Weekly Reports | Jul 19 2024
This story features CORE LITHIUM LIMITED, and other companies. For more info SHARE ANALYSIS: CXO
Broker Rating Changes (Post Thursday Last Week)
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CORE LITHIUM LIMITED ((CXO)) Upgrade to Neutral from Sell by Jarden and Upgrade to Neutral from Sell by Goldman Sachs.B/H/S: 0/0/0
Jarden revises the rating on Core Lithium to Neutral from Sell and the target price is lowered to 10c from 12c.
The target price is based on the assumption by the analyst that Finniss will return to operation, supported by lithium price and the enterprise value of $110m can be justified, notes Jarden, on the basis of a strong cash position and residual salvage value of the Finniss infrastructure.
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.
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JUMBO INTERACTIVE LIMITED ((JIN)) Downgrade to Underweight from Neutral by Jarden.B/H/S: 0/0/0
Jumbo Interactive is downgraded to Underweight from Neutral by Jarden with a target price of $15.40, down from $15.70.
The broker forecasts strong upcoming FY24 results but the outlook for FY25 has been tempered by a mean reversion in jackpots towards more historical trends of 23-25 jackpots over $15m per half.
Jarden believe there is downside risk to consensus estimates for FY25.
| Order | Company | New Rating | Old Rating | Broker | |
|---|---|---|---|---|---|
| Upgrade | |||||
| 1 | CORE LITHIUM LIMITED | Neutral | Sell | Goldman Sachs | |
| 2 | CORE LITHIUM LIMITED | Neutral | Sell | Jarden | |
| Downgrade | |||||
| 3 | JUMBO INTERACTIVE LIMITED | Sell | Neutral | Jarden | |
Price Target Changes (Post Thursday Last Week)
| Company | Last Price | Broker | New Target | Old Target | Change | |
|---|---|---|---|---|---|---|
| ADT | Adriatic Metals | $3.31 | Canaccord Genuity | 5.50 | 5.35 | 2.80% |
| AGY | Argosy Minerals | $0.08 | Petra Capital | 0.30 | 0.31 | -3.23% |
| ALK | Alkane Resources | $0.55 | Moelis | 0.65 | 0.60 | 8.33% |
| Petra Capital | 1.00 | 1.06 | -5.66% | |||
| Petra Capital | 1.12 | 1.06 | 5.66% | |||
| ALL | Aristocrat Leisure | $52.57 | Goldman Sachs | 55.30 | N/A | – |
| ANG | Austin Engineering | $0.62 | Petra Capital | 0.67 | 0.60 | 11.67% |
| ARU | Arafura Rare Earths | $0.19 | Petra Capital | 0.25 | 0.48 | -47.92% |
| ASN | Anson Resources | $0.14 | Petra Capital | 0.40 | 0.41 | -2.44% |
| ASX | ASX | $65.44 | Jarden | 61.25 | 61.10 | 0.25% |
| BCB | Bowen Coking Coal | $0.06 | Petra Capital | 0.12 | 0.11 | 9.09% |
| BKT | Black Rock Mining | $0.06 | Petra Capital | 0.20 | 0.17 | 17.65% |
| BLU | Blue Energy | $0.01 | Petra Capital | 0.09 | 0.12 | -25.00% |
| BRE | Brazilian Rare Earths | $2.98 | Petra Capital | 4.36 | 5.13 | -15.01% |
| Petra Capital | 4.55 | 5.13 | -11.31% | |||
| CEH | Coast Entertainment | $0.50 | Canaccord Genuity | 0.60 | 0.54 | 11.11% |
| CMM | Capricorn Metals | $5.44 | Jarden | 5.31 | 5.33 | -0.38% |
| CNB | Carnaby Resources | $0.52 | Petra Capital | 1.53 | 1.44 | 6.25% |
| CVN | Carnarvon Energy | $0.19 | Jarden | 0.24 | 0.25 | -4.00% |
| CXO | Core Lithium | $0.10 | Goldman Sachs | 0.08 | 0.12 | -33.33% |
| Jarden | 0.10 | 0.15 | -33.33% | |||
| DMP | Domino’s Pizza Enterprises | $33.12 | Petra Capital | 38.10 | 40.80 | -6.62% |
| GLN | Galan Lithium | $0.16 | Petra Capital | 0.51 | 0.55 | -7.27% |
| GQG | GQG Partners | $2.85 | Goldman Sachs | 3.00 | 2.73 | 9.89% |
| IGO | IGO | $5.87 | Goldman Sachs | 7.15 | 8.10 | -11.73% |
| JIN | Jumbo Interactive | $15.89 | Jarden | 15.40 | 15.90 | -3.14% |
| KAR | Karoon Energy | $1.90 | Jarden | 2.25 | 2.28 | -1.32% |
| LFG | Liberty Financial | $3.78 | Jarden | 4.00 | 4.20 | -4.76% |
| LIN | Lindian Resources | $0.12 | Petra Capital | 0.63 | 0.69 | -8.70% |
| LTM | Arcadium Lithium | $5.38 | Goldman Sachs | 6.35 | 10.90 | -41.74% |
| MEI | Meteoric Resources | $0.14 | Petra Capital | 0.39 | 0.38 | 2.63% |
| MMC | Andean Silver | $0.99 | Canaccord Genuity | 2.50 | 2.30 | 8.70% |
| MMI | Metro Mining | $0.05 | Petra Capital | 0.09 | 0.09 | 1.11% |
| NWC | New World Resources | $0.03 | Petra Capital | 0.13 | 0.12 | 8.33% |
| NWL | Netwealth Group | $22.72 | Wilsons | 23.52 | 22.03 | 6.76% |
| OBM | Ora Banda Mining | $0.45 | Moelis | 0.46 | 0.42 | 9.52% |
| ORG | Origin Energy | $10.72 | Jarden | 11.00 | 10.40 | 5.77% |
| ORI | Orica | $17.70 | Jarden | 18.50 | 18.55 | -0.27% |
| PLS | Pilbara Minerals | $2.98 | Goldman Sachs | 2.60 | 2.80 | -7.14% |
| PNR | Pantoro | $0.09 | Petra Capital | 0.16 | 0.17 | -5.88% |
| PPM | Pepper Money | $1.42 | Jarden | 1.55 | 1.60 | -3.13% |
| QAN | Qantas Airways | $6.09 | Jarden | 7.30 | 7.00 | 4.29% |
| RED | Red 5 | $0.42 | Petra Capital | 0.46 | 0.47 | -2.13% |
| Petra Capital | 0.46 | 0.49 | -6.12% | |||
| RHK | Red Hawk Mining | $0.86 | Petra Capital | 0.97 | 0.95 | 2.11% |
| RMC | Resimac Group | $0.81 | Jarden | 0.93 | 1.02 | -8.82% |
| RMS | Ramelius Resources | $2.00 | Canaccord Genuity | 2.70 | 2.60 | 3.85% |
| RNU | Renascor Resources | $0.09 | Petra Capital | 0.15 | 0.16 | -6.25% |
| RSG | Resolute Mining | $0.66 | Canaccord Genuity | 1.55 | 1.40 | 10.71% |
| SFX | Sheffield Resources | $0.31 | Petra Capital | 0.68 | 0.69 | -1.45% |
| SMR | Stanmore Resources | $3.86 | Petra Capital | 5.77 | 5.30 | 8.87% |
| SPR | Spartan Resources | $1.07 | Canaccord Genuity | 1.20 | 0.85 | 41.18% |
| STN | Saturn Metals | $0.18 | Petra Capital | 0.56 | 0.50 | 12.00% |
| STO | Santos | $8.00 | Jarden | 8.25 | 8.15 | 1.23% |
| SUN | Suncorp Group | $17.04 | Jarden | 17.17 | 17.00 | 1.00% |
| TLC | Lottery Corp | $4.96 | Goldman Sachs | 5.60 | N/A | – |
| Jarden | 5.00 | 5.20 | -3.85% | |||
| TLG | Talga Group | $0.47 | Petra Capital | 1.06 | 1.19 | -10.92% |
| TLS | Telstra Group | $3.88 | Goldman Sachs | 4.30 | 4.25 | 1.18% |
| TTM | Titan Minerals | $0.05 | Canaccord Genuity | 0.13 | 0.14 | -7.14% |
| WDS | Woodside Energy | $29.52 | Jarden | 29.15 | 29.25 | -0.34% |
| WGX | Westgold Resources | $2.73 | Petra Capital | 2.98 | 2.67 | 11.61% |
| Company | Last Price | Broker | New Target | Old Target | Change | |
More Highlights
ADT ADRIATIC METALS PLC
Gold & Silver Overnight Price: $3.23
Canaccord Genuity rates ((ADT)) as Speculative Buy (1)
Canaccord Genuity anticipates further upside for both the gold price and gold equities supported by pending rate cuts and strong margin growth, respectively.
The broker raises its 2024-29 gold price forecasts by an average of 3.4% and increases the long-term (from 2030) estimate by 5% to US$2,712/oz. For silver, the long-term price is increased by 20% to US$33.58/oz.
Across Canaccord’s research coverage of developers and explorers, price targets rise by 3% on average, after FY25 and FY26 earnings (EBITDA) forecasts increase by 2% and 3%, respectively, on the higher gold price estimates.
Adriatic Metals is among the broker’s best developer/explorer ideas. The target rises to $5.50 from $5.35 and the Speculative Buy rating is maintained.
This report was published on July 11, 2024.
Target price is $5.50 Current Price is $3.23 Difference: $2.27
If ADT meets the Canaccord Genuity target it will return approximately 70% (excluding dividends, fees and charges).
Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena’s consensus calculations require a minimum of three sources
GYG GUZMAN Y GOMEZ LIMITED
Overnight Price: $26.97
Wilsons rates ((GYG)) as Initiation of coverage with Overweight (1)
Wilsons initiate coverage of Guzman y Gomez with an Overweight rating and a $31.98 target price.
The broker expects the company will benefit from strong unit economics, with median annual sales for drive-thru and strip stores at $6.1m and $4.5m respectively, and restaurant margins at 22% and 20%.
To date Guzman y Gomez has developed what Wilsons views as a robust store network in Australia, with plans to expand to 1,000 restaurants from 185, over the long term.
With $277m in net cash, the company can support its aggressive expansion strategy, the broker suggests, including potential growth in the US market.
Overweight. $31.98 target price.
This report was published on July 9, 2024.
Target price is $31.98 Current Price is $26.97 Difference: $5.01
If GYG meets the Wilsons target it will return approximately 19% (excluding dividends, fees and charges).
The company’s fiscal year ends in June.
Forecast for FY24:
Wilsons forecasts a full year FY24 dividend of 0.00 cents and EPS of 17.70 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 152.37.
Forecast for FY25:
Wilsons forecasts a full year FY25 dividend of 0.00 cents and EPS of 21.00 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 128.43.
Market Sentiment: 1.0
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
QAN QANTAS AIRWAYS LIMITED
Transportation & Logistics Overnight Price: $6.21
Goldman Sachs rates ((QAN)) as Buy (1)
Goldman Sachs retains a positive view on Qantas Airways and belives the earnings have structurally improved, due to over -$1bn in cost reductions.
The broker also mentions the investment spend in customer experience is gaining traction, which should lead to operational improvements without the need for additional spending.
Qantas Airways’ market valuation remains below pre-covid levels, trading at a significant discount compared to regional and US peers, Goldman Sachs notes.
The analyst anticipates this valuation gap to narrow as the company delivers sustained earnings and capital returns of circa $1.6bn over the next three years.
Earnings forecasts remain unchanged. Buy rating and $8.05 target price.
This report was published on May 29, 2024.
Target price is $8.05 Current Price is $6.21 Difference: $1.84
If QAN meets the Goldman Sachs target it will return approximately 30% (excluding dividends, fees and charges).
Current consensus price target is $6.73, suggesting upside of 9.0%(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 85.00 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 7.31.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 88.3, implying annual growth of -8.1%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 7.0.
Forecast for FY25:
Goldman Sachs forecasts a full year FY25 dividend of 30.00 cents and EPS of 96.00 cents.
At the last closing share price the estimated dividend yield is 4.83%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 6.47.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 97.9, implying annual growth of 10.9%.
Current consensus DPS estimate is 19.9, implying a prospective dividend yield of 3.2%.
Current consensus EPS estimate suggests the PER is 6.3.
Market Sentiment: 0.7
All consensus data are updated until yesterday. FNArena’s consensus calculations require a minimum of three sources
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For more info SHARE ANALYSIS: CXO - CORE LITHIUM LIMITED
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