Australian Broker Call *Extra* Edition – Nov 04, 2024

Daily Market Reports | Nov 04 2024

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)

APX   ASL   CCP   COL (2)   CTD (3)   CTT   CVV   CXL   DRR   DTL   EXP   GOR (2)   IGO   JBH (2)   JHX   KCN   LRK (2)   LYC   MAP   MIN   NIC   ORG (2)   PLS   RWL   SMI   TRJ   UNI (2)   WES  

TRJ    TRAJAN GROUP HOLDINGS LIMITED

Medical Equipment & Devices - Overnight Price: $1.23

Canaccord Genuity rates ((TRJ)) as Buy (1) -

Trajan Group has retained FY25 guidance despite challenges in the pharma segment and lower capital equipment demand, notes Canaccord Genuity, with anticipated revenue between $160-$165m and core EBITDA of $17-$19m.

Strength in MOSH/MOAH food testing offsets weaker segments, with the broker commenting recent updates show optimism in a second-half recovery for Pharma.

The broker believes Trajan Group is positioned for potential growth in the food/beverage testing sector and in Asia, while trading at a discount relative to its global peers.

No change to Buy rating and $1.40 target price.

This report was published on October 30, 2024.

Target price is $1.40 Current Price is $1.23 Difference: $0.17
If TRJ meets the Canaccord Genuity target it will return approximately 14% (excluding dividends, fees and charges).
The company's fiscal year ends in June.

Forecast for FY25:

Canaccord Genuity forecasts a full year FY25 dividend of 0.00 cents and EPS of 0.70 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 175.71.

Forecast for FY26:

Canaccord Genuity forecasts a full year FY26 dividend of 0.00 cents and EPS of 2.60 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 47.31.

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

UNI    UNIVERSAL STORE HOLDINGS LIMITED

Apparel & Footwear - Overnight Price: $7.80

Petra Capital rates ((UNI)) as Buy (1) -

At its AGM, Universal Store reported strong FYTD sales growth to 27 October 2024 and Petra Capital observes direct-to-customer sales are up 19.3% year-on-year alongside a steady gross margin at 60.7%.

Increased sales were driven by private brand performance, particularly from PS, Neovision, Luck & Trouble, and Worship, the broker observes.

The company has reaffirmed guidance for 9 to 15 new store openings in FY25, with seven stores expected to open before Christmas.

Despite a 1% increase in CODB% due to inflation, the broker notes upside potential in LFL sales and gross margin.

Retaining a Buy rating, the broker raised the price target to $8.25 from $7.50, driven by stronger sales forecasts and a higher sum-of-the-parts (SOTP) multiple.

This report was published on October 31, 2024.

Target price is $8.25 Current Price is $7.80 Difference: $0.45
If UNI meets the Petra Capital target it will return approximately 6% (excluding dividends, fees and charges).
Current consensus price target is $8.69, suggesting upside of 10.8%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY25:

Petra Capital forecasts a full year FY25 dividend of 33.20 cents and EPS of 46.00 cents.
At the last closing share price the estimated dividend yield is 4.26%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.96.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 47.7, implying annual growth of 5.9%.
Current consensus DPS estimate is 33.2, implying a prospective dividend yield of 4.2%.
Current consensus EPS estimate suggests the PER is 16.4.

Forecast for FY26:

Petra Capital forecasts a full year FY26 dividend of 36.40 cents and EPS of 52.10 cents.
At the last closing share price the estimated dividend yield is 4.67%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.97.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 52.8, implying annual growth of 10.7%.
Current consensus DPS estimate is 36.8, implying a prospective dividend yield of 4.7%.
Current consensus EPS estimate suggests the PER is 14.8.

Market Sentiment: 0.9
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Wilsons rates ((UNI)) as Overweight (1) -

Universal Store reported continued top-line momentum, with sales in the Universal Store and Perfect Stranger brands up 15% and 34% year-on-year, respectively, for weeks 9-17 of FY25.

As per Wilsons' commentary, the gross margin improved, driven by a shift toward private-label products, though investments in headcount caused some operating margin compression.

Guidance for new store openings remains on track, with 9-15 additional stores planned.

The broker has slightly reduced its price target to $8.30 from $8.40, reflecting modest downgrades to forecasts due to increased cost-of-doing-business (CODB).

The Overweight rating is maintained as November/December trading is anticipated to drive significant performance.

This report was published on November 1, 2024.

Target price is $8.30 Current Price is $7.80 Difference: $0.5
If UNI meets the Wilsons target it will return approximately 6% (excluding dividends, fees and charges).
Current consensus price target is $8.69, suggesting upside of 10.8%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY25:

Wilsons forecasts a full year FY25 dividend of 27.80 cents and EPS of 46.30 cents.
At the last closing share price the estimated dividend yield is 3.56%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.85.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 47.7, implying annual growth of 5.9%.
Current consensus DPS estimate is 33.2, implying a prospective dividend yield of 4.2%.
Current consensus EPS estimate suggests the PER is 16.4.

Forecast for FY26:

Wilsons forecasts a full year FY26 dividend of 35.50 cents and EPS of 59.20 cents.
At the last closing share price the estimated dividend yield is 4.55%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.18.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 52.8, implying annual growth of 10.7%.
Current consensus DPS estimate is 36.8, implying a prospective dividend yield of 4.7%.
Current consensus EPS estimate suggests the PER is 14.8.

Market Sentiment: 0.9
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

WES    WESFARMERS LIMITED

Consumer Products & Services - Overnight Price: $66.62

Jarden rates ((WES)) as Neutral (3) -

Jarden comments Wesfarmers 1Q AGM update highlighted steady year-to-date sales, with strong growth at Bunnings and Officeworks offset by weaker trends in Kmart due to consumer spending shifts.

Updates to the broker's FY25 earnings forecasts reflect a -3% reduction, driven by softer Kmart sales and weaker spodumene prices impacting the Industrial segment.

Jarden views Wesfarmers conglomerate structure as beneficial for future expansion in health and consumer goods.

The broker maintains a target price of $61.20 and a Neutral rating.

This report was published on November 1, 2024.

Target price is $61.20 Current Price is $66.62 Difference: minus $5.42 (current price is over target).
If WES meets the Jarden target it will return approximately minus 8% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $65.00, suggesting downside of -2.6%(ex-dividends)
The company's fiscal year ends in June.

Forecast for FY25:

Jarden forecasts a full year FY25 dividend of 202.00 cents and EPS of 231.40 cents.
At the last closing share price the estimated dividend yield is 3.03%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 28.79.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 237.9, implying annual growth of 5.4%.
Current consensus DPS estimate is 207.6, implying a prospective dividend yield of 3.1%.
Current consensus EPS estimate suggests the PER is 28.0.

Forecast for FY26:

Jarden forecasts a full year FY26 dividend of 229.00 cents and EPS of 263.80 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 25.25.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 257.9, implying annual growth of 8.4%.
Current consensus DPS estimate is 224.6, implying a prospective dividend yield of 3.4%.
Current consensus EPS estimate suggests the PER is 25.9.

Market Sentiment: -0.7
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Disclaimer:
The content of this information does in no way reflect the opinions of FNArena, or of its journalists. In fact we don't have any opinion about the stock market, its value, future direction or individual shares. FNArena solely reports about what the main experts in the market note, believe and comment on. By doing so we believe we provide experienced, intelligent investors with a valuable tool that helps them in making up their own minds, reading market trends and getting a feel for what is happening beneath the surface.

This document is provided for informational purposes only. It does not constitute an offer to sell or a solicitation to buy any security or other financial instrument. FNArena employs very experienced journalists who base their work on information believed to be reliable and accurate, though no guarantee is given that the daily report is accurate or complete. Investors should contact their personal adviser before making any investment decision.

Decisions about inclusions in this Report are made independently of the providers of stock market research and at full discretion of the team of journalists responsible for content at FNArena. Inclusion does not equal endorsement, in any way, shape or form. This Report is provided for informational purposes only.