Weekly Reports | Jan 31 2025
This story features AMPOL LIMITED, and other companies. For more info SHARE ANALYSIS: ALD
Broker Rating Changes (Post Thursday Last Week)
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AMPOL LIMITED ((ALD)) Upgrade to Buy from Neutral by Goldman Sachs.B/H/S: 0/0/0
Goldman Sachs notes Ampol reported a weaker-than-expected 4Q24 result with $45m Lytton gross profit -$5m below its estimate.
The broker notes the international trading segment continued to struggle over Q4 impacted by low market volatility but assumes gradual recovery over 2025. Unaudited 2024 EBITDA of $1.2bn was 4% below Goldman’s $1.25 estimate.
Ahead of FY24 result on Feb 24, the broker estimates $1.2bn underlying EBITDA, $237m net profit, and $4.1bn net debt.
The broker revised FY24/25 EBITDA by -2/-2% primarily adjusting for lower international earnings and higher Lytton operating expense.
Target price reduces to $32.0 from $32.3. Rating upgraded to Buy on attractive valuation and defensive refining exposure, plus an anticipated 2025 earnings recovery.
ARISTOCRAT LEISURE LIMITED ((ALL)) Upgrade to Buy from Neutral by Goldman Sachs.B/H/S: 0/0/0
Reflecting Goldman Sachs’ preference for high quality companies with a track record of delivering strong and certain earnings growth, the broker upgrades Aristocrat Leisure to Buy from Neutral after raising the target to $78 from $70.
The broker highlights Aristocrat’s record North American installations in 2024, reinforcing market dominance and enabling over 40% market share.
Earnings growth is further bolstered by currency tailwinds and synergies between Aristocrat’s land-based and social casino segments, explain the analysts.
Balance sheet strength also underpins the company’s capacity for buybacks and mergers and acquisitions, highlights Goldman Sachs.
CORE LITHIUM LIMITED ((CXO)) Upgrade to Market Weight from Underweight by Wilsons.B/H/S: 0/0/0
In a report looking into 2025, Wilsons reviews seven key talking points for the lithium market covering demand, supply, inventories, geopolitical noise, M&A and how geography could be a key differentiator for new projects moving forward.
Despite being in the midst of an over-supplied market for lithium, the broker believes market rebalancing is underway but the pace will be relatively sedate.
The broker acknowledges its lithium price profile was too optimistic previously, lowering it to a broadly flat forecast versus spot price over the next three years — US$850/t SC6 and US$11,000/t carbonate, before progressively moving up. The new price profile sits slightly below consensus estimates for the coming years.
In the case of Core Lithium, the broker is not forecasting a resumption of operations at Finniss project in the next two years and therefore sees minimal changes from its revised lithium prices and mark-to-market adjustments.
Target price retained at 10c but rating upgraded to Market Weight from Underweight.
LIONTOWN RESOURCES LIMITED ((LTR)) Upgrade to Neutral from Underweight by Jarden.B/H/S: 0/0/0
Jarden incorporated a lower long-term lithium SC6 price of US$1,200/dmt (previously US$1,400/dmt) into Liontown Resources’ forecasts and lower forex, and also made changes to its core assumptions after the December quarter update.
Specifically, the broker noted management mentioning freight rates of $30/t (and “as low as $19/t where we can co-charter”), a number well below its prior $50/t assumption.
The broker is forecasting further cash burn of over -$100m in the current half before accounting for timing of sales, provisional pricing adjustments and working capital.
Target price lowered to 63c from 68c; rating upgraded to Neutral from Underweight.
LOTTERY CORPORATION LIMITED ((TLC)) Upgrade to Overweight from Neutral by Jarden.B/H/S: 0/0/0
Ahead of Lottery Corp’s 1H25 result, Jarden has marked to market reduced jackpot activity and base games which returned to growth following a -5% turnover drop in FY24.
The broker now sees a -4% downside risk to consensus 1H25 turnover of $3.4bn (Jarden’s estimate is $3.3bn). Beyond FY25, the broker assumes reversion to long-term growth of 4-5%.
Target price lifts slightly to $5.05 from $5.00 but rating upgraded to Overweight from Neutral.
WESFARMERS LIMITED ((WES)) Upgrade to Buy from Neutral by Goldman Sachs.B/H/S: 0/0/0
After a strong year of stock performance in 2024, Goldman Sachs continues to see new drivers of growth to give both earnings and valuation upside for Wesfarmers.
The broker forecasts 1H25 Bunnings sales growth of 2.6% y/y, above ABS Home Improvement category growth of 1%.
The broker has raised valuation multiples for Bunnings to 22x from 20x and for Kmart to 18x from 16x.
Goldman notes Wesfarmers will have the highest F24-27 EPS compounded growth of 10% in its top 5 consumer coverage consisting of Woolworths ((WOW)), Coles ((COL)), Endeavour Group ((EDV)) and JB Hi-Fi ((JBH)) while return on capital will expand by 6pts to 25% vs peers flat.
Target price increased to $78.7 from $69.50 and rating upgraded to Buy from Neutral.
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3P LEARNING LIMITED ((3PL)) Downgrade to Hold from Speculative Buy by Taylor Collison.B/H/S: 0/0/0
Taylor Collison notes elevated Mathletics churn and muted B2C growth extrapolated from third-party web traffic and app download data foreshadowed 3P Learning’s FY24 guidance miss. Based on this, the broker anticipates another underwhelming result for 1H25.
Lack of liquidity also exacerbates share price volatility where results have the potential to underperform, the broker observes.
The broker remains optimistic due to a longer-term growth strategy bolstered by experienced management and the expected return of B2C consumers. But in the short-term rating is downgraded to Hold until management provides validation that the goal of 10% revenue growth is achievable, sustainable, and profitable.
No target price is mentioned.
DROPSUITE LIMITED ((DSE)) Downgrade to Hold from Buy by Petra Capital.B/H/S: 0/0/0
Dropsuite reported another strong quarter, with a 37% year-on-year increase in annual recurring revenue (ARR) to US$31.5m in 4Q24. In AUD terms, this translates to a 45% y/y increase buoyed by the lower AUD, notes Petra Capital.
The company received a takeover offer from NinjaOne at $5.9/share which the broker views as compelling and likely to succeed.
The broker has lifted EPS estimates for FY24 and FY25 by 7% and 5%, respectively with the key drivers being higher ARR and a lower AUD/USD.
Target price lifted to $5.9 from $3.98. Rating lowered to Hold from Buy.
| Order | Company | New Rating | Old Rating | Broker | |
|---|---|---|---|---|---|
| Upgrade | |||||
| 1 | AMPOL LIMITED | Buy | Neutral | Goldman Sachs | |
| 2 | ARISTOCRAT LEISURE LIMITED | Buy | Neutral | Goldman Sachs | |
| 3 | CORE LITHIUM LIMITED | Neutral | Sell | Wilsons | |
| 4 | LIONTOWN RESOURCES LIMITED | Neutral | Sell | Jarden | |
| 5 | LOTTERY CORPORATION LIMITED | Buy | Neutral | Jarden | |
| 6 | WESFARMERS LIMITED | Buy | Neutral | Goldman Sachs | |
| Downgrade | |||||
| 7 | 3P LEARNING LIMITED | Neutral | Buy | Taylor Collison | |
| 8 | DROPSUITE LIMITED | Neutral | Buy | Petra Capital | |
Price Target Changes (Post Thursday Last Week)
| Company | Last Price | Broker | New Target | Old Target | Change | |
|---|---|---|---|---|---|---|
| 3PL | 3P Learning | $0.76 | Taylor Collison | N/A | 1.64 | -100.00% |
| A11 | Atlantic Lithium | $0.23 | Wilsons | 0.55 | 0.85 | -35.29% |
| A1M | AIC Mines | $0.36 | Moelis | 0.69 | 0.65 | 6.15% |
| AEL | Amplitude Energy | $0.20 | Canaccord Genuity | 0.33 | 0.31 | 6.45% |
| ALD | Ampol | $29.10 | Goldman Sachs | 32.00 | 32.30 | -0.93% |
| ALL | Aristocrat Leisure | $73.99 | Goldman Sachs | 78.00 | 70.00 | 11.43% |
| BGL | Bellevue Gold | $1.21 | Goldman Sachs | 1.50 | 1.55 | -3.23% |
| Moelis | 1.20 | 1.40 | -14.29% | |||
| BPT | Beach Energy | $1.52 | Jarden | 1.42 | 1.40 | 1.43% |
| BSA | BSA | $1.04 | Canaccord Genuity | 1.85 | 1.75 | 5.71% |
| CRN | Coronado Global Resources | $0.65 | Goldman Sachs | 1.05 | 1.80 | -41.67% |
| DSE | Dropsuite | $5.73 | Petra Capital | 5.90 | 3.98 | 48.24% |
| DYL | Deep Yellow | $1.29 | Canaccord Genuity | 1.90 | 1.92 | -1.04% |
| EVN | Evolution Mining | $5.65 | Jarden | 4.72 | 3.54 | 33.33% |
| FCL | Fineos Corp | $1.79 | Goldman Sachs | N/A | 1.65 | -100.00% |
| FEX | Fenix Resources | $0.29 | Petra Capital | 0.40 | 0.42 | -4.76% |
| FMG | Fortescue | $19.14 | Goldman Sachs | 16.40 | 15.40 | 6.49% |
| Jarden | 17.24 | 16.81 | 2.56% | |||
| GMD | Genesis Minerals | $3.12 | Moelis | 3.05 | 2.70 | 12.96% |
| GOR | Gold Road Resources | $2.48 | Canaccord Genuity | 2.65 | 2.45 | 8.16% |
| Goldman Sachs | 2.75 | 2.65 | 3.77% | |||
| IFL | Insignia Financial | $4.49 | Jarden | 4.60 | 4.20 | 9.52% |
| IGO | IGO Ltd | $5.06 | Jarden | 6.20 | 8.28 | -25.12% |
| INA | Ingenia Communities | $5.77 | Goldman Sachs | N/A | 4.60 | -100.00% |
| INR | ioneer | $0.18 | Wilsons | 0.10 | 0.20 | -50.00% |
| IPH | IPH | $5.02 | Goldman Sachs | N/A | 7.50 | -100.00% |
| IPX | Iperionx | $4.04 | Petra Capital | 6.69 | 5.01 | 33.53% |
| KGN | Kogan.com | $4.68 | Canaccord Genuity | 8.00 | 8.20 | -2.44% |
| KMD | KMD Brands | $0.37 | Canaccord Genuity | 0.42 | 0.48 | -12.50% |
| KYP | Kinatico | $0.17 | Taylor Collison | 0.22 | 0.15 | 46.67% |
| LIC | Lifestyle Communities | $9.65 | Goldman Sachs | N/A | 9.95 | -100.00% |
| LLL | Leo Lithium | Wilsons | 0.45 | 0.42 | 7.14% | |
| LTR | Liontown Resources | $0.69 | Jarden | 0.63 | 0.68 | -7.35% |
| Wilsons | 1.00 | 1.40 | -28.57% | |||
| MND | Monadelphous Group | $15.55 | Goldman Sachs | 12.95 | 12.30 | 5.28% |
| Goldman Sachs | 13.40 | 12.30 | 8.94% | |||
| NWL | Netwealth Group | $31.16 | Jarden | 24.00 | 21.10 | 13.74% |
| NXL | Nuix | $4.28 | Moelis | 6.09 | 6.94 | -12.25% |
| Petra Capital | 4.87 | 6.91 | -29.52% | |||
| PMV | Premier Investments | $22.84 | Petra Capital | 29.00 | 33.75 | -14.07% |
| PPS | Praemium | $0.88 | Canaccord Genuity | 1.05 | 0.95 | 10.53% |
| Moelis | 1.03 | 0.87 | 18.39% | |||
| RDY | ReadyTech Holdings | $3.19 | Goldman Sachs | N/A | 4.25 | -100.00% |
| REG | Regis Healthcare | $6.41 | Jarden | 7.10 | 4.46 | 59.19% |
| RMD | ResMed | $40.50 | Jarden | 36.60 | 33.83 | 8.19% |
| RRL | Regis Resources | $2.97 | Canaccord Genuity | 3.10 | 2.65 | 16.98% |
| Goldman Sachs | 2.80 | 2.70 | 3.70% | |||
| SFX | Sheffield Resources | $0.14 | Petra Capital | 0.17 | 0.28 | -39.29% |
| SMR | Stanmore Resources | $2.62 | Petra Capital | 5.08 | 5.33 | -4.69% |
| SOM | SomnoMed | $0.64 | Wilsons | 0.80 | 0.45 | 77.78% |
| STK | Strickland Metals | $0.08 | Canaccord Genuity | 0.17 | 0.16 | 6.25% |
| STO | Santos | $7.08 | Goldman Sachs | 7.90 | 8.14 | -2.95% |
| Jarden | 7.65 | 7.85 | -2.55% | |||
| TCG | Turaco Gold | $0.31 | Canaccord Genuity | 0.75 | 0.70 | 7.14% |
| TLC | Lottery Corp | $5.00 | Jarden | 5.05 | 5.00 | 1.00% |
| TWE | Treasury Wine Estates | $10.77 | Goldman Sachs | 13.00 | 15.20 | -14.47% |
| VEA | Viva Energy | $2.61 | Goldman Sachs | 3.25 | 3.35 | -2.99% |
| WAF | West African Resources | $1.65 | Canaccord Genuity | 3.95 | 3.70 | 6.76% |
| WDS | Woodside Energy | $24.73 | Jarden | 26.90 | 27.00 | -0.37% |
| WES | Wesfarmers | $76.90 | Goldman Sachs | 78.70 | 69.50 | 13.24% |
| WGX | Westgold Resources | $2.54 | Canaccord Genuity | 4.70 | 4.50 | 4.44% |
| WHC | Whitehaven Coal | $6.10 | Goldman Sachs | 8.90 | 7.90 | 12.66% |
| Company | Last Price | Broker | New Target | Old Target | Change | |
More Highlights
BSA BSA LIMITED
Industrial Sector Contractors & Engineers Overnight Price: $1.04
Canaccord Genuity rates ((BSA)) as Buy (1)
BSA upgraded FY25 EBITDA guidance to $26-28m from $24-27m after reporting 2Q25 EBITDA of $7.5m, up 31.5% year on year and 10.5% margins vs 8.8% in the previous corresponding period.
Canaccord Genuity notes the strong result reflected ongoing volumes in the group’s core telecommunications work, coupled with a favourable mix of work and pricing management.
The broker lifted its EPS forecasts for FY25 and FY26 by 12% and 8%. Petra reminded the pending nbn tender represents a significant
event, but in its view the company appears well-positioned to continue.
Target price rises to $1.85 from $1.75. Buy rating maintained.
This report was published on January 24, 2025.
Target price is $1.85 Current Price is $1.04 Difference: $0.81
If BSA meets the Canaccord Genuity target it will return approximately 78% (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 21.70 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 4.79.
Forecast for FY26:
Canaccord Genuity forecasts a full year FY26 dividend of 0.00 cents and EPS of 22.70 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 4.58.
All consensus data are updated until yesterday. FNArena’s consensus calculations require a minimum of three sources
EXP EXPERIENCE CO LIMITED
Travel, Leisure & Tourism Overnight Price: $0.12
Canaccord Genuity rates ((EXP)) as Buy (1)
Canaccord Genuity highlights Experience Co’s 2Q25 trading update showed an earnings turnaround is underway. Whilst skydiving volume recovery continues to take longer than initially expected, strong adventure experiences and operational efficiencies delivered 1H EBITDA of $10.7m, beating the broker’s estimate of $9.1m.
The broker notes January trading is showing Skydive Australia and NZ to have stronger volumes (excluding weather-impacted Wollongong/Newcastle sites), improving Reef Unlimited volumes/revenue per customer and Treetops’ new site in Canberra trading strongly.
Target price of 23c and Buy rating retained.
This report was published on January 29, 2025.
Target price is $0.23 Current Price is $0.12 Difference: $0.11
If EXP meets the Canaccord Genuity target it will return approximately 92% (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 0.42 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 28.57.
Forecast for FY26:
Canaccord Genuity forecasts a full year FY26 dividend of 0.00 cents and EPS of 1.05 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 11.43.
Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena’s consensus calculations require a minimum of three sources
KYP KINATICO LIMITED
Software & Services Overnight Price: $0.17
Taylor Collison rates ((KYP)) as Outperform (2)
Taylor Collison notes Kinatico’s SaaS revenue is growing at a nearly 50% pace with a pipeline to match and is cash accretive.
The broker remains attracted to the company’s simplified compliance solution, supported by a pre-existing base of over 10,000 corporate data verification customers and the imminent launch of its new platform.
The broker’s FY25 projections remain largely in line with Kinatico’s but FY26 estimates have been upgraded due to cost-base efficiencies and slight revenue increases. Free cash flow estimate for FY26 is raised to $3.3m from $1.7m due to decreasing software development spend.
Target price increases to 22c from 15c. Rating remains at Outperform.
This report was published on January 21, 2025.
Target price is $0.22 Current Price is $0.17 Difference: $0.055
If KYP meets the Taylor Collison target it will return approximately 33% (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 0.25 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 66.00.
Forecast for FY26:
Taylor Collison forecasts a full year FY26 dividend of 0.00 cents and EPS of 0.69 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 23.91.
All consensus data are updated until yesterday. FNArena’s consensus calculations require a minimum of three sources
PPS PRAEMIUM LIMITED
Wealth Management & Investments Overnight Price: $0.85
Canaccord Genuity rates ((PPS)) as Buy (1)
Canaccord Genuity notes Praemium reported strong December quarter performance with platform funds under administration (FUA) growing to $30.2bn, up 4% quarter-on-quarter and 32% year-on-year.
The broker revised higher FUA forecasts for FY25 and FY26 by 3% and 3.9% respectively. Net profit forecasts are also revised up 1.8% and 2.8% for FY25 and FY26 respectively.
Target price upgraded to $1.05 from $0.95. Buy rating maintained.
This report was published on January 23, 2025.
Target price is $1.05 Current Price is $0.85 Difference: $0.195
If PPS meets the Canaccord Genuity target it will return approximately 23% (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 1.50 cents and EPS of 4.00 cents.
At the last closing share price the estimated dividend yield is 1.75%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 21.38.
Forecast for FY26:
Canaccord Genuity forecasts a full year FY26 dividend of 2.00 cents and EPS of 5.00 cents.
At the last closing share price the estimated dividend yield is 2.34%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 17.10.
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena’s consensus calculations require a minimum of three sources
SOM SOMNOMED LIMITED
Medical Equipment & Devices Overnight Price: $0.66
Wilsons rates ((SOM)) as Overweight (1)
Wilson raises its target for SomnoMed by 70% (not a typo) to 80c, maintaining its Overweight rating, citing a strong earnings (EBITDA) recovery and improved operational efficiency following last year’s restructuring.
A 2Q trading update shows group revenue rising by 19% year-on-year to $53.7m, supported by a 37% increase in US sales and better manufacturing capacity, which helped recapture lost customers and reduce turnaround times, explains the broker.
Revenue guidance remains at $105m, while EBITDA guidance has been raised to $7-9m from more than $7m.
The broker notes ongoing demand growth in the global sleep apnoea market, bolstered by increased awareness and referrals, and sees the business benefiting from favourable sector tailwinds.
This report was published on January 29, 2025.
Target price is $0.80 Current Price is $0.66 Difference: $0.145
If SOM meets the Wilsons target it will return approximately 22% (excluding dividends, fees and charges).
The company’s fiscal year ends in June.
Forecast for FY25:
Wilsons forecasts a full year FY25 dividend of 0.00 cents and EPS of 0.30 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 218.33.
Forecast for FY26:
Wilsons forecasts a full year FY26 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 93.57.
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: 3PL - 3P LEARNING LIMITED
For more info SHARE ANALYSIS: ALD - AMPOL LIMITED
For more info SHARE ANALYSIS: ALL - ARISTOCRAT LEISURE LIMITED
For more info SHARE ANALYSIS: COL - COLES GROUP LIMITED
For more info SHARE ANALYSIS: CXO - CORE LITHIUM LIMITED
For more info SHARE ANALYSIS: DSE - DROPSUITE LIMITED
For more info SHARE ANALYSIS: EDV - ENDEAVOUR GROUP LIMITED
For more info SHARE ANALYSIS: JBH - JB HI-FI LIMITED
For more info SHARE ANALYSIS: LTR - LIONTOWN RESOURCES LIMITED
For more info SHARE ANALYSIS: TLC - LOTTERY CORPORATION LIMITED
For more info SHARE ANALYSIS: WES - WESFARMERS LIMITED
For more info SHARE ANALYSIS: WOW - WOOLWORTHS GROUP LIMITED