compared to Xero’s most comparable plan, which should strengthen Reckon’s relative value proposition, Taylor Collison notes.

Management projects 12% growth in its Legal segment, driven by BillingQ modules, targeting legal firms with 5 attorneys or more, reducing sales cycles to about 3 months.

Outperform rating unchanged. No target price is set by Taylor Collison.

This report was published on June 11, 2024.

Current Price is $0.51. Target price not assessed.
The company’s fiscal year ends in December.

Forecast for FY24:

Taylor Collison forecasts a full year FY24 dividend of 2.50 cents and EPS of 4.80 cents.
At the last closing share price the estimated dividend yield is 4.90%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 10.63.

Forecast for FY25:

Taylor Collison forecasts a full year FY25 dividend of 2.30 cents and EPS of 5.70 cents.
At the last closing share price the estimated dividend yield is 4.51%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 8.95.

Market Sentiment: 0.0
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: $27.26

Jarden rates ((WDS)) as Neutral (3) –

Woodside Energy announced the first oil at its 82%-owned West African Sangomar oil field, despite covid-related delays. As per Jarden, this asset will contribute around 11% to group production in 2025.

Phase 1 development costs remain within estimates, and production is expected to ramp-up in late-2024 and significantly contribute by 2025, notes the broker.

The relationship with the Senegalese Government remains positive,Jarden observes, which is crucial for project stability. While drilling results are meeting expectations, uncertainties about Phase 2 development persist. 

The Neutral rating and $29.25 target are retained.

This report was published on June 12, 2024.

Target price is $29.25 Current Price is $27.26 Difference: $1.99
If WDS meets the Jarden target it will return approximately 7% (excluding dividends, fees and charges).
Current consensus price target is $33.80, suggesting upside of 24.6%(ex-dividends)
The company’s fiscal year ends in December.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 157.01 cents and EPS of 197.87 cents.
At the last closing share price the estimated dividend yield is 5.76%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 13.78.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 192.8, implying annual growth of N/A.
Current consensus DPS estimate is 153.9, implying a prospective dividend yield of 5.7%.
Current consensus EPS estimate suggests the PER is 14.1.

Forecast for FY25:

Jarden forecasts a full year FY25 dividend of 163.11 cents and EPS of 206.40 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 13.21.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 207.9, implying annual growth of 7.8%.
Current consensus DPS estimate is 166.0, implying a prospective dividend yield of 6.1%.
Current consensus EPS estimate suggests the PER is 13.0.

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

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