Weekly Reports | Oct 04 2024
This story features BREVILLE GROUP LIMITED, and other companies. For more info SHARE ANALYSIS: BRG
Broker Rating Changes (Post Thursday Last Week)
Downgrade
BREVILLE GROUP LIMITED ((BRG)) Downgrade to Sell from Hold by Petra Capital.B/H/S: 0/0/0
Due to incorrect data entry, Petra Capital’s rating for Breville Group should have been downgraded to Sell from Hold last month.
A summary of the broker’s research dated August 22 follows.
Expansion in gross margins and stronger sales in 2H24 helped Breville Group report slightly better than forecast FY24 earnings, Petra Capital notes.
Lower freight costs with promotional activity controlled boosted the gross margin by 140 basis points in 2H24. It is likely to remain flat, the broker highlights, into FY25. This means growth will depend on volume expansion.
The analyst believes new product launches, new markets and expansion of Lelit/Baratza should assist in volume growth.
Petra Capital makes minor EPS changes. Target price rises to $28.30 from $24.40.
GPT GROUP ((GPT)) Downgrade to Underweight from Overweight by Jarden.B/H/S: 0/0/0
While Jarden is not negative on prospects for mall REITs, after strong outperformances the broker’s ratings are downgraded for Vicinity Centres, Scentre Group and GPT Group.
In fact, REIT’s should continue to see 3-4% comparable net operating income (NOI) growth and a 4-6% funds from operations (FFO) compound annual growth rate (CAGR) over the next few years, predict the analysts.
However, based upon transactional evidence of development returns, the broker believes a further increase in valuation premiums is not really justified.
Jarden’s target for GPT Group rises to $5.10 from $5.05 and the rating is downgraded to Underweight from Overweight.
METALS ACQUISITION LIMITED ((MAC)) Downgrade to Hold from Buy by Moelis.B/H/S: 0/0/0
Moelis updates the gold, silver, copper and forex estimates and marks-to-market the changes to earnings estimates.
Rating is downgraded to Hold from Buy due to the recent 17% rally in the share price.
No change in the target price of $23.
ORA BANDA MINING LIMITED ((OBM)) Downgrade to Hold from Buy by Moelis.B/H/S: 0/0/0
Ora Banda Mining reported FY24 results which showed favourable trading activity over the last 12 months. Moelis notes this is probably due to a higher gold price and a turnaround at Davyhurst.
The analyst believes the commissioning of Sand King in FY25 will enable the business to generate around 150koz p.a. in FY26.
Target price is raised to 66c. Stock rating downgraded to Hold from Buy with a lot of optimism built into the share price at current levels.
ORICA LIMITED ((ORI)) Downgrade to Neutral from Overweight by Jarden.B/H/S: 0/0/0
Jarden believes earnings growth in Orica’s key Australia Pacific & Asia (APA) division will slow into FY26 on slowing recontracting growth for ammonium nitrate (AN).
The North American AN market is growing increasingly oversupplied due to the attractive gas input costs for AN production in the US and large agricultural producers switching AN into the explosives market, explains the broker.
Now that the Orica share price has rallied by 20.2% over the past year, and the risk/reward profile has turned negative, the analysts downgrade the rating for Orica to Neutral from Overweight. The $18.50 target is maintained.
SCENTRE GROUP ((SCG)) Downgrade to Neutral from Overweight by Jarden.B/H/S: 0/0/0
While Jarden is not negative on prospects for mall REITs, after strong outperformances the broker’s ratings are downgraded for Vicinity Centres, Scentre Group and GPT Group.
In fact, REIT’s should continue to see 3-4% comparable net operating income (NOI) growth and a 4-6% funds from operations (FFO) compound annual growth rate (CAGR) over the next few years, predict the analysts.
However, based upon transactional evidence of development returns, the broker believes a further increase in valuation premiums is not really justified.
Jarden’s target for Scentre Group rises to $3.90 from $3.75 and the rating is downgraded to Neutral from Overweight.
VICINITY CENTRES ((VCX)) Downgrade to Overweight from Buy by Jarden.B/H/S: 0/0/0
While Jarden is not negative on prospects for mall REITs, after strong outperformances the broker’s ratings are downgraded for Vicinity Centres, Scentre Group and GPT Group.
In fact, REIT’s should continue to see 3-4% comparable net operating income (NOI) growth and a 4-6% funds from operations (FFO) compound annual growth rate (CAGR) over the next few years, predict the analysts.
However, based upon transactional evidence of development returns, the broker believes a further increase in valuation premiums is not really justified.
Jarden’s target for Vicinity Centres rises to $2.50 from $2.45 and the rating is downgraded to Overweight from Buy.
WEB TRAVEL GROUP LIMITED ((WEB)) Downgrade to Overweight from Buy by Jarden.B/H/S: 0/0/0
In the wake of the B2C de-merger, Jarden highlights Webjet is now a pure-play B2B platform in the bed-bank space, which should command a premium multiple.
Such premium is deserved because of the large addressable market (over US$90bn), a high incremental return on invested capital (ROIC) and scale, the broker suggests.
The target falls to $7.70 after the de-merger, and the rating is downgraded to Overweight from Buy, with the analysts suggesting risk-reward remains skewed to the upside.
| Order | Company | New Rating | Old Rating | Broker | |
|---|---|---|---|---|---|
| Downgrade | |||||
| 1 | BREVILLE GROUP LIMITED | Sell | Neutral | Petra Capital | |
| 2 | GPT GROUP | Sell | Buy | Jarden | |
| 3 | METALS ACQUISITION LIMITED | Neutral | Buy | Moelis | |
| 4 | ORA BANDA MINING LIMITED | Neutral | Buy | Moelis | |
| 5 | ORICA LIMITED | Neutral | Buy | Jarden | |
| 6 | SCENTRE GROUP | Neutral | Buy | Jarden | |
| 7 | VICINITY CENTRES | Buy | Buy | Jarden | |
| 8 | WEB TRAVEL GROUP LIMITED | Buy | Buy | Jarden | |
Price Target Changes (Post Thursday Last Week)
| Company | Last Price | Broker | New Target | Old Target | Change | |
|---|---|---|---|---|---|---|
| 360 | Life360 | $19.27 | Goldman Sachs | 21.85 | 19.75 | 10.63% |
| A1M | AIC Mines | $0.37 | Moelis | 0.65 | 0.64 | 1.56% |
| ACF | Acrow | $1.08 | Petra Capital | 1.32 | 1.47 | -10.20% |
| ALK | Alkane Resources | $0.44 | Moelis | 0.70 | 0.65 | 7.69% |
| ALL | Aristocrat Leisure | $57.00 | Jarden | 59.00 | 47.20 | 25.00% |
| ASN | Anson Resources | $0.08 | Petra Capital | 0.35 | 0.41 | -14.63% |
| BKW | Brickworks | $28.79 | Jarden | 30.00 | 28.50 | 5.26% |
| CDA | Codan | $15.83 | Canaccord Genuity | 16.76 | 15.34 | 9.26% |
| Moelis | 18.15 | 16.85 | 7.72% | |||
| DXS | Dexus | $7.81 | Jarden | 7.85 | 7.60 | 3.29% |
| ELD | Elders | $8.54 | Wilsons | 8.07 | 8.33 | -3.12% |
| FFM | FireFly Metals | $1.07 | Moelis | 1.30 | 1.15 | 13.04% |
| FMG | Fortescue | $19.98 | Jarden | 16.83 | 15.84 | 6.25% |
| GMD | Genesis Minerals | $2.02 | Moelis | 2.65 | 2.50 | 6.00% |
| GOR | Gold Road Resources | $1.68 | Moelis | 2.30 | 2.10 | 9.52% |
| GPT | GPT Group | $5.03 | Jarden | 5.10 | 4.85 | 5.15% |
| KMD | KMD Brands | $0.46 | Canaccord Genuity | 0.48 | 0.39 | 23.08% |
| LNW | Light & Wonder | $130.53 | Jarden | 175.00 | 176.00 | -0.57% |
| LTR | Liontown Resources | $0.77 | Jarden | 0.90 | 1.00 | -10.00% |
| NDO | Nido Education | $0.86 | Canaccord Genuity | 1.12 | 1.25 | -10.40% |
| OBM | Ora Banda Mining | $0.62 | Moelis | 0.66 | 0.47 | 40.43% |
| Moelis | 0.67 | 0.47 | 42.55% | |||
| PME | Pro Medicus | $177.76 | Goldman Sachs | 193.00 | 149.00 | 29.53% |
| PMV | Premier Investments | $30.35 | Jarden | 29.50 | 29.80 | -1.01% |
| RIO | Rio Tinto | $126.04 | Goldman Sachs | 136.60 | 136.00 | 0.44% |
| SCG | Scentre Group | $3.61 | Jarden | 3.90 | 3.65 | 6.85% |
| STX | Strike Energy | $0.21 | Goldman Sachs | 0.25 | 0.50 | -50.00% |
| VCX | Vicinity Centres | $2.25 | Jarden | 2.50 | 2.35 | 6.38% |
| WEB | WEB Travel | $7.00 | Jarden | 7.70 | 9.45 | -18.52% |
| WTC | WiseTech Global | $134.60 | Goldman Sachs | 138.00 | 104.00 | 32.69% |
| XRO | Xero | $146.02 | Goldman Sachs | 201.00 | 180.00 | 11.67% |
| Company | Last Price | Broker | New Target | Old Target | Change | |
More Highlights
360 LIFE360 INC
Software & Services Overnight Price: $18.94
Goldman Sachs rates ((360)) as Buy (1)
Goldman Sachs raises forecasts for Life360 in advance of the company 3Q24 results due to robust growith in the subscription business, better cost management as well as growth in higher-margin indirect revenue sources.
The broker lifts EBITDA estimates by 5% in FY25 and 7% in FY26 with an accompanying upgrade in the target price of 11% to $21.75.
Goldman Sachs believes Life360 offers many levers to grow and monetise its user base, increase the international membership roll-out, as well as advertising and indirect data sales including pet care.
Buy rating unchanged.
This report was published on September 30, 2024.
Target price is $21.85 Current Price is $18.94 Difference: $2.91
If 360 meets the Goldman Sachs target it will return approximately 15% (excluding dividends, fees and charges).
Current consensus price target is $20.09, suggesting upside of 6.1%(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 16.67 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 113.60.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 21.9, 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 86.5.
Forecast for FY25:
Goldman Sachs forecasts a full year FY25 dividend of 0.00 cents and EPS of 36.38 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 52.07.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 47.4, implying annual growth of 116.4%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 40.0.
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
AYA ARTRYA LIMITED
Medical Equipment & Devices Overnight Price: $0.34
Petra Capital rates ((AYA)) as Initiation of coverage with Buy (1)
Petra Capital initiates coverage on AI health-tech play, Artrya, with a Buy rating and $2.21 target.
The company’s next generation deep machine learning solutions (branded Salix) are a point-of-care offering providing rapid result delivery to clinicians and are targeting a large and rapidly growing cardiac CT diagnosis market, explains the broker.
Radiologist shortages and increased scan volumes have seen AI become a cornerstone technology for diagnostic imaging companies aiming to lift margins and increase workflow efficiency, highlights Petra Capital.
After a hiccup in 2022, with the FDA knocking-back its first 510(k) process (Premarket Notification), the broker anticipates highly likely 1Q 2025 regulatory clearance of Artrya’s first commercial product in the US. Salix has already been launched in Australia.
This report was published on October 2, 2024.
Target price is $2.21 Current Price is $0.34 Difference: $1.875
If AYA meets the Petra Capital target it will return approximately 560% (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 149.60 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is minus 0.22.
Forecast for FY26:
Petra Capital forecasts a full year FY26 dividend of 0.00 cents and EPS of minus 1.10 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is minus 30.45.
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: $8.60
Goldman Sachs rates ((CKF)) as Initiation of coverage with Buy (1)
Goldman Sachs is cautiously optimistic on the Quick Service Restaurant (QSR) outlook because consumer sentiment is trending
positively and as interest rate expectations and recent tax cuts are now being factored in.
Recent elevated population growth and a forecast return to growth in real disposable income and consumption are other factors behind the broker’s positive thesis.
The analysts commence coverage of Collins Foods with a Buy rating as cost growth has moderated (wages, poultry, electricity and rent growth falling), while oils and grains have returned to pre-covid levels.
Goldman also sees potential for increased Digital sales penetration; and notes the KFC presence is reaching scale in the Netherlands and expects improving KFC Europe margins in the long-term.
A $10 target is set.
This report was published on October 3, 2024.
Target price is $10.00 Current Price is $8.60 Difference: $1.4
If CKF meets the Goldman Sachs target it will return approximately 16% (excluding dividends, fees and charges).
Current consensus price target is $9.46, suggesting upside of 10.0%(ex-dividends)
The company’s fiscal year ends in May.
Forecast for FY25:
Goldman Sachs forecasts a full year FY25 dividend of 21.00 cents and EPS of 42.00 cents.
At the last closing share price the estimated dividend yield is 2.44%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 20.48.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 45.9, implying annual growth of -4.5%.
Current consensus DPS estimate is 24.1, implying a prospective dividend yield of 2.8%.
Current consensus EPS estimate suggests the PER is 18.7.
Forecast for FY26:
Goldman Sachs forecasts a full year FY26 dividend of 28.00 cents and EPS of 56.00 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 15.36.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 58.4, implying annual growth of 27.2%.
Current consensus DPS estimate is 30.8, implying a prospective dividend yield of 3.6%.
Current consensus EPS estimate suggests the PER is 14.7.
Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena’s consensus calculations require a minimum of three sources
DDR DICKER DATA LIMITED
Hardware & Equipment Overnight Price: $9.40
Jarden rates ((DDR)) as Buy (1)
Jarden observes the tailwinds of Ai are starting to flow through the hardware and software “ecosystems” of Dicker Data’s and Data#2 ((DTL)) key vendors, which gives the broker more reason to be upbeat on the PC and non-PC hardware replacement cycle, growth in software and Gen.Ai services.
Dicker Data is Buy rated with a $10.60 target price.
This report was published on September 26, 2024.
Target price is $10.60 Current Price is $9.40 Difference: $1.2
If DDR meets the Jarden target it will return approximately 13% (excluding dividends, fees and charges).
Current consensus price target is $10.57, suggesting upside of 12.4%(ex-dividends)
The company’s fiscal year ends in December.
Forecast for FY24:
Jarden forecasts a full year FY24 EPS of 45.20 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 20.80.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 45.0, implying annual growth of -1.3%.
Current consensus DPS estimate is 47.0, implying a prospective dividend yield of 5.0%.
Current consensus EPS estimate suggests the PER is 20.9.
Forecast for FY25:
Jarden forecasts a full year FY25 EPS of 50.50 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 18.61.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 51.4, implying annual growth of 14.2%.
Current consensus DPS estimate is 50.6, implying a prospective dividend yield of 5.4%.
Current consensus EPS estimate suggests the PER is 18.3.
Market Sentiment: 0.7
All consensus data are updated until yesterday. FNArena’s consensus calculations require a minimum of three sources
PME PRO MEDICUS LIMITED
Medical Equipment & Devices Overnight Price: $178.25
Goldman Sachs rates ((PME)) as Buy (1)
Goldman Sachs raises its target for Buy-rated Pro Medicus by 30% to $193, well in advance of the $128.50 average target of five daily-covered brokers in the FNArena database (which doesn’t include Goldman Sachs).
The $193 target is justified by the revenue/margin outlook, unique cloud offering, and significant long-term opportunity, suggest the analysts.
The company’s share of the US market remains low at 7%, highlights the broker, which forecasts a long-term US market share over 25%. Upside potential is also noted for the core total addressable market (TAM), adjacencies (cardiology and AI) and potential new markets.
Regarding adjacencies, Goldman Sachs suggests Pro Medicus is well positioned to take share in cardiology and AI, thanks to a unique partnership with medical key opinion leaders in settings that are generally well-funded.
This report was published on September 27, 2024.
Target price is $193.00 Current Price is $178.25 Difference: $14.75
If PME meets the Goldman Sachs target it will return approximately 8% (excluding dividends, fees and charges).
Current consensus price target is $128.50, suggesting downside of -27.9%(ex-dividends)
The company’s fiscal year ends in June.
Forecast for FY25:
Goldman Sachs forecasts a full year FY25 dividend of 54.10 cents and EPS of 104.00 cents.
At the last closing share price the estimated dividend yield is 0.30%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 171.39.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 102.7, implying annual growth of 29.6%.
Current consensus DPS estimate is 51.4, implying a prospective dividend yield of 0.3%.
Current consensus EPS estimate suggests the PER is 173.6.
Forecast for FY26:
Goldman Sachs forecasts a full year FY26 dividend of 68.00 cents and EPS of 133.00 cents.
At the last closing share price the estimated dividend yield is 0.38%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 134.02.How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 135.7, implying annual growth of 32.1%.
Current consensus DPS estimate is 67.8, implying a prospective dividend yield of 0.4%.
Current consensus EPS estimate suggests the PER is 131.4.
Market Sentiment: -0.2
All consensus data are updated until yesterday. FNArena’s consensus calculations require a minimum of three sources
XRO XERO LIMITED
Accountancy Overnight Price: $148.72
Goldman Sachs rates ((XRO)) as Buy (1)
Goldman Sachs raises its target for Xero by 12% to $201 on higher earnings forecasts and a re-rating of SaaS peers. Buy.
The broker’s industry feedback suggests a positive from management’s greater focus on localising the product to be more US-centric, and becoming consistent with how those accountants operate, who use QuickBooks Online Accountant (QBO).
There is an improving Canadian opportunity in 2025-26, highlight the analysts, as Open-banking is introduced. A lack of progress on open banking/bank feeds has been cited as the key reason behind an industry wide slowdown in cloud adoption, explains Goldman Sachs.
This report was published on September 27, 2024.
Target price is $201.00 Current Price is $148.72 Difference: $52.28
If XRO meets the Goldman Sachs target it will return approximately 35% (excluding dividends, fees and charges).
Current consensus price target is $161.43, suggesting upside of 8.5%(ex-dividends)
The company’s fiscal year ends in March.
Forecast for FY25:
Goldman Sachs forecasts a full year FY25 dividend of 0.00 cents.
How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 139.0, 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 107.0.
Forecast for FY26:
Goldman Sachs forecasts a full year FY26 dividend of 0.00 cents.
How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 184.2, implying annual growth of 32.5%.
Current consensus DPS estimate is 13.6, implying a prospective dividend yield of 0.1%.
Current consensus EPS estimate suggests the PER is 80.7.
This company reports in NZD. 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
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CHARTS
For more info SHARE ANALYSIS: BRG - BREVILLE GROUP LIMITED
For more info SHARE ANALYSIS: GPT - GPT GROUP
For more info SHARE ANALYSIS: MAC - MAC COPPER LIMITED
For more info SHARE ANALYSIS: OBM - ORA BANDA MINING LIMITED
For more info SHARE ANALYSIS: ORI - ORICA LIMITED
For more info SHARE ANALYSIS: SCG - SCENTRE GROUP
For more info SHARE ANALYSIS: VCX - VICINITY CENTRES
For more info SHARE ANALYSIS: WEB - WEB TRAVEL GROUP LIMITED