Australian Broker Call
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February 06, 2018
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COMPANIES DISCUSSED IN THIS ISSUE
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The number next to the symbol represents the number of brokers covering it for this report -(if more than 1)
Last Updated: 12:32 PM
Your daily news report on the latest recommendation, valuation, forecast and opinion changes.
This report includes concise but limited reviews of research recently published by Stockbrokers, 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.
For more info about the different terms used by stockbrokers, as well as the different methodologies behind similar sounding ratings, download our guide HERE
Today's Upgrades and Downgrades
| AGL - | AGL ENERGY | Downgrade to Neutral from Outperform | Macquarie |
| MPL - | MEDIBANK PRIVATE | Downgrade to Neutral from Outperform | Macquarie |
| NHF - | NIB HOLDINGS | Downgrade to Neutral from Outperform | Macquarie |
| RHP - | RHIPE | Downgrade to Hold from Add | Morgans |
AAD ARDENT LEISURE GROUP
Travel, Leisure & Tourism
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Overnight Price: $1.92
Credit Suisse rates AAD as Outperform (1) -
After two years of bad news Credit Suisse points to the fact there have been two consecutive quarters of growth at Main Event.
The broker finds it hard to mount a constructive argument for the stock yet believes an inflection point around Main Event margins and revenue and an improvement in Dreamworld is approaching.
This carries significant operating leverage and on this basis an Outperform rating is maintained. However, the broker notes execution is paramount.
Target is reduced to $2.05 from $2.10.
Target price is $2.05 Current Price is $1.92 Difference: $0.13
If AAD meets the Credit Suisse target it will return approximately 7% (excluding dividends, fees and charges).
Current consensus price target is $1.81, suggesting downside of -5.9% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Credit Suisse forecasts a full year FY18 dividend of 3.96 cents and EPS of 0.41 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 0.3, implying annual growth of N/A. Current consensus DPS estimate is 4.0, implying a prospective dividend yield of 2.1%. Current consensus EPS estimate suggests the PER is 640.0. |
Forecast for FY19:
Credit Suisse forecasts a full year FY19 dividend of 5.52 cents and EPS of 7.36 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 4.7, implying annual growth of 1466.7%. Current consensus DPS estimate is 5.4, implying a prospective dividend yield of 2.8%. Current consensus EPS estimate suggests the PER is 40.9. |
Market Sentiment: -0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Macquarie rates AAD as Neutral (3) -
Macquarie observes the trading update was softer than expected and the outlook is mixed. The broker acknowledges recent divestments have created a more sustainable capital structure and provide the added financial flexibility to reinvest in the core.
Nevertheless, Macquarie awaits evidence of sustained improvement in operations. Neutral maintained. Target reduced to $2.00 from $2.15.
Target price is $2.00 Current Price is $1.92 Difference: $0.08
If AAD meets the Macquarie target it will return approximately 4% (excluding dividends, fees and charges).
Current consensus price target is $1.81, suggesting downside of -5.9% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Macquarie forecasts a full year FY18 dividend of 4.00 cents and EPS of minus 2.50 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 0.3, implying annual growth of N/A. Current consensus DPS estimate is 4.0, implying a prospective dividend yield of 2.1%. Current consensus EPS estimate suggests the PER is 640.0. |
Forecast for FY19:
Macquarie forecasts a full year FY19 dividend of 8.00 cents and EPS of 4.10 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 4.7, implying annual growth of 1466.7%. Current consensus DPS estimate is 5.4, implying a prospective dividend yield of 2.8%. Current consensus EPS estimate suggests the PER is 40.9. |
Market Sentiment: -0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
UBS rates AAD as Sell (5) -
UBS observes the first half trading update was weak, noting the one bright spot was a return to positive revenue growth at Main Event.
UBS makes material reductions to FY18-20 forecasts because of the low earnings base but also cuts longer-term forecasts by -5%.
The broker retains a Sell rating and reduces the target to $1.75 from $1.85.
Target price is $1.75 Current Price is $1.92 Difference: minus $0.17 (current price is over target).
If AAD meets the UBS target it will return approximately minus 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $1.81, suggesting downside of -5.9% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
UBS forecasts a full year FY18 dividend of 4.00 cents and EPS of minus 1.90 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 0.3, implying annual growth of N/A. Current consensus DPS estimate is 4.0, implying a prospective dividend yield of 2.1%. Current consensus EPS estimate suggests the PER is 640.0. |
Forecast for FY19:
UBS forecasts a full year FY19 dividend of 6.60 cents and EPS of 4.80 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 4.7, implying annual growth of 1466.7%. Current consensus DPS estimate is 5.4, implying a prospective dividend yield of 2.8%. Current consensus EPS estimate suggests the PER is 40.9. |
Market Sentiment: -0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
AGL AGL ENERGY LIMITED
Infrastructure & Utilities
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Overnight Price: $23.07
Macquarie rates AGL as Downgrade to Neutral from Outperform (3) -
Macquarie observes the tailwinds from electricity prices have faded and re-investment is somewhat uncertain as the market is rapidly changing in terms of its technology while retail competition is heightened.
The broker considers the risk remains to the downside as AGL is more exposed than its peers to political risk. Rating is downgraded to Neutral from Outperform. Target is reduced to $24.05 from $25.40.
Target price is $24.05 Current Price is $23.07 Difference: $0.98
If AGL meets the Macquarie target it will return approximately 4% (excluding dividends, fees and charges).
Current consensus price target is $26.97, suggesting upside of 16.9% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Macquarie forecasts a full year FY18 dividend of 117.00 cents and EPS of 155.70 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 154.7, implying annual growth of 92.2%. Current consensus DPS estimate is 116.3, implying a prospective dividend yield of 5.0%. Current consensus EPS estimate suggests the PER is 14.9. |
Forecast for FY19:
Macquarie forecasts a full year FY19 dividend of 129.00 cents and EPS of 171.30 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 179.5, implying annual growth of 16.0%. Current consensus DPS estimate is 135.3, implying a prospective dividend yield of 5.9%. Current consensus EPS estimate suggests the PER is 12.9. |
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $27.90
UBS rates ANZ as Neutral (3) -
Banking analysts at UBS have been comparing mortgage data provided by the major banks with data available through Census, ATO and the ABS Household Income & Wealth surveys.
Their conclusion is there are reasons to suspect a large number of borrowers are materially overstating their household income in order to secure a mortgage.
UBS also believes mortgage mis-selling is likely to be a key feature of the Royal Commission, as the Terms of Reference have been widened to include mortgage brokers. No changes have been made following this report, with the broker retaining an underweight view on Australian banks.
Target price is $30.50 Current Price is $27.90 Difference: $2.6
If ANZ meets the UBS target it will return approximately 9% (excluding dividends, fees and charges).
Current consensus price target is $30.34, suggesting upside of 8.7% (ex-dividends)
The company's fiscal year ends in September.
Forecast for FY18:
UBS forecasts a full year FY18 dividend of 160.00 cents and EPS of 228.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 235.0, implying annual growth of 6.8%. Current consensus DPS estimate is 160.5, implying a prospective dividend yield of 5.8%. Current consensus EPS estimate suggests the PER is 11.9. |
Forecast for FY19:
UBS forecasts a full year FY19 dividend of 160.00 cents and EPS of 235.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 238.9, implying annual growth of 1.7%. Current consensus DPS estimate is 162.3, implying a prospective dividend yield of 5.8%. Current consensus EPS estimate suggests the PER is 11.7. |
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $53.65
Morgan Stanley rates ASX as Equal-weight (3) -
Morgan Stanley flags upside risk should strong secondary listing momentum continue. Activity momentum and price power supports around 7% growth in earnings per share in FY18, in the broker's calculation.
Opportunities to monetise data assets also remain underappreciated Morgan Stanley believes.
Equal-weight retained. Target is raised to $55.50 from $53.00. Industry view: In-Line.
Target price is $55.50 Current Price is $53.65 Difference: $1.85
If ASX meets the Morgan Stanley target it will return approximately 3% (excluding dividends, fees and charges).
Current consensus price target is $52.60, suggesting downside of -2.0% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Morgan Stanley forecasts a full year FY18 dividend of 215.30 cents and EPS of 239.50 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 233.1, implying annual growth of 3.8%. Current consensus DPS estimate is 208.7, implying a prospective dividend yield of 3.9%. Current consensus EPS estimate suggests the PER is 23.0. |
Forecast for FY19:
Morgan Stanley forecasts a full year FY19 dividend of 235.60 cents and EPS of 262.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 245.3, implying annual growth of 5.2%. Current consensus DPS estimate is 218.6, implying a prospective dividend yield of 4.1%. Current consensus EPS estimate suggests the PER is 21.9. |
Market Sentiment: -0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Deutsche Bank rates AWE as Hold (3) -
Deutsche Bank notes the board is now on board (pun intended) with the Mitsui bid at $0.95, abandoning its earlier support for Mineral Resources' take over approach.
Target price has been lifted accordingly.
Deutsche Bank notes the Mitsui takeover bid is subject to a 50.1% minimum acceptance condition, plus a limited number of other conditions. It is not subject to any regulatory approvals or financing conditions, and the suitor has already received FIRB approval.
Target price is $0.95 Current Price is $0.95 Difference: $0
If AWE meets the Deutsche Bank target it will return approximately 0% (excluding dividends, fees and charges).
Current consensus price target is $0.78, suggesting downside of -17.9% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Deutsche Bank forecasts a full year FY18 dividend of 0.00 cents and EPS of minus 3.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is -12.2, 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 FY19:
Deutsche Bank forecasts a full year FY19 dividend of 0.00 cents and EPS of minus 1.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 51.3, 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 1.9. |
Market Sentiment: -0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
UBS rates AWE as No Rating (-1) -
AWE has formally recommended shareholders accept the 95c a share offer from Mitsui. The company has terminated the scheme with Mineral Resources ((MIN)) after that company failed to match the Mitsui offer within the required period.
Mitsui's bid is subject to no regulatory action and a minimum shareholder acceptance of at last 50.1% of shares on issue.
UBS is restricted on a rating and target.
Current Price is $0.95. Target price not assessed.
Current consensus price target is $0.78, suggesting downside of -17.9% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
UBS forecasts a full year FY18 dividend of 0.00 cents and EPS of minus 2.60 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is -12.2, 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 FY19:
UBS forecasts a full year FY19 dividend of 0.00 cents and EPS of 0.10 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 51.3, 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 1.9. |
Market Sentiment: -0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
CCL COCA-COLA AMATIL LIMITED
Food, Beverages & Tobacco
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Overnight Price: $8.16
Deutsche Bank rates CCL as Hold (3) -
Early indications are the Container Deposit Scheme might prove less costly than initially estimated by the scheme's coordinator. Far fewer containers were collected and redeemed in December.
In addition, the analysts report industry feedback suggests volumes have been less impacted too (in comparison with expectations). It is early days yet, but here might be building an upside surprise to Amatil's margins, suggests Deutsche Bank.
Hold rating and $7.80 price target left unchanged.
Target price is $7.80 Current Price is $8.16 Difference: minus $0.36 (current price is over target).
If CCL meets the Deutsche Bank target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $8.46, suggesting upside of 3.7% (ex-dividends)
The company's fiscal year ends in December.
Forecast for FY17:
Deutsche Bank forecasts a full year FY17 dividend of 47.00 cents and EPS of 55.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 54.9, implying annual growth of 70.5%. Current consensus DPS estimate is 46.1, implying a prospective dividend yield of 5.6%. Current consensus EPS estimate suggests the PER is 14.9. |
Forecast for FY18:
Deutsche Bank forecasts a full year FY18 dividend of 45.00 cents and EPS of 53.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 54.2, implying annual growth of -1.3%. Current consensus DPS estimate is 44.7, implying a prospective dividend yield of 5.5%. Current consensus EPS estimate suggests the PER is 15.1. |
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $16.46
Morgan Stanley rates CPU as Underweight (5) -
Rising US rates and tax reductions have supported a re-rating to levels not seen since 2007, Morgan Stanley observes.
Yet, underlying structural challenges are underappreciated, the broker asserts, and there are headwinds from negligible organic growth and revenue compression which demand rising reinvestment.
Underweight rating retained. Target is raised to $13.00 from $11.50. Industry view: In-Line.
Target price is $13.00 Current Price is $16.46 Difference: minus $3.46 (current price is over target).
If CPU meets the Morgan Stanley target it will return approximately minus 21% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $14.47, suggesting downside of -12.1% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Morgan Stanley forecasts a full year FY18 dividend of 53.16 cents and EPS of 80.77 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 75.9, implying annual growth of N/A. Current consensus DPS estimate is 35.3, implying a prospective dividend yield of 2.1%. Current consensus EPS estimate suggests the PER is 21.7. |
Forecast for FY19:
Morgan Stanley forecasts a full year FY19 dividend of 55.75 cents and EPS of 86.09 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 85.2, implying annual growth of 12.3%. Current consensus DPS estimate is 37.0, implying a prospective dividend yield of 2.2%. Current consensus EPS estimate suggests the PER is 19.3. |
This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: -0.1
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $6.43
Deutsche Bank rates DOW as Buy (1) -
The company will incur a -$77m impairment charge relating to its mining division. Deutsche Bank notes the division's high returns have fallen significantly because of the loss of two material contracts and delays in securing alternatives.
The broker does not believe the impairment will impact on operations and is merely an accounting adjustment to reflect what is already known. Buy rating and $7.96 target maintained.
Target price is $7.96 Current Price is $6.43 Difference: $1.53
If DOW meets the Deutsche Bank target it will return approximately 24% (excluding dividends, fees and charges).
Current consensus price target is $7.34, suggesting upside of 14.1% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Deutsche Bank forecasts a full year FY18 dividend of 26.00 cents and EPS of 48.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 41.1, implying annual growth of 14.8%. Current consensus DPS estimate is 26.0, implying a prospective dividend yield of 4.0%. Current consensus EPS estimate suggests the PER is 15.6. |
Forecast for FY19:
Deutsche Bank forecasts a full year FY19 dividend of 28.00 cents and EPS of 50.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 47.3, implying annual growth of 15.1%. Current consensus DPS estimate is 27.8, implying a prospective dividend yield of 4.3%. Current consensus EPS estimate suggests the PER is 13.6. |
Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
FBU FLETCHER BUILDING LIMITED
Building Products & Services
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Overnight Price: $7.03
Macquarie rates FBU as Underperform (5) -
Recent media reports may have suggested ACCIANO Concessions is conducting due diligence on the Fletcher construction business but Macquarie notes the company has indicated there is no basis in the story.
Rather the reference may be to counter party due diligence on Fletcher as a JV partner in Northern Express Group PPP.
Underperform rating is retained. Target is NZ$6.27.
Current Price is $7.03. Target price not assessed.
Current consensus price target is N/A
The company's fiscal year ends in June.
Forecast for FY18:
Macquarie forecasts a full year FY18 dividend of 32.30 cents and EPS of 35.53 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 38.8, implying annual growth of N/A. Current consensus DPS estimate is 31.9, implying a prospective dividend yield of 4.5%. Current consensus EPS estimate suggests the PER is 18.1. |
Forecast for FY19:
Macquarie forecasts a full year FY19 dividend of 32.30 cents and EPS of 46.33 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 53.2, implying annual growth of 37.1%. Current consensus DPS estimate is 36.3, implying a prospective dividend yield of 5.2%. Current consensus EPS estimate suggests the PER is 13.2. |
This company reports in NZD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $0.69
Citi rates FXJ as Neutral (3) -
Citi downgrades FY19 and FY20 estimates for earnings per share by -3% and -5% respectively. The changes reflect the lower earnings estimates for Domain ((DHG)), of which Fairfax owns 60%.
The broker retains a Neutral rating and $0.70 target.
Target price is $0.70 Current Price is $0.69 Difference: $0.01
If FXJ meets the Citi target it will return approximately 1% (excluding dividends, fees and charges).
Current consensus price target is $0.74, suggesting upside of 7.2% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Citi forecasts a full year FY18 dividend of 3.70 cents and EPS of 5.30 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 5.3, implying annual growth of -14.5%. Current consensus DPS estimate is 3.8, implying a prospective dividend yield of 5.5%. Current consensus EPS estimate suggests the PER is 13.0. |
Forecast for FY19:
Citi forecasts a full year FY19 dividend of 3.30 cents and EPS of 4.70 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 5.1, implying annual growth of -3.8%. Current consensus DPS estimate is 3.6, implying a prospective dividend yield of 5.2%. Current consensus EPS estimate suggests the PER is 13.5. |
Market Sentiment: 0.2
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $5.84
Deutsche Bank rates GXL as Hold (3) -
The analysts note the company has reported trading over 2H18 in line with budgets, leaving Greencross comfortable with consensus FY18 estimates. But then the CEO of two years is stepping down, to be replaced by Simon Hickey, currently the CEO of Campus Living Villages.
While labeled as "understandable", Deutsche Bank analysts still suggest the switch to a new CEO won't make the challenges ahead any lighter. Online competition plus a large footprint of large format stores are but two of the obvious challenges, in the analysts' view.
Hold rating retained, while estimates have been lowered. Target price remains $5.90.
Target price is $5.90 Current Price is $5.84 Difference: $0.06
If GXL meets the Deutsche Bank target it will return approximately 1% (excluding dividends, fees and charges).
Current consensus price target is $6.20, suggesting upside of 6.2% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Deutsche Bank forecasts a full year FY18 dividend of 20.00 cents and EPS of 38.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 36.9, implying annual growth of 1.9%. Current consensus DPS estimate is 19.8, implying a prospective dividend yield of 3.4%. Current consensus EPS estimate suggests the PER is 15.8. |
Forecast for FY19:
Deutsche Bank forecasts a full year FY19 dividend of 22.00 cents and EPS of 41.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 39.6, implying annual growth of 7.3%. Current consensus DPS estimate is 21.0, implying a prospective dividend yield of 3.6%. Current consensus EPS estimate suggests the PER is 14.7. |
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $1.87
Morgan Stanley rates HSO as Underweight (5) -
Morgan Stanley notes weak volume trends continue in the first half. Private health insurance affordability needs to improve for volumes to recover and the uncertain ramp up profile of the Northern Beaches Hospital leaves the broker's rating Underweight.
Morgan Stanley finds the valuation not compelling while margin expansion is expected to become more challenging. Price target is $1.70. In-Line industry view.
Target price is $1.70 Current Price is $1.87 Difference: minus $0.17 (current price is over target).
If HSO meets the Morgan Stanley target it will return approximately minus 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $2.08, suggesting upside of 11.4% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Morgan Stanley forecasts a full year FY18 dividend of 6.50 cents and EPS of 9.70 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 10.2, implying annual growth of 8.5%. Current consensus DPS estimate is 7.0, implying a prospective dividend yield of 3.7%. Current consensus EPS estimate suggests the PER is 18.3. |
Forecast for FY19:
Morgan Stanley forecasts a full year FY19 dividend of 7.10 cents and EPS of 10.70 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 11.0, implying annual growth of 7.8%. Current consensus DPS estimate is 7.7, implying a prospective dividend yield of 4.1%. Current consensus EPS estimate suggests the PER is 17.0. |
Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Ord Minnett rates HSO as Hold (3) -
Ord Minnett expects solid growth in hospital revenue, supported by new capacity when the company reports its first half result on February 15.
The broker expects a slight contraction in New Zealand pathology operations because of the stronger NZ dollar. Hold maintained. Target is $2.
This stock is not covered in-house by Ord Minnett. Instead, the broker whitelabels research by JP Morgan.
Target price is $2.00 Current Price is $1.87 Difference: $0.13
If HSO meets the Ord Minnett target it will return approximately 7% (excluding dividends, fees and charges).
Current consensus price target is $2.08, suggesting upside of 11.4% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Ord Minnett forecasts a full year FY18 dividend of 7.00 cents and EPS of 10.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 10.2, implying annual growth of 8.5%. Current consensus DPS estimate is 7.0, implying a prospective dividend yield of 3.7%. Current consensus EPS estimate suggests the PER is 18.3. |
Forecast for FY19:
Ord Minnett forecasts a full year FY19 dividend of 7.00 cents and EPS of 10.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 11.0, implying annual growth of 7.8%. Current consensus DPS estimate is 7.7, implying a prospective dividend yield of 4.1%. Current consensus EPS estimate suggests the PER is 17.0. |
Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $1.60
Macquarie rates HT1 as Outperform (1) -
Macquarie considers the stock well-positioned with its assets in the growing media segments of radio and outdoor. There is also scope for upside from media sector consolidation.
The broker refines estimates for earnings per share, reducing 2017 by -0.3% and 2018 by -2.3%. Outperform. Target is raised to $2.32 from $2.25.
Target price is $2.32 Current Price is $1.60 Difference: $0.72
If HT1 meets the Macquarie target it will return approximately 45% (excluding dividends, fees and charges).
Current consensus price target is $2.40, suggesting upside of 49.7% (ex-dividends)
The company's fiscal year ends in December.
Forecast for FY17:
Macquarie forecasts a full year FY17 dividend of 8.10 cents and EPS of 19.20 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 19.3, implying annual growth of N/A. Current consensus DPS estimate is 7.3, implying a prospective dividend yield of 4.6%. Current consensus EPS estimate suggests the PER is 8.3. |
Forecast for FY18:
Macquarie forecasts a full year FY18 dividend of 6.90 cents and EPS of 17.20 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 18.2, implying annual growth of -5.7%. Current consensus DPS estimate is 7.1, implying a prospective dividend yield of 4.4%. Current consensus EPS estimate suggests the PER is 8.8. |
Market Sentiment: 0.8
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $3.08
Macquarie rates MPL as Downgrade to Neutral from Outperform (3) -
Macquarie expects private health insurance will remain a key funding source for healthcare expenditure in Australia, despite the heightened political debate.
Nevertheless, the potential margin risk and minimal upside to the target results in a downgrade to Neutral from Outperform. Target is $3.46.
The broker also retains the view that ongoing structural change is required for the system to manage the underlying growth in claims.
Target price is $3.46 Current Price is $3.08 Difference: $0.38
If MPL meets the Macquarie target it will return approximately 12% (excluding dividends, fees and charges).
Current consensus price target is $3.04, suggesting downside of -1.3% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Macquarie forecasts a full year FY18 dividend of 12.10 cents and EPS of 15.37 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 15.6, implying annual growth of -4.3%. Current consensus DPS estimate is 12.3, implying a prospective dividend yield of 4.0%. Current consensus EPS estimate suggests the PER is 19.7. |
Forecast for FY19:
Macquarie forecasts a full year FY19 dividend of 12.30 cents and EPS of 15.70 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 15.9, implying annual growth of 1.9%. Current consensus DPS estimate is 12.5, implying a prospective dividend yield of 4.1%. Current consensus EPS estimate suggests the PER is 19.4. |
Market Sentiment: -0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
NEC NINE ENTERTAINMENT CO. HOLDINGS LIMITED
Print, Radio & TV
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Overnight Price: $1.64
Credit Suisse rates NEC as Outperform (1) -
ThinkTV reports are showing Nine Entertainment achieved a 40% market share in the six months to December 2017 and Credit Suisse calculates this implies TV advertising revenue grew by 16% in the period.
FY18 earnings estimates are raised by 8.2% and the broker raises its target to $1.80 from $1.60 to reflect this. Outperform retained.
Target price is $1.80 Current Price is $1.64 Difference: $0.16
If NEC meets the Credit Suisse target it will return approximately 10% (excluding dividends, fees and charges).
Current consensus price target is $1.53, suggesting downside of -6.5% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Credit Suisse forecasts a full year FY18 dividend of 9.50 cents and EPS of 16.46 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 16.1, implying annual growth of N/A. Current consensus DPS estimate is 9.8, implying a prospective dividend yield of 6.0%. Current consensus EPS estimate suggests the PER is 10.2. |
Forecast for FY19:
Credit Suisse forecasts a full year FY19 dividend of 9.91 cents and EPS of 15.36 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 14.0, implying annual growth of -13.0%. Current consensus DPS estimate is 8.8, implying a prospective dividend yield of 5.4%. Current consensus EPS estimate suggests the PER is 11.7. |
Market Sentiment: 0.2
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $6.28
Macquarie rates NHF as Downgrade to Neutral from Outperform (3) -
Macquarie expects private health insurance will remain a key funding source for healthcare expenditure in Australia, despite the heightened political debate.
Nevertheless, the potential margin risk and minimal upside to the target results in a downgrade to Neutral from Outperform. Target is $6.90.
The broker also retains the view that ongoing structural change is required for the system to manage the underlying growth in claims.
Target price is $6.90 Current Price is $6.28 Difference: $0.62
If NHF meets the Macquarie target it will return approximately 10% (excluding dividends, fees and charges).
Current consensus price target is $5.95, suggesting downside of -5.3% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Macquarie forecasts a full year FY18 dividend of 21.10 cents and EPS of 27.10 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 26.3, implying annual growth of -3.3%. Current consensus DPS estimate is 20.3, implying a prospective dividend yield of 3.2%. Current consensus EPS estimate suggests the PER is 23.9. |
Forecast for FY19:
Macquarie forecasts a full year FY19 dividend of 23.70 cents and EPS of 29.90 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 28.6, implying annual growth of 8.7%. Current consensus DPS estimate is 22.3, implying a prospective dividend yield of 3.6%. Current consensus EPS estimate suggests the PER is 22.0. |
Market Sentiment: -0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $3.16
Deutsche Bank rates OGC as Buy (1) -
2018 production and cost guidance is slightly softer than Deutsche Bank envisaged. The company is guiding to a softer 2018 after a record 2017. 2017 results will be reported on February 22.
The broker reduces 2018 estimates for earnings by -50% because of increase depreciation and higher costs.
Buy rating and $3.80 target maintained.
Target price is $3.80 Current Price is $3.16 Difference: $0.64
If OGC meets the Deutsche Bank target it will return approximately 20% (excluding dividends, fees and charges).
Current consensus price target is $4.42, suggesting upside of 39.8% (ex-dividends)
The company's fiscal year ends in December.
Forecast for FY17:
Deutsche Bank forecasts a full year FY17 dividend of 2.59 cents and EPS of 35.01 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 31.3, implying annual growth of N/A. Current consensus DPS estimate is 2.7, implying a prospective dividend yield of 0.9%. Current consensus EPS estimate suggests the PER is 10.1. |
Forecast for FY18:
Deutsche Bank forecasts a full year FY18 dividend of 3.89 cents and EPS of 16.86 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 28.7, implying annual growth of -8.3%. Current consensus DPS estimate is 3.6, implying a prospective dividend yield of 1.1%. Current consensus EPS estimate suggests the PER is 11.0. |
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
PRY PRIMARY HEALTH CARE LIMITED
Healthcare services
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Overnight Price: $3.60
Morgan Stanley rates PRY as Underweight (5) -
Morgan Stanley suggests GP churn and retention need to improve before it can be certain that the long-term value of the whole business can be realised.
This may take longer than initially anticipated, with potential short-term risks in the rest of the business.
The broker retains an Underweight rating and a $3.10 target. Industry View is In-Line.
Target price is $3.10 Current Price is $3.60 Difference: minus $0.5 (current price is over target).
If PRY meets the Morgan Stanley target it will return approximately minus 14% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $3.44, suggesting downside of -4.4% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Morgan Stanley forecasts a full year FY18 dividend of 10.70 cents and EPS of 18.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 17.8, implying annual growth of N/A. Current consensus DPS estimate is 11.1, implying a prospective dividend yield of 3.1%. Current consensus EPS estimate suggests the PER is 20.2. |
Forecast for FY19:
Morgan Stanley forecasts a full year FY19 dividend of 11.50 cents and EPS of 19.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 19.7, implying annual growth of 10.7%. Current consensus DPS estimate is 12.2, implying a prospective dividend yield of 3.4%. Current consensus EPS estimate suggests the PER is 18.3. |
Market Sentiment: -0.2
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
QUB QUBE HOLDINGS LIMITED
Transportation & Logistics
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Overnight Price: $2.42
Morgans rates QUB as Hold (3) -
Ahead of the company's result release, the broker has rolled forward its Qube valuation and subsequently lifted its target to $2.80 from $2.62. Recent share price weakness suggests an upgrade from Hold could be considered, but the broker will wait to assess the situation post result.
Target price is $2.80 Current Price is $2.42 Difference: $0.38
If QUB meets the Morgans target it will return approximately 16% (excluding dividends, fees and charges).
Current consensus price target is $2.81, suggesting upside of 16.1% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Morgans forecasts a full year FY18 dividend of 5.50 cents and EPS of 7.30 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 7.6, implying annual growth of 40.7%. Current consensus DPS estimate is 5.4, implying a prospective dividend yield of 2.2%. Current consensus EPS estimate suggests the PER is 31.8. |
Forecast for FY19:
Morgans forecasts a full year FY19 dividend of 5.50 cents and EPS of 7.50 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 8.7, implying annual growth of 14.5%. Current consensus DPS estimate is 5.5, implying a prospective dividend yield of 2.3%. Current consensus EPS estimate suggests the PER is 27.8. |
Market Sentiment: 0.1
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $0.99
Morgans rates RHP as Downgrade to Hold from Add (3) -
Rhipe posted a strong result ahead of Morgans' forecast. FY guidance is within comfortable reach. An acceleration in licensing revenue and tight cost control were the highlights.
The company now has a strong balance sheet, supporting a maiden interim dividend of 0.5c. But given the stock has rallied 150% in the six months since its FY17 result, Morgans has pulled its rating back to Hold. Target rises to $1.04 from 82c.
Target price is $1.04 Current Price is $0.99 Difference: $0.05
If RHP meets the Morgans target it will return approximately 5% (excluding dividends, fees and charges).
The company's fiscal year ends in June.
Forecast for FY18:
Morgans forecasts a full year FY18 dividend of 0.00 cents and EPS of 2.40 cents. |
Forecast for FY19:
Morgans forecasts a full year FY19 dividend of 0.00 cents and EPS of 4.30 cents. |
Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
SDA SPEEDCAST INTERNATIONAL LIMITED
Hardware & Equipment
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Overnight Price: $5.48
Credit Suisse rates SDA as Outperform (1) -
The company has announced at 10-year deal with NBN Co valued at up to $184m to build and manage services for the satellite component of the NBN.
Credit Suisse increases FY18 and FY19 estimate by 11% and 14% respectively. Outperform retained. Target is raised to $7.50 from $6.00.
Target price is $7.50 Current Price is $5.48 Difference: $2.02
If SDA meets the Credit Suisse target it will return approximately 37% (excluding dividends, fees and charges).
Current consensus price target is $5.49, suggesting upside of 0.1% (ex-dividends)
The company's fiscal year ends in December.
Forecast for FY17:
Credit Suisse forecasts a full year FY17 dividend of 12.74 cents and EPS of 23.77 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 22.9, implying annual growth of N/A. Current consensus DPS estimate is 8.3, implying a prospective dividend yield of 1.5%. Current consensus EPS estimate suggests the PER is 23.9. |
Forecast for FY18:
Credit Suisse forecasts a full year FY18 dividend of 21.98 cents and EPS of 40.97 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 32.7, implying annual growth of 42.8%. Current consensus DPS estimate is 13.7, implying a prospective dividend yield of 2.5%. Current consensus EPS estimate suggests the PER is 16.8. |
This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
UBS rates SDA as Buy (1) -
UBS notes the upside it previously forecast has now crystallised, with the company securing a 10-year contract with NBN Co to deliver enterprise grade satellite services. While the base contract is $107m, the broker notes there is upside to $184m, depending on the uptake.
UBS envisages the potential for a 5-7% uplift to FY18 earnings per share from the contract, all else being equal. The broker retains a Buy rating and $5.20 target.
Target price is $5.20 Current Price is $5.48 Difference: minus $0.28 (current price is over target).
If SDA meets the UBS target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $5.49, suggesting upside of 0.1% (ex-dividends)
The company's fiscal year ends in December.
Forecast for FY17:
UBS forecasts a full year FY17 dividend of 7.78 cents and EPS of 23.34 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 22.9, implying annual growth of N/A. Current consensus DPS estimate is 8.3, implying a prospective dividend yield of 1.5%. Current consensus EPS estimate suggests the PER is 23.9. |
Forecast for FY18:
UBS forecasts a full year FY18 dividend of 11.67 cents and EPS of 31.12 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 32.7, implying annual growth of 42.8%. Current consensus DPS estimate is 13.7, implying a prospective dividend yield of 2.5%. Current consensus EPS estimate suggests the PER is 16.8. |
This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $0.16
Citi rates SEH as Buy (1) -
2018 guidance is broadly in line with Citi's estimates. Guidance includes average annual production of 22-27mmscfd and capital expenditure of US$30-35m net.
Capital expenditure is higher than Citi estimated, a function of further processing capacity being targeted for sanction this year.
Citi retains a Buy/High Risk rating and $0.31 target.
Target price is $0.31 Current Price is $0.16 Difference: $0.15
If SEH meets the Citi target it will return approximately 94% (excluding dividends, fees and charges).
The company's fiscal year ends in December.
Forecast for FY17:
Citi forecasts a full year FY17 dividend of 0.00 cents and EPS of minus 0.20 cents. |
Forecast for FY18:
Citi forecasts a full year FY18 dividend of 0.00 cents and EPS of minus 0.10 cents. |
Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $2.00
Deutsche Bank rates VVR as Buy (1) -
Deutsche Bank updates its model and factors in cap rate movements to the valuation. Feedback from property valuers suggests no real movement in service station cap rates over the past 1.5 years.
Buy maintained. Target is reduced to $2.49 from $2.72.
Target price is $2.49 Current Price is $2.00 Difference: $0.49
If VVR meets the Deutsche Bank target it will return approximately 25% (excluding dividends, fees and charges).
Current consensus price target is $2.44, suggesting upside of 22.0% (ex-dividends)
The company's fiscal year ends in December.
Forecast for FY17:
Deutsche Bank forecasts a full year FY17 dividend of 13.00 cents and EPS of 13.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 13.1, implying annual growth of -6.4%. Current consensus DPS estimate is 13.1, implying a prospective dividend yield of 6.6%. Current consensus EPS estimate suggests the PER is 15.3. |
Forecast for FY18:
Deutsche Bank forecasts a full year FY18 dividend of 14.00 cents and EPS of 14.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 14.0, implying annual growth of 6.9%. Current consensus DPS estimate is 14.1, implying a prospective dividend yield of 7.1%. Current consensus EPS estimate suggests the PER is 14.3. |
Market Sentiment: 0.8
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $30.23
Citi rates WBC as Neutral (3) -
The bank has released its first quarter Pillar 3 risk and capital report, revealing a CET1 ratio of 10.1%. Citi suspects this may be softer than the market had expected.
Mortgage growth and margins appear affected by macro prudential limits and the broker suggests there is some risk to consensus estimates heading into the first half results in May. Neutral rating and $31 target maintained.
Target price is $31.00 Current Price is $30.23 Difference: $0.77
If WBC meets the Citi target it will return approximately 3% (excluding dividends, fees and charges).
Current consensus price target is $33.46, suggesting upside of 10.7% (ex-dividends)
Forecast for FY18:
Current consensus EPS estimate is 242.3, implying annual growth of 1.8%. Current consensus DPS estimate is 192.8, implying a prospective dividend yield of 6.4%. Current consensus EPS estimate suggests the PER is 12.5. |
Forecast for FY19:
Current consensus EPS estimate is 247.0, implying annual growth of 1.9%. Current consensus DPS estimate is 195.7, implying a prospective dividend yield of 6.5%. Current consensus EPS estimate suggests the PER is 12.2. |
Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Deutsche Bank rates WBC as Buy (1) -
The analysts comment Westpac's 1Q18 update was limited to capital and asset quality disclosures, in line with the bank's usual practice; it was also broadly in line with Deutsche Bank's expectations.
Forecasts have been reduced slightly. Deutsche Bank continues to see Westpac as attractive given returns and valuation. Buy rating retained, while price target loses 50c to $34.50.
Target price is $34.50 Current Price is $30.23 Difference: $4.27
If WBC meets the Deutsche Bank target it will return approximately 14% (excluding dividends, fees and charges).
Current consensus price target is $33.46, suggesting upside of 10.7% (ex-dividends)
The company's fiscal year ends in September.
Forecast for FY18:
Deutsche Bank forecasts a full year FY18 dividend of 191.00 cents and EPS of 249.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 242.3, implying annual growth of 1.8%. Current consensus DPS estimate is 192.8, implying a prospective dividend yield of 6.4%. Current consensus EPS estimate suggests the PER is 12.5. |
Forecast for FY19:
Deutsche Bank forecasts a full year FY19 dividend of 193.00 cents and EPS of 256.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 247.0, implying annual growth of 1.9%. Current consensus DPS estimate is 195.7, implying a prospective dividend yield of 6.5%. Current consensus EPS estimate suggests the PER is 12.2. |
Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Macquarie rates WBC as Outperform (1) -
Despite weaker-than-expected capital generation in the first quarter Macquarie continues to find value in the stock at current levels.
The broker envisages upside risk to consensus expectations from lower impairment charges, improving markets and a recovery in markets income.
Outperform rating and $35 target maintained.
Target price is $35.00 Current Price is $30.23 Difference: $4.77
If WBC meets the Macquarie target it will return approximately 16% (excluding dividends, fees and charges).
Current consensus price target is $33.46, suggesting upside of 10.7% (ex-dividends)
The company's fiscal year ends in September.
Forecast for FY18:
Macquarie forecasts a full year FY18 dividend of 199.00 cents and EPS of 244.40 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 242.3, implying annual growth of 1.8%. Current consensus DPS estimate is 192.8, implying a prospective dividend yield of 6.4%. Current consensus EPS estimate suggests the PER is 12.5. |
Forecast for FY19:
Macquarie forecasts a full year FY19 dividend of 203.00 cents and EPS of 245.80 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 247.0, implying annual growth of 1.9%. Current consensus DPS estimate is 195.7, implying a prospective dividend yield of 6.5%. Current consensus EPS estimate suggests the PER is 12.2. |
Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Ord Minnett rates WBC as Accumulate (2) -
First quarter capital generation was below Ord Minnett's expectations although both asset quality and funding were strong.
The broker continues to expect capital management will commence in the first half of FY19, with a 10c per share special dividend.
Accumulate rating and $33.10 target maintained.
This stock is not covered in-house by Ord Minnett. Instead, the broker whitelabels research by JP Morgan.
Target price is $33.10 Current Price is $30.23 Difference: $2.87
If WBC meets the Ord Minnett target it will return approximately 9% (excluding dividends, fees and charges).
Current consensus price target is $33.46, suggesting upside of 10.7% (ex-dividends)
The company's fiscal year ends in September.
Forecast for FY18:
Ord Minnett forecasts a full year FY18 EPS of 240.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 242.3, implying annual growth of 1.8%. Current consensus DPS estimate is 192.8, implying a prospective dividend yield of 6.4%. Current consensus EPS estimate suggests the PER is 12.5. |
Forecast for FY19:
Ord Minnett forecasts a full year FY19 EPS of 245.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 247.0, implying annual growth of 1.9%. Current consensus DPS estimate is 195.7, implying a prospective dividend yield of 6.5%. Current consensus EPS estimate suggests the PER is 12.2. |
Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $40.94
Citi rates WES as Sell (5) -
Citi observes the performance of the circa 230 unconverted Homebase stores is weighing heavily on Bunnings UK&I. Wesfarmers has announced over -$1bn in impairments from the division and a -$165m operating loss in the first half.
This is worse than Citi expected and the market is expected to begin pricing in an exit of BUKI under a new senior management team. The company is pausing its store conversion program in order to monitor the 19 pilot stores already converted.
Citi retains a Sell rating and reduces the target to $39.30 from $41.50.
Target price is $39.30 Current Price is $40.94 Difference: minus $1.64 (current price is over target).
If WES meets the Citi target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $40.20, suggesting downside of -1.8% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Citi forecasts a full year FY18 dividend of 218.00 cents and EPS of 236.50 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 232.9, implying annual growth of -8.6%. Current consensus DPS estimate is 214.7, implying a prospective dividend yield of 5.2%. Current consensus EPS estimate suggests the PER is 17.6. |
Forecast for FY19:
Citi forecasts a full year FY19 dividend of 219.00 cents and EPS of 241.70 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 251.5, implying annual growth of 8.0%. Current consensus DPS estimate is 218.8, implying a prospective dividend yield of 5.3%. Current consensus EPS estimate suggests the PER is 16.3. |
Market Sentiment: -0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Credit Suisse rates WES as Neutral (3) -
After indicating it would make an operating loss of -$165m for the Bunnings UK division Credit Suisse believes Wesfarmers faces either a long period of losses or an embarrassing exit.
The broker considers the stock's near-term outlook depends on maturing turnaround stories while it has an underweight exposure to strengthening infrastructure. Industrials and chemicals will need to do some heavy lifting, in the broker's view.
Neutral retained. Target is reduced to $40.43 from $42.18.
Target price is $40.43 Current Price is $40.94 Difference: minus $0.51 (current price is over target).
If WES meets the Credit Suisse target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $40.20, suggesting downside of -1.8% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Credit Suisse forecasts a full year FY18 dividend of 190.00 cents and EPS of 255.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 232.9, implying annual growth of -8.6%. Current consensus DPS estimate is 214.7, implying a prospective dividend yield of 5.2%. Current consensus EPS estimate suggests the PER is 17.6. |
Forecast for FY19:
Credit Suisse forecasts a full year FY19 dividend of 167.00 cents and EPS of 232.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 251.5, implying annual growth of 8.0%. Current consensus DPS estimate is 218.8, implying a prospective dividend yield of 5.3%. Current consensus EPS estimate suggests the PER is 16.3. |
Market Sentiment: -0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Deutsche Bank rates WES as Sell (5) -
Deutsche Bank's earnings estimates for FY18 and FY19 are reduced by -5% in the wake of the company's update on the Bunnings UK loss.
The broker believes, in some ways, the Wesfarmers Homebase situation looks worse than what confronted Woolworths ((WOW)) in its Masters venture. Management has noted that the pay-out ratio will exclude the one-offs and banking covenants are unaffected.
Sell rating retained. Price target drops by -$1 to $37 on reduced forecasts.
Target price is $37.00 Current Price is $40.94 Difference: minus $3.94 (current price is over target).
If WES meets the Deutsche Bank target it will return approximately minus 10% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $40.20, suggesting downside of -1.8% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Deutsche Bank forecasts a full year FY18 dividend of 210.00 cents and EPS of 238.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 232.9, implying annual growth of -8.6%. Current consensus DPS estimate is 214.7, implying a prospective dividend yield of 5.2%. Current consensus EPS estimate suggests the PER is 17.6. |
Forecast for FY19:
Deutsche Bank forecasts a full year FY19 dividend of 215.00 cents and EPS of 244.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 251.5, implying annual growth of 8.0%. Current consensus DPS estimate is 218.8, implying a prospective dividend yield of 5.3%. Current consensus EPS estimate suggests the PER is 16.3. |
Market Sentiment: -0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Macquarie rates WES as Outperform (1) -
The company has announced $1.3bn in significant items in the first half comprising of non-cash impairments of -$1.02bn on the acquisition of Homebase UK and a -$306m impairment of Target.
Macquarie suggests the company appears to have underestimated the customer response to the strategy of removing the prior offering of soft furnishings at Homebase and replacing it with Bunnings-style hardware items.
Wesfarmers has commenced a review of the business and an update is expected in June. Macquarie suggests this outcome will reduce investor confidence in further acquisitions although the business is well-positioned in Bunnings Australasia, Kmart and resources. Outperform rating maintained. Target is $43.92.
Target price is $43.92 Current Price is $40.94 Difference: $2.98
If WES meets the Macquarie target it will return approximately 7% (excluding dividends, fees and charges).
Current consensus price target is $40.20, suggesting downside of -1.8% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Macquarie forecasts a full year FY18 dividend of 213.50 cents and EPS of 246.90 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 232.9, implying annual growth of -8.6%. Current consensus DPS estimate is 214.7, implying a prospective dividend yield of 5.2%. Current consensus EPS estimate suggests the PER is 17.6. |
Forecast for FY19:
Macquarie forecasts a full year FY19 dividend of 253.30 cents and EPS of 281.50 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 251.5, implying annual growth of 8.0%. Current consensus DPS estimate is 218.8, implying a prospective dividend yield of 5.3%. Current consensus EPS estimate suggests the PER is 16.3. |
Market Sentiment: -0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Morgans rates WES as Hold (3) -
Wesfarmers has had its Masters moment, choosing to write down the value of its underperforming Bunnings UK & Ireland start-up and reassess its strategy. Also to be included in the upcoming result will be a write down of the value of Target due to poor sales.
With Target a problem and Coles also now underperforming its rivals, the broker would not be surprised if Wesfarmers decided just to exit Bunnings offshore, and suggests the market we see this as a positive. Target falls to $40.64 from $41.46, Hold retained.
Target price is $40.64 Current Price is $40.94 Difference: minus $0.3 (current price is over target).
If WES meets the Morgans target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $40.20, suggesting downside of -1.8% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Morgans forecasts a full year FY18 dividend of 235.00 cents and EPS of 244.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 232.9, implying annual growth of -8.6%. Current consensus DPS estimate is 214.7, implying a prospective dividend yield of 5.2%. Current consensus EPS estimate suggests the PER is 17.6. |
Forecast for FY19:
Morgans forecasts a full year FY19 dividend of 245.00 cents and EPS of 253.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 251.5, implying annual growth of 8.0%. Current consensus DPS estimate is 218.8, implying a prospective dividend yield of 5.3%. Current consensus EPS estimate suggests the PER is 16.3. |
Market Sentiment: -0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Ord Minnett rates WES as Hold (3) -
The company has announced more than $1.2bn in significant items and a weak first half for the Bunnings UK & Ireland as well as the Target divisions. A strategic review of Bunnings UKI has commenced.
Ord Minnett expects Bunnings will continue to perform well following industry consolidation in Australasia, while the tail risk regarding an exit, or ongoing large losses, in the UK is increasing. Coles is also enduring a more competitive environment.
Ord Minnett retains a Hold rating and lowers the target to $41 from $44.
This stock is not covered in-house by Ord Minnett. Instead, the broker whitelabels research by JP Morgan.
Target price is $41.00 Current Price is $40.94 Difference: $0.06
If WES meets the Ord Minnett target it will return approximately 0% (excluding dividends, fees and charges).
Current consensus price target is $40.20, suggesting downside of -1.8% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Ord Minnett forecasts a full year FY18 dividend of 225.00 cents and EPS of 139.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 232.9, implying annual growth of -8.6%. Current consensus DPS estimate is 214.7, implying a prospective dividend yield of 5.2%. Current consensus EPS estimate suggests the PER is 17.6. |
Forecast for FY19:
Ord Minnett forecasts a full year FY19 dividend of 225.00 cents and EPS of 256.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 251.5, implying annual growth of 8.0%. Current consensus DPS estimate is 218.8, implying a prospective dividend yield of 5.3%. Current consensus EPS estimate suggests the PER is 16.3. |
Market Sentiment: -0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
UBS rates WES as Neutral (3) -
The company has announced a material downgrade to the Bunnings UK&I operating earnings, driving a -5% downgrade to UBS estimates for underlying earnings per share in FY18. The broker considers there is a growing risk that Wesfarmers will exit the UK in the near to medium term.
BUKI is forecast to record around -$384m of cumulative EBIT losses through to FY21 before breaking even in FY22, which may prove optimistic, UBS asserts, given the current trading and the loss of key management. This is also exacerbated by the large lease liability behind the BUKI business.
The broker retains a Neutral rating and lowers the target to $40.30 from $41.30.
Target price is $40.30 Current Price is $40.94 Difference: minus $0.64 (current price is over target).
If WES meets the UBS target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $40.20, suggesting downside of -1.8% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
UBS forecasts a full year FY18 dividend of 211.00 cents and EPS of 244.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 232.9, implying annual growth of -8.6%. Current consensus DPS estimate is 214.7, implying a prospective dividend yield of 5.2%. Current consensus EPS estimate suggests the PER is 17.6. |
Forecast for FY19:
UBS forecasts a full year FY19 dividend of 209.00 cents and EPS of 245.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 251.5, implying annual growth of 8.0%. Current consensus DPS estimate is 218.8, implying a prospective dividend yield of 5.3%. Current consensus EPS estimate suggests the PER is 16.3. |
Market Sentiment: -0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Summaries
| AAD | ARDENT LEISURE | Outperform - Credit Suisse | Overnight Price $1.92 |
| Neutral - Macquarie | Overnight Price $1.92 | ||
| Sell - UBS | Overnight Price $1.92 | ||
| AGL | AGL ENERGY | Downgrade to Neutral from Outperform - Macquarie | Overnight Price $23.07 |
| ANZ | ANZ BANKING GROUP | Neutral - UBS | Overnight Price $27.90 |
| ASX | ASX | Equal-weight - Morgan Stanley | Overnight Price $53.65 |
| AWE | AWE | Hold - Deutsche Bank | Overnight Price $0.95 |
| No Rating - UBS | Overnight Price $0.95 | ||
| CCL | COCA-COLA AMATIL | Hold - Deutsche Bank | Overnight Price $8.16 |
| CPU | COMPUTERSHARE | Underweight - Morgan Stanley | Overnight Price $16.46 |
| DOW | DOWNER EDI | Buy - Deutsche Bank | Overnight Price $6.43 |
| FBU | FLETCHER BUILDING | Underperform - Macquarie | Overnight Price $7.03 |
| FXJ | FAIRFAX MEDIA | Neutral - Citi | Overnight Price $0.69 |
| GXL | GREENCROSS | Hold - Deutsche Bank | Overnight Price $5.84 |
| HSO | HEALTHSCOPE | Underweight - Morgan Stanley | Overnight Price $1.87 |
| Hold - Ord Minnett | Overnight Price $1.87 | ||
| HT1 | HT&E LTD | Outperform - Macquarie | Overnight Price $1.60 |
| MPL | MEDIBANK PRIVATE | Downgrade to Neutral from Outperform - Macquarie | Overnight Price $3.08 |
| NEC | NINE ENTERTAINMENT | Outperform - Credit Suisse | Overnight Price $1.64 |
| NHF | NIB HOLDINGS | Downgrade to Neutral from Outperform - Macquarie | Overnight Price $6.28 |
| OGC | OCEANAGOLD | Buy - Deutsche Bank | Overnight Price $3.16 |
| PRY | PRIMARY HEALTH CARE | Underweight - Morgan Stanley | Overnight Price $3.60 |
| QUB | QUBE HOLDINGS | Hold - Morgans | Overnight Price $2.42 |
| RHP | RHIPE | Downgrade to Hold from Add - Morgans | Overnight Price $0.99 |
| SDA | SPEEDCAST INTERN | Outperform - Credit Suisse | Overnight Price $5.48 |
| Buy - UBS | Overnight Price $5.48 | ||
| SEH | SINO GAS & ENERGY | Buy - Citi | Overnight Price $0.16 |
| VVR | VIVA ENERGY REIT | Buy - Deutsche Bank | Overnight Price $2.00 |
| WBC | WESTPAC BANKING | Neutral - Citi | Overnight Price $30.23 |
| Buy - Deutsche Bank | Overnight Price $30.23 | ||
| Outperform - Macquarie | Overnight Price $30.23 | ||
| Accumulate - Ord Minnett | Overnight Price $30.23 | ||
| WES | WESFARMERS | Sell - Citi | Overnight Price $40.94 |
| Neutral - Credit Suisse | Overnight Price $40.94 | ||
| Sell - Deutsche Bank | Overnight Price $40.94 | ||
| Outperform - Macquarie | Overnight Price $40.94 | ||
| Hold - Morgans | Overnight Price $40.94 | ||
| Hold - Ord Minnett | Overnight Price $40.94 | ||
| Neutral - UBS | Overnight Price $40.94 |
RATING SUMMARY
| Rating | No. Of Recommendations |
| 1. Buy | 12 |
| 2. Accumulate | 1 |
| 3. Hold | 18 |
| 5. Sell | 7 |
Tuesday 06 February 2018
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