Australian Broker Call *Extra* Edition – Jul 18, 2024

This story features ALKANE RESOURCES LIMITED, and other companies. For more info SHARE ANALYSIS: ALK

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)

ALK (2)   ALL   ANG   CEH   CNU   CXO   DMP   IGO   IPL   LNW   LTM   LTR   MIN   OBM   PLS   TLC (2)  

ALK    ALKANE RESOURCES LIMITED

Gold & Silver – Overnight Price: $0.56

Moelis rates ((ALK)) as Buy (1) –

Alkane Resources released the Scoping Study for the Boda-Kaiser project and it highlights the potential for a large-scale, long-life open pit and underground gold and copper mine, Moelis observes.

The analyst points to a 20mtpa scenario, with annual production of 159koz gold and 36kt copper and a pre-production capex of -$1.78bn and sustaining capex of -$200m over a 17-year project life.

The project has an estimated value of $1.81bn with the broker assuming commodity prices of $3,500oz gold and $15,00/t copper.

Near-term management remain focused on the Tomingley expansion project, with FY25 expected to be a transition year.

Buy rating unchanged and the target revised to 65c from 60c.

This report was published on July 11, 2024.

Target price is $0.65 Current Price is $0.56 Difference: $0.095
If ALK meets the Moelis target it will return approximately 17% (excluding dividends, fees and charges).
The company’s fiscal year ends in June.

Forecast for FY24:

Moelis forecasts a full year FY24 dividend of 0.00 cents and EPS of 3.80 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 14.61.

Forecast for FY25:

Moelis forecasts a full year FY25 dividend of 0.00 cents and EPS of 3.20 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 17.34.

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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Petra Capital rates ((ALK)) as Buy (1) –

Alkane Resources released a “robust” scoping study for its Boda-Kaiser Gold Copper Project, which revealed a potential 20mt operation versus expectations of 10mt and 5mt, respectively, notes Petra Capital.

The pre-production capex is estimated at up to -$1.78bn, with a focus on funding and strategic partnerships over the next 12 months.

Petra Capital believes the market attaches little value to Boda-Kaiser and this is expected to improve as the company progresses with its development plan.

Rating, Buy; Target Price lowered to $1.00 from $1.12.

This report was published on July 11, 2024.

Target price is $1.00 Current Price is $0.56 Difference: $0.445
If ALK meets the Petra Capital target it will return approximately 80% (excluding dividends, fees and charges).
The company’s fiscal year ends in June.

Forecast for FY24:

Petra Capital forecasts a full year FY24 dividend of 0.00 cents and EPS of 3.60 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 15.42.

Forecast for FY25:

Petra Capital forecasts a full year FY25 dividend of 0.00 cents and EPS of 4.20 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 13.21.

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

ALL    ARISTOCRAT LEISURE LIMITED

Gaming – Overnight Price: $52.39

Goldman Sachs rates ((ALL)) as Initiation of coverage with Neutral (3) –

Goldman Sachs re-initiates coverage of Aristocrat Leisure after a year’s absence with a Neutral rating and $55.30 target price.

The broker appreciates the company’s leading market position in land-based content and cabinets but remains Neutral rated due to a likely tapering of growth in FY25 after a strong performance in FY24; increased competition from Light & Wonder; and given there is some ground to be covered before the company hits its interactive revenue targets.

Goldman Sachs expects North American Gaming will continue to drive the bulk of profits and considers the company’s slow decline in A&NZ to be expected given its “unsustainable” market share of more than 75%.

The company has announced a strategic review of its Pixel United businesses and the broker suspects a spin-off could be in the wings.

This report was published on July 10, 2024.

Target price is $55.30 Current Price is $52.39 Difference: $2.91
If ALL meets the Goldman Sachs target it will return approximately 6% (excluding dividends, fees and charges).
Current consensus price target is $55.05, suggesting upside of 5.1%(ex-dividends)
The company’s fiscal year ends in September.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 89.10 cents and EPS of 239.30 cents.
At the last closing share price the estimated dividend yield is 1.70%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 21.89.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 237.0, implying annual growth of 6.5%.
Current consensus DPS estimate is 72.6, implying a prospective dividend yield of 1.4%.
Current consensus EPS estimate suggests the PER is 22.1.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 116.40 cents and EPS of 264.50 cents.
At the last closing share price the estimated dividend yield is 2.22%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 19.81.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 260.4, implying annual growth of 9.9%.
Current consensus DPS estimate is 80.6, implying a prospective dividend yield of 1.5%.
Current consensus EPS estimate suggests the PER is 20.1.

Market Sentiment: 0.8
All consensus data are updated until yesterday. FNArena’s consensus calculations require a minimum of three sources

ANG    AUSTIN ENGINEERING LIMITED

Mining Sector Contracting – Overnight Price: $0.64

Petra Capital rates ((ANG)) as Buy (1) –

Petra Capital remains positive on Austin Engineering despite the share price rise and the analyst doesn’t consider the valuation as stretched.

The outlook for its product demand remains strong due to firm commodity prices and increasing mine strip ratios, the broker highlights.

The Austin 2.0 cost out initiative coincides with elevated mining activity, which Petra Capital believes will result in an earnings upgrade cycle.

Revised revenue projections for FY24-FY26 reflect higher order inflows and improved operating efficiencies and the analyst raises EPS forecasts by 7% for FY25.

Buy rating and the target price is lifted to 67c from 60c.

This report was published on July 11, 2024.

Target price is $0.67 Current Price is $0.64 Difference: $0.03
If ANG meets the Petra Capital target it will return approximately 5% (excluding dividends, fees and charges).
The company’s fiscal year ends in June.

Forecast for FY24:

Petra Capital forecasts a full year FY24 dividend of 1.50 cents and EPS of 5.20 cents.
At the last closing share price the estimated dividend yield is 2.34%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 12.31.

Forecast for FY25:

Petra Capital forecasts a full year FY25 dividend of 2.50 cents and EPS of 6.70 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 9.55.

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

CEH    COAST ENTERTAINMENT HOLDINGS LIMITED

Travel, Leisure & Tourism – Overnight Price: $0.49

Canaccord Genuity rates ((CEH)) as Buy (1) –

Canaccord Genuity liked the FY24 trading update from Coast Entertainment with the 2H24 revealing “solid underlying momentum”.

Attendances seemed to have held up despite management highlighting wet weather issues and the analyst points to deferred revenue of $12.1m, a rise on the previous corresponding period.

Revenues met the broker’s forecasts with FY25 estimates awaiting a management guidance update.

Buy rating and unchanged target price of 60c.

This report was published on July 12, 2024.

Target price is $0.60 Current Price is $0.49 Difference: $0.11
If CEH meets the Canaccord Genuity target it will return approximately 22% (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 2.00 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is minus 24.50.

Forecast for FY25:

Canaccord Genuity forecasts a full year FY25 dividend of 0.00 cents and EPS of minus 1.00 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is minus 49.00.

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

CNU    CHORUS LIMITED

Telecommunication – Overnight Price: $7.19

Jarden rates ((CNU)) as Underweight (4) –

Jarden updates Chorus earnings forecasts ahead of the expected draft Maximum Allowable Revenue (MAR) determination for RP2.

The analyst forecasts WACC increase for RP2 to 7.68% from 4.72% in RP1, impacting MAR expectations.

Connection numbers for 4Q24 indicate growth in entry-level fibre products but show an overall decline in total connections, with competition from satellite and fixed wireless posing risks.

Jarden’s forecasts for operating earnings see a slight reduction due to lower connection numbers and delayed fibre price increases. 

Jarden retains an Underweight rating and lowers the target to NZ$7.17 from NZ$7.25.

This report was published on July 9, 2024.

Current Price is $7.19. Target price not assessed.
The company’s fiscal year ends in June.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 44.35 cents and EPS of 3.51 cents.
At the last closing share price the estimated dividend yield is 6.17%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 204.78.

Forecast for FY25:

Jarden forecasts a full year FY25 dividend of 48.97 cents and EPS of 6.01 cents.
At the last closing share price the estimated dividend yield is 6.81%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 119.73.

This company reports in NZD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.3
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: $0.11

Goldman Sachs rates ((CXO)) as Upgrade to Neutral from Sell (3) –

Goldman Sachs reviews the lithium market, observing that lithium companies’ share prices continue to de-rate despite having outperformed global peers (and the underlying commodities market) in the past year.

The broker spies no solid support in the near term and forecasts near-term pricing weakness through to December 2025 given continued additions to the market surplus as new projects continue to be proposed or progressed and the brokers observes narrowing premiums and widening discounts at auctions.

The broker upgrades Core Lithium to Neutral from Sell believing production restart risk has been priced in; given the company now holds cash equivalent to 40% of its market capitalisation; and given it is trading at discount to peers given the -76% fall in its share price.

But the broker cuts its target price to 8c from 12c, expecting potential benefits from easing inflation and ongoing exploration wont hit any time soon.

This report was published on July 11, 2024.

Target price is $0.08 Current Price is $0.11 Difference: minus $0.03 (current price is over target).
If CXO meets the Goldman Sachs target it will return approximately minus 27% (excluding dividends, fees and charges – negative figures indicate an expected loss).
The company’s fiscal year ends in June.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 0.00 cents and EPS of minus 1.00 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is minus 11.00.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 0.00 cents and EPS of 0.00 cents.

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

DMP    DOMINO’S PIZZA ENTERPRISES LIMITED

Food, Beverages & Tobacco – Overnight Price: $36.09

Petra Capital rates ((DMP)) as Hold (3) –

Petra Capital highlights the weak Yen as a key factor which is impacting on the cost of goods sold due to the ingredient purchases in US dollars for Domino’s Pizza Enterprises’s Japanese operations.

The broker highlights Domino’s Pizza Enterprises continues to face material challenges in key markets, elevated gearing, and slow store openings with end-FY24 global stores reaching 3,840, implying 58 net openings, which is lower than the broker’s expectations.

Petra Capital lowers EPS forecasts by -4.5% and -7.8% for FY24/FY25, respectively.

Hold rating unchanged. Target price revised to $38.10 from $40.80.

This report was published on July 11, 2024.

Target price is $38.10 Current Price is $36.09 Difference: $2.01
If DMP meets the Petra Capital target it will return approximately 6% (excluding dividends, fees and charges).
Current consensus price target is $43.25, suggesting upside of 19.8%(ex-dividends)
The company’s fiscal year ends in June.

Forecast for FY24:

Petra Capital forecasts a full year FY24 dividend of 106.30 cents and EPS of 132.50 cents.
At the last closing share price the estimated dividend yield is 2.95%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 27.24.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 134.5, implying annual growth of 191.8%.
Current consensus DPS estimate is 102.4, implying a prospective dividend yield of 2.8%.
Current consensus EPS estimate suggests the PER is 26.8.

Forecast for FY25:

Petra Capital forecasts a full year FY25 dividend of 124.90 cents and EPS of 155.70 cents.
At the last closing share price the estimated dividend yield is 3.46%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 23.18.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 162.9, implying annual growth of 21.1%.
Current consensus DPS estimate is 122.6, implying a prospective dividend yield of 3.4%.
Current consensus EPS estimate suggests the PER is 22.2.

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

IGO    IGO LIMITED

Nickel – Overnight Price: $5.83

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

Goldman Sachs reviews the lithium market, observing that lithium companies’ share prices continue to de-rate despite having outperformed global peers (and the underlying commodities market) in the past year.

The broker spies no solid support in the near term and forecasts near-term pricing weakness through to December 2025 given continued additions to the market surplus as new projects continue to be proposed or progressed and the brokers observes narrowing premiums and widening discounts at auctions.

The broker says IGO’s widening discount to Pilbara Minerals supports the broker’s preference for the company. 

Goldman Sachs also appreciates the potential value from the Greenbushes expansion and suspects the market has overdone its response to the joint-venture balance sheet risks given all-in-sustaining costs for the project are well below peers.

FY24 and FY25 dividend forecasts fall. FY25 EPS forecast is reduced. Buy rating retained. Target price falls to 7.15 from $8.10. 

This report was published on July 11, 2024.

Target price is $7.15 Current Price is $5.83 Difference: $1.32
If IGO meets the Goldman Sachs target it will return approximately 23% (excluding dividends, fees and charges).
Current consensus price target is $6.35, suggesting upside of 8.9%(ex-dividends)
The company’s fiscal year ends in June.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 15.00 cents and EPS of 68.00 cents.
At the last closing share price the estimated dividend yield is 2.57%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 8.57.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 68.0, implying annual growth of -6.2%.
Current consensus DPS estimate is 16.1, implying a prospective dividend yield of 2.8%.
Current consensus EPS estimate suggests the PER is 8.6.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 13.00 cents and EPS of 13.00 cents.
At the last closing share price the estimated dividend yield is 2.23%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 44.85.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 25.9, implying annual growth of -61.9%.
Current consensus DPS estimate is 11.3, implying a prospective dividend yield of 1.9%.
Current consensus EPS estimate suggests the PER is 22.5.

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

IPL    INCITEC PIVOT LIMITED

Agriculture – Overnight Price: $2.87

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

Jarden believes the cancelation of the Incitec Pivot fertilisers sale will shift focus to a potential fertilisers distribution spin-off and the closure of Phosphate Hill, which raises issue about un-provisioned asset retirement costs.

The explosives business, which is generating strong growth, and a $900m on-market share buyback are forecast by the broker to provide share price support.

Some minor EPS revisions reflect a slight reduction in FY24 Phosphate Hill production forecasts, notes Jarden.

Overweight rating and $3.15 target unchanged.

This report was published on July 11, 2024.

Target price is $3.15 Current Price is $2.87 Difference: $0.28
If IPL meets the Jarden target it will return approximately 10% (excluding dividends, fees and charges).
Current consensus price target is $3.08, suggesting upside of 7.4%(ex-dividends)
The company’s fiscal year ends in September.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 9.80 cents and EPS of 19.30 cents.
At the last closing share price the estimated dividend yield is 3.41%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 14.87.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 19.1, implying annual growth of -33.7%.
Current consensus DPS estimate is 13.3, implying a prospective dividend yield of 4.6%.
Current consensus EPS estimate suggests the PER is 15.0.

Forecast for FY25:

Jarden forecasts a full year FY25 dividend of 11.00 cents and EPS of 21.80 cents.
At the last closing share price the estimated dividend yield is 3.83%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 13.17.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 20.1, implying annual growth of 5.2%.
Current consensus DPS estimate is 10.1, implying a prospective dividend yield of 3.5%.
Current consensus EPS estimate suggests the PER is 14.3.

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

LNW    LIGHT & WONDER INC

Gaming – Overnight Price: $156.40

Goldman Sachs rates ((LNW)) as Initiation of coverage with Buy (1) –

Goldman Sachs initiates coverage of Light & Wonder with a Buy rating and $190 target as part of the broker’s general push into the gaming industry.

The broker observes the company is a market leader in land-based gaming and offers strong opportunties for earnings growth in fledgling digital and real-money gaming markets.

Goldman Sachs prefers Light & Wonder to Aristocrat Leisure on which it also initiates coverage, appreciating its stronger risk-reward skew.

The broker observes the challenger is set to continue building market share in A&NZ and North America, forecasting a 12% compound annual growth rate. 

Goldman Sachs also believes SciPlay is outperforming the social casino segment due to better monetisation and user growth.

This report was published on July 10, 2024.

Target price is $190.00 Current Price is $156.40 Difference: $33.6
If LNW meets the Goldman Sachs target it will return approximately 21% (excluding dividends, fees and charges).
Current consensus price target is $167.00, suggesting upside of 6.8%(ex-dividends)
The company’s fiscal year ends in December.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 0.00 cents and EPS of 867.51 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 18.03.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 478.8, implying annual growth of 77.4%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 32.7.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 0.00 cents and EPS of 1080.65 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 14.47.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 605.9, implying annual growth of 26.5%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 25.8.

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

LTM    ARCADIUM LITHIUM PLC

New Battery Elements – Overnight Price: $5.44

Goldman Sachs rates ((LTM)) as Neutral (3) –

It is too early to call the bottom of the lithium bear market, declares Goldman Sachs. Estimates for ASX-listed Lithium sector stocks under coverage are updated to reflect lithium/nickel pricing updates and company specific changes.

The broker anticipates significant downside risk to lithium prices due to oversupply, and accordingly lowers forecasts over 2024 with the 2025 estimate unchanged.

The broker considers Arcadium Lithium’s lithium to be fair, reflecting upcoming execution risk and Goldman Sachs would appreciate greater clarity surround contract support for realised pricing.

Neutral rating retained. Target price rises 2% to $6.35.

This report was published on July 11, 2024.

Target price is $6.35 Current Price is $5.44 Difference: $0.91
If LTM meets the Goldman Sachs target it will return approximately 17% (excluding dividends, fees and charges).
Current consensus price target is $8.38, suggesting upside of 54.0%(ex-dividends)
The company’s fiscal year ends in December.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 0.00 cents and EPS of 2.90 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 187.59.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 12.9, implying annual growth of -72.1%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 42.2.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 0.00 cents and EPS of minus 1.90 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is minus 286.32.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 25.4, implying annual growth of 96.9%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 21.4.

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

LTR    LIONTOWN RESOURCES LIMITED

New Battery Elements – Overnight Price: $0.95

Goldman Sachs rates ((LTR)) as Neutral (3) –

Goldman Sachs reviews the lithium market, observing that lithium companies’ share prices continue to de-rate despite having outperformed global peers (and the underlying commodities market) in the past year.

The broker spies no solid support in the near term and forecasts near-term pricing weakness through to December 2025 given continued additions to the market surplus as new projects continue to be proposed or progressed and the brokers observes narrowing premiums and widening discounts at auctions.

Goldman Sachs expects costs will rise modestly at Liontown Resources and expects news of movement towards production could prove supportive.

Neutral rating and $1.15 target price retained. 

This report was published on July 11, 2024.

Target price is $1.15 Current Price is $0.95 Difference: $0.195
If LTR meets the Goldman Sachs target it will return approximately 20% (excluding dividends, fees and charges).
Current consensus price target is $1.18, suggesting upside of 23.9%(ex-dividends)
The company’s fiscal year ends in June.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 0.00 cents and EPS of minus 6.70 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is minus 14.25.

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 N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is N/A.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 0.00 cents and EPS of 0.80 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 119.37.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -2.4, 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 N/A.

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

MIN    MINERAL RESOURCES LIMITED

Iron Ore – Overnight Price: $57.53

Goldman Sachs rates ((MIN)) as Sell (5) –

Goldman Sachs reviews the lithium market, observing that lithium companies’ share prices continue to de-rate despite having outperformed global peers (and the underlying commodities market) in the past year.

The broker spies no solid support in the near term and forecasts near-term pricing weakness through to December 2025 given continued additions to the market surplus as new projects continue to be proposed or progressed and the brokers observes narrowing premiums and widening discounts at auctions.

Goldman Sachs is predicting potentially weak FY25 guidance from Mineral Resources when it reports.

Sell rating and $47 target price retained.

This report was published on July 11, 2024.

Target price is $47.00 Current Price is $57.53 Difference: minus $10.53 (current price is over target).
If MIN meets the Goldman Sachs target it will return approximately minus 18% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $69.50, suggesting upside of 20.8%(ex-dividends)
The company’s fiscal year ends in June.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 20.00 cents and EPS of 89.00 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 64.64.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 74.5, implying annual growth of -41.5%.
Current consensus DPS estimate is 18.6, implying a prospective dividend yield of 0.3%.
Current consensus EPS estimate suggests the PER is 77.2.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 24.00 cents and EPS of 92.00 cents.
At the last closing share price the estimated dividend yield is 0.42%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 62.53.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 100.6, implying annual growth of 35.0%.
Current consensus DPS estimate is 41.6, implying a prospective dividend yield of 0.7%.
Current consensus EPS estimate suggests the PER is 57.2.

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

OBM    ORA BANDA MINING LIMITED

Gold & Silver – Overnight Price: $0.45

Moelis rates ((OBM)) as Buy (1) –

Moelis observes Ora Banda Mining has formally sanctioned the Sand King Underground project, projecting production of 60koz p.a. by June 2025 which is slightly lower than the broker’s expectations.

Management offered FY25 production guidance of 100loz-110koz of gold with all-in-sustaining-costs of $1,975oz$2,125oz, and FY26 production is forecast at 140koz-160koz of gold with all-in-sustaining-costs of $1,740oz-$1,890oz.

Exploration expenditure is expected at around -$25m in FY25 and -$60-$80m in FY26, notes the analyst.

EPS forecasts are trimmed by -33.1% and -31.9% for FY24/FY25, respectively.

Buy rating and a 4c target price.

This report was published on July 11, 2024.

Target price is $0.46 Current Price is $0.45 Difference: $0.01
If OBM meets the Moelis target it will return approximately 2% (excluding dividends, fees and charges).
The company’s fiscal year ends in June.

Forecast for FY24:

Moelis forecasts a full year FY24 dividend of 0.00 cents and EPS of 0.40 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 112.50.

Forecast for FY25:

Moelis forecasts a full year FY25 dividend of 0.00 cents and EPS of 4.30 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 10.47.

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

PLS    PILBARA MINERALS LIMITED

New Battery Elements – Overnight Price: $3.02

Goldman Sachs rates ((PLS)) as Sell (5) –

Goldman Sachs reviews the lithium market, observing that lithium companies’ share prices continue to de-rate despite having outperformed global peers (and the underlying commodities market) in the past year.

The broker spies no solid support in the near term and forecasts near-term pricing weakness through to December 2025 given continued additions to the market surplus as new projects continue to be proposed or progressed and the brokers observes narrowing premiums and widening discounts at auctions.

The broker observes Pilbara Minerals continues to trade at premium to peers and spies better value elsewhere.

A Sell rating is retained. Target price decreases to $2.60 from $2.80.

This report was published on July 11, 2024.

Target price is $2.60 Current Price is $3.02 Difference: minus $0.42 (current price is over target).
If PLS meets the Goldman Sachs target it will return approximately minus 14% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $3.34, suggesting upside of 10.5%(ex-dividends)
The company’s fiscal year ends in June.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 0.00 cents and EPS of 11.40 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 26.49.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 11.4, implying annual growth of -85.7%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 26.5.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 2.90 cents and EPS of 4.80 cents.
At the last closing share price the estimated dividend yield is 0.96%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 62.92.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 9.2, implying annual growth of -19.3%.
Current consensus DPS estimate is 1.0, implying a prospective dividend yield of 0.3%.
Current consensus EPS estimate suggests the PER is 32.8.

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

TLC    LOTTERY CORPORATION LIMITED

Gaming – Overnight Price: $4.99

Goldman Sachs rates ((TLC)) as Initiation of coverage with Neutral (3) –

Goldman Sachs is re-initiating coverage of Lottery Corp after a year’s absence with a Neutral rating and $5.60 target price.

The broker says a strong FY24 justifies the Neutral rating, expecting a normalisation in FY25.

Otherwise, it’s steady as she goes, the broker expecting the transition of customers from retail to higher margin digital channels to continue apace (albeit below covid levels) and is awaiting updates on capital management given the company’s strong cash flow.

This report was published on July 10, 2024.

Target price is $5.60 Current Price is $4.99 Difference: $0.61
If TLC meets the Goldman Sachs target it will return approximately 12% (excluding dividends, fees and charges).
Current consensus price target is $5.62, suggesting upside of 12.6%(ex-dividends)
The company’s fiscal year ends in June.

Forecast for FY24:

Goldman Sachs forecasts a full year FY24 dividend of 16.50 cents and EPS of 18.10 cents.
At the last closing share price the estimated dividend yield is 3.31%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 27.57.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 18.5, implying annual growth of 55.5%.
Current consensus DPS estimate is 17.7, implying a prospective dividend yield of 3.5%.
Current consensus EPS estimate suggests the PER is 27.0.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 16.90 cents and EPS of 18.80 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 26.54.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 18.5, implying annual growth of N/A.
Current consensus DPS estimate is 18.2, implying a prospective dividend yield of 3.6%.
Current consensus EPS estimate suggests the PER is 27.0.

Market Sentiment: 0.8
All consensus data are updated until yesterday. FNArena’s consensus calculations require a minimum of three sources

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Jarden rates ((TLC)) as Neutral (3) –

Jarden observes Lottery Corp has had a strong year with record jackpot activity expected to positively impact FY24 results, including 55 jackpots of $15m or more, a 30% increase compared to FY23.

The broker upgrades its 2H24 lotteries turnover estimate to $3,971m from $3,834m, indicating it is positioned around -3% below consensus.

For FY25, jackpot activity is expected to normalise leading to a -4.1% decrease in lotteries turnover.

The target price has been revised to $5.00 from $5.20, maintaining a Neutral rating.

This report was published on July 10, 2024.

Target price is $5.00 Current Price is $4.99 Difference: $0.01
If TLC meets the Jarden target it will return approximately 0% (excluding dividends, fees and charges).
Current consensus price target is $5.62, suggesting upside of 12.6%(ex-dividends)
The company’s fiscal year ends in June.

Forecast for FY24:

Jarden forecasts a full year FY24 dividend of 16.90 cents and EPS of 18.60 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 26.83.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 18.5, implying annual growth of 55.5%.
Current consensus DPS estimate is 17.7, implying a prospective dividend yield of 3.5%.
Current consensus EPS estimate suggests the PER is 27.0.

Forecast for FY25:

Jarden forecasts a full year FY25 dividend of 15.30 cents and EPS of 17.10 cents.
At the last closing share price the estimated dividend yield is 3.07%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 29.18.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 18.5, implying annual growth of N/A.
Current consensus DPS estimate is 18.2, implying a prospective dividend yield of 3.6%.
Current consensus EPS estimate suggests the PER is 27.0.

Market Sentiment: 0.8
All consensus data are updated until yesterday. FNArena’s consensus calculations require a minimum of three sources

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