Australian Broker Call *Extra* Edition – Dec 10, 2024

This story features ACUSENSUS LIMITED, and other companies. For more info SHARE ANALYSIS: ACE

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)

ACE   ALK   ALL   APA   BGL   LOT   MPA   MTO   PNR   PTM   RKN   VUL  

ACE    ACUSENSUS LIMITED

Transportation & Logistics – Overnight Price: $1.00

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

Canaccord Genuity highlights a strong start to FY25 for Acusensus, with 17% growth in Q1 revenue to $14m ahead of expectations for 14% growth for the financial year.

The broker notes revenue is being supported by long-term government contracts, with no churn and high cross-sell success rates.

Key domestic wins include a $9.4m three-year contract with the Western Australian government, contributing $3m in annual incremental revenue from the September quarter of 2025, highlight the analysts.

International growth includes new US contracts for distracted driving and speed enforcement, as well as a first long-term UK contract with Devon & Cornwall Police, explains the broker.

Canaccord Genuity retains a Buy rating and a $1.30 target price.

This report was published on October 22, 2024.

Target price is $1.30 Current Price is $1.00 Difference: $0.295
If ACE meets the Canaccord Genuity target it will return approximately 29% (excluding dividends, fees and charges).
The company’s fiscal year ends in July.

Forecast for FY25:

Canaccord Genuity forecasts a full year FY25 dividend of 0.00 cents and EPS of minus 1.40 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is minus 71.79.

Forecast for FY26:

Canaccord Genuity forecasts a full year FY26 dividend of 0.00 cents and EPS of minus 0.90 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is minus 111.67.

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

ALK    ALKANE RESOURCES LIMITED

Gold & Silver – Overnight Price: $0.49

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

Petra Capital notes the sale of Rio Tinto’s 30% stake in the 5.4mt copper-equivalent Winu project in WA to Sumitomo Metal Mining for US$399m equates to a value of $1.4bn for Alkane Resources’ Boda-Kaiser resource.

With the company’s market cap at $315m, even accounting for a discount for the lower grade, the market is ascribing little to no value for the asset, the analyst observes.

Boda-Kaiser is lower grade than Winu by -38% but is 10% larger in terms of tonnes.

Petra Capital values Boda-Kaiser at around $150m for a stated resource of 14.7moz gold equivalent.

Buy rated with a $1.04 target price.

This report was published on December 6, 2024.

Target price is $1.04 Current Price is $0.49 Difference: $0.545
If ALK meets the Petra Capital target it will return approximately 110% (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 5.80 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 8.53.

Forecast for FY26:

Petra Capital forecasts a full year FY26 dividend of 0.00 cents and EPS of 11.90 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 4.16.

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: $69.00

Jarden rates ((ALL)) as Neutral (3) –

Jarden points to the second potential loss of a CEO succession candidate for Aristocrat Leisure, with the CEO of land-based gaming, Hector Fernandez, resigning to become CEO of private equity-owned IGT/Everi.

This is the second resignation after Mitchell Bowen, former CEO of Gaming and Interactive Operations, left earlier in 2024.

Jarden does not see the announcement as a reason for a decline in the share price.

No change to the Neutral rating or $61 target price. Earnings forecasts remain unchanged.

This report was published on December 6, 2024.

Target price is $61.00 Current Price is $69.00 Difference: minus $8 (current price is over target).
If ALL meets the Jarden target it will return approximately minus 12% (excluding dividends, fees and charges – negative figures indicate an expected loss).
Current consensus price target is $70.75, suggesting upside of 2.5%(ex-dividends)
The company’s fiscal year ends in September.

Forecast for FY25:

Jarden forecasts a full year FY25 dividend of 89.00 cents and EPS of 265.00 cents.
At the last closing share price the estimated dividend yield is 1.29%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 26.04.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 263.8, implying annual growth of 28.8%.
Current consensus DPS estimate is 92.1, implying a prospective dividend yield of 1.3%.
Current consensus EPS estimate suggests the PER is 26.2.

Forecast for FY26:

Jarden forecasts a full year FY26 dividend of 94.00 cents and EPS of 281.40 cents.
At the last closing share price the estimated dividend yield is 1.36%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 24.52.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 287.5, implying annual growth of 9.0%.
Current consensus DPS estimate is 95.2, implying a prospective dividend yield of 1.4%.
Current consensus EPS estimate suggests the PER is 24.0.

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

APA    APA GROUP

Infrastructure & Utilities – Overnight Price: $7.28

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

The Australian Energy Regulator has confirmed that the South West Queensland pipeline should be further regulated, i.e., become a “scheme pipeline.”

Jarden believes this is a positive outcome for APA Group, as increased regulation could have resulted in a notable reduction in future tariffs. The broker also highlights Queensland’s important role in addressing the expected shortfall in southern Australian gas supply by 2028.

The Overweight rating and $8.45 target price are maintained. No change to earnings forecasts.

This report was published on December 6, 2024.

Target price is $8.45 Current Price is $7.28 Difference: $1.17
If APA meets the Jarden target it will return approximately 16% (excluding dividends, fees and charges).
Current consensus price target is $7.91, suggesting upside of 8.7%(ex-dividends)
The company’s fiscal year ends in June.

Forecast for FY25:

Jarden forecasts a full year FY25 dividend of 57.00 cents and EPS of 17.40 cents.
At the last closing share price the estimated dividend yield is 7.83%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 41.84.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 17.7, implying annual growth of -77.1%.
Current consensus DPS estimate is 57.0, implying a prospective dividend yield of 7.8%.
Current consensus EPS estimate suggests the PER is 41.1.

Forecast for FY26:

Jarden forecasts a full year FY26 dividend of 58.00 cents and EPS of 25.30 cents.
At the last closing share price the estimated dividend yield is 7.97%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 28.77.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 22.8, implying annual growth of 28.8%.
Current consensus DPS estimate is 57.7, implying a prospective dividend yield of 7.9%.
Current consensus EPS estimate suggests the PER is 31.9.

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

BGL    BELLEVUE GOLD LIMITED

Gold & Silver – Overnight Price: $1.34

Moelis rates ((BGL)) as Initiation of coverage with Hold (3) –

Moelis initiates coverage on Bellevue Gold with a Hold rating and a target price of $1.40, highlighting recent commissioning of its namesake gold project in Western Australia.

The project benefits from a two-stage processing expansion plan, explains the analyst, expected to increase capacity to 1.6mtpa by FY26, and exploration potential remains with -$60m earmarked for drilling in FY25-26.

The broker forecasts annual output of 165-180koz at costs (AISC) of $1,750-1,850/oz for FY25.

Moelis views Bellevue as a likely consolidation target due to its single-asset status and sees risks tied to sustaining exploration investment and executing the expansion plan. 

Moelis sets a 12-month target price of $1.40, maintaining a Hold rating.

This report was published on December 9, 2024.

Target price is $1.40 Current Price is $1.34 Difference: $0.06
If BGL meets the Moelis target it will return approximately 4% (excluding dividends, fees and charges).
Current consensus price target is $1.63, suggesting upside of 21.9%(ex-dividends)
The company’s fiscal year ends in June.

Forecast for FY25:

Moelis forecasts a full year FY25 dividend of 0.00 cents and EPS of 11.50 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 11.65.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 11.7, implying annual growth of 79.4%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 11.5.

Forecast for FY26:

Moelis forecasts a full year FY26 dividend of 0.00 cents and EPS of 14.20 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 9.44.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 15.3, implying annual growth of 30.8%.
Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.
Current consensus EPS estimate suggests the PER is 8.8.

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

LOT    LOTUS RESOURCES LIMITED

Uranium – Overnight Price: $0.23

Canaccord Genuity rates ((LOT)) as Speculative Buy (1) –

Canaccord Genuity highlights Lotus Resources has increased Letlhakane’s mineral resource by 65%, with the total resource at 142.2mt at 363ppm U3O8 for 113.7mlbs.

The broker notes total uranium resources are at 164mlbs, which includes 23mlbs of reserves at Kayelekera.

The Speculative Buy rating and 42c target price are retained.

This report was published on December 9, 2024.

Target price is $0.42 Current Price is $0.23 Difference: $0.19
If LOT meets the Canaccord Genuity target it will return approximately 83% (excluding dividends, fees and charges).
Current consensus price target is $0.55, suggesting upside of 137.7%(ex-dividends)
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 minus 0.20 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is minus 115.00.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -0.4, 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.

Forecast for FY26:

Canaccord Genuity forecasts a full year FY26 dividend of 0.00 cents and EPS of minus 0.70 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is minus 32.86.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 1.4, 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 16.4.

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

MPA    MAD PAWS HOLDINGS LIMITED

Overnight Price: $0.07

Taylor Collison rates ((MPA)) as Initiation of coverage with Speculative Buy (1) –

Taylor Collison initiates coverage on Mad Paws with a Speculative Buy rating and a 12c target, citing potential further upside through unlocking sum-of-the-parts (SOTP) value.

The company is experiencing strong macro tailwinds in the pet sector, supported by rising pet ownership and spending per pet, explains the analyst.

Challenges remain as the business continues to generate negative free cash flow, though the broker forecasts profitability in the medium term.

Taylor Collison values the marketplace assets at 14c/share and eCommerce assets at 6.0-7.4c/share, noting expressions of interest for both segments and the appointment of a financial advisor.

Marketplace growth has rebounded, with a 19% year-on-year increase in new customers following a media partnership with Seven West Media ((SWM)), highlights the analyst.

This report was published on November 29, 2024.

Target price is $0.12 Current Price is $0.07 Difference: $0.051
If MPA meets the Taylor Collison target it will return approximately 74% (excluding dividends, fees and charges).
The company’s fiscal year ends in June.

Forecast for FY25:

Taylor Collison forecasts a full year FY25 dividend of 0.00 cents and EPS of minus 1.18 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is minus 5.85.

Forecast for FY26:

Taylor Collison forecasts a full year FY26 dividend of 0.00 cents and EPS of 0.25 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 27.60.

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

MTO    MOTORCYCLE HOLDINGS LIMITED

Automobiles & Components – Overnight Price: $1.86

Moelis rates ((MTO)) as Buy (1) –

Moelis notes a stronger-than-expected year-to-date trading update for Motorcycle Holdings, with revenues rising by 8% year-on-year.

Growth was driven by a 13% increase in used bike retail units and gains in parts, accessories, and service revenues, explains the broker.

The analysts highlight the company’s cost management initiatives, including property consolidation and system upgrades, which are expected to offset rising expenses.

The addition of new CFMOTO models continues to expand market share and support margin growth, observes the broker.

Moelis implements substantial EPS upgrades of 20-30% for FY25-27 forecasts, reflecting operating leverage as the business recovers from cyclical lows. The new management team is seen as well-placed to execute strategic growth initiatives.

Buy rating. The target price rises to $2.60 from $2.37.

This report was published on December 10, 2024.

Target price is $2.60 Current Price is $1.86 Difference: $0.74
If MTO meets the Moelis target it will return approximately 40% (excluding dividends, fees and charges).
The company’s fiscal year ends in June.

Forecast for FY25:

Moelis forecasts a full year FY25 dividend of 13.10 cents and EPS of 23.30 cents.
At the last closing share price the estimated dividend yield is 7.04%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 7.98.

Forecast for FY26:

Moelis forecasts a full year FY26 dividend of 14.70 cents and EPS of 26.70 cents.
At the last closing share price the estimated dividend yield is 7.90%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 6.97.

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

PNR    PANTORO LIMITED

Gold & Silver – Overnight Price: $0.09

Moelis rates ((PNR)) as Initiation of coverage with Buy (1) –

Moelis initiates coverage on Pantoro with a Buy rating and a target price of 14c, highlighting the company’s strong position as an emerging Australian gold producer.

The broker notes the completion of the 1mtpa processing facility at the Norseman project, supported by significant mineral resources of 4.7moz and ore reserves of 895koz.

Production is expected to ramp up to 80-90koz annually for ten years, with potential for higher grades and increased output.

Pantoro’s net cash position of approximately $105m and minimal hedging provide full exposure to gold prices up to $4,200/oz, highlights Moelis.

This report was published on December 10, 2024.

Target price is $0.14 Current Price is $0.09 Difference: $0.046
If PNR meets the Moelis target it will return approximately 49% (excluding dividends, fees and charges).
The company’s fiscal year ends in June.

Forecast for FY25:

Moelis forecasts a full year FY25 dividend of 0.00 cents and EPS of 0.98 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 9.59.

Forecast for FY26:

Moelis forecasts a full year FY26 dividend of 0.00 cents and EPS of 1.02 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 9.22.

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

PTM    PLATINUM ASSET MANAGEMENT LIMITED

Wealth Management & Investments – Overnight Price: $0.90

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

After completing the due diligence, Regal Partners ((RPL)) has decided not to pursue the acquisition of Platinum Asset Management.

Interest in Platinum from other parties may have waned given the time elapsed and weak flow trends/performance, suggests Goldman Sachs.

The broker highlights November net outflows of -$841m, including a -$537m institutional mandate loss, weighing on profitability due to a high cost-to-income ratio of 60%.

The broker notes weak investment performance across key funds, including a -23.3% underperformance by the International Fund compared to its benchmark over the past year.

A 20c fully franked special dividend was declared.

Goldman Sachs maintains a Sell rating and lowers its target price to 85c from 95c, reflecting a cautious outlook despite the company’s ongoing turnaround efforts.

This report was published on December 10, 2024.

Target price is $0.95 Current Price is $0.90 Difference: $0.055
If PTM meets the Goldman Sachs target it will return approximately 6% (excluding dividends, fees and charges).
The company’s fiscal year ends in June.

Forecast for FY25:

Goldman Sachs forecasts a full year FY25 dividend of 27.30 cents and EPS of 5.80 cents.
At the last closing share price the estimated dividend yield is 30.50%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 15.43.

Forecast for FY26:

Goldman Sachs forecasts a full year FY26 dividend of 5.70 cents and EPS of 6.00 cents.
At the last closing share price the estimated dividend yield is 6.37%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 14.92.

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

RKN    RECKON LIMITED

Accountancy – Overnight Price: $0.55

Moelis rates ((RKN)) as Initiation of coverage with Buy (1) –

Moelis initiates coverage on Reckon with a Buy rating and a target price of 67c, citing strategic value from the transition to its proprietary Reckon One platform. It’s noted the Australian market for cloud-based accounting software is large and continues to grow.

The broker notes stable revenues of $53.4m in 2023, with 60% generated from cloud-based subscriptions. Subscriber growth in Reckon One offsets declines in legacy products, supported by recent enhancements like payroll functionality, explains the analyst.

Management incentives align with shareholder value, focusing on returning cash and exploring M&A opportunities, highlights Moelis.

The company’s US-based nQ Zebraworks division also offers growth potential, according to the broker, targeting mid-sized legal practices with bundled SaaS solutions.

This report was published on December 10, 2024.

Target price is $0.67 Current Price is $0.55 Difference: $0.12
If RKN meets the Moelis target it will return approximately 22% (excluding dividends, fees and charges).
The company’s fiscal year ends in December.

Forecast for FY24:

Moelis forecasts a full year FY24 EPS of 3.60 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 15.28.

Forecast for FY25:

Moelis forecasts a full year FY25 EPS of 3.60 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 15.28.

Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena’s consensus calculations require a minimum of three sources

VUL    VULCAN ENERGY RESOURCES LIMITED

New Battery Elements – Overnight Price: $6.15

Canaccord Genuity rates ((VUL)) as Speculative Buy (1) –

Canaccord Genuity highlights Vulcan Energy Resources’ progress on its Zero Carbon Lithium project in Germany, with first product samples expected soon as the electrolysis plant begins operations.

The broker notes Vulcan’s agreement with BASF to develop a renewable heat project at the Ludwigshafen site, which could double production capacity and pave the way for similar partnerships across the Rhine Valley. 

The project has funding commitments from Export Finance Australia, the European Investment Bank, and the German Government, covering approximately half of the -EUR1.4bn capital requirement, observes Canaccord.

Speculative Buy. Target $11.50.

This report was published on December 9, 2024.

Target price is $11.50 Current Price is $6.15 Difference: $5.35
If VUL meets the Canaccord Genuity target it will return approximately 87% (excluding dividends, fees and charges).

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

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