Australian Broker Call *Extra* Edition – Jun 07, 2022

Daily Market Reports | 10:56 AM

An additional news report on the recommendation, valuation, forecast and opinion changes for ASX-listed equities.

In addition to The Australian Broker Call Report, which is published and updated daily (Mon-Fri), FNArena has now added The Australian Broker Call *Extra* Edition, featuring additional sources of research and insights on ASX-listed stocks, also enlarging the number of stocks that make up the FNArena universe.

One key difference is the *Extra* Edition will not be updated daily, but merely “regularly” depending on availability of suitable quality content. As such, the *Extra* Edition tries to build a bridge between daily updates via the Australian Broker Call Report and ad hoc news stories, that are not always timely for investors hungry for the next information update.

Investors using the *Extra* Edition as a source of input for their own share market research should thus take into account that information after publication may not be up to date, or yet awaiting another update by FNArena’s team of journalists.

Similar to The Australian Broker Call Report, this *Extra* Edition includes concise but limited reviews of research recently published by Stockbrokers and other experts, 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 of this Report.

The Australian Broker Call *Extra* Edition is a summary that has been prepared independently of the sources identified. Readers will check the full text of the recommendations and consult a Licenced Advisor before making any investment decision.

The copyright of this Report is owned by the publisher. Readers will not copy, forward or disseminate this Report to any other person. For more vital information about the sources included, see the bottom of this Report.

COMPANIES DISCUSSED IN THIS ISSUE

Click on a symbol for fast access.
The number next to the symbol represents the number of brokers covering it for this report -(if more than 1)

AOF   BHP   CAI   COE   DEG   JHX   JLG   LGP   MSB   NXS   PEB   PME (2)   REA   TGR   WES  

AOF    AUSTRALIAN UNITY OFFICE FUND

REITs – Overnight Price: $2.42

Moelis rates ((AOF)) as Hold (3) –

Australian Unity Office Fund has received an indicative proposal from Aliro Group to acquire outstanding units for $2.45 each, cash. The largest shareholder, Hume Partners, has supported the proposal.

In the event of a firm offer, investors would be given the option to realise a valuation relatively close to the current net tangible assets or hold shares in the stock while the portfolio is re-positioned.

Moelis believes a substantial outlay will be required in order to reposition several buildings in the portfolio to a point where they can become competitive. Hold rating and $2.34 target maintained.

This report was published on May 30, 2022.

Target price is $2.34 Current Price is $2.42 Difference: minus $0.08 (current price is over target).
If AOF meets the Moelis target it will return approximately minus 3% (excluding dividends, fees and charges – negative figures indicate an expected loss).
The company’s fiscal year ends in June.

Forecast for FY22:

Moelis forecasts a full year FY22 dividend of 15.20 cents and EPS of 18.40 cents.
At the last closing share price the estimated dividend yield is 6.28%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 13.15.

Forecast for FY23:

Moelis forecasts a full year FY23 dividend of 10.10 cents and EPS of 12.30 cents.
At the last closing share price the estimated dividend yield is 4.17%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 19.67.

Market Sentiment: 0.0
All consensus data are updated until yesterday. FNArena’s consensus calculations require a minimum of three sources

BHP    BHP GROUP LIMITED

Bulks – Overnight Price: $46.34

Goldman Sachs rates ((BHP)) as Resume Coverage with Buy (1) –

Goldman Sachs resumes coverage with a Buy rating, noting an attractive valuation and cash flow remain post the completed oil de-merger.

The broker believes the premium versus peers can be maintained because of superior margins and operating performance, particularly in Pilbara iron ore as well as high-returning copper growth. Target is $51.20.

This report was published on June 2, 2022.

Target price is $51.20 Current Price is $46.34 Difference: $4.86
If BHP meets the Goldman Sachs target it will return approximately 10% (excluding dividends, fees and charges).
Current consensus price target is $47.79, suggesting upside of 2.7%(ex-dividends)
The company’s fiscal year ends in June.

Forecast for FY22:

Goldman Sachs forecasts a full year FY22 dividend of 483.43 cents and EPS of 647.77 cents.
At the last closing share price the estimated dividend yield is 10.43%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 7.15.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 623.7, implying annual growth of N/A.
Current consensus DPS estimate is 581.5, implying a prospective dividend yield of 12.5%.
Current consensus EPS estimate suggests the PER is 7.5.

Forecast for FY23:

Goldman Sachs forecasts a full year FY23 dividend of 388.94 cents and EPS of 534.10 cents.
At the last closing share price the estimated dividend yield is 8.39%.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 8.68.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 539.7, implying annual growth of -13.5%.
Current consensus DPS estimate is 428.2, implying a prospective dividend yield of 9.2%.
Current consensus EPS estimate suggests the PER is 8.6.

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

CAI    CALIDUS RESOURCES LIMITED

Gold & Silver – Overnight Price: $0.83

Canaccord Genuity rates ((CAI)) as Speculative Buy (1) –

Calidus Resources has recently completed the commissioning of the Warrawoona processing plant and poured first gold from the CIL circuit.

Canaccord Genuity reports the focus has turned to exploration with drilling at Blue Spec East highlighting the potential for an open pit. The company expects Warrawoona will produce 80,000 ounces per annum over an eight-year mine life for an AISC (all-in costs) of $1292/oz.

Canaccord Genuity maintains a Speculative Buy rating and target of $1.20.

This report was published on June 2, 2022.

Target price is $1.20 Current Price is $0.83 Difference: $0.37
If CAI meets the Canaccord Genuity target it will return approximately 45% (excluding dividends, fees and charges).
The company’s fiscal year ends in June.

Forecast for FY22:

Canaccord Genuity forecasts a full year FY22 dividend of 0.00 cents and EPS of minus 1.00 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is minus 83.00.

Forecast for FY23:

Canaccord Genuity forecasts a full year FY23 dividend of 0.00 cents and EPS of 16.00 cents.
At the last closing share price the stock’s estimated Price to Earnings Ratio (PER) is 5.19.

All consensus data are updated until yesterday. FNArena’s consensus calculations require a minimum of three sources