Australian Broker Call
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January 08, 2018
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COMPANIES DISCUSSED IN THIS ISSUE
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The number next to the symbol represents the number of brokers covering it for this report -(if more than 1)
Last Updated: 04:07 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.
For more info about the different terms used by stockbrokers, as well as the different methodologies behind similar sounding ratings, download our guide HERE
Today's Upgrades and Downgrades
| BBG - | BILLABONG INT | Downgrade to Neutral from Buy | Citi |
| EVN - | EVOLUTION MINING | Downgrade to Neutral from Outperform | Macquarie |
| NMT - | NEOMETALS | Downgrade to Neutral from Outperform | Macquarie |
| ORE - | OROCOBRE | Downgrade to Underperform from Neutral | Macquarie |
| SAR - | SARACEN MINERAL | Downgrade to Neutral from Outperform | Macquarie |
| SBM - | ST BARBARA | Downgrade to Neutral from Outperform | Macquarie |
Overnight Price: $55.18
Deutsche Bank rates ASX as Hold (3) -
Deutsche Bank finds the company's market positioning and capital generation attractive but remains concerned about elevated cost growth in FY18.
Hold retained. Target is $54.50.
Target price is $54.50 Current Price is $55.18 Difference: minus $0.68 (current price is over target).
If ASX meets the Deutsche Bank target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $52.24, suggesting downside of -5.3% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Deutsche Bank forecasts a full year FY18 dividend of 203.00 cents and EPS of 232.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 233.0, implying annual growth of 3.8%. Current consensus DPS estimate is 208.7, implying a prospective dividend yield of 3.8%. Current consensus EPS estimate suggests the PER is 23.7. |
Forecast for FY19:
Deutsche Bank forecasts a full year FY19 dividend of 205.00 cents and EPS of 244.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 245.4, implying annual growth of 5.3%. Current consensus DPS estimate is 218.7, implying a prospective dividend yield of 4.0%. Current consensus EPS estimate suggests the PER is 22.5. |
Market Sentiment: -0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
BBG BILLABONG INTERNATIONAL LIMITED
Apparel & Footwear
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Overnight Price: $0.99
Citi rates BBG as Downgrade to Neutral from Buy (3) -
Citi analysts note Billabong's board has recommended the Boardriders takeover bid at $1.00 per share. However, Citi still only sees a 50% chance of the deal being approved by shareholders.
Downgrade to Neutral/High Risk from Buy/High Risk. Target price drops to $1.05 from $1.25.
Target price is $1.05 Current Price is $0.99 Difference: $0.06
If BBG meets the Citi target it will return approximately 6% (excluding dividends, fees and charges).
The company's fiscal year ends in June.
Forecast for FY18:
Citi forecasts a full year FY18 dividend of 0.00 cents and EPS of 2.10 cents. |
Forecast for FY19:
Citi forecasts a full year FY19 dividend of 0.00 cents and EPS of 4.90 cents. |
Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $2.72
Macquarie rates EVN as Downgrade to Neutral from Outperform (3) -
Macquarie considers the domestic gold producers are fully valued and downgrades Evolution Mining to Neutral from Outperform. Target is raised to $2.90 from $2.80.
The broker envisages few catalysts for growth in 2018, although accepts cash generation will be good and the strength in gold will also support high asset valuations. M&A activity is expected to be muted.
Target price is $2.90 Current Price is $2.72 Difference: $0.18
If EVN meets the Macquarie target it will return approximately 7% (excluding dividends, fees and charges).
Current consensus price target is $2.55, suggesting downside of -6.3% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Macquarie forecasts a full year FY18 dividend of 3.00 cents and EPS of 17.70 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 17.2, implying annual growth of 29.5%. Current consensus DPS estimate is 7.3, implying a prospective dividend yield of 2.7%. Current consensus EPS estimate suggests the PER is 15.8. |
Forecast for FY19:
Macquarie forecasts a full year FY19 dividend of 8.00 cents and EPS of 25.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 18.6, implying annual growth of 8.1%. Current consensus DPS estimate is 8.4, implying a prospective dividend yield of 3.1%. Current consensus EPS estimate suggests the PER is 14.6. |
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $0.44
Macquarie rates NMT as Downgrade to Neutral from Outperform (3) -
FX changes have had a positive impact on FY18 earnings for battery materials producers, but drive modest downgrades to FY19 and FY20 estimates.
Rating is downgraded to Neutral from Outperform. Target is 40c.
Target price is $0.40 Current Price is $0.44 Difference: minus $0.04 (current price is over target).
If NMT meets the Macquarie target it will return approximately minus 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).
The company's fiscal year ends in June.
Forecast for FY18:
Macquarie forecasts a full year FY18 dividend of 0.00 cents and EPS of 3.30 cents. |
Forecast for FY19:
Macquarie forecasts a full year FY19 dividend of 0.00 cents and EPS of 4.00 cents. |
Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $7.21
Macquarie rates ORE as Downgrade to Underperform from Neutral (5) -
FX changes have had a positive impact on FY18 earnings for battery materials producers, but drive modest downgrades to Macquarie's FY19 and FY20 estimates.
Rating is downgraded to Underperform from Neutral due to a lack of share price upside. Target is raised to $6.50 from $4.97.
Target price is $6.50 Current Price is $7.21 Difference: minus $0.71 (current price is over target).
If ORE meets the Macquarie target it will return approximately minus 10% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $6.01, suggesting downside of -16.7% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Macquarie forecasts a full year FY18 dividend of 0.00 cents and EPS of 17.30 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 18.2, implying annual growth of 727.3%. Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A. Current consensus EPS estimate suggests the PER is 39.6. |
Forecast for FY19:
Macquarie forecasts a full year FY19 dividend of 0.00 cents and EPS of 8.50 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 27.6, implying annual growth of 51.6%. Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A. Current consensus EPS estimate suggests the PER is 26.1. |
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
SAR SARACEN MINERAL HOLDINGS LIMITED
Gold & Silver
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Overnight Price: $1.68
Macquarie rates SAR as Downgrade to Neutral from Outperform (3) -
Macquarie considers the domestic gold producers are fully valued and downgrades Saracen Mineral to Neutral from Outperform. Target is raised to $1.90 from $1.80.
The broker envisages few catalysts for growth in 2018, although accepts cash generation will be good and the strength in gold will also support high asset valuations. M&A activity is expected to be muted.
Target price is $1.90 Current Price is $1.68 Difference: $0.22
If SAR meets the Macquarie target it will return approximately 13% (excluding dividends, fees and charges).
The company's fiscal year ends in June.
Forecast for FY18:
Macquarie forecasts a full year FY18 dividend of 2.00 cents and EPS of 12.20 cents. |
Forecast for FY19:
Macquarie forecasts a full year FY19 dividend of 3.00 cents and EPS of 18.20 cents. |
Market Sentiment: -0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $3.89
Macquarie rates SBM as Downgrade to Neutral from Outperform (3) -
Macquarie considers the domestic gold producers are fully valued and downgrades St Barbara to Neutral from Outperform. Target is raised to $3.90 from $3.60.
The broker envisages few catalysts for growth in 2018, although accepts cash generation will be good and the strength in gold will also support high asset valuations. M&A activity is expected to be muted.
Target price is $3.90 Current Price is $3.89 Difference: $0.01
If SBM meets the Macquarie target it will return approximately 0% (excluding dividends, fees and charges).
Current consensus price target is $3.37, suggesting downside of -13.4% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY18:
Macquarie forecasts a full year FY18 dividend of 0.00 cents and EPS of 31.20 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 34.3, implying annual growth of 8.2%. Current consensus DPS estimate is 8.5, implying a prospective dividend yield of 2.2%. Current consensus EPS estimate suggests the PER is 11.3. |
Forecast for FY19:
Macquarie forecasts a full year FY19 dividend of 0.00 cents and EPS of 367.70 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 99.0, implying annual growth of 188.6%. Current consensus DPS estimate is 8.0, implying a prospective dividend yield of 2.1%. Current consensus EPS estimate suggests the PER is 3.9. |
Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Summaries
| ASX | ASX | Hold - Deutsche Bank | Overnight Price $55.18 |
| BBG | BILLABONG INT | Downgrade to Neutral from Buy - Citi | Overnight Price $0.99 |
| EVN | EVOLUTION MINING | Downgrade to Neutral from Outperform - Macquarie | Overnight Price $2.72 |
| NMT | NEOMETALS | Downgrade to Neutral from Outperform - Macquarie | Overnight Price $0.44 |
| ORE | OROCOBRE | Downgrade to Underperform from Neutral - Macquarie | Overnight Price $7.21 |
| SAR | SARACEN MINERAL | Downgrade to Neutral from Outperform - Macquarie | Overnight Price $1.68 |
| SBM | ST BARBARA | Downgrade to Neutral from Outperform - Macquarie | Overnight Price $3.89 |
RATING SUMMARY
| Rating | No. Of Recommendations |
| 3. Hold | 6 |
| 5. Sell | 1 |
Monday 15 January 2018
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