Weekly Reports | Sep 20 2024
This story features WESTPAC BANKING CORPORATION, and other companies. For more info SHARE ANALYSIS: WBC
Broker Rating Changes (Post Thursday Last Week)
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WESTPAC BANKING CORPORATION ((WBC)) Downgrade to Neutral from Overweight by Jarden.B/H/S: 0/0/0
Jarden’s new order of preference among the major Australian banks is National Australia Bank (Overweight), Westpac and ANZ Bank with Neutral ratings, followed by the Underweight-rated CommBank.
Overall, the broker expects resilient near-term bank earnings and continues to see upside risks to FY25 consensus forecasts, driven by slightly better margins and currently overstated loan loss expectations.
The analysts raise FY25 and FY26 EPS forecasts by around 1-2% across the majors, while 12-month target prices rise modestly.
The target for Westpac rises to $29.20 from $28.60 and the rating is downgraded to Neutral from Overweight on an elevated relative valuation, explains the broker.
| Order | Company | New Rating | Old Rating | Broker | |
|---|---|---|---|---|---|
| Downgrade | |||||
| 1 | WESTPAC BANKING CORPORATION | Neutral | Buy | Jarden | |
Price Target Changes (Post Thursday Last Week)
| Company | Last Price | Broker | New Target | Old Target | Change | |
|---|---|---|---|---|---|---|
| AEE | Aura Energy | $0.13 | Petra Capital | 0.33 | 0.45 | -26.67% |
| ANZ | ANZ Bank | $31.50 | Jarden | 30.00 | 29.50 | 1.69% |
| AX1 | Accent Group | $2.36 | Wilsons | 2.55 | 2.40 | 6.25% |
| CBA | CommBank | $144.02 | Jarden | 107.00 | 106.00 | 0.94% |
| CCX | City Chic Collective | $0.13 | Canaccord Genuity | 0.30 | 0.25 | 20.00% |
| CHL | Camplify Holdings | $1.32 | Canaccord Genuity | 2.40 | 2.75 | -12.73% |
| COI | Comet Ridge | $0.17 | Canaccord Genuity | 0.17 | 0.21 | -19.05% |
| FFM | FireFly Metals | $1.03 | Canaccord Genuity | 1.40 | 1.35 | 3.70% |
| GTK | Gentrack Group | $9.75 | Wilsons | 11.50 | 11.00 | 4.55% |
| NAB | National Australia Bank | $39.50 | Jarden | 37.00 | 36.00 | 2.78% |
| NHC | New Hope | $4.62 | Goldman Sachs | 3.80 | 3.90 | -2.56% |
| NXD | NextEd Group | $0.12 | Canaccord Genuity | 0.38 | 0.60 | -36.67% |
| PMT | Patriot Battery Metals | $0.38 | Canaccord Genuity | 1.05 | 1.40 | -25.00% |
| SMP | SmartPay | $0.95 | Wilsons | 1.66 | 1.86 | -10.75% |
| WBC | Westpac | $33.37 | Jarden | 29.20 | 28.60 | 2.10% |
| WEB | Webjet | $8.07 | Wilsons | 9.59 | 9.52 | 0.74% |
| WGX | Westgold Resources | $2.68 | Canaccord Genuity | 3.50 | 3.55 | -1.41% |
| Petra Capital | 3.60 | 3.75 | -4.00% | |||
| Company | Last Price | Broker | New Target | Old Target | Change | |
More Highlights
CCR CREDIT CLEAR LIMITED
Diversified Financials Overnight Price: $0.29
Petra Capital rates ((CCR)) as Buy (1)
Petra Capital continues to advocate for a contrarian play on Credit Clear despite clear evidence of a deteriorating macro-economic environment, including hardship cases highlighted by Origin Energy ((ORG)) and rising business insolvencies.
The company is continuing to growth its Tier-1 clients up 67% in FY24 which infers improved revenue growth in around 12-15 months given the lag, the analyst notes.
The target price lifts to 53c from 51c. Buy rating unchanged.
This report was published on September 13, 2024.
Target price is $0.53 Current Price is $0.29 Difference: $0.24
If CCR meets the Petra Capital target it will return approximately 83% (excluding dividends, fees and charges).
The company’s fiscal year ends in June.
Forecast for FY25:
Petra Capital forecasts a full year FY25 dividend of 0.00 cents and EPS of minus 0.10 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is minus 290.00.
Forecast for FY26:
Petra Capital forecasts a full year FY26 dividend of 0.00 cents and EPS of 0.90 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 32.22.
Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena’s consensus calculations require a minimum of three sources
GTK GENTRACK GROUP LIMITED
Software & Services Overnight Price: $10.02
Wilsons rates ((GTK)) as Overweight (1)
As UK water utilities are increasingly ramping-up procurement for modern CRM and billing solutions, Wilsons sees a material opportunity for Gentrack Group.
The utilities are motivated by lower leakage, reduced household consumption, improved customer experience and the smart water meter rollout, explain the analysts.
Securing some current potential contract wins in the space would be a material catalyst for Gentrack Group, suggests the broker, given the current lack of B2C reference sites.
Overweight rating. The target rises to $11.50 from $11.00.
This report was published on September 16, 2024.
Target price is $11.50 Current Price is $10.02 Difference: $1.48
If GTK meets the Wilsons target it will return approximately 15% (excluding dividends, fees and charges).
Current consensus price target is $11.23, suggesting upside of 12.1%(ex-dividends)
The company’s fiscal year ends in September.
Forecast for FY24:
Wilsons forecasts a full year FY24 dividend of 0.00 cents and EPS of 11.07 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 90.53.
Forecast for FY25:
Wilsons forecasts a full year FY25 dividend of 0.00 cents and EPS of 17.25 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 58.09.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 17.4, implying annual growth of 93.3%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 57.6.
This company reports in NZD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena’s consensus calculations require a minimum of three sources
RED RED 5 LIMITED
Gold & Silver Overnight Price: $0.33
Jarden rates ((RED)) as Initiation of coverage with Overweight (2)
The merger of Red 5 and Silver Lake Resources -resulting in the new name of Vault Minerals ((VAU)) later this month- brings together four operating mines.
The mines are King of the Hills, Darlot, Mt Monger and Deflector, as well as Sugar Zone (currently under care & maintenance).
This combination creates an around 400kozpa producer with true upper third quartile costs (AISC), highlights the broker, which initiates coverage on Red 5 with an Overweight rating and 40c target.
The amount of cash on hand will double form the current level to around $1bn by FY26, highlight the analysts, providing prospects for capital returns to shareholders once tax losses are exhausted.
This report was published on September 17, 2024.
Target price is $0.40 Current Price is $0.33 Difference: $0.07
If RED meets the Jarden target it will return approximately 21% (excluding dividends, fees and charges).
The company’s fiscal year ends in June.
Forecast for FY25:
Jarden forecasts a full year FY25 dividend of 0.00 cents and EPS of 3.70 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 8.92.
Forecast for FY26:
Jarden forecasts a full year FY26 dividend of 0.00 cents and EPS of 3.00 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 11.00.
Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena’s consensus calculations require a minimum of three sources
TWE TREASURY WINE ESTATES LIMITED
Food, Beverages & Tobacco Overnight Price: $11.23
Goldman Sachs rates ((TWE)) as Buy (1)
Goldman Sachs reviews the latest NielsenIQ scan data and highlights it only covers around 50% of retail sales in the US.
The latest data insights do offer a trend, the broker notes. Sales for the four weeks to September 7 were mixed with 19 Crimes revealing slightly weaker pricing and better volumes.
Treasury Wine Estates US sales ex-Daou were down -5% year-on-year versus a fall of -2% for the US wine market, the analyst points to an improvement against the previous four weeks.
Goldman Sachs believes the results were “positive” for the group. Buy rating and $15.20 target maintained. No change to earnings forecasts.
This report was published on September 19, 2024.
Target price is $15.20 Current Price is $11.23 Difference: $3.97
If TWE meets the Goldman Sachs target it will return approximately 35% (excluding dividends, fees and charges).
Current consensus price target is $13.71, suggesting upside of 22.1%(ex-dividends)
The company’s fiscal year ends in June.
Forecast for FY25:
Goldman Sachs forecasts a full year FY25 dividend of 42.00 cents and EPS of 60.00 cents.
At the last closing share price the estimated dividend yield is 3.74%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 18.72.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 61.7, implying annual growth of 385.8%.
Current consensus DPS estimate is 41.4, implying a prospective dividend yield of 3.7%.
Current consensus EPS estimate suggests the PER is 18.2.
Forecast for FY26:
Goldman Sachs forecasts a full year FY26 dividend of 50.00 cents and EPS of 71.00 cents.
At the last closing share price the estimated dividend yield is 4.45%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 15.82.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 71.5, implying annual growth of 15.9%.
Current consensus DPS estimate is 48.1, implying a prospective dividend yield of 4.3%.
Current consensus EPS estimate suggests the PER is 15.7.
Market Sentiment: 0.7
All consensus data are updated until yesterday. FNArena’s consensus calculations require a minimum of three sources
WGX WESTGOLD RESOURCES LIMITED
Petra Capital rates ((WGX)) as Buy (1)
Petra Capital forecasts FY26 production of 520koz for Westgold Resources which would lift the company to be the third-largest producer on the ASX.
This week, management guided to FY25 production of 400-420koz which will be back ended as several mines ramp-up.
As synergy benefits are crystallised and output rises, the broker notes a falling cost (AISC) profile for Westgold at the same time as capex is peaking.
The target for Westgold Resources falls to $3.60 from $3.75. Buy.
This report was published on September 18, 2024.
Target price is $3.60 Current Price is $2.65 Difference: $0.95
If WGX meets the Petra Capital target it will return approximately 36% (excluding dividends, fees and charges).
The company’s fiscal year ends in June.
Forecast for FY25:
Petra Capital forecasts a full year FY25 dividend of 10.00 cents and EPS of 21.20 cents.
At the last closing share price the estimated dividend yield is 3.77%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 12.50.
Forecast for FY26:
Petra Capital forecasts a full year FY26 dividend of 12.00 cents and EPS of 47.00 cents.
At the last closing share price the estimated dividend yield is 4.53%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 5.64.
Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena’s consensus calculations require a minimum of three sources
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