2023-24 Harvest Updates, page-96

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Wed, 6 Dec at 9:30 am

GNC - GRAINCORP LIMITED

Macquarie rates GNC as Outperform (1) - The Agricultural Bureau's December crop report was a positive surprise for Macquarie, and sees the broker lift its full year earnings forecast for GrainCorp by 2%.

The report outlined good growing conditions in both Victoria and southern New South Wales, more than offsetting less favourable conditions and crop yields from both Queensland and northern New South Wales.

In particular, Victoria saw a 12% increase to estimated crops, but the total east coast crop estimate was lifted 4% to sit 14% above the 20-year average.

The Outperform rating and target price of $9.70 are retained.

Target price is $9.70 Current Price is $7.48 Difference: $2.22 If GNC meets the Macquarie target it will return approximately 30% (excluding dividends, fees and charges). Current consensus price target is $8.75, suggesting upside of 16.9%(ex-dividends)The company's fiscal year ends in September.

Forecast for FY24:

Macquarie forecasts a full year FY24 dividend of 36.10 cents and EPS of 51.50 cents . At the last closing share price the estimated dividend yield is 4.83%. At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.52. How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 52.5, implying annual growth of -53.0%. Current consensus DPS estimate is 32.3, implying a prospective dividend yield of 4.3%. Current consensus EPS estimate suggests the PER is 14.2.

Forecast for FY25:

Macquarie forecasts a full year FY25 dividend of 28.90 cents and EPS of 41.50 cents . At the last closing share price the estimated dividend yield is 3.86%. At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.02. How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 46.2, implying annual growth of -12.0%. Current consensus DPS estimate is 27.5, implying a prospective dividend yield of 3.7%. Current consensus EPS estimate suggests the PER is 16.2.

Market Sentiment: 0.6All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources