Australian Broker Call
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February 10, 2020
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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: 05:00 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
| BLD - | BORAL | Downgrade to Underperform from Neutral | Credit Suisse |
| FLT - | FLIGHT CENTRE | Downgrade to Hold from Buy | Ord Minnett |
AZJ AURIZON HOLDINGS LIMITED
Transportation & Logistics
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Overnight Price: $5.47
Citi rates AZJ as Neutral (3) -
In an initial response to today's release of interim results, Citi found the underlying performance in line with expectations. The underlying EPS surprises by some 2% with the analysts noting management at the company has left FY guidance intact.
Bulks performed better, but coal earnings were weaker, comment the analysts. Additional positives cited are an increase to the share buyback and a 20% jump in the dividend.
Target price is $5.60 Current Price is $5.47 Difference: $0.13
If AZJ meets the Citi target it will return approximately 2% (excluding dividends, fees and charges).
Current consensus price target is $5.70, suggesting upside of 4.2% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY20:
Citi forecasts a full year FY20 dividend of 27.10 cents and EPS of 27.10 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 26.9, implying annual growth of 13.0%. Current consensus DPS estimate is 27.5, implying a prospective dividend yield of 5.0%. Current consensus EPS estimate suggests the PER is 20.3. |
Forecast for FY21:
Citi forecasts a full year FY21 dividend of 29.90 cents and EPS of 29.90 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 29.6, implying annual growth of 10.0%. Current consensus DPS estimate is 29.6, implying a prospective dividend yield of 5.4%. Current consensus EPS estimate suggests the PER is 18.5. |
Market Sentiment: 0.2
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $4.59
Credit Suisse rates BLD as Downgrade to Underperform from Neutral (5) -
US coal power station output has fallen -15% in 2019 with a further -9% fall expected in 2020.
Credit Suisse estimates a decline of more than -0.8mt in ash sold from Boral sites and decreases its FY20 forecast to 6.6mt.
The broker expects Boral will abandon its 2021 target for a 20-25% increase in volumes amid margin pressure from alternatives.
Credit Suisse downgrades to Underperform from Neutral on these stock-specific issues and reduces the target to $4.45 from $4.50.
Target price is $4.45 Current Price is $4.59 Difference: minus $0.14 (current price is over target).
If BLD meets the Credit Suisse target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $4.85, suggesting upside of 5.7% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY20:
Credit Suisse forecasts a full year FY20 dividend of 22.50 cents and EPS of 32.44 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 32.5, implying annual growth of 40.1%. Current consensus DPS estimate is 21.6, implying a prospective dividend yield of 4.7%. Current consensus EPS estimate suggests the PER is 14.1. |
Forecast for FY21:
Credit Suisse forecasts a full year FY21 dividend of 19.50 cents and EPS of 36.04 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 35.4, implying annual growth of 8.9%. Current consensus DPS estimate is 22.9, implying a prospective dividend yield of 5.0%. Current consensus EPS estimate suggests the PER is 13.0. |
Market Sentiment: -0.2
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $244.61
Credit Suisse rates COH as Neutral (3) -
Credit Suisse expects a return to strong growth in FY20 implant unit sales, weighted to the second half. However, for the first half result, downside risk lies with the extent of the slowdown in services revenue growth.
First half results will be reported on February 18. With a lower earnings growth outlook from FY21 onwards the broker retains a Neutral rating. Target is raised to $240 from $211.
Target price is $240.00 Current Price is $244.61 Difference: minus $4.61 (current price is over target).
If COH meets the Credit Suisse target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $202.67, suggesting downside of -17.1% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY20:
Credit Suisse forecasts a full year FY20 dividend of 359.00 cents and EPS of 515.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 517.6, implying annual growth of 7.9%. Current consensus DPS estimate is 365.2, implying a prospective dividend yield of 1.5%. Current consensus EPS estimate suggests the PER is 47.3. |
Forecast for FY21:
Credit Suisse forecasts a full year FY21 dividend of 390.00 cents and EPS of 559.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 565.3, implying annual growth of 9.2%. Current consensus DPS estimate is 399.2, implying a prospective dividend yield of 1.6%. Current consensus EPS estimate suggests the PER is 43.3. |
Market Sentiment: -0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $11.68
UBS rates CWN as Neutral (3) -
Melco has announced it will not pursue its planned investment for the second tranche of shares in Crown Resorts. Instead it will focus on its operations elsewhere.
Outside of the potential for further corporate activity, UBS envisages a lack of positive catalysts for Crown Resorts.
The broker does not adjust forecasts for the impact of the coronavirus but estimates that a -10% fall in Chinese international casino visitors would result in a -2% decline in operating earnings (EBITDA) for Australian casinos.
Neutral rating and $11.65 target maintained.
Target price is $11.65 Current Price is $11.68 Difference: minus $0.03 (current price is over target).
If CWN meets the UBS target it will return approximately minus 0% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $12.21, suggesting upside of 4.5% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY20:
UBS forecasts a full year FY20 dividend of 60.00 cents and EPS of 49.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 51.9, implying annual growth of -12.1%. Current consensus DPS estimate is 60.0, implying a prospective dividend yield of 5.1%. Current consensus EPS estimate suggests the PER is 22.5. |
Forecast for FY21:
UBS forecasts a full year FY21 dividend of 60.00 cents and EPS of 54.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 53.7, implying annual growth of 3.5%. Current consensus DPS estimate is 60.0, implying a prospective dividend yield of 5.1%. Current consensus EPS estimate suggests the PER is 21.8. |
Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
FLT FLIGHT CENTRE LIMITED
Travel, Leisure & Tourism
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Overnight Price: $37.85
Citi rates FLT as Neutral (3) -
Despite the company expecting pre-tax profit in the first half to remain within the guidance range of $90-110m, Citi suspects the focus will quickly shift to the second half where Flight Centre historically generates 60% of underlying profit.
The coronavirus adds to a number of headwinds and the probability of further downgrades to FY20 profit guidance of $310-350m has increased, in the broker's opinion.
This is expected to weigh on the share price in the near term and Citi retains a Neutral rating. Target is $41.60. First half results will be reported on February 27.
Target price is $41.60 Current Price is $37.85 Difference: $3.75
If FLT meets the Citi target it will return approximately 10% (excluding dividends, fees and charges).
Current consensus price target is $43.27, suggesting upside of 14.3% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY20:
Citi forecasts a full year FY20 dividend of 135.40 cents and EPS of 226.80 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 229.9, implying annual growth of -12.1%. Current consensus DPS estimate is 151.6, implying a prospective dividend yield of 4.0%. Current consensus EPS estimate suggests the PER is 16.5. |
Forecast for FY21:
Citi forecasts a full year FY21 dividend of 163.10 cents and EPS of 273.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 264.9, implying annual growth of 15.2%. Current consensus DPS estimate is 172.3, implying a prospective dividend yield of 4.6%. Current consensus EPS estimate suggests the PER is 14.3. |
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Macquarie rates FLT as Neutral (3) -
The company suspects it may struggle to meet FY20 guidance. Coronavirus has negatively affected the corporate business in China and Singapore, which represents around 2.5% of group transaction value.
Macquarie has already taken a conservative approach and its forecasts are already below the bottom end of guidance. Neutral rating maintained. Target is reduced to $39.00 from $39.10.
Target price is $39.00 Current Price is $37.85 Difference: $1.15
If FLT meets the Macquarie target it will return approximately 3% (excluding dividends, fees and charges).
Current consensus price target is $43.27, suggesting upside of 14.3% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY20:
Macquarie forecasts a full year FY20 dividend of 142.60 cents and EPS of 218.80 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 229.9, implying annual growth of -12.1%. Current consensus DPS estimate is 151.6, implying a prospective dividend yield of 4.0%. Current consensus EPS estimate suggests the PER is 16.5. |
Forecast for FY21:
Macquarie forecasts a full year FY21 dividend of 151.20 cents and EPS of 231.90 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 264.9, implying annual growth of 15.2%. Current consensus DPS estimate is 172.3, implying a prospective dividend yield of 4.6%. Current consensus EPS estimate suggests the PER is 14.3. |
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Morgan Stanley rates FLT as Overweight (1) -
Flight Centre has lifted its first half profit guidance by 3% at the midpoint. While this modest uplift is encouraging, the broker acknowledges a clear near term risk from the coronavirus.
The company suggests it's too early to gauge the impact on the second half, but guidance will be more difficult to achieve.
The broker recently reduced its forecast to the bottom end of the prior guidance range. Overweight and $45 target retained. Industry view Cautious.
Target price is $45.00 Current Price is $37.85 Difference: $7.15
If FLT meets the Morgan Stanley target it will return approximately 19% (excluding dividends, fees and charges).
Current consensus price target is $43.27, suggesting upside of 14.3% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY20:
Morgan Stanley forecasts a full year FY20 EPS of 226.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 229.9, implying annual growth of -12.1%. Current consensus DPS estimate is 151.6, implying a prospective dividend yield of 4.0%. Current consensus EPS estimate suggests the PER is 16.5. |
Forecast for FY21:
Morgan Stanley forecasts a full year FY21 EPS of 276.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 264.9, implying annual growth of 15.2%. Current consensus DPS estimate is 172.3, implying a prospective dividend yield of 4.6%. Current consensus EPS estimate suggests the PER is 14.3. |
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Ord Minnett rates FLT as Downgrade to Hold from Buy (3) -
Ord Minnett assesses outbound travel out of Australia is holding up reasonably well but remains on high alert for any worsening in the coronavirus.
Industry sources suggest the combined impact of the bushfires and coronavirus has had a negative impact on hotel bookings.
While understanding the potential earnings risk, the broker notes history indicates the coronavirus issue will be resolved and normal operating conditions will return within a relatively short timeframe.
The broker downgrades to Hold from Buy, acknowledging there are risk exposures across multiple lines of business for Flight Centre. Target is reduced to $41.38 from $46.09.
Target price is $41.38 Current Price is $37.85 Difference: $3.53
If FLT meets the Ord Minnett target it will return approximately 9% (excluding dividends, fees and charges).
Current consensus price target is $43.27, suggesting upside of 14.3% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY20:
Ord Minnett forecasts a full year FY20 EPS of 242.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 229.9, implying annual growth of -12.1%. Current consensus DPS estimate is 151.6, implying a prospective dividend yield of 4.0%. Current consensus EPS estimate suggests the PER is 16.5. |
Forecast for FY21:
Ord Minnett forecasts a full year FY21 EPS of 286.70 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 264.9, implying annual growth of 15.2%. Current consensus DPS estimate is 172.3, implying a prospective dividend yield of 4.6%. Current consensus EPS estimate suggests the PER is 14.3. |
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
UBS rates FLT as Buy (1) -
The company expects first half pre-tax profit to be slightly ahead of the mid point of guidance. This is below UBS estimates albeit in line with consensus.
Flight Centre is experiencing some early impact from the coronavirus in the second half, which may mean achieving FY20 guidance becomes challenging.
Nevertheless, UBS believes the issues are likely to be transitory and the company is winning share, with its balance sheet a key advantage. Buy rating and $50.50 target maintained.
Target price is $50.50 Current Price is $37.85 Difference: $12.65
If FLT meets the UBS target it will return approximately 33% (excluding dividends, fees and charges).
Current consensus price target is $43.27, suggesting upside of 14.3% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY20:
UBS forecasts a full year FY20 dividend of 134.00 cents and EPS of 233.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 229.9, implying annual growth of -12.1%. Current consensus DPS estimate is 151.6, implying a prospective dividend yield of 4.0%. Current consensus EPS estimate suggests the PER is 16.5. |
Forecast for FY21:
UBS forecasts a full year FY21 dividend of 168.00 cents and EPS of 278.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 264.9, implying annual growth of 15.2%. Current consensus DPS estimate is 172.3, implying a prospective dividend yield of 4.6%. Current consensus EPS estimate suggests the PER is 14.3. |
Market Sentiment: 0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
HRL HRL HOLDINGS LTD
Industrial Sector Contractors & Engineers
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Overnight Price: $0.13
Morgans rates HRL as Add (1) -
First half results were in line with guidance issued in October. Management is comfortable with consensus estimates for FY20 underlying operating earnings (EBITDA) of $7.0m.
Morgans believes the result was another step towards restoring confidence in the growth outlook. Importantly the high-margin Analytica business continues to perform strongly.
Morgans continues to envisage material upside to valuation and maintains an Add rating. Target is raised to $0.16 from $0.14.
Target price is $0.16 Current Price is $0.13 Difference: $0.03
If HRL meets the Morgans target it will return approximately 23% (excluding dividends, fees and charges).
The company's fiscal year ends in June.
Forecast for FY20:
Morgans forecasts a full year FY20 dividend of 0.00 cents and EPS of 0.60 cents. |
Forecast for FY21:
Morgans forecasts a full year FY21 dividend of 0.00 cents and EPS of 0.80 cents. |
Market Sentiment: 1.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $44.87
Citi rates JBH as Neutral (3) -
In an initial response to today's interim report release, Citi highlights the core net profit beat consensus expectations by some 4%, while its own forecast was beaten by 0.8%. The Good Guys, lower D&A and interest costs made the difference.
The announced interim dividend of 99c was better than expected too. The provided guidance is better than market consensus, by some 2.5% at the mid-point, but falls short of Citi's forecast. The analysts' response is this might prove conservative.
Citi anticipates an uplift in market consensus forecasts post the release.
Target price is $35.20 Current Price is $44.87 Difference: minus $9.67 (current price is over target).
If JBH meets the Citi target it will return approximately minus 22% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $35.49, suggesting downside of -20.9% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY20:
Citi forecasts a full year FY20 dividend of 151.00 cents and EPS of 231.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 222.0, implying annual growth of 2.1%. Current consensus DPS estimate is 145.5, implying a prospective dividend yield of 3.2%. Current consensus EPS estimate suggests the PER is 20.2. |
Forecast for FY21:
Citi forecasts a full year FY21 dividend of 152.00 cents and EPS of 232.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 224.9, implying annual growth of 1.3%. Current consensus DPS estimate is 147.3, implying a prospective dividend yield of 3.3%. Current consensus EPS estimate suggests the PER is 20.0. |
Market Sentiment: -0.1
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $21.67
Credit Suisse rates NWS as Outperform (1) -
Second quarter results were firmer than expected. The result was supported by a US$22m one-time benefit from the settlement of a warranty claim and after adjusting for this operating earnings (EBITDA) would have been in line with consensus, Credit Suisse points out.
Guidance for the second half was more positive with an improvement expected at Dow Jones after the content deal with Facebook. Credit Suisse maintains an Outperform rating and raises the target to $23.90 from $23.80.
Target price is $23.90 Current Price is $21.67 Difference: $2.23
If NWS meets the Credit Suisse target it will return approximately 10% (excluding dividends, fees and charges).
Current consensus price target is $24.34, suggesting upside of 12.3% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY20:
Credit Suisse forecasts a full year FY20 dividend of 23.12 cents and EPS of 54.41 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 60.7, implying annual growth of N/A. Current consensus DPS estimate is 28.2, implying a prospective dividend yield of 1.3%. Current consensus EPS estimate suggests the PER is 35.7. |
Forecast for FY21:
Credit Suisse forecasts a full year FY21 dividend of 28.90 cents and EPS of 75.62 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 69.8, implying annual growth of 15.0%. Current consensus DPS estimate is 29.9, implying a prospective dividend yield of 1.4%. Current consensus EPS estimate suggests the PER is 31.0. |
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
Morgan Stanley rates NWS as Underweight (5) -
There were a few ups and downs in the mix of News Corp's divisional results, but they netted out to largely in line with forecasts. For the broker the key question from here is what can the company achieve in its efforts to unlock shareholder value? The sale of the Inserts/Coupon business is supposedly close, but then what?
No guidance offered as usual other than earnings are expected to be higher. The broker retains Underweight and a US$12.50 target. Industry view: Attractive.
Current Price is $21.67. Target price not assessed.
Current consensus price target is $24.34, suggesting upside of 12.3% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY20:
Morgan Stanley forecasts a full year FY20 dividend of 28.90 cents and EPS of 60.69 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 60.7, implying annual growth of N/A. Current consensus DPS estimate is 28.2, implying a prospective dividend yield of 1.3%. Current consensus EPS estimate suggests the PER is 35.7. |
Forecast for FY21:
Morgan Stanley forecasts a full year FY21 dividend of 28.90 cents and EPS of 67.92 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 69.8, implying annual growth of 15.0%. Current consensus DPS estimate is 29.9, implying a prospective dividend yield of 1.4%. Current consensus EPS estimate suggests the PER is 31.0. |
This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.5
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
UBS rates NWS as Buy (1) -
UBS found the first half result beat forecasts at a group level but was mixed across segments. News and Information Services stood out and was the main reason for the beat to estimates.
UBS maintains a Buy rating and $23.75 target.
Target price is $23.75 Current Price is $21.67 Difference: $2.08
If NWS meets the UBS target it will return approximately 10% (excluding dividends, fees and charges).
Current consensus price target is $24.34, suggesting upside of 12.3% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY20:
UBS forecasts a full year FY20 dividend of 28.62 cents and EPS of 64.39 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 60.7, implying annual growth of N/A. Current consensus DPS estimate is 28.2, implying a prospective dividend yield of 1.3%. Current consensus EPS estimate suggests the PER is 35.7. |
Forecast for FY21:
UBS forecasts a full year FY21 dividend of 28.90 cents and EPS of 62.14 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 69.8, implying annual growth of 15.0%. Current consensus DPS estimate is 29.9, implying a prospective dividend yield of 1.4%. Current consensus EPS estimate suggests the PER is 31.0. |
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
PTM PLATINUM ASSET MANAGEMENT LIMITED
Wealth Management & Investments
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Overnight Price: $4.76
Morgan Stanley rates PTM as Underweight (5) -
The broker has marked to market for Platinum Asset Management's returns but reduced FY20-22 earnings forecasts given first half outflows and fund underperformance.
Target rises to $3.50 from $3.35, Underweight retained. Industry view In Line.
Target price is $3.50 Current Price is $4.76 Difference: minus $1.26 (current price is over target).
If PTM meets the Morgan Stanley target it will return approximately minus 26% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $3.90, suggesting downside of -18.1% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY20:
Morgan Stanley forecasts a full year FY20 dividend of 25.00 cents and EPS of 26.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 26.3, implying annual growth of -2.7%. Current consensus DPS estimate is 25.8, implying a prospective dividend yield of 5.4%. Current consensus EPS estimate suggests the PER is 18.1. |
Forecast for FY21:
Morgan Stanley forecasts a full year FY21 dividend of 23.00 cents and EPS of 24.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 25.5, implying annual growth of -3.0%. Current consensus DPS estimate is 24.9, implying a prospective dividend yield of 5.2%. Current consensus EPS estimate suggests the PER is 18.7. |
Market Sentiment: -1.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
QAN QANTAS AIRWAYS LIMITED
Transportation & Logistics
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Overnight Price: $6.43
UBS rates QAN as Buy (1) -
UBS believes there is an increasing likelihood that Qantas will pursue direct flights to New York and London. An increase in capital expenditure is expected as a result.
The broker reduces FY20 estimates for earnings per share by -6% although estimates for FY21 are unchanged because of a lower oil price forecast.
The broker retains a Buy rating and reduces the target to $7.25 from $7.30.
Target price is $7.25 Current Price is $6.43 Difference: $0.82
If QAN meets the UBS target it will return approximately 13% (excluding dividends, fees and charges).
Current consensus price target is $7.41, suggesting upside of 15.2% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY20:
UBS forecasts a full year FY20 dividend of 27.00 cents and EPS of 56.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 58.4, implying annual growth of 6.2%. Current consensus DPS estimate is 26.9, implying a prospective dividend yield of 4.2%. Current consensus EPS estimate suggests the PER is 11.0. |
Forecast for FY21:
UBS forecasts a full year FY21 dividend of 28.00 cents and EPS of 73.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 69.3, implying annual growth of 18.7%. Current consensus DPS estimate is 28.4, implying a prospective dividend yield of 4.4%. Current consensus EPS estimate suggests the PER is 9.3. |
Market Sentiment: 0.6
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $114.40
Credit Suisse rates REA as Underperform (5) -
First half results were in line with Credit Suisse estimates. A listings recovery is expected in the second half but developer volumes remain weak and are expected to drag down media revenue for the remainder of FY20.
Commentary from management that it has stopped charging agents on a "per lead" basis shows that implementation of the product is not straightforward and Credit Suisse believes this will push out any monetisation opportunity.
Underperform rating maintained. Target is reduced to $100.20 from $100.80.
Target price is $100.20 Current Price is $114.40 Difference: minus $14.2 (current price is over target).
If REA meets the Credit Suisse target it will return approximately minus 12% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $101.52, suggesting downside of -11.3% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY20:
Credit Suisse forecasts a full year FY20 dividend of 118.00 cents and EPS of 234.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 241.7, implying annual growth of 203.3%. Current consensus DPS estimate is 122.1, implying a prospective dividend yield of 1.1%. Current consensus EPS estimate suggests the PER is 47.3. |
Forecast for FY21:
Credit Suisse forecasts a full year FY21 dividend of 152.00 cents and EPS of 276.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 287.3, implying annual growth of 18.9%. Current consensus DPS estimate is 146.5, implying a prospective dividend yield of 1.3%. Current consensus EPS estimate suggests the PER is 39.8. |
Market Sentiment: -0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Morgan Stanley rates REA as Overweight (1) -
REA Group's revenues and earnings were some 3% above the broker's forecast, confirming a cyclical recovery is underway. But the pace and the trajectory of a listings bounce-back remain unclear at this point, the broker warns.
No guidance provided as usual. Overweight and $110 target retained. Industry view: Attractive.
Target price is $110.00 Current Price is $114.40 Difference: minus $4.4 (current price is over target).
If REA meets the Morgan Stanley target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $101.52, suggesting downside of -11.3% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY20:
Morgan Stanley forecasts a full year FY20 dividend of 131.70 cents and EPS of 257.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 241.7, implying annual growth of 203.3%. Current consensus DPS estimate is 122.1, implying a prospective dividend yield of 1.1%. Current consensus EPS estimate suggests the PER is 47.3. |
Forecast for FY21:
Morgan Stanley forecasts a full year FY21 dividend of 156.30 cents and EPS of 305.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 287.3, implying annual growth of 18.9%. Current consensus DPS estimate is 146.5, implying a prospective dividend yield of 1.3%. Current consensus EPS estimate suggests the PER is 39.8. |
Market Sentiment: -0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Morgans rates REA as Reduce (5) -
The company is witnessing early signs of a recovery in listings volumes but acknowledges second half profit targets may be difficult to meet. Continued weakness in new for-sale listings continues to grind down revenue, Morgans observes.
Forecasts are downgraded to reflect the weak start to FY20. The broker retains a Reduce rating and lowers the target to $89.93 from $90.41.
Target price is $89.93 Current Price is $114.40 Difference: minus $24.47 (current price is over target).
If REA meets the Morgans target it will return approximately minus 21% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $101.52, suggesting downside of -11.3% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY20:
Morgans forecasts a full year FY20 dividend of 118.00 cents and EPS of 242.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 241.7, implying annual growth of 203.3%. Current consensus DPS estimate is 122.1, implying a prospective dividend yield of 1.1%. Current consensus EPS estimate suggests the PER is 47.3. |
Forecast for FY21:
Morgans forecasts a full year FY21 dividend of 130.00 cents and EPS of 272.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 287.3, implying annual growth of 18.9%. Current consensus DPS estimate is 146.5, implying a prospective dividend yield of 1.3%. Current consensus EPS estimate suggests the PER is 39.8. |
Market Sentiment: -0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Ord Minnett rates REA as Lighten (4) -
First half net profit was significantly below Ord Minnett's forecasts. While the business is entering a period of easier comparables, initial data from January suggests the rebound in property listings is not a strong as the broker had hoped.
Ord Minnett reduces FY20 earnings estimates by -6.8%. The broker maintains a Lighten rating and raises the target to $99 from $90 as the model is rolled forward to June 2021.
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 $114.40 Difference: minus $15.4 (current price is over target).
If REA meets the Ord Minnett target it will return approximately minus 13% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $101.52, suggesting downside of -11.3% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY20:
Ord Minnett forecasts a full year FY20 EPS of 231.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 241.7, implying annual growth of 203.3%. Current consensus DPS estimate is 122.1, implying a prospective dividend yield of 1.1%. Current consensus EPS estimate suggests the PER is 47.3. |
Forecast for FY21:
Ord Minnett forecasts a full year FY21 EPS of 285.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 287.3, implying annual growth of 18.9%. Current consensus DPS estimate is 146.5, implying a prospective dividend yield of 1.3%. Current consensus EPS estimate suggests the PER is 39.8. |
Market Sentiment: -0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
UBS rates REA as Neutral (3) -
On an initial assessment, first half operating earnings (EBITDA) missed UBS estimates.
The company has guided that the rate of revenue growth will exceed the rate of cost growth over FY20 with full year revenue growth dependent on improved listing conditions in the second half.
Neutral rating and $105 target maintained.
Target price is $105.00 Current Price is $114.40 Difference: minus $9.4 (current price is over target).
If REA meets the UBS target it will return approximately minus 8% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $101.52, suggesting downside of -11.3% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY20:
UBS forecasts a full year FY20 dividend of 123.00 cents and EPS of 246.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 241.7, implying annual growth of 203.3%. Current consensus DPS estimate is 122.1, implying a prospective dividend yield of 1.1%. Current consensus EPS estimate suggests the PER is 47.3. |
Forecast for FY21:
UBS forecasts a full year FY21 dividend of 148.00 cents and EPS of 295.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 287.3, implying annual growth of 18.9%. Current consensus DPS estimate is 146.5, implying a prospective dividend yield of 1.3%. Current consensus EPS estimate suggests the PER is 39.8. |
Market Sentiment: -0.3
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $2.53
Macquarie rates S32 as Underperform (5) -
Macquarie expects a weaker first half result when the company reports on February 13. Commodity price headwinds are significant. The broker expects free cash flow to decrease -46% half on half.
An interim dividend of US1c is forecast. Macquarie maintains an Underperform rating and $2.20 target.
Target price is $2.20 Current Price is $2.53 Difference: minus $0.33 (current price is over target).
If S32 meets the Macquarie target it will return approximately minus 13% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $2.85, suggesting upside of 12.8% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY20:
Macquarie forecasts a full year FY20 dividend of 2.75 cents and EPS of 6.79 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 8.0, implying annual growth of N/A. Current consensus DPS estimate is 4.8, implying a prospective dividend yield of 1.9%. Current consensus EPS estimate suggests the PER is 31.6. |
Forecast for FY21:
Macquarie forecasts a full year FY21 dividend of 7.37 cents and EPS of 18.50 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 21.5, implying annual growth of 168.8%. Current consensus DPS estimate is 11.2, implying a prospective dividend yield of 4.4%. Current consensus EPS estimate suggests the PER is 11.8. |
This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.4
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $31.42
Credit Suisse rates SHL as Neutral (3) -
Going into the first half result, due February 19, Credit Suisse envisages low risk to FY20 guidance.
The broker makes minor changes to forecasts, lowering the risk-free rate to 3.0% on sustained lower bond yields and consistent with the rest of the sector.
Neutral maintained. Target rises to $31.80 from $26.80.
Target price is $31.80 Current Price is $31.42 Difference: $0.38
If SHL meets the Credit Suisse target it will return approximately 1% (excluding dividends, fees and charges).
Current consensus price target is $29.98, suggesting downside of -4.6% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY20:
Credit Suisse forecasts a full year FY20 dividend of 89.00 cents and EPS of 120.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 123.4, implying annual growth of 0.7%. Current consensus DPS estimate is 89.0, implying a prospective dividend yield of 2.8%. Current consensus EPS estimate suggests the PER is 25.5. |
Forecast for FY21:
Credit Suisse forecasts a full year FY21 dividend of 95.00 cents and EPS of 132.00 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 131.2, implying annual growth of 6.3%. Current consensus DPS estimate is 93.3, implying a prospective dividend yield of 3.0%. Current consensus EPS estimate suggests the PER is 23.9. |
Market Sentiment: 0.2
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
More Research Tools In Stock Analysis - click HERE
Overnight Price: $11.77
Citi rates TWE as Neutral (3) -
Citi believes investors should focus on the price performance in key segments in the US. In the most recent half-year, the company's prices fell by -10% in the US$11-plus per bottle category.
Price declines in this category have been in evidence for more than a year. The challenge for the company, in the broker's view, is its 43% of wine sold on promotion, versus the industry at 38%.
The outlook for developed wine markets remains challenged as global wine supply is high while Australian grape prices are rising. Citi retains a Neutral rating and $13.70 target.
Target price is $13.70 Current Price is $11.77 Difference: $1.93
If TWE meets the Citi target it will return approximately 16% (excluding dividends, fees and charges).
Current consensus price target is $14.58, suggesting upside of 23.9% (ex-dividends)
The company's fiscal year ends in June.
Forecast for FY20:
Citi forecasts a full year FY20 dividend of 41.00 cents and EPS of 62.40 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 62.2, implying annual growth of 6.5%. Current consensus DPS estimate is 40.9, implying a prospective dividend yield of 3.5%. Current consensus EPS estimate suggests the PER is 18.9. |
Forecast for FY21:
Citi forecasts a full year FY21 dividend of 47.00 cents and EPS of 70.70 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 70.7, implying annual growth of 13.7%. Current consensus DPS estimate is 47.6, implying a prospective dividend yield of 4.0%. Current consensus EPS estimate suggests the PER is 16.6. |
Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
Overnight Price: $33.46
Morgan Stanley rates WPL as Equal-weight (3) -
CNOOC has declared force majeure on some LNG contracts with Woodside Petroleum. It's not a material risk, the broker points out, given some contracts were set back in the early 2000s at low prices.
The broker doesn't believe China would not ultimately accept the volumes, but Woodside could always sell committed volumes on the spot market.
Equal-weight and $33 target retained. Industry view: In Line.
Target price is $33.00 Current Price is $33.46 Difference: minus $0.46 (current price is over target).
If WPL meets the Morgan Stanley target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).
Current consensus price target is $36.73, suggesting upside of 9.8% (ex-dividends)
The company's fiscal year ends in December.
Forecast for FY19:
Morgan Stanley forecasts a full year FY19 EPS of 174.28 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 173.2, implying annual growth of N/A. Current consensus DPS estimate is 136.7, implying a prospective dividend yield of 4.1%. Current consensus EPS estimate suggests the PER is 19.3. |
Forecast for FY20:
Morgan Stanley forecasts a full year FY20 EPS of 218.93 cents. How do these forecasts compare to market consensus projections? Current consensus EPS estimate is 212.2, implying annual growth of 22.5%. Current consensus DPS estimate is 162.5, implying a prospective dividend yield of 4.9%. Current consensus EPS estimate suggests the PER is 15.8. |
This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.
Market Sentiment: 0.4
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 | |
| ANN | ANSELL | $32.00 | Credit Suisse | 31.90 | 30.00 | 6.33% |
| BLD | BORAL | $4.59 | Credit Suisse | 4.45 | 4.50 | -1.11% |
| COH | COCHLEAR | $244.61 | Credit Suisse | 240.00 | 211.00 | 13.74% |
| CTD | CORPORATE TRAVEL | $17.38 | Ord Minnett | 25.53 | 27.40 | -6.82% |
| EVT | EVENT HOSPITALITY | $12.51 | Ord Minnett | 15.00 | 15.13 | -0.86% |
| EXP | EXPERIENCE CO | $0.21 | Ord Minnett | 0.28 | 0.33 | -15.15% |
| FLT | FLIGHT CENTRE | $37.85 | Citi | 41.60 | 42.90 | -3.03% |
| Macquarie | 39.00 | 39.10 | -0.26% | |||
| Ord Minnett | 41.38 | 46.09 | -10.22% | |||
| HLO | HELLOWORLD | $4.23 | Ord Minnett | 6.24 | 6.51 | -4.15% |
| HRL | HRL HOLDINGS | $0.13 | Morgans | 0.16 | 0.14 | 14.29% |
| NWS | NEWS CORP | $21.67 | Credit Suisse | 23.90 | 23.80 | 0.42% |
| ORA | ORORA | $3.14 | Ord Minnett | 3.20 | 3.15 | 1.59% |
| PTM | PLATINUM | $4.76 | Morgan Stanley | 3.50 | 3.35 | 4.48% |
| QAN | QANTAS AIRWAYS | $6.43 | UBS | 7.25 | 7.30 | -0.68% |
| REA | REA GROUP | $114.40 | Credit Suisse | 100.20 | 100.80 | -0.60% |
| Morgans | 89.93 | 90.41 | -0.53% | |||
| Ord Minnett | 99.00 | 90.00 | 10.00% | |||
| RHC | RAMSAY HEALTH CARE | $79.08 | Credit Suisse | 75.00 | 65.00 | 15.38% |
| SHL | SONIC HEALTHCARE | $31.42 | Credit Suisse | 31.80 | 26.80 | 18.66% |
| SLK | SEALINK TRAVEL | $4.06 | Ord Minnett | 5.53 | 5.85 | -5.47% |
| WEB | WEBJET | $12.62 | Ord Minnett | 21.00 | 21.05 | -0.24% |
Summaries
| AZJ | AURIZON HOLDINGS | Neutral - Citi | Overnight Price $5.47 |
| BLD | BORAL | Downgrade to Underperform from Neutral - Credit Suisse | Overnight Price $4.59 |
| COH | COCHLEAR | Neutral - Credit Suisse | Overnight Price $244.61 |
| CWN | CROWN RESORTS | Neutral - UBS | Overnight Price $11.68 |
| FLT | FLIGHT CENTRE | Neutral - Citi | Overnight Price $37.85 |
| Neutral - Macquarie | Overnight Price $37.85 | ||
| Overweight - Morgan Stanley | Overnight Price $37.85 | ||
| Downgrade to Hold from Buy - Ord Minnett | Overnight Price $37.85 | ||
| Buy - UBS | Overnight Price $37.85 | ||
| HRL | HRL HOLDINGS | Add - Morgans | Overnight Price $0.13 |
| JBH | JB HI-FI | Neutral - Citi | Overnight Price $44.87 |
| NWS | NEWS CORP | Outperform - Credit Suisse | Overnight Price $21.67 |
| Underweight - Morgan Stanley | Overnight Price $21.67 | ||
| Buy - UBS | Overnight Price $21.67 | ||
| PTM | PLATINUM | Underweight - Morgan Stanley | Overnight Price $4.76 |
| QAN | QANTAS AIRWAYS | Buy - UBS | Overnight Price $6.43 |
| REA | REA GROUP | Underperform - Credit Suisse | Overnight Price $114.40 |
| Overweight - Morgan Stanley | Overnight Price $114.40 | ||
| Reduce - Morgans | Overnight Price $114.40 | ||
| Lighten - Ord Minnett | Overnight Price $114.40 | ||
| Neutral - UBS | Overnight Price $114.40 | ||
| S32 | SOUTH32 | Underperform - Macquarie | Overnight Price $2.53 |
| SHL | SONIC HEALTHCARE | Neutral - Credit Suisse | Overnight Price $31.42 |
| TWE | TREASURY WINE ESTATES | Neutral - Citi | Overnight Price $11.77 |
| WPL | WOODSIDE PETROLEUM | Equal-weight - Morgan Stanley | Overnight Price $33.46 |
RATING SUMMARY
| Rating | No. Of Recommendations |
| 1. Buy | 7 |
| 3. Hold | 11 |
| 4. Reduce | 1 |
| 5. Sell | 6 |
Monday 10 February 2020
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Disclaimer:
The content of this information does in no way reflect the opinions of
FNArena, or of its journalists. In fact we don't have any opinion about
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
with a valuable tool that helps them in making up their own minds, reading
market trends and getting a feel for what is happening beneath the surface.
This document is provided for informational purposes only. It does not
constitute an offer to sell or a solicitation to buy any security or other
financial instrument. FNArena employs very experienced journalists who
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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