Australian Broker Call
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June 18, 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: 10:36 AM
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
| BAP - | BAPCOR LIMITED | Downgrade to Neutral from Buy | UBS |
| GUD - | G.U.D. HOLDINGS | Upgrade to Neutral from Sell | UBS |
AZJ AURIZON HOLDINGS LIMITED
Transportation & Logistics
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Overnight Price: $4.35
Morgan Stanley rates AZJ as Underweight (5) -
The ACCC has updated its timetable for the sale of the Queensland intermodal assets with a new decision date of July 5 2018.
Morgan Stanley envisages downside risk to consensus estimates based on the limited prospects for regulatory relief and limited margin for safety should headwinds coincide.
Underweight. Target is $4.00. Industry view: Cautious.
Target price is $4.00 Current Price is $4.35 Difference: minus $0.35 (current price is over target).
If AZJ meets the Morgan Stanley target it will return approximately minus 8% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $4.42, suggesting upside of 1.6% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Morgan Stanley forecasts a full year FY18 dividend of 27.10 cents and EPS of 27.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 26.7, implying annual growth of N/A. Current consensus DPS estimate is 25.9, implying a prospective dividend yield of 6.0%. Current consensus EPS estimate suggests the PER is 16.3. |
Forecast for FY19:
Morgan Stanley forecasts a full year FY19 dividend of 27.20 cents and EPS of 27.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 26.1, implying annual growth of -2.2%. Current consensus DPS estimate is 24.2, implying a prospective dividend yield of 5.6%. Current consensus EPS estimate suggests the PER is 16.7. |
Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $6.84
UBS rates BAP as Downgrade to Neutral from Buy (3) -
UBS observes the share price is up around 25% over the last six months and while positive about the long-term prospects downgrades to Neutral from Buy.
The broker believes the shares are starting to price in a successful roll-out in Asia and a substantial uplift in private-label penetration.
It also could be implying an acquisition of Kmart Tyre & Auto. The latter could be around 6% accretive based on rough estimates, UBS suggests. Target is raised to $7.00 from $6.40.
Target price is $7.00 Current Price is $6.84 Difference: $0.16
If BAP meets the UBS target it will return approximately 2% (excluding dividends, fees and charges).
Current consensus price target is $6.77, suggesting downside of -1.1% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
UBS forecasts a full year FY18 dividend of 15.00 cents and EPS of 30.30 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 31.2, implying annual growth of 31.3%. Current consensus DPS estimate is 16.5, implying a prospective dividend yield of 2.4%. Current consensus EPS estimate suggests the PER is 21.9. |
Forecast for FY19:
UBS forecasts a full year FY19 dividend of 17.00 cents and EPS of 34.40 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 35.5, implying annual growth of 13.8%. Current consensus DPS estimate is 19.3, implying a prospective dividend yield of 2.8%. Current consensus EPS estimate suggests the PER is 19.3. |
Market Sentiment: 0.8
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $33.56
Macquarie rates BHP as Outperform (1) -
The board has formally approved the development of the US$3.4bn, 80mtpa South Flank project. Reserves and resources estimates for Western Australian iron ore have been upgraded.
Macquarie notes South Flake provides a clear 15-20-year production outlook for the division and is expected to account for 50% of group cash flow over the next five years.
Outperform rating and $36.20 target maintained.
Target price is $36.20 Current Price is $33.56 Difference: $2.64
If BHP meets the Macquarie target it will return approximately 8% (excluding dividends, fees and charges).
Current consensus price target is $34.13, suggesting upside of 1.7% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Macquarie forecasts a full year FY18 dividend of 132.72 cents and EPS of 220.98 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 229.2, implying annual growth of N/A. Current consensus DPS estimate is 156.8, implying a prospective dividend yield of 4.7%. Current consensus EPS estimate suggests the PER is 14.6. |
Forecast for FY19:
Macquarie forecasts a full year FY19 dividend of 99.21 cents and EPS of 198.56 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 236.1, implying annual growth of 3.0%. Current consensus DPS estimate is 145.9, implying a prospective dividend yield of 4.3%. Current consensus EPS estimate suggests the PER is 14.2. |
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
Overnight Price: $9.19
Macquarie rates BXB as Neutral (3) -
Macquarie updates its forecasts for CHEP Americas, taking into account cost inflation, particularly in transport, as well as updated FX assumptions.
The broker believes the share price is reflecting the cost pressures in the US but, until there is stabilisation, remains cautious about the ability to achieve improved profit. Neutral rating and $10.20 target maintained.
Target price is $10.20 Current Price is $9.19 Difference: $1.01
If BXB meets the Macquarie target it will return approximately 11% (excluding dividends, fees and charges).
Current consensus price target is $10.35, suggesting upside of 12.6% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Macquarie forecasts a full year FY18 dividend of 29.25 cents and EPS of 52.83 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 57.1, implying annual growth of N/A. Current consensus DPS estimate is 32.9, implying a prospective dividend yield of 3.6%. Current consensus EPS estimate suggests the PER is 16.1. |
Forecast for FY19:
Macquarie forecasts a full year FY19 dividend of 30.41 cents and EPS of 55.28 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 57.9, implying annual growth of 1.4%. Current consensus DPS estimate is 33.7, implying a prospective dividend yield of 3.7%. Current consensus EPS estimate suggests the PER is 15.9. |
This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Morgans rates CYB as Hold (3) -
Morgans believes there is a high probability that Virgin Money will recommend the revised takeover proposal. The broker assumes CYBG will target cost synergies equivalent to 15-50% of Virgin Money's cost base and it could achieve underlying accretion of 9-32%.
The broker remains mindful of the execution risks, particularly the IT integration risk. Hold rating maintained. Target is $5.28.
Target price is $5.28 Current Price is $5.51 Difference: minus $0.23 (current price is over target).
If CYB meets the Morgans target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $5.93, suggesting upside of 7.6% (ex-dividends)
The company's fiscal year ends in September.
Forecast for FY18:
Morgans forecasts a full year FY18 dividend of 1.73 cents and EPS of 50.12 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 48.9, implying annual growth of N/A. Current consensus DPS estimate is 3.6, implying a prospective dividend yield of 0.7%. Current consensus EPS estimate suggests the PER is 11.3. |
Forecast for FY19:
Morgans forecasts a full year FY19 dividend of 38.11 cents and EPS of 50.23 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 53.6, implying annual growth of 9.6%. Current consensus DPS estimate is 24.6, implying a prospective dividend yield of 4.5%. Current consensus EPS estimate suggests the PER is 10.3. |
This company reports in GBP. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.2
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
DCG DECMIL GROUP LIMITED
Mining Sector Contracting
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Overnight Price: $1.06
Citi rates DCG as Buy (1) -
Citi only initiated coverage last month, but forecasts have been reduced less than three weeks on which cuts the price target by -5c to $1.40. Despite this,the analysts maintain the Buy rating arguing visibility and confidence in forecasts have both increased.
Target price is $1.40 Current Price is $1.06 Difference: $0.34
If DCG meets the Citi target it will return approximately 32% (excluding dividends, fees and charges).
The company's fiscal year ends in June.
Forecast for FY18:
Citi forecasts a full year FY18 dividend of 0.00 cents and EPS of 1.40 cents. |
Forecast for FY19:
Citi forecasts a full year FY19 dividend of 2.50 cents and EPS of 8.80 cents. |
Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
GUD G.U.D. HOLDINGS LIMITED
Household & Personal Products
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Overnight Price: $14.18
UBS rates GUD as Upgrade to Neutral from Sell (3) -
The company recently acquired Disc Brakes Australia and is adding new lines to its automotive division. Feedback from industry appears supportive of the momentum in the automotive business, UBS observes.
The company appears well placed to acquire high-quality aftermarket brands that are not too reliant on sales to either Bapcor ((BAP)) or Repco. Rating is upgraded to Neutral from Sell. Target is raised to $14.60 from $11.75.
Target price is $14.60 Current Price is $14.18 Difference: $0.42
If GUD meets the UBS target it will return approximately 3% (excluding dividends, fees and charges).
Current consensus price target is $13.63, suggesting downside of -3.9% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
UBS forecasts a full year FY18 dividend of 52.00 cents and EPS of 66.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 76.5, implying annual growth of 27.3%. Current consensus DPS estimate is 51.7, implying a prospective dividend yield of 3.6%. Current consensus EPS estimate suggests the PER is 18.5. |
Forecast for FY19:
UBS forecasts a full year FY19 dividend of 58.00 cents and EPS of 80.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 75.7, implying annual growth of -1.0%. Current consensus DPS estimate is 59.0, implying a prospective dividend yield of 4.2%. Current consensus EPS estimate suggests the PER is 18.7. |
Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $9.76
Macquarie rates IEL as Outperform (1) -
Macquarie believes the company is well-positioned to capitalise on the opportunities in the industry.
The broker considers the valuation premium is justified given the strong underlying fundamentals. Canada remains key to the business outlook, as it is experiencing a strengthening in international students.
Outperform rating. Target raised to $9.75 from $7.25.
Target price is $9.75 Current Price is $9.76 Difference: minus $0.01 (current price is over target).
If IEL meets the Macquarie target it will return approximately minus 0% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $8.18, suggesting downside of -16.2% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Macquarie forecasts a full year FY18 dividend of 15.90 cents and EPS of 22.10 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 21.3, implying annual growth of 28.5%. Current consensus DPS estimate is 15.5, implying a prospective dividend yield of 1.6%. Current consensus EPS estimate suggests the PER is 45.8. |
Forecast for FY19:
Macquarie forecasts a full year FY19 dividend of 19.20 cents and EPS of 25.60 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 24.9, implying annual growth of 16.9%. Current consensus DPS estimate is 18.6, implying a prospective dividend yield of 1.9%. Current consensus EPS estimate suggests the PER is 39.2. |
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $11.60
Macquarie rates ILU as Neutral (3) -
Macquarie believes the formal approval by BHP Billiton ((BHP)) of South Flank will underpin a significant increase in Iluka's royalties from 2021. The company has a 1.232% gross revenue royalty from 100% of production from BHP's Mining Area C project.
The company also receives $1m for every 1mtpa increase in production. Assuming all South Flank production is captured by the royalty, Macquarie calculates the company should receive an additional $80m in capacity payments over 2021-24.
Neutral rating and target raised to $11.00 from $10.60.
Target price is $11.00 Current Price is $11.60 Difference: minus $0.6 (current price is over target).
If ILU meets the Macquarie target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $11.11, suggesting downside of -4.2% (ex-dividends)
The company's fiscal year ends in December.
Forecast for FY18:
Macquarie forecasts a full year FY18 dividend of 33.00 cents and EPS of 62.80 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 66.3, implying annual growth of N/A. Current consensus DPS estimate is 21.2, implying a prospective dividend yield of 1.8%. Current consensus EPS estimate suggests the PER is 17.5. |
Forecast for FY19:
Macquarie forecasts a full year FY19 dividend of 41.00 cents and EPS of 83.90 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 75.1, implying annual growth of 13.3%. Current consensus DPS estimate is 29.3, implying a prospective dividend yield of 2.5%. Current consensus EPS estimate suggests the PER is 15.4. |
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
LLC LEND LEASE CORPORATION LIMITED
Infra & Property Developers
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Overnight Price: $19.29
Macquarie rates LLC as Outperform (1) -
The briefing on the Australian property business unit signalled a strong outlook, factoring in the Barangaroo apartments, commercial developments and a pipeline of projects worth over $30bn.
Macquarie observes the business will move into a production phase between FY20 and FY22, in part because of a tapering of apartment completions.
Earnings could still be supported by forward sales of commercial developments, the communities business and a growing pipeline in retirement.
Outperform and $18.30 target retained.
Target price is $18.30 Current Price is $19.29 Difference: minus $0.99 (current price is over target).
If LLC meets the Macquarie target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $18.23, suggesting downside of -5.5% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Macquarie forecasts a full year FY18 dividend of 61.20 cents and EPS of 127.50 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 140.7, implying annual growth of 8.1%. Current consensus DPS estimate is 65.4, implying a prospective dividend yield of 3.4%. Current consensus EPS estimate suggests the PER is 13.7. |
Forecast for FY19:
Macquarie forecasts a full year FY19 dividend of 71.60 cents and EPS of 143.80 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 154.6, implying annual growth of 9.9%. Current consensus DPS estimate is 72.9, implying a prospective dividend yield of 3.8%. Current consensus EPS estimate suggests the PER is 12.5. |
Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $17.00
Morgan Stanley rates MIN as Overweight (1) -
The company has confirmed an early end to the Wodgina DSO operations, indicating that spodumene's profitability is more than double DSO. Morgan Stanley estimates this has a negative impact on earnings over FY18-20.
A positive catalyst is expected to be the pre-feasibility study for the Wodgina hydroxide plant, expected in the September quarter. Morgan Stanley currently only captures the hydroxide plant value in its bull case.
Target is reduced to $22.80 from $23.60. Overweight retained. Industry view: Attractive.
Target price is $22.80 Current Price is $17.00 Difference: $5.8
If MIN meets the Morgan Stanley target it will return approximately 34% (excluding dividends, fees and charges).
Current consensus price target is $20.83, suggesting upside of 22.5% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Morgan Stanley forecasts a full year FY18 dividend of 56.70 cents and EPS of 133.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 160.0, implying annual growth of 48.6%. Current consensus DPS estimate is 69.9, implying a prospective dividend yield of 4.1%. Current consensus EPS estimate suggests the PER is 10.6. |
Forecast for FY19:
Morgan Stanley forecasts a full year FY19 dividend of 91.70 cents and EPS of 183.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 213.7, implying annual growth of 33.6%. Current consensus DPS estimate is 94.9, implying a prospective dividend yield of 5.6%. Current consensus EPS estimate suggests the PER is 8.0. |
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $2.77
Ord Minnett rates MTS as Accumulate (2) -
The company is due to report its FY18 result on June 25. Ord Minnett forecasts net profit to be up 10.2% and hardware growth to be strong.
The broker estimates the decline in the share price since the announcement of the loss of the Drakes SA contract has meant implied long-term operating earnings have shifted to decline from growth.
Ord Minnett suggests that the incorporated decline is too large and so the risk/reward remains attractive at current levels. Accumulate rating and $3.25 target maintained.
This stock is not covered in-house by Ord Minnett. Instead, the broker whitelabels research by JP Morgan.
Target price is $3.25 Current Price is $2.77 Difference: $0.48
If MTS meets the Ord Minnett target it will return approximately 17% (excluding dividends, fees and charges).
Current consensus price target is $3.14, suggesting upside of 13.2% (ex-dividends)
The company's fiscal year ends in April.
Forecast for FY18:
Ord Minnett forecasts a full year FY18 dividend of 14.00 cents and EPS of minus 15.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 15.5, implying annual growth of -13.4%. Current consensus DPS estimate is 13.7, implying a prospective dividend yield of 4.9%. Current consensus EPS estimate suggests the PER is 17.9. |
Forecast for FY19:
Ord Minnett forecasts a full year FY19 dividend of 16.00 cents and EPS of 22.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 22.9, implying annual growth of 47.7%. Current consensus DPS estimate is 14.9, implying a prospective dividend yield of 5.4%. Current consensus EPS estimate suggests the PER is 12.1. |
Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
RFG RETAIL FOOD GROUP LIMITED
Food, Beverages & Tobacco
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Overnight Price: $0.55
UBS rates RFG as Sell (5) -
The company has revised down earnings guidance and now expects underlying net profit of around $34.5m and an FY18 reported loss of -$87.6m.
The business continues to be affected by tough trading conditions including negative sentiment regarding a string of media reports alleging mistreatment of franchisees, UBS notes.
The broker reduces estimates for EPS by -30% and maintains a Sell rating. Target is reduced to $0.50 from $0.90.
Target price is $0.50 Current Price is $0.55 Difference: minus $0.05 (current price is over target).
If RFG meets the UBS target it will return approximately minus 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).
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 19.10 cents. |
Forecast for FY19:
UBS forecasts a full year FY19 dividend of 0.00 cents and EPS of 13.90 cents. |
Market Sentiment: -1.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $3.90
Macquarie rates S32 as Outperform (1) -
South32 has announced a US$1.3bn takeover offer for the shares it doesn't already own in Arizona Mining and Macquarie analysts, in an initial response, note the target;s core project is the high grade Hermosa project in Arizona, USA with apparent growth options in the medium- to longer term.
Macquarie sees a strong replacement option for the struggling Cannington operation. The analysts also believe a lack of growth options in the South32 portfolio
has been a consistent source of negative sentiment for the stock.
Outperform. Target $4.
Target price is $4.00 Current Price is $3.90 Difference: $0.1
If S32 meets the Macquarie target it will return approximately 3% (excluding dividends, fees and charges).
Current consensus price target is $3.77, suggesting downside of -3.5% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Macquarie forecasts a full year FY18 dividend of 21.65 cents and EPS of 32.60 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 32.1, implying annual growth of N/A. Current consensus DPS estimate is 19.6, implying a prospective dividend yield of 5.0%. Current consensus EPS estimate suggests the PER is 12.1. |
Forecast for FY19:
Macquarie forecasts a full year FY19 dividend of 17.01 cents and EPS of 34.15 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 32.3, implying annual growth of 0.6%. Current consensus DPS estimate is 17.5, implying a prospective dividend yield of 4.5%. Current consensus EPS estimate suggests the PER is 12.1. |
This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $17.80
Credit Suisse rates SGM as Underperform (5) -
US scrap peer, Schnitzer, will report its May quarter results on June 26. Ferrous volumes are estimated to be up 23% and non-ferrous volumes up 13%.
If the Sims US profile mirrors Schnitzer, Credit Suisse calculates second half operating earnings could be $100m versus its forecasts of $84m.
Underperform rating and $14.50 target maintained.
Target price is $14.50 Current Price is $17.80 Difference: minus $3.3 (current price is over target).
If SGM meets the Credit Suisse target it will return approximately minus 19% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $16.28, suggesting downside of -8.6% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Credit Suisse forecasts a full year FY18 dividend of 48.74 cents and EPS of 97.48 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 97.8, implying annual growth of -5.0%. Current consensus DPS estimate is 51.6, implying a prospective dividend yield of 2.9%. Current consensus EPS estimate suggests the PER is 18.2. |
Forecast for FY19:
Credit Suisse forecasts a full year FY19 dividend of 59.05 cents and EPS of 118.09 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 112.3, implying annual growth of 14.8%. Current consensus DPS estimate is 56.2, implying a prospective dividend yield of 3.2%. Current consensus EPS estimate suggests the PER is 15.9. |
Market Sentiment: -0.1
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $12.13
Citi rates TCL as Sell (5) -
Citi believes it important to take a closer look at the credit metrics of Transurban and suggests current consensus expectations for distributions may not be met.
Pressure could be mounting as interest rates rise and this could result in either a dilutive equity raising or reduction in the pay-out ratio. The broker estimates a -$4bn reduction in net debt would restore the metrics to a more appropriate level.
The broker maintains a Sell rating and $10.52 target.
Target price is $10.52 Current Price is $12.13 Difference: minus $1.61 (current price is over target).
If TCL meets the Citi target it will return approximately minus 13% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $12.82, suggesting upside of 5.7% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Citi forecasts a full year FY18 dividend of 56.00 cents and EPS of 27.10 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 27.0, implying annual growth of 130.8%. Current consensus DPS estimate is 56.0, implying a prospective dividend yield of 4.6%. Current consensus EPS estimate suggests the PER is 44.9. |
Forecast for FY19:
Citi forecasts a full year FY19 dividend of 59.00 cents and EPS of 20.90 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 30.7, implying annual growth of 13.7%. Current consensus DPS estimate is 60.5, implying a prospective dividend yield of 5.0%. Current consensus EPS estimate suggests the PER is 39.5. |
Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Summaries
| AZJ | AURIZON HOLDINGS | Underweight - Morgan Stanley | Overnight Price $4.35 |
| BAP | BAPCOR LIMITED | Downgrade to Neutral from Buy - UBS | Overnight Price $6.84 |
| BHP | BHP BILLITON | Outperform - Macquarie | Overnight Price $33.56 |
| BXB | BRAMBLES | Neutral - Macquarie | Overnight Price $9.19 |
| CYB | CYBG | Hold - Morgans | Overnight Price $5.51 |
| DCG | DECMIL GROUP | Buy - Citi | Overnight Price $1.06 |
| GUD | G.U.D. HOLDINGS | Upgrade to Neutral from Sell - UBS | Overnight Price $14.18 |
| IEL | IDP EDUCATION | Outperform - Macquarie | Overnight Price $9.76 |
| ILU | ILUKA RESOURCES | Neutral - Macquarie | Overnight Price $11.60 |
| LLC | LEND LEASE CORP | Outperform - Macquarie | Overnight Price $19.29 |
| MIN | MINERAL RESOURCES | Overweight - Morgan Stanley | Overnight Price $17.00 |
| MTS | METCASH | Accumulate - Ord Minnett | Overnight Price $2.77 |
| RFG | RETAIL FOOD GROUP | Sell - UBS | Overnight Price $0.55 |
| S32 | SOUTH32 | Outperform - Macquarie | Overnight Price $3.90 |
| SGM | SIMS METAL MANAGEMENT | Underperform - Credit Suisse | Overnight Price $17.80 |
| TCL | TRANSURBAN GROUP | Sell - Citi | Overnight Price $12.13 |
RATING SUMMARY
| Rating | No. Of Recommendations |
| 1. Buy | 6 |
| 2. Accumulate | 1 |
| 3. Hold | 5 |
| 5. Sell | 4 |
Monday 18 June 2018
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the stock market, its value, future direction or individual shares. FNArena solely reports about what the main experts in the market note, believe
and comment on. By doing so we believe we provide intelligent investors
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This document is provided for informational purposes only. It does not
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