Australian Broker Call
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July 18, 2022
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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: 06:07 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.
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Today's Upgrades and Downgrades
ANN - | Ansell | Upgrade to Outperform from Neutral | Macquarie |
SGM - | Sims | Upgrade to Buy from Neutral | Citi |
Overnight Price: $2.77
Macquarie rates ABP as Outperform (1) -
Macquarie revisits Australian REITs and has the following observations:
Slowing economic growth could bode well for REITs in 2023; industrial supply remains tight; retail is historically preferred during a downturn (Macquarie expects a recession in 2023); bond yields are starting to normalise; the EPS yield spread has returned to the long-term average; the sector has been sold off recently; and the green transition could result in significant property expenses as the Ukraine conflict sustains energy prices (although REITS are well-placed to manage costs).
The broker prefers REITs with greater earnings certainty but stabilising bond yields may make such a stance appear too conservative.
Macquarie appreciates Abacus Property's exposure to metropolitan self-storage assets and expects the March 2022 capital raising should soften balance sheet concerns in the near term.
Outperform rating retained. Target price falls to $3.46 from $3.59.
Target price is $3.46 Current Price is $2.77 Difference: $0.69
If ABP meets the Macquarie target it will return approximately 25% (excluding dividends, fees and charges).
Current consensus price target is $3.43, suggesting upside of 24.2% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 18.00 cents and EPS of 19.70 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 19.5, implying annual growth of -60.9%. Current consensus DPS estimate is 18.0, implying a prospective dividend yield of 6.5%. Current consensus EPS estimate suggests the PER is 14.2. |
Forecast for FY23:
Macquarie forecasts a full year FY23 EPS of 19.20 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 19.7, implying annual growth of 1.0%. Current consensus DPS estimate is 18.3, implying a prospective dividend yield of 6.6%. Current consensus EPS estimate suggests the PER is 14.0. |
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
AIA AUCKLAND INTERNATIONAL AIRPORT LIMITED
Infrastructure & Utilities
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Overnight Price: $6.67
Morgan Stanley rates AIA as Overweight (1) -
As New Zealand prepares to fully re-open, Morgan Stanley adjusts its forecasts for Auckland International Airport. The Overweight rating is retained due to the asset quality and scarcity, along with prospects for recovery.
The broker forecasts an international passenger recovery to 60% of 2019 levels by the end of 2022, and anticipates a dividend resumption in the 2H of FY23.
The target price falls to NZ$8.08 from NZ$8.28. Industry view: Cautious.
Current Price is $6.67. Target price not assessed.
Current consensus price target is $7.50, suggesting upside of 12.6% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Morgan Stanley forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 2.81 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is -1.5, 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 FY23:
Morgan Stanley forecasts a full year FY23 dividend of 9.36 cents and EPS of 17.79 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 10.5, implying annual growth of N/A. Current consensus DPS estimate is 8.4, implying a prospective dividend yield of 1.3%. Current consensus EPS estimate suggests the PER is 63.4. |
This company reports in NZD. 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
ANN ANSELL LIMITED
Commercial Services & Supplies
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Overnight Price: $24.01
Macquarie rates ANN as Upgrade to Outperform from Neutral (1) -
Macquarie notes Ansell's near term earnings continue to be impacted by the unwinding of covid demand from FY20/21.
But the broker sees this factor as discounted in forecasts and consensus earnings for the company.
Macquarie downgrades earnings by -8% and -9% for FY22 & FY23, respectively, reflecting revised assumptions for operations and FX forecasts.
Ansell is trading at 12.7x 12-month forward consensus forecast earnings, a -29% discount to the ASX200 industrials, with a strong balance sheet, leverage to a lower AUD and defensive healthcare earnings, notes the broker.
The price target raises to $27.85 from $27.65 and the rating is upgraded to Outperform from Neutral.
Target price is $27.85 Current Price is $24.01 Difference: $3.84
If ANN meets the Macquarie target it will return approximately 16% (excluding dividends, fees and charges).
Current consensus price target is $29.64, suggesting upside of 19.6% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 75.11 cents and EPS of 164.75 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 186.1, implying annual growth of N/A. Current consensus DPS estimate is 79.1, implying a prospective dividend yield of 3.2%. Current consensus EPS estimate suggests the PER is 13.3. |
Forecast for FY23:
Macquarie forecasts a full year FY23 dividend of 83.00 cents and EPS of 166.28 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 198.5, implying annual growth of 6.7%. Current consensus DPS estimate is 87.3, implying a prospective dividend yield of 3.5%. Current consensus EPS estimate suggests the PER is 12.5. |
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
APM APM HUMAN SERVICES INTERNATIONAL LIMITED
Healthcare
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Overnight Price: $3.28
Credit Suisse rates APM as Outperform (1) -
Credit Suisse has initiated a monthly report analysing industry data for the Disability Employment Services (DES) program, which is APM Human Services International's largest contract, accounting for roughly 20% of revenue.
The broker notes caseloads eased in the June half to take the year-on-year tally to -6%, thanks in part to the buoyant labour market post lockdowns.
On the upside, outcomes (wherein participants were placed in sustainable employment) rose 10% in the June half.
Meanwhile, the company has refinanced its debt, saving roughly 240 basis points, which the broker estimates will cut net interest costs by -$15m.
All up, the broker expects the company to outperform prospectus forecasts by 6%. Outperform rating retained. Target price inches up to $4.25 from $4.20.
Target price is $4.25 Current Price is $3.28 Difference: $0.97
If APM meets the Credit Suisse target it will return approximately 30% (excluding dividends, fees and charges).
The company's fiscal year ends in June.
Forecast for FY22:
Credit Suisse forecasts a full year FY22 dividend of 4.89 cents and EPS of 18.17 cents. |
Forecast for FY23:
Credit Suisse forecasts a full year FY23 dividend of 10.89 cents and EPS of 21.08 cents. |
Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $6.00
Citi rates APX as Neutral (3) -
Citi notes website traffic to Appen's two largest customers' rating website reveals soft demand, Google and Facebook both revealing a deceleration in June.
Neutral rating and $6.60 target price retained.
Target price is $6.60 Current Price is $6.00 Difference: $0.6
If APX meets the Citi target it will return approximately 10% (excluding dividends, fees and charges).
Current consensus price target is $6.43, suggesting upside of 10.7% (ex-dividends)
The company's fiscal year ends in December.
Forecast for FY22:
Citi forecasts a full year FY22 dividend of 7.50 cents and EPS of 28.70 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 36.4, implying annual growth of 17.8%. Current consensus DPS estimate is 8.8, implying a prospective dividend yield of 1.5%. Current consensus EPS estimate suggests the PER is 16.0. |
Forecast for FY23:
Citi forecasts a full year FY23 dividend of 9.20 cents and EPS of 35.50 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 39.1, implying annual growth of 7.4%. Current consensus DPS estimate is 9.4, implying a prospective dividend yield of 1.6%. Current consensus EPS estimate suggests the PER is 14.9. |
Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Macquarie rates ARF as Outperform (1) -
Macquarie revisits Australian REITs and has the following observations:
Slowing economic growth could bode well for REITs in 2023; industrial supply remains tight; retail is historically preferred during a downturn (Macquarie expects a recession in 2023); bond yields are starting to normalise; the EPS yield spread has returned to the long-term average; the sector has been sold off recently; and the green transition could result in significant property expenses as the Ukraine conflict sustains energy prices (although REITS are well-placed to manage costs).
The broker prefers REITs with greater earnings certainty but stabilising bond yields may make such a stance appear too conservative.
Arena REIT is one of these stocks and Macquarie notes underlying tenant performance across the asset base shows cash-flow resilience and the REIT boasts long weighted average lease expiries, strong CPI linked reviews and a good hedging profile.
Outperform rating retained. Target price rises to $4.92 from $4.61.
Target price is $4.92 Current Price is $4.59 Difference: $0.33
If ARF meets the Macquarie target it will return approximately 7% (excluding dividends, fees and charges).
Current consensus price target is $4.51, suggesting downside of -1.7% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 16.00 cents and EPS of 16.40 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 16.6, implying annual growth of -60.4%. Current consensus DPS estimate is 16.0, implying a prospective dividend yield of 3.5%. Current consensus EPS estimate suggests the PER is 27.7. |
Forecast for FY23:
Macquarie forecasts a full year FY23 dividend of 17.30 cents and EPS of 17.60 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 17.3, implying annual growth of 4.2%. Current consensus DPS estimate is 17.1, implying a prospective dividend yield of 3.7%. Current consensus EPS estimate suggests the PER is 26.5. |
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
BRG BREVILLE GROUP LIMITED
Household & Personal Products
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Overnight Price: $19.27
Morgan Stanley rates BRG as Overweight (1) -
Morgan Stanley reviews its investment thesis for Breville Group in light of a -40% share price decline this year, and retains its Overweight rating and $25 target price. Industry view: In-Line.
The broker sees limited earnings risk in FY23/24 due to the global expansion plans, and suggest margins can be maintained by adjusting costs.
The analysts believe the current premium multiple to global peers is justified for several reasons including it being early days for the global expansion, and a long-track record of execution by management. High-income customers are also expected to be more resilient.
Target price is $25.00 Current Price is $19.27 Difference: $5.73
If BRG meets the Morgan Stanley target it will return approximately 30% (excluding dividends, fees and charges).
Current consensus price target is $26.12, suggesting upside of 31.1% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Morgan Stanley forecasts a full year FY22 dividend of 31.20 cents and EPS of 76.80 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 76.2, implying annual growth of 15.9%. Current consensus DPS estimate is 30.0, implying a prospective dividend yield of 1.5%. Current consensus EPS estimate suggests the PER is 26.1. |
Forecast for FY23:
Morgan Stanley forecasts a full year FY23 dividend of 34.00 cents and EPS of 83.70 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 83.9, implying annual growth of 10.1%. Current consensus DPS estimate is 33.9, implying a prospective dividend yield of 1.7%. Current consensus EPS estimate suggests the PER is 23.7. |
Market Sentiment: 0.8
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $11.59
Macquarie rates CHC as Outperform (1) -
Macquarie revisits Australian REITs and has the following observations:
Slowing economic growth could bode well for REITs in 2023; industrial supply remains tight; retail is historically preferred during a downturn (Macquarie expects a recession in 2023); bond yields are starting to normalise; the EPS yield spread has returned to the long-term average; the sector has been sold off recently; and the green transition could result in significant property expenses as the Ukraine conflict sustains energy prices (although REITS are well-placed to manage costs).
The broker prefers REITs with greater earnings certainty but stabilising bond yields may make such a stance appear too conservative.
Macquarie expects Charter Hall's funds under management could surprise to the upside when it reports, expecting additions of $2bn in acquisitions, 1.5% in revaluations and $0.5bn in development completions.
Outperform rating retained. Target price falls to $15.33 form $16.33.
Target price is $15.33 Current Price is $11.59 Difference: $3.74
If CHC meets the Macquarie target it will return approximately 32% (excluding dividends, fees and charges).
Current consensus price target is $16.65, suggesting upside of 43.0% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 40.10 cents and EPS of 112.60 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 113.8, implying annual growth of 11.2%. Current consensus DPS estimate is 40.1, implying a prospective dividend yield of 3.4%. Current consensus EPS estimate suggests the PER is 10.2. |
Forecast for FY23:
Macquarie forecasts a full year FY23 EPS of 90.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 92.4, implying annual growth of -18.8%. Current consensus DPS estimate is 42.6, implying a prospective dividend yield of 3.7%. Current consensus EPS estimate suggests the PER is 12.6. |
Market Sentiment: 0.8
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $2.95
Macquarie rates CIP as Outperform (1) -
Macquarie revisits Australian REITs and has the following observations:
Slowing economic growth could bode well for REITs in 2023; industrial supply remains tight; retail is historically preferred during a downturn (Macquarie expects a recession in 2023); bond yields are starting to normalise; the EPS yield spread has returned to the long-term average; the sector has been sold off recently; and the green transition could result in significant property expenses as the Ukraine conflict sustains energy prices (although REITS are well-placed to manage costs).
The broker prefers REITs with greater earnings certainty but stabilising bond yields may make such a stance appear too conservative.
Macquarie notes Centuria Industrial REIT has been on the acquisition path and believes market rent growth should ameliorate the impact of rising bond yields.
Outperform rating retained. Target price falls to $3.79 from $3.94.
Target price is $3.94 Current Price is $2.95 Difference: $0.99
If CIP meets the Macquarie target it will return approximately 34% (excluding dividends, fees and charges).
Current consensus price target is $3.66, suggesting upside of 24.6% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 17.30 cents and EPS of 18.20 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 18.1, implying annual growth of -84.6%. Current consensus DPS estimate is 17.2, implying a prospective dividend yield of 5.9%. Current consensus EPS estimate suggests the PER is 16.2. |
Forecast for FY23:
Macquarie forecasts a full year FY23 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 0.6%. Current consensus DPS estimate is 16.6, implying a prospective dividend yield of 5.6%. Current consensus EPS estimate suggests the PER is 16.2. |
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $4.43
Macquarie rates CLW as Neutral (3) -
Macquarie revisits Australian REITs and has the following observations:
Slowing economic growth could bode well for REITs in 2023; industrial supply remains tight; retail is historically preferred during a downturn (Macquarie expects a recession in 2023); bond yields are starting to normalise; the EPS yield spread has returned to the long-term average; the sector has been sold off recently; and the green transition could result in significant property expenses as the Ukraine conflict sustains energy prices (although REITS are well-placed to manage costs).
The broker prefers REITs with greater earnings certainty but stabilising bond yields may make such a stance appear too conservative.
Macquarie appreciates Charter Hall Long WALE REIT's rental structure, noting 46% of leases are linked to CPI escalators and considers the group attractive on valuation. But it warns the REIT's exposure to higher debt costs are significant.
Neutral rating retained. Target price falls to $4.74 from $5.11.
Target price is $4.74 Current Price is $4.43 Difference: $0.31
If CLW meets the Macquarie target it will return approximately 7% (excluding dividends, fees and charges).
Current consensus price target is $4.97, suggesting upside of 11.1% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 30.40 cents and EPS of 30.50 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 30.4, implying annual growth of -73.2%. Current consensus DPS estimate is 30.6, implying a prospective dividend yield of 6.8%. Current consensus EPS estimate suggests the PER is 14.7. |
Forecast for FY23:
Macquarie forecasts a full year FY23 EPS of 27.30 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 28.6, implying annual growth of -5.9%. Current consensus DPS estimate is 29.0, implying a prospective dividend yield of 6.5%. Current consensus EPS estimate suggests the PER is 15.6. |
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $3.89
Macquarie rates CQR as Outperform (1) -
Macquarie revisits Australian REITs and has the following observations:
Slowing economic growth could bode well for REITs in 2023; industrial supply remains tight; retail is historically preferred during a downturn (Macquarie expects a recession in 2023); bond yields are starting to normalise; the EPS yield spread has returned to the long-term average; the sector has been sold off recently; and the green transition could result in significant property expenses as the Ukraine conflict sustains energy prices (although REITS are well-placed to manage costs).
The broker prefers REITs with greater earnings certainty but stabilising bond yields may make such a stance appear too conservative.
Macquarie appreciates the defensive nature of Charter Hall Retail REIT's convenience retail cash flows in a rising interest-rate environment and that it is trading at a -18% discount to net tangible assets with a 6.3% dividend yield.
Outperform rating retained. Target price falls to $4.21 from $4.44.
Target price is $4.21 Current Price is $3.89 Difference: $0.32
If CQR meets the Macquarie target it will return approximately 8% (excluding dividends, fees and charges).
Current consensus price target is $4.08, suggesting upside of 4.1% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 24.50 cents and EPS of 28.40 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 28.4, implying annual growth of -44.2%. Current consensus DPS estimate is 24.5, implying a prospective dividend yield of 6.3%. Current consensus EPS estimate suggests the PER is 13.8. |
Forecast for FY23:
Macquarie forecasts a full year FY23 EPS of 27.50 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 27.6, implying annual growth of -2.8%. Current consensus DPS estimate is 25.1, implying a prospective dividend yield of 6.4%. Current consensus EPS estimate suggests the PER is 14.2. |
Market Sentiment: 0.1
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $2.74
Macquarie rates DXI as Neutral (3) -
Macquarie revisits Australian REITs and has the following observations:
Slowing economic growth could bode well for REITs in 2023; industrial supply remains tight; retail is historically preferred during a downturn (Macquarie expects a recession in 2023); bond yields are starting to normalise; the EPS yield spread has returned to the long-term average; the sector has been sold off recently; and the green transition could result in significant property expenses as the Ukraine conflict sustains energy prices (although REITS are well-placed to manage costs).
The broker prefers REITs with greater earnings certainty but stabilising bond yields may make such a stance appear too conservative.
Macquarie eyes Dexus Industria REIT hedging profile with concern.
Neutral rating retained. Target price falls to $3.03 from $3.26.
Target price is $3.03 Current Price is $2.74 Difference: $0.29
If DXI meets the Macquarie target it will return approximately 11% (excluding dividends, fees and charges).
The company's fiscal year ends in June.
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 17.30 cents and EPS of 18.40 cents. |
Forecast for FY23:
Macquarie forecasts a full year FY23 EPS of 17.20 cents. |
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Macquarie rates DXS as Outperform (1) -
Macquarie revisits Australian REITs and has the following observations:
Slowing economic growth could bode well for REITs in 2023; industrial supply remains tight; retail is historically preferred during a downturn (Macquarie expects a recession in 2023); bond yields are starting to normalise; the EPS yield spread has returned to the long-term average; the sector has been sold off recently; and the green transition could result in significant property expenses as the Ukraine conflict sustains energy prices (although REITS are well-placed to manage costs).
The broker prefers REITs with greater earnings certainty but stabilising bond yields may make such a stance appear too conservative.
Macquarie is not keen on Dexus' exposure to the office market and notes an upcoming maintenance capital expenditure bill and tenant incentives. The REIT's portfolio is 70% hedged and Macquarie suspects the market may be being overly pessimistic.
Outperform rating retained. Target price falls to $10.41 from $11.54.
Target price is $10.41 Current Price is $9.36 Difference: $1.05
If DXS meets the Macquarie target it will return approximately 11% (excluding dividends, fees and charges).
Current consensus price target is $10.71, suggesting upside of 14.8% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 53.30 cents and EPS of 53.50 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 67.8, implying annual growth of -35.4%. Current consensus DPS estimate is 53.1, implying a prospective dividend yield of 5.7%. Current consensus EPS estimate suggests the PER is 13.8. |
Forecast for FY23:
Macquarie forecasts a full year FY23 EPS of 52.40 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 67.1, implying annual growth of -1.0%. Current consensus DPS estimate is 53.7, implying a prospective dividend yield of 5.8%. Current consensus EPS estimate suggests the PER is 13.9. |
Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $16.33
UBS rates FMG as Neutral (3) -
Given the tight WA labour market and inflationary backdrop, UBS continues to see risks to both timeline and capex for Fortescue Metals' Iron Bridge magnetite project.
Overall company returns in the first half of 2022 should be supported by a firm iron ore price, tightening low-grade discounts and strong operational performance, suggests the broker. The Neutral rating and $16.00 target price are retained.
Target price is $16.00 Current Price is $16.33 Difference: minus $0.33 (current price is over target).
If FMG 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 $16.73, suggesting downside of -1.0% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
UBS forecasts a full year FY22 EPS of 284.96 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 319.1, implying annual growth of N/A. Current consensus DPS estimate is 234.2, implying a prospective dividend yield of 13.9%. Current consensus EPS estimate suggests the PER is 5.3. |
Forecast for FY23:
UBS forecasts a full year FY23 EPS of 279.43 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 289.0, implying annual growth of -9.4%. Current consensus DPS estimate is 219.4, implying a prospective dividend yield of 13.0%. Current consensus EPS estimate suggests the PER is 5.8. |
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: $18.95
Macquarie rates GMG as Outperform (1) -
Macquarie revisits Australian REITs and has the following observations:
Slowing economic growth could bode well for REITs in 2023; industrial supply remains tight; retail is historically preferred during a downturn (Macquarie expects a recession in 2023); bond yields are starting to normalise; the EPS yield spread has returned to the long-term average; the sector has been sold off recently; and the green transition could result in significant property expenses as the Ukraine conflict sustains energy prices (although REITS are well-placed to manage costs).
The broker prefers REITs with greater earnings certainty but stabilising bond yields may make such a stance appear too conservative.
Goodman Group is one of Macquarie's top picks, the broker admiring its relatively strong earnings certainty but suspects this stance may be too conservative in the light of normalising bond yields.
The REIT has development production of $7bn with a fee take of 15% notes the broker, solid assets under management; and completions should help co-investments, yielding a slight rise in net operating income growth, although slower economic growth could take its toll.
As a result key risks are movements in asset values and development returns but the broker expects capital recycling and low industrial vacancy will yield a more resilient pipeline for the company and that the company can post an EPS compound average growth rate of 11% over three years.
Outperform rating retained. Target price falls to $23.31 from $25.31.
Target price is $23.31 Current Price is $18.95 Difference: $4.36
If GMG meets the Macquarie target it will return approximately 23% (excluding dividends, fees and charges).
Current consensus price target is $23.36, suggesting upside of 22.3% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 30.00 cents and EPS of 81.60 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 81.2, implying annual growth of -35.2%. Current consensus DPS estimate is 30.0, implying a prospective dividend yield of 1.6%. Current consensus EPS estimate suggests the PER is 23.5. |
Forecast for FY23:
Macquarie forecasts a full year FY23 EPS of 92.10 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 91.8, implying annual growth of 13.1%. Current consensus DPS estimate is 31.9, implying a prospective dividend yield of 1.7%. Current consensus EPS estimate suggests the PER is 20.8. |
Market Sentiment: 0.7
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
GOZ GROWTHPOINT PROPERTIES AUSTRALIA
Infra & Property Developers
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Overnight Price: $3.61
Macquarie rates GOZ as Outperform (1) -
Macquarie revisits Australian REITs and has the following observations:
Slowing economic growth could bode well for REITs in 2023; industrial supply remains tight; retail is historically preferred during a downturn (Macquarie expects a recession in 2023); bond yields are starting to normalise; the EPS yield spread has returned to the long-term average; the sector has been sold off recently; and the green transition could result in significant property expenses as the Ukraine conflict sustains energy prices (although REITS are well-placed to manage costs).
The broker prefers REITs with greater earnings certainty but stabilising bond yields may make such a stance appear too conservative.
Macquarie appreciates Growthpoint Properties Australia's defensive income, exposure to industrial, resilient tenant base and long weighted average lease expiries, but spies risk from rising interest rates, noting the portfolio was 60% hedged at June 2022.
Outperform rating retained. Target price falls to $4.16 from $4.57.
Target price is $4.16 Current Price is $3.61 Difference: $0.55
If GOZ meets the Macquarie target it will return approximately 15% (excluding dividends, fees and charges).
Current consensus price target is $4.11, suggesting upside of 13.2% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 20.80 cents and EPS of 27.70 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 26.6, implying annual growth of -62.9%. Current consensus DPS estimate is 20.9, implying a prospective dividend yield of 5.8%. Current consensus EPS estimate suggests the PER is 13.6. |
Forecast for FY23:
Macquarie forecasts a full year FY23 EPS of 27.50 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 26.5, implying annual growth of -0.4%. Current consensus DPS estimate is 21.5, implying a prospective dividend yield of 5.9%. Current consensus EPS estimate suggests the PER is 13.7. |
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $4.46
Macquarie rates GPT as Neutral (3) -
Macquarie revisits Australian REITs and has the following observations:
Slowing economic growth could bode well for REITs in 2023; industrial supply remains tight; retail is historically preferred during a downturn (Macquarie expects a recession in 2023); bond yields are starting to normalise; the EPS yield spread has returned to the long-term average; the sector has been sold off recently; and the green transition could result in significant property expenses as the Ukraine conflict sustains energy prices (although REITS are well-placed to manage costs).
The broker prefers REITs with greater earnings certainty but stabilising bond yields may make such a stance appear too conservative.
Macquarie is cautious toward GPT Group, noting office lease expiries and interest-rate headwinds.
Neutral rating retained. Target price falls to $4.69 from $4.89.
Target price is $4.69 Current Price is $4.46 Difference: $0.23
If GPT meets the Macquarie target it will return approximately 5% (excluding dividends, fees and charges).
Current consensus price target is $4.80, suggesting upside of 8.0% (ex-dividends)
The company's fiscal year ends in December.
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 12.60 cents and EPS of 31.80 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 31.7, implying annual growth of -57.1%. Current consensus DPS estimate is 22.3, implying a prospective dividend yield of 5.0%. Current consensus EPS estimate suggests the PER is 14.0. |
Forecast for FY23:
Macquarie forecasts a full year FY23 EPS of 31.90 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 31.8, implying annual growth of 0.3%. Current consensus DPS estimate is 24.6, implying a prospective dividend yield of 5.5%. Current consensus EPS estimate suggests the PER is 14.0. |
Market Sentiment: -0.2
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Ord Minnett rates GPT as Lighten (4) -
Ord Minnett revisits REITs after recent market falls and nominates GPT Group as its least favourite sector pick, given it has the lowest interest rate hedging in the sector, at a time of rising inflation.
GPT Group has also raised its gearing to its highest level since 2008 and Ord Minnett spies an asset correction in the wings.
The broker also believes vacancy risk exists in the company's office portfolio, with more than 30% of the portfolio due to expire before the end of 2024.
Lighten rating retained. Target price is $4.60.
This stock is not covered in-house by Ord Minnett. Instead, the broker whitelabels research by JP Morgan.
Target price is $4.60 Current Price is $4.46 Difference: $0.14
If GPT meets the Ord Minnett target it will return approximately 3% (excluding dividends, fees and charges).
Current consensus price target is $4.80, suggesting upside of 8.0% (ex-dividends)
The company's fiscal year ends in December.
Forecast for FY22:
Ord Minnett forecasts a full year FY22 dividend of 22.00 cents and EPS of 31.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 31.7, implying annual growth of -57.1%. Current consensus DPS estimate is 22.3, implying a prospective dividend yield of 5.0%. Current consensus EPS estimate suggests the PER is 14.0. |
Forecast for FY23:
Ord Minnett forecasts a full year FY23 dividend of 24.00 cents and EPS of 31.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 31.8, implying annual growth of 0.3%. Current consensus DPS estimate is 24.6, implying a prospective dividend yield of 5.5%. Current consensus EPS estimate suggests the PER is 14.0. |
Market Sentiment: -0.2
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $1.57
Macquarie rates HCW as Outperform (1) -
Macquarie revisits Australian REITs and has the following observations:
Slowing economic growth could bode well for REITs in 2023; industrial supply remains tight; retail is historically preferred during a downturn (Macquarie expects a recession in 2023); bond yields are starting to normalise; the EPS yield spread has returned to the long-term average; the sector has been sold off recently; and the green transition could result in significant property expenses as the Ukraine conflict sustains energy prices (although REITS are well-placed to manage costs).
The broker prefers REITs with greater earnings certainty but stabilising bond yields may make such a stance appear too conservative.
Macquarie notes HealthCo Healthcare & Wellness REIT's capital management is being reviewed given the dividend is unlikely to be covered until FY25 but the valuation remains attractive as do expected development completions.
Outperform rating retained. Target price falls to $2.07 from $2.11.
Target price is $2.07 Current Price is $1.57 Difference: $0.5
If HCW meets the Macquarie target it will return approximately 32% (excluding dividends, fees and charges).
Current consensus price target is $2.02, suggesting upside of 25.3% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 7.40 cents and EPS of 5.10 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 5.2, implying annual growth of N/A. Current consensus DPS estimate is 7.4, implying a prospective dividend yield of 4.6%. Current consensus EPS estimate suggests the PER is 31.0. |
Forecast for FY23:
Macquarie forecasts a full year FY23 EPS of 7.60 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 7.9, implying annual growth of 51.9%. Current consensus DPS estimate is 8.8, implying a prospective dividend yield of 5.5%. Current consensus EPS estimate suggests the PER is 20.4. |
Market Sentiment: 0.7
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $1.35
Macquarie rates HDN as Outperform (1) -
Macquarie revisits Australian REITs and has the following observations:
Slowing economic growth could bode well for REITs in 2023; industrial supply remains tight; retail is historically preferred during a downturn (Macquarie expects a recession in 2023); bond yields are starting to normalise; the EPS yield spread has returned to the long-term average; the sector has been sold off recently; and the green transition could result in significant property expenses as the Ukraine conflict sustains energy prices (although REITS are well-placed to manage costs).
The broker prefers REITs with greater earnings certainty but stabilising bond yields may make such a stance appear too conservative.
Macquarie appreciates HomeCo Daily Needs REIT's operational metrics which point to solid tenant performance defensive income.
Outperform rating retained. Target price rises to $1.65 from $1.58.
Target price is $1.65 Current Price is $1.35 Difference: $0.3
If HDN meets the Macquarie target it will return approximately 22% (excluding dividends, fees and charges).
Current consensus price target is $1.50, suggesting upside of 10.5% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 8.30 cents and EPS of 8.80 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 8.9, implying annual growth of 56.4%. Current consensus DPS estimate is 8.2, implying a prospective dividend yield of 6.0%. Current consensus EPS estimate suggests the PER is 15.3. |
Forecast for FY23:
Macquarie forecasts a full year FY23 EPS of 9.10 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 9.0, implying annual growth of 1.1%. Current consensus DPS estimate is 8.5, implying a prospective dividend yield of 6.2%. Current consensus EPS estimate suggests the PER is 15.1. |
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
JHX JAMES HARDIE INDUSTRIES PLC
Building Products & Services
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Overnight Price: $33.68
UBS rates JHX as Buy (1) -
UBS believes James Hardie Industries is relatively well placed to endure a downturn in the US and prefers to compare the current downturn to 2000/01, rather than the more severe 2008 version.
The company's overweight exposure to the repair & remodel (R&R) segment compared to new construction will assist as R&R downturns are shorter and not as severe, explains the analyst.
The broker lowers its target to $53.00 from $57.70 on lower revenue growth for FY23, while the FY24 EPS estimate declines by -20% on more conservative volume assumptions. Buy.
Target price is $53.00 Current Price is $33.68 Difference: $19.32
If JHX meets the UBS target it will return approximately 57% (excluding dividends, fees and charges).
Current consensus price target is $49.71, suggesting upside of 44.6% (ex-dividends)
The company's fiscal year ends in March.
Forecast for FY23:
UBS forecasts a full year FY23 EPS of 232.40 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 252.6, implying annual growth of N/A. Current consensus DPS estimate is 129.7, implying a prospective dividend yield of 3.8%. Current consensus EPS estimate suggests the PER is 13.6. |
Forecast for FY24:
UBS forecasts a full year FY24 EPS of 211.65 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 271.0, implying annual growth of 7.3%. Current consensus DPS estimate is 142.6, implying a prospective dividend yield of 4.1%. Current consensus EPS estimate suggests the PER is 12.7. |
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: $12.31
Morgan Stanley rates JIN as Overweight (1) -
While Jumbo Interactive released total transaction value (TTV) and ticket sales in line with Morgan Stanley's forecasts, revenue was a miss due to a higher skew to lower take-rate games.
As a result, the broker sets the company's retailing take rate -150bp lower and cuts earnings by around -20% for FY23-24. The target price falls to $16.00 from $25.50. Overweight. Industry view: In-line.
As revenue exceeded expectations, the analyst stresses demand is not flagging or competition increasing, and volume assumptions for lotteries retailing remain unchanged.
Target price is $16.00 Current Price is $12.31 Difference: $3.69
If JIN meets the Morgan Stanley target it will return approximately 30% (excluding dividends, fees and charges).
Current consensus price target is $17.53, suggesting upside of 34.6% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Morgan Stanley forecasts a full year FY22 dividend of 36.80 cents and EPS of 49.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 51.0, implying annual growth of 18.1%. Current consensus DPS estimate is 41.7, implying a prospective dividend yield of 3.2%. Current consensus EPS estimate suggests the PER is 25.5. |
Forecast for FY23:
Morgan Stanley forecasts a full year FY23 dividend of 44.60 cents and EPS of 59.50 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 61.3, implying annual growth of 20.2%. Current consensus DPS estimate is 45.8, implying a prospective dividend yield of 3.5%. Current consensus EPS estimate suggests the PER is 21.2. |
Market Sentiment: 0.8
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Morgans rates JIN as Add (1) -
Following preliminary FY22 results released by Jumbo Interactive, and a negative share price move in reaction, Morgans encourages investors to buy shares. The results were a -2% miss versus the analyst's estimate.
The broker considers the company as a play on the structural dynamic of an increasing proportion of online lottery ticket purchases. It's felt the SaaS and Managed Services divisions will also help deliver growth in FY23.
Management reiterated the dividend payout ratio, which implies to the broker a full year dividend of 43cps. The Add rating is maintained and the target eases to $17.50 from $18.30.
Target price is $17.50 Current Price is $12.31 Difference: $5.19
If JIN meets the Morgans target it will return approximately 42% (excluding dividends, fees and charges).
Current consensus price target is $17.53, suggesting upside of 34.6% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Morgans forecasts a full year FY22 dividend of 43.00 cents and EPS of 51.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 51.0, implying annual growth of 18.1%. Current consensus DPS estimate is 41.7, implying a prospective dividend yield of 3.2%. Current consensus EPS estimate suggests the PER is 25.5. |
Forecast for FY23:
Morgans forecasts a full year FY23 dividend of 46.00 cents and EPS of 61.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 61.3, implying annual growth of 20.2%. Current consensus DPS estimate is 45.8, implying a prospective dividend yield of 3.5%. Current consensus EPS estimate suggests the PER is 21.2. |
Market Sentiment: 0.8
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $9.51
Macquarie rates LLC as Outperform (1) -
Macquarie revisits Australian REITs and has the following observations:
Slowing economic growth could bode well for REITs in 2023; industrial supply remains tight; retail is historically preferred during a downturn (Macquarie expects a recession in 2023); bond yields are starting to normalise; the EPS yield spread has returned to the long-term average; the sector has been sold off recently; and the green transition could result in significant property expenses as the Ukraine conflict sustains energy prices (although REITS are well-placed to manage costs).
The broker prefers REITs with greater earnings certainty but says stabilising bond yields may make such a stance appear too conservative.
Lendlease Group is one of Macquarie's preferred picks but expects rising construction costs to hit earnings and says its ability to start $4bn of work in the second half will be critical. The broker suspects the company may cut the payout ratio to fund the group's target of $12bn of deployed capital by 2026.
Outperform rating retained. Target price falls to $11.80 from $12.30.
Target price is $11.80 Current Price is $9.51 Difference: $2.29
If LLC meets the Macquarie target it will return approximately 24% (excluding dividends, fees and charges).
Current consensus price target is $12.31, suggesting upside of 29.6% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 18.50 cents and EPS of 36.90 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 37.3, implying annual growth of 14.8%. Current consensus DPS estimate is 18.6, implying a prospective dividend yield of 2.0%. Current consensus EPS estimate suggests the PER is 25.5. |
Forecast for FY23:
Macquarie forecasts a full year FY23 EPS of 51.40 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 57.7, implying annual growth of 54.7%. Current consensus DPS estimate is 29.7, implying a prospective dividend yield of 3.1%. Current consensus EPS estimate suggests the PER is 16.5. |
Market Sentiment: 0.8
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $2.05
Macquarie rates MGR as Outperform (1) -
Macquarie revisits Australian REITs and has the following observations:
Slowing economic growth could bode well for REITs in 2023; industrial supply remains tight; retail is historically preferred during a downturn (Macquarie expects a recession in 2023); bond yields are starting to normalise; the EPS yield spread has returned to the long-term average; the sector has been sold off recently; and the green transition could result in significant property expenses as the Ukraine conflict sustains energy prices (although REITS are well-placed to manage costs).
The broker prefers REITs with greater earnings certainty but stabilising bond yields may make such a stance appear too conservative.
Macquarie expects Mirvac Group will increase earnings thanks to rising residential; and as rent relief rolls of; and says a key driver will be management's commentary on residential sales given growing challenges, and the upshot for the apartment development pipeline (which is well known in the market). Macquarie is positive on residential apartments given low vacancies.
Outperform rating retained, the broker noting the company is trading on a larger relative discount to peers. Target price falls to $2.34 from $2.62.
Target price is $2.34 Current Price is $2.05 Difference: $0.29
If MGR meets the Macquarie target it will return approximately 14% (excluding dividends, fees and charges).
Current consensus price target is $2.56, suggesting upside of 23.8% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 10.20 cents and EPS of 15.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 15.1, implying annual growth of -34.0%. Current consensus DPS estimate is 10.1, implying a prospective dividend yield of 4.9%. Current consensus EPS estimate suggests the PER is 13.7. |
Forecast for FY23:
Macquarie forecasts a full year FY23 EPS of 15.40 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 16.0, implying annual growth of 6.0%. Current consensus DPS estimate is 10.7, implying a prospective dividend yield of 5.2%. Current consensus EPS estimate suggests the PER is 12.9. |
Market Sentiment: 0.8
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Ord Minnett rates MGR as Buy (1) -
Ord Minnett revisits REITs after recent market falls and selects Mirvac Group as its top sector-pick.
The broker believes the implied price for the company is far too negative and considers the stock to be oversold, and appreciates the company's strong track record, commercial development pipeline and relatively young, quality $15bn investment portfolio.
Buy rating and $2.50 target price retained.
This stock is not covered in-house by Ord Minnett. Instead, the broker whitelabels research by JP Morgan.
Target price is $2.50 Current Price is $2.05 Difference: $0.45
If MGR meets the Ord Minnett target it will return approximately 22% (excluding dividends, fees and charges).
Current consensus price target is $2.56, suggesting upside of 23.8% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Ord Minnett forecasts a full year FY22 dividend of 10.00 cents and EPS of 15.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 15.1, implying annual growth of -34.0%. Current consensus DPS estimate is 10.1, implying a prospective dividend yield of 4.9%. Current consensus EPS estimate suggests the PER is 13.7. |
Forecast for FY23:
Ord Minnett forecasts a full year FY23 dividend of 11.00 cents and EPS of 16.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 16.0, implying annual growth of 6.0%. Current consensus DPS estimate is 10.7, implying a prospective dividend yield of 5.2%. Current consensus EPS estimate suggests the PER is 12.9. |
Market Sentiment: 0.8
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $2.25
Macquarie rates NSR as Neutral (3) -
Macquarie revisits Australian REITs and has the following observations:
Slowing economic growth could bode well for REITs in 2023; industrial supply remains tight; retail is historically preferred during a downturn (Macquarie expects a recession in 2023); bond yields are starting to normalise; the EPS yield spread has returned to the long-term average; the sector has been sold off recently; and the green transition could result in significant property expenses as the Ukraine conflict sustains energy prices (although REITS are well-placed to manage costs).
The broker prefers REITs with greater earnings certainty but stabilising bond yields may make such a stance appear too conservative.
Macquarie notes that management updates have been surprising to the upside, and while it is a fan of self-storage, believes tailwinds may be normalising and less impressed with the group's low hedging and fair market valuation.
Neutral rating retained. Target price falls to $2.29 from $2.39.
Target price is $2.29 Current Price is $2.25 Difference: $0.04
If NSR meets the Macquarie target it will return approximately 2% (excluding dividends, fees and charges).
Current consensus price target is $2.33, suggesting upside of 4.3% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 9.20 cents and EPS of 10.50 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 10.4, implying annual growth of -65.7%. Current consensus DPS estimate is 9.7, implying a prospective dividend yield of 4.3%. Current consensus EPS estimate suggests the PER is 21.4. |
Forecast for FY23:
Macquarie forecasts a full year FY23 EPS of 10.60 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 10.3, implying annual growth of -1.0%. Current consensus DPS estimate is 9.9, implying a prospective dividend yield of 4.4%. Current consensus EPS estimate suggests the PER is 21.7. |
Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
NWL NETWEALTH GROUP LIMITED
Wealth Management & Investments
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Overnight Price: $12.54
Macquarie rates NWL as Outperform (1) -
Netwealth Group's net inflows of $2.7bn for 4Q22 and total funds under administration of $55.7bn for FY22 were slightly below guidance notes Macquarie.
The broker sees the slight miss on net inflows were due to market volatility and regulatory requirements for advisers.
Macquarie reduces earnings by -2% & -10.7% for FY22 and FY23, respectively, with slightly lower inflows from market movements offset by higher cash balances.
An Outperform rating is maintained and the price target is reduced to $16.00 from $17.40
Target price is $16.00 Current Price is $12.54 Difference: $3.46
If NWL meets the Macquarie target it will return approximately 28% (excluding dividends, fees and charges).
Current consensus price target is $14.81, suggesting upside of 15.4% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 19.70 cents and EPS of 23.40 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 23.1, implying annual growth of 2.4%. Current consensus DPS estimate is 19.3, implying a prospective dividend yield of 1.5%. Current consensus EPS estimate suggests the PER is 55.5. |
Forecast for FY23:
Macquarie forecasts a full year FY23 dividend of 24.00 cents and EPS of 30.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 28.3, implying annual growth of 22.5%. Current consensus DPS estimate is 23.4, implying a prospective dividend yield of 1.8%. Current consensus EPS estimate suggests the PER is 45.3. |
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
PDL PENDAL GROUP LIMITED
Wealth Management & Investments
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Overnight Price: $3.76
Credit Suisse rates PDL as Neutral (3) -
Pendal Group's March-quarter update shows outflows fell short of Credit Suisse's forecasts, funds under management falling -11% quarter on quarter, mostly in higher margin products, estimates the broker. Performance fees were only a touch softer than forecast.
On the upside, Thomson Siegel & Walmsley (TSW) outflows slowed sharply and it reported a $1.3bn mandate win for the June quarter.
Earnings forecasts ease -1% to -2%, which were already -10% to -15% below old consensus. Neutral rating retained. Target price slips to $3.90 from $4.
Target price is $3.90 Current Price is $3.76 Difference: $0.14
If PDL meets the Credit Suisse target it will return approximately 4% (excluding dividends, fees and charges).
Current consensus price target is $4.80, suggesting upside of 16.8% (ex-dividends)
The company's fiscal year ends in September.
Forecast for FY22:
Credit Suisse forecasts a full year FY22 dividend of 45.00 cents and EPS of 52.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 48.5, implying annual growth of -6.7%. Current consensus DPS estimate is 45.2, implying a prospective dividend yield of 11.0%. Current consensus EPS estimate suggests the PER is 8.5. |
Forecast for FY23:
Credit Suisse forecasts a full year FY23 dividend of 35.00 cents and EPS of 38.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 38.6, implying annual growth of -20.4%. Current consensus DPS estimate is 37.8, implying a prospective dividend yield of 9.2%. Current consensus EPS estimate suggests the PER is 10.6. |
Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Macquarie rates PDL as No Rating (-1) -
Pendal Group's June quarter funds under management update revealed net outflows of -$4.2bn, notes Macquarie.
The broker sees the US pooled fund outflows of -US$1.9bn as disappointing.
The company earned $5.4m in performance fees while assets under management fell -11% from market movements that were partially offset by FX movements up 3.3%, highlights Macquarie.
Macquarie downgrades earnings forecasts by -4.3% and -14.6% for FY22 & FY23, respectively.
Due to research restrictions the broker cannot provide a price target or recommendation.
Current Price is $3.76. Target price not assessed.
Current consensus price target is $4.80, suggesting upside of 16.8% (ex-dividends)
The company's fiscal year ends in September.
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 43.50 cents and EPS of 52.60 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 48.5, implying annual growth of -6.7%. Current consensus DPS estimate is 45.2, implying a prospective dividend yield of 11.0%. Current consensus EPS estimate suggests the PER is 8.5. |
Forecast for FY23:
Macquarie forecasts a full year FY23 dividend of 33.50 cents and EPS of 40.60 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 38.6, implying annual growth of -20.4%. Current consensus DPS estimate is 37.8, implying a prospective dividend yield of 9.2%. Current consensus EPS estimate suggests the PER is 10.6. |
Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Morgan Stanley rates PDL as Equal-weight (3) -
Following Pendal Group's worse-than-expected outflows for the June quarter, Morgan Stanley thinks it will be difficult to return to inflows, given current market volatility. Soft momentum in retail and pressures in UK/EU equities are also expected to weigh.
For the quarter, there were outflows of -$4bn ex cash and closing funds under management were $111bn versus the $122bn expected by the broker.
The Equal-weight rating and $5.90 target price are maintained. Industry view is Attractive.
Target price is $5.90 Current Price is $3.76 Difference: $2.14
If PDL meets the Morgan Stanley target it will return approximately 57% (excluding dividends, fees and charges).
Current consensus price target is $4.80, suggesting upside of 16.8% (ex-dividends)
The company's fiscal year ends in September.
Forecast for FY22:
Morgan Stanley forecasts a full year FY22 dividend of 45.50 cents and EPS of 44.20 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 48.5, implying annual growth of -6.7%. Current consensus DPS estimate is 45.2, implying a prospective dividend yield of 11.0%. Current consensus EPS estimate suggests the PER is 8.5. |
Forecast for FY23:
Morgan Stanley forecasts a full year FY23 dividend of 38.50 cents and EPS of 42.80 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 38.6, implying annual growth of -20.4%. Current consensus DPS estimate is 37.8, implying a prospective dividend yield of 9.2%. Current consensus EPS estimate suggests the PER is 10.6. |
Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Ord Minnett rates PDL as Buy (1) -
Pendal Group's FY22 June-quarter funds under management fell due to the market retreat as expected, but weaker flows disappointed Ord Minnett, the company reporting net outflows across the division.
The broker raises outflow assumptions for FY23. Medium to long-term investment was strong.
Buy recommendation retained on valuation grounds. Target price falls to $4.20 from $6.00.
Target price is $4.20 Current Price is $3.76 Difference: $0.44
If PDL meets the Ord Minnett target it will return approximately 12% (excluding dividends, fees and charges).
Current consensus price target is $4.80, suggesting upside of 16.8% (ex-dividends)
The company's fiscal year ends in September.
Forecast for FY22:
Ord Minnett forecasts a full year FY22 dividend of 46.00 cents and EPS of 37.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 48.5, implying annual growth of -6.7%. Current consensus DPS estimate is 45.2, implying a prospective dividend yield of 11.0%. Current consensus EPS estimate suggests the PER is 8.5. |
Forecast for FY23:
Ord Minnett forecasts a full year FY23 dividend of 44.00 cents and EPS of 33.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 38.6, implying annual growth of -20.4%. Current consensus DPS estimate is 37.8, implying a prospective dividend yield of 9.2%. Current consensus EPS estimate suggests the PER is 10.6. |
Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
UBS rates PDL as Buy (1) -
June funds under management (FUM) for Pendal Group were a -3% miss versus the forecast by UBS. Net outflows during the quarter of -$4.2bn were higher than expected, and are seen as ongoing.
The broker retains its Buy rating and sees value if the $100m buy-back is executed and/or the Perpetual ((PPT)) offer is reconsidered by the board.
After incorporating the lower FUM and revising the outlook, the analyst lowers the target price to $4.25 from $5.25.
Target price is $4.25 Current Price is $3.76 Difference: $0.49
If PDL meets the UBS target it will return approximately 13% (excluding dividends, fees and charges).
Current consensus price target is $4.80, suggesting upside of 16.8% (ex-dividends)
The company's fiscal year ends in September.
Forecast for FY22:
UBS forecasts a full year FY22 EPS of 50.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 48.5, implying annual growth of -6.7%. Current consensus DPS estimate is 45.2, implying a prospective dividend yield of 11.0%. Current consensus EPS estimate suggests the PER is 8.5. |
Forecast for FY23:
UBS forecasts a full year FY23 EPS of 34.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 38.6, implying annual growth of -20.4%. Current consensus DPS estimate is 37.8, implying a prospective dividend yield of 9.2%. Current consensus EPS estimate suggests the PER is 10.6. |
Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
QAL QUALITAS LIMITED
Wealth Management & Investments
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Overnight Price: $1.63
Macquarie rates QAL as Outperform (1) -
Macquarie revisits Australian REITs and has the following observations:
Slowing economic growth could bode well for REITs in 2023; industrial supply remains tight; retail is historically preferred during a downturn (Macquarie expects a recession in 2023); bond yields are starting to normalise; the EPS yield spread has returned to the long-term average; the sector has been sold off recently; and the green transition could result in significant property expenses as the Ukraine conflict sustains energy prices (although REITS are well-placed to manage costs).
The broker prefers REITs with greater earnings certainty but stabilising bond yields may make such a stance appear too conservative.
Macquarie notes Qualitas is well positioned to grow earnings and funds under management and execution upside is strong.
Outperform rating retained. Target price rises to $2.53 from $2.46.
Target price is $2.53 Current Price is $1.63 Difference: $0.9
If QAL meets the Macquarie target it will return approximately 55% (excluding dividends, fees and charges).
The company's fiscal year ends in June.
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 4.00 cents and EPS of 5.60 cents. |
Forecast for FY23:
Macquarie forecasts a full year FY23 EPS of 7.40 cents. |
Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $93.27
Citi rates RIO as Buy (1) -
Rio Tinto's June-quarter report failed to impress Citi, the aluminium division beset by rising energy and raw materials costs, and reduced production after a July strike at Kitimat and instability at Boyne relating to unplanned absences.
Copper plodded along and the broker expects iron ore production will at least meet the lower end of guidance.
Citi's 2022 commodity price decks falls -11% for iron ore, -16% fro aluminium and -14% for copper. Aluminium and copper forecasts fall -11% and -19% for 2023.
Buy rating retained. Target price falls to $120 from $135.
Target price is $120.00 Current Price is $93.27 Difference: $26.73
If RIO meets the Citi target it will return approximately 29% (excluding dividends, fees and charges).
Current consensus price target is $112.36, suggesting upside of 17.9% (ex-dividends)
The company's fiscal year ends in December.
Forecast for FY22:
Citi forecasts a full year FY22 dividend of 1173.05 cents and EPS of 1662.47 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 1658.0, implying annual growth of N/A. Current consensus DPS estimate is 1206.5, implying a prospective dividend yield of 12.7%. Current consensus EPS estimate suggests the PER is 5.7. |
Forecast for FY23:
Citi forecasts a full year FY23 dividend of 990.46 cents and EPS of 1420.81 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 1429.7, implying annual growth of -13.8%. Current consensus DPS estimate is 1066.5, implying a prospective dividend yield of 11.2%. Current consensus EPS estimate suggests the PER is 6.7. |
This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Credit Suisse rates RIO as Outperform (1) -
Rio Tinto downgrades 2022 guidance -6% and -3% for alumina and aluminium after a soft June quarter.
Iron ore shipments marginally outpaced the Credit Suisse and consensus forecasts but the broker retains its forecast at the bottom end of guidance given the high bar required and given ongoing operational changes.
The aluminium division battled rising energy costs and raw materials prices, which Credit Suisse estimates will add $1.1bn to 2022 costs.
Meanwhile, the copper division logged a US$140m provision and increased closure liabilities.
Outperform rating retained, thanks to the "pristine" balance sheet. Target price eases to $116 from $118.
Target price is $116.00 Current Price is $93.27 Difference: $22.73
If RIO meets the Credit Suisse target it will return approximately 24% (excluding dividends, fees and charges).
Current consensus price target is $112.36, suggesting upside of 17.9% (ex-dividends)
The company's fiscal year ends in December.
Forecast for FY22:
Credit Suisse forecasts a full year FY22 dividend of 1233.92 cents and EPS of 1565.92 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 1658.0, implying annual growth of N/A. Current consensus DPS estimate is 1206.5, implying a prospective dividend yield of 12.7%. Current consensus EPS estimate suggests the PER is 5.7. |
Forecast for FY23:
Credit Suisse forecasts a full year FY23 dividend of 1171.67 cents and EPS of 1455.25 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 1429.7, implying annual growth of -13.8%. Current consensus DPS estimate is 1066.5, implying a prospective dividend yield of 11.2%. Current consensus EPS estimate suggests the PER is 6.7. |
This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Macquarie rates RIO as Outperform (1) -
Macquarie sees Rio Tinto's Jube quarter result as soft with weaker than expected iron ore prices (volumes were in line), rising cost pressures and lower than anticipated volumes for alumina and aluminum.
The broker downgrades earnings forecasts by -7% and -2% for FY22 &FY23, respectively based on the softer than expected results.
Macquarie notes that movements in iron ore prices are a key risk to earnings forecasts and Rio Tinto's valuation.
The Outperform rating is maintained and the price target is reduced by -3% to $120.
Target price is $120.00 Current Price is $93.27 Difference: $26.73
If RIO meets the Macquarie target it will return approximately 29% (excluding dividends, fees and charges).
Current consensus price target is $112.36, suggesting upside of 17.9% (ex-dividends)
The company's fiscal year ends in December.
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 1021.58 cents and EPS of 1513.63 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 1658.0, implying annual growth of N/A. Current consensus DPS estimate is 1206.5, implying a prospective dividend yield of 12.7%. Current consensus EPS estimate suggests the PER is 5.7. |
Forecast for FY23:
Macquarie forecasts a full year FY23 dividend of 1005.81 cents and EPS of 1492.74 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 1429.7, implying annual growth of -13.8%. Current consensus DPS estimate is 1066.5, implying a prospective dividend yield of 11.2%. Current consensus EPS estimate suggests the PER is 6.7. |
This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Morgan Stanley rates RIO as Overweight (1) -
After assessing Rio Tinto's 2Q operational performance, Morgan Stanley sees a -5% impact on earnings (EBITDA), which has the potential to impact the dividend, unless the payout ratio is lifted. Management maintained guidance for most business units.
Production for iron ore was in-line with the broker's estimate, while softer for aluminium and copper. The Overweight rating and $119.50 target are retained. Industry View: Attractive.
Target price is $119.50 Current Price is $93.27 Difference: $26.23
If RIO meets the Morgan Stanley target it will return approximately 28% (excluding dividends, fees and charges).
Current consensus price target is $112.36, suggesting upside of 17.9% (ex-dividends)
The company's fiscal year ends in December.
Forecast for FY22:
Morgan Stanley forecasts a full year FY22 dividend of 1142.62 cents and EPS of 1597.73 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 1658.0, implying annual growth of N/A. Current consensus DPS estimate is 1206.5, implying a prospective dividend yield of 12.7%. Current consensus EPS estimate suggests the PER is 5.7. |
Forecast for FY23:
Morgan Stanley forecasts a full year FY23 dividend of 1002.91 cents and EPS of 1424.82 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 1429.7, implying annual growth of -13.8%. Current consensus DPS estimate is 1066.5, implying a prospective dividend yield of 11.2%. Current consensus EPS estimate suggests the PER is 6.7. |
This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Ord Minnett rates RIO as Hold (3) -
Rio Tinto's FY22 June-quarter production report revealed Pilbara iron ore shipments met Ord Minnett's forecasts but pricing disappointed. Shipment guidance remains on track, and cost guidance was roughly steady.
Lower guidance was issued for the aluminium division thanks primarily to higher costs.
Hold rating retained. Target price eases to $99 from $100.
This stock is not covered in-house by Ord Minnett. Instead, the broker whitelabels research by JP Morgan.
Target price is $99.00 Current Price is $93.27 Difference: $5.73
If RIO meets the Ord Minnett target it will return approximately 6% (excluding dividends, fees and charges).
Current consensus price target is $112.36, suggesting upside of 17.9% (ex-dividends)
The company's fiscal year ends in December.
Forecast for FY22:
Ord Minnett forecasts a full year FY22 EPS of 1323.84 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 1658.0, implying annual growth of N/A. Current consensus DPS estimate is 1206.5, implying a prospective dividend yield of 12.7%. Current consensus EPS estimate suggests the PER is 5.7. |
Forecast for FY23:
Ord Minnett forecasts a full year FY23 EPS of 979.39 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 1429.7, implying annual growth of -13.8%. Current consensus DPS estimate is 1066.5, implying a prospective dividend yield of 11.2%. Current consensus EPS estimate suggests the PER is 6.7. |
This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
RWC RELIANCE WORLDWIDE CORP. LIMITED
Building Products & Services
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Overnight Price: $4.24
UBS rates RWC as Buy (1) -
UBS believes Reliance Worldwide is relatively well placed to endure a downturn in the US and prefers to compare the current downturn to 2000/01 rather than the more severe 2008 version.
The broker explains the company is the most exposed (under its coverage) to the repair & remodel (R&R) segment and non-discretionary repair. R&R downturns are shorter and not as severe, explains the analyst.
In addition, FY23/FY24 margins should get solid support as the prices for copper/resins pull-back strongly, anticipates the broker. The Buy rating is maintained, while the target falls to $5.40 from $5.70.
Target price is $5.40 Current Price is $4.24 Difference: $1.16
If RWC meets the UBS target it will return approximately 27% (excluding dividends, fees and charges).
Current consensus price target is $5.16, suggesting upside of 22.6% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
UBS forecasts a full year FY22 EPS of 25.55 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 26.2, implying annual growth of N/A. Current consensus DPS estimate is 13.9, implying a prospective dividend yield of 3.3%. Current consensus EPS estimate suggests the PER is 16.1. |
Forecast for FY23:
UBS forecasts a full year FY23 EPS of 27.67 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 30.9, implying annual growth of 17.9%. Current consensus DPS estimate is 16.3, implying a prospective dividend yield of 3.9%. Current consensus EPS estimate suggests the PER is 13.6. |
This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.7
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
SCP SHOPPING CENTRES AUSTRALASIA PROPERTY GROUP RE LIMITED
REITs
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Overnight Price: $2.83
Macquarie rates SCP as Neutral (3) -
Shopping Centres Australasia Property has acquired five assets for $180m. These are convenience-based shopping centres with the earnings benefit to be delivered over several years depending on the cost of debt.
The acquisitions will be funded via debt using existing undrawn bank facilities. Macquarie remains attracted to the defensive cash flow and exposure to the CPI via the supermarket turn-over clauses.
Yet the valuation support remains limited relative to peers so the broker sticks with a Neutral rating. Target is reduced to $2.94 from $2.96.
Macquarie appreciates Shopping Centres Australasia Property's defensive cash-flow profile and notes gearing is at the low end of target, but considers the valuation to be challenging relative to peers.
Neutral rating retained. Target price falls to $2.81 from $2.94.
Target price is $2.81 Current Price is $2.83 Difference: minus $0.02 (current price is over target).
If SCP meets the Macquarie target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $2.89, suggesting upside of 0.9% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 15.20 cents and EPS of 16.60 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 16.6, implying annual growth of -61.4%. Current consensus DPS estimate is 14.1, implying a prospective dividend yield of 4.9%. Current consensus EPS estimate suggests the PER is 17.2. |
Forecast for FY23:
Macquarie forecasts a full year FY23 EPS of 17.40 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 17.4, implying annual growth of 4.8%. Current consensus DPS estimate is 13.2, implying a prospective dividend yield of 4.6%. Current consensus EPS estimate suggests the PER is 16.4. |
Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $13.80
Citi rates SGM as Upgrade to Buy from Neutral (1) -
Citi cuts FY22 earnings forecasts for Sims -1% and FY23 forecasts -6% to account for lower Turkish scrap price assumptions.
The broker notes scrap prices have fallen -38% since March and Turkish scrap now looks oversold.
Add to that the recent -35% share-price retreat and Citi spies value, not to mention the strong net cash position and balance sheet.
Rating upgraded to Buy from Neutral. Target price slips to $17 from $20.40 to reflect the broader market de-rating.
Target price is $17.00 Current Price is $13.80 Difference: $3.2
If SGM meets the Citi target it will return approximately 23% (excluding dividends, fees and charges).
Current consensus price target is $20.03, suggesting upside of 39.6% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Citi forecasts a full year FY22 dividend of 74.00 cents and EPS of 278.10 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 271.8, implying annual growth of 138.2%. Current consensus DPS estimate is 81.6, implying a prospective dividend yield of 5.7%. Current consensus EPS estimate suggests the PER is 5.3. |
Forecast for FY23:
Citi forecasts a full year FY23 dividend of 50.00 cents and EPS of 163.40 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 185.1, implying annual growth of -31.9%. Current consensus DPS estimate is 59.8, implying a prospective dividend yield of 4.2%. Current consensus EPS estimate suggests the PER is 7.7. |
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $3.80
Macquarie rates SGP as Neutral (3) -
Macquarie revisits Australian REITs and has the following observations:
Slowing economic growth could bode well for REITs in 2023; industrial supply remains tight; retail is historically preferred during a downturn (Macquarie expects a recession in 2023); bond yields are starting to normalise; the EPS yield spread has returned to the long-term average; the sector has been sold off recently; and the green transition could result in significant property expenses as the Ukraine conflict sustains energy prices (although REITS are well-placed to manage costs).
The broker prefers REITs with greater earnings certainty but stabilising bond yields may make such a stance appear too conservative.
Macquarie expects Stockland will report a tax loss, the extent of which is unclear. The broker likes the REIT's capital allocation transition but expects uncertainty around residential conditions will continue to drag, as will rising interest rates.
Neutral rating retained. Target price falls to 3.74 from $3.90.
Target price is $3.74 Current Price is $3.80 Difference: minus $0.06 (current price is over target).
If SGP meets the Macquarie target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $4.59, suggesting upside of 21.6% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 28.10 cents and EPS of 35.40 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 34.1, implying annual growth of -26.5%. Current consensus DPS estimate is 26.8, implying a prospective dividend yield of 7.1%. Current consensus EPS estimate suggests the PER is 11.1. |
Forecast for FY23:
Macquarie forecasts a full year FY23 dividend of 31.40 cents and EPS of 38.90 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 36.6, implying annual growth of 7.3%. Current consensus DPS estimate is 28.9, implying a prospective dividend yield of 7.7%. Current consensus EPS estimate suggests the PER is 10.3. |
Market Sentiment: 0.7
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
TLS TELSTRA CORPORATION LIMITED
Telecommunication
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Overnight Price: $3.94
Ord Minnett rates TLS as Buy (1) -
Telstra has finalised the Digicel acquisition ahead of schedule and Ord Minnett revises earnings and capital expenditure forecasts less than 1%.
Buy rating retained. Target price is steady at $4.65.
This stock is not covered in-house by Ord Minnett. Instead, the broker whitelabels research by JP Morgan.
Target price is $4.65 Current Price is $3.94 Difference: $0.71
If TLS meets the Ord Minnett target it will return approximately 18% (excluding dividends, fees and charges).
Current consensus price target is $4.46, suggesting upside of 13.0% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Ord Minnett forecasts a full year FY22 dividend of 16.00 cents and EPS of 14.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 13.7, implying annual growth of -12.4%. Current consensus DPS estimate is 16.0, implying a prospective dividend yield of 4.1%. Current consensus EPS estimate suggests the PER is 28.8. |
Forecast for FY23:
Ord Minnett forecasts a full year FY23 dividend of 16.00 cents and EPS of 17.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 16.5, implying annual growth of 20.4%. Current consensus DPS estimate is 16.0, implying a prospective dividend yield of 4.1%. Current consensus EPS estimate suggests the PER is 23.9. |
Market Sentiment: 0.8
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
TWE TREASURY WINE ESTATES LIMITED
Food, Beverages & Tobacco
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Overnight Price: $11.58
Morgan Stanley rates TWE as Overweight (1) -
Morgan Stanley reiterates its Overweight call on Treasury Wine Estates, noting the resilience of wine consumption through economic cycles and inflation offsets. The latter includes the cost-out program and lower grape costs, explains the analyst.
The broker highlights the company has a portfolio of well recognised brands at attractive price points to counter any trading-down by the consumer. The $13.80 price target is unchanged. Industry view is In-Line.
Target price is $13.80 Current Price is $11.58 Difference: $2.22
If TWE meets the Morgan Stanley target it will return approximately 19% (excluding dividends, fees and charges).
Current consensus price target is $13.41, suggesting upside of 16.7% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Morgan Stanley forecasts a full year FY22 dividend of 29.50 cents and EPS of 45.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 44.3, implying annual growth of 27.8%. Current consensus DPS estimate is 27.3, implying a prospective dividend yield of 2.4%. Current consensus EPS estimate suggests the PER is 25.9. |
Forecast for FY23:
Morgan Stanley forecasts a full year FY23 dividend of 37.10 cents and EPS of 57.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 54.9, implying annual growth of 23.9%. Current consensus DPS estimate is 35.7, implying a prospective dividend yield of 3.1%. Current consensus EPS estimate suggests the PER is 20.9. |
Market Sentiment: 0.7
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $1.88
Macquarie rates VCX as Outperform (1) -
Macquarie revisits Australian REITs and has the following observations:
Slowing economic growth could bode well for REITs in 2023; industrial supply remains tight; retail is historically preferred during a downturn (Macquarie expects a recession in 2023); bond yields are starting to normalise; the EPS yield spread has returned to the long-term average; the sector has been sold off recently; and the green transition could result in significant property expenses as the Ukraine conflict sustains energy prices (although REITS are well-placed to manage costs).
The broker prefers REITs with greater earnings certainty but stabilising bond yields may make such a stance appear too conservative.
Vicinity Centres is one of the broker's preferred picks, Macquarie admiring the company's defensive characteristics (a higher hedged position, strong balance sheet and retail sales strength) and expecting the REIT to outpace upgraded guidance and raises earnings 10% in FY23.
Outperform rating and $2.01 target price retained.
Target price is $2.01 Current Price is $1.88 Difference: $0.13
If VCX meets the Macquarie target it will return approximately 7% (excluding dividends, fees and charges).
Current consensus price target is $1.90, suggesting downside of -1.9% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 9.80 cents and EPS of 12.70 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 12.5, implying annual growth of N/A. Current consensus DPS estimate is 9.8, implying a prospective dividend yield of 5.1%. Current consensus EPS estimate suggests the PER is 15.5. |
Forecast for FY23:
Macquarie forecasts a full year FY23 dividend of 10.90 cents and EPS of 12.70 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 13.2, implying annual growth of 5.6%. Current consensus DPS estimate is 10.8, implying a prospective dividend yield of 5.6%. Current consensus EPS estimate suggests the PER is 14.7. |
Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $1.14
Macquarie rates WGX as Outperform (1) -
Macquarie's site visit to Westgold Resources' Murchison gold operations provided the broker with more confidence on the outlook for Big Bell.
The broker upgrades the forecast for Big Bell's output to 1.2Mtpa from 1.1Mtpa and sees potential increases to lift extraction in the future.
Earnings forecasts for Westgold Resources are reduced by -6% and -5% for FY22 & FY23, respectively due to the increase in Macquarie's forecast D&A rates on the back of lower mining inventory.
The price target is maintained at $2.00. Outperform.
Target price is $2.00 Current Price is $1.14 Difference: $0.86
If WGX meets the Macquarie target it will return approximately 75% (excluding dividends, fees and charges).
The company's fiscal year ends in June.
Forecast for FY22:
Macquarie forecasts a full year FY22 dividend of 1.00 cents and EPS of 10.90 cents. |
Forecast for FY23:
Macquarie forecasts a full year FY23 dividend of 2.00 cents and EPS of 15.40 cents. |
Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $44.13
Ord Minnett rates WTC as Buy (1) -
WiseTech Global has upgraded FY22 guidance, thanks to revenue growth, operating leverage and better cost management.
Ord Minnett thanks the covid re-opening, which it expects has driven higher non-recurring revenue on higher margins.
Transport volumes showed signs of weakness.
The broker now expects WiseTech will hit the top end of guidance. FY22 and FY23 EPS forecasts rise sharply but slow thereafter.
Buy rating retained. Target price falls to $50.50 from $52.
Target price is $52.00 Current Price is $44.13 Difference: $7.87
If WTC meets the Ord Minnett target it will return approximately 18% (excluding dividends, fees and charges).
Current consensus price target is $48.34, suggesting upside of 2.2% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY22:
Ord Minnett forecasts a full year FY22 dividend of 10.70 cents and EPS of 53.70 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 53.4, implying annual growth of 60.5%. Current consensus DPS estimate is 10.5, implying a prospective dividend yield of 0.2%. Current consensus EPS estimate suggests the PER is 88.6. |
Forecast for FY23:
Ord Minnett forecasts a full year FY23 dividend of 12.50 cents and EPS of 75.90 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 72.9, implying annual growth of 36.5%. Current consensus DPS estimate is 13.5, implying a prospective dividend yield of 0.3%. Current consensus EPS estimate suggests the PER is 64.9. |
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Today's Price Target Changes
Company | Last Price | Broker | New Target | Prev Target | Change | |
ABP | Abacus Property | $2.76 | Macquarie | 3.46 | 3.59 | -3.62% |
ANN | Ansell | $24.77 | Macquarie | 27.85 | 27.65 | 0.72% |
APM | APM Human Services International | $3.30 | Credit Suisse | 4.25 | 4.20 | 1.19% |
ARF | Arena REIT | $4.59 | Macquarie | 4.92 | 4.61 | 6.72% |
CHC | Charter Hall | $11.64 | Macquarie | 15.33 | 16.33 | -6.12% |
CLW | Charter Hall Long WALE REIT | $4.47 | Macquarie | 4.74 | 5.11 | -7.24% |
CQR | Charter Hall Retail REIT | $3.92 | Macquarie | 4.21 | 4.44 | -5.18% |
DXI | Dexus Industria REIT | $2.79 | Macquarie | 3.03 | 3.26 | -7.06% |
DXS | Dexus | $9.33 | Macquarie | 10.41 | 11.54 | -9.79% |
FMG | Fortescue Metals | $16.89 | UBS | 16.00 | 18.70 | -14.44% |
GMG | Goodman Group | $19.09 | Macquarie | 23.31 | 25.31 | -7.90% |
GOZ | Growthpoint Properties Australia | $3.63 | Macquarie | 4.16 | 4.57 | -8.97% |
GPT | GPT Group | $4.44 | Macquarie | 4.69 | 4.89 | -4.09% |
HCW | HealthCo Healthcare & Wellness REIT | $1.61 | Macquarie | 2.07 | 2.11 | -1.90% |
HDN | HomeCo Daily Needs REIT | $1.36 | Macquarie | 1.65 | 1.58 | 4.43% |
JHX | James Hardie Industries | $34.38 | UBS | 53.00 | 57.70 | -8.15% |
JIN | Jumbo Interactive | $13.02 | Morgan Stanley | 16.00 | 25.50 | -37.25% |
Morgans | 17.50 | 18.30 | -4.37% | |||
LLC | Lendlease Group | $9.50 | Macquarie | 11.80 | 12.30 | -4.07% |
MGR | Mirvac Group | $2.07 | Macquarie | 2.34 | 2.62 | -10.69% |
NSR | National Storage REIT | $2.23 | Macquarie | 2.29 | 2.39 | -4.18% |
NWL | Netwealth Group | $12.83 | Macquarie | 16.00 | 17.40 | -8.05% |
PDL | Pendal Group | $4.11 | Credit Suisse | 3.90 | 4.00 | -2.50% |
Ord Minnett | 4.20 | 6.00 | -30.00% | |||
UBS | 4.25 | 5.25 | -19.05% | |||
QAL | Qualitas | $1.62 | Macquarie | 2.53 | 2.46 | 2.85% |
RIO | Rio Tinto | $95.27 | Citi | 120.00 | 135.00 | -11.11% |
Credit Suisse | 116.00 | 118.00 | -1.69% | |||
Macquarie | 120.00 | 124.00 | -3.23% | |||
Ord Minnett | 99.00 | 100.00 | -1.00% | |||
RWC | Reliance Worldwide | $4.21 | UBS | 5.40 | 5.70 | -5.26% |
SCP | Shopping Centres Australasia Property | $2.86 | Macquarie | 2.81 | 2.94 | -4.42% |
SGM | Sims | $14.34 | Citi | 17.00 | 20.40 | -16.67% |
SGP | Stockland | $3.77 | Macquarie | 3.74 | 3.90 | -4.10% |
Summaries
ABP | Abacus Property | Outperform - Macquarie | Overnight Price $2.77 |
AIA | Auckland International Airport | Overweight - Morgan Stanley | Overnight Price $6.67 |
ANN | Ansell | Upgrade to Outperform from Neutral - Macquarie | Overnight Price $24.01 |
APM | APM Human Services International | Outperform - Credit Suisse | Overnight Price $3.28 |
APX | Appen | Neutral - Citi | Overnight Price $6.00 |
ARF | Arena REIT | Outperform - Macquarie | Overnight Price $4.59 |
BRG | Breville Group | Overweight - Morgan Stanley | Overnight Price $19.27 |
CHC | Charter Hall | Outperform - Macquarie | Overnight Price $11.59 |
CIP | Centuria Industrial REIT | Outperform - Macquarie | Overnight Price $2.95 |
CLW | Charter Hall Long WALE REIT | Neutral - Macquarie | Overnight Price $4.43 |
CQR | Charter Hall Retail REIT | Outperform - Macquarie | Overnight Price $3.89 |
DXI | Dexus Industria REIT | Neutral - Macquarie | Overnight Price $2.74 |
DXS | Dexus | Outperform - Macquarie | Overnight Price $9.36 |
FMG | Fortescue Metals | Neutral - UBS | Overnight Price $16.33 |
GMG | Goodman Group | Outperform - Macquarie | Overnight Price $18.95 |
GOZ | Growthpoint Properties Australia | Outperform - Macquarie | Overnight Price $3.61 |
GPT | GPT Group | Neutral - Macquarie | Overnight Price $4.46 |
Lighten - Ord Minnett | Overnight Price $4.46 | ||
HCW | HealthCo Healthcare & Wellness REIT | Outperform - Macquarie | Overnight Price $1.57 |
HDN | HomeCo Daily Needs REIT | Outperform - Macquarie | Overnight Price $1.35 |
JHX | James Hardie Industries | Buy - UBS | Overnight Price $33.68 |
JIN | Jumbo Interactive | Overweight - Morgan Stanley | Overnight Price $12.31 |
Add - Morgans | Overnight Price $12.31 | ||
LLC | Lendlease Group | Outperform - Macquarie | Overnight Price $9.51 |
MGR | Mirvac Group | Outperform - Macquarie | Overnight Price $2.05 |
Buy - Ord Minnett | Overnight Price $2.05 | ||
NSR | National Storage REIT | Neutral - Macquarie | Overnight Price $2.25 |
NWL | Netwealth Group | Outperform - Macquarie | Overnight Price $12.54 |
PDL | Pendal Group | Neutral - Credit Suisse | Overnight Price $3.76 |
No Rating - Macquarie | Overnight Price $3.76 | ||
Equal-weight - Morgan Stanley | Overnight Price $3.76 | ||
Buy - Ord Minnett | Overnight Price $3.76 | ||
Buy - UBS | Overnight Price $3.76 | ||
QAL | Qualitas | Outperform - Macquarie | Overnight Price $1.63 |
RIO | Rio Tinto | Buy - Citi | Overnight Price $93.27 |
Outperform - Credit Suisse | Overnight Price $93.27 | ||
Outperform - Macquarie | Overnight Price $93.27 | ||
Overweight - Morgan Stanley | Overnight Price $93.27 | ||
Hold - Ord Minnett | Overnight Price $93.27 | ||
RWC | Reliance Worldwide | Buy - UBS | Overnight Price $4.24 |
SCP | Shopping Centres Australasia Property | Neutral - Macquarie | Overnight Price $2.83 |
SGM | Sims | Upgrade to Buy from Neutral - Citi | Overnight Price $13.80 |
SGP | Stockland | Neutral - Macquarie | Overnight Price $3.80 |
TLS | Telstra | Buy - Ord Minnett | Overnight Price $3.94 |
TWE | Treasury Wine Estates | Overweight - Morgan Stanley | Overnight Price $11.58 |
VCX | Vicinity Centres | Outperform - Macquarie | Overnight Price $1.88 |
WGX | Westgold Resources | Outperform - Macquarie | Overnight Price $1.14 |
WTC | WiseTech Global | Buy - Ord Minnett | Overnight Price $44.13 |
RATING SUMMARY
Rating | No. Of Recommendations |
1. Buy | 35 |
3. Hold | 11 |
4. Reduce | 1 |
Monday 18 July 2022
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Disclaimer:
The content of this information does in no way reflect the opinions of
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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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base their work on information believed to be reliable and accurate, though
no guarantee is given that the daily report is accurate or complete. Investors
should contact their personal adviser before making any investment decision.
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