Just got this in an email today ...
Friday, 5 April 2024ELD - ELDERS LIMITED
Macquarie rates ELD as Upgrade to Outperform from Neutral (1) - Macquarie raises its target for Elders to $10.45 from $7.12 and upgrades the rating to Outperform from Neutral after adopting profit forecasts around 10% ahead of consensus over FY24 and FY25.
These higher forecasts are based on a more positive view on both the seasonal outlook and livestock prices. Above average rainfall at the end of 2023 on the east coast of Australia is expected to result in a strong winter plant over April to June.
Also, the National Oceanic and Atmospheric Administration (NOAA) in the US is suggesting a 62% probability of La Nina conditions emerging later in the year, providing the analyst with confidence for the 2024/25 season.
Livestock prices have rebounded from depressed levels, and Macquarie expects strong demand for Australian beef (particularly out of the US as slaughter rates decline) will underpin prices over FY24/25.
The broker's target price is also boosted by a multiple re-rate and lower discount applied thanks to a dissipation of El Nino/weather risk.
Target price is $10.45 Current Price is $9.61 Difference: $0.84 If ELD meets the Macquarie target it will return approximately 9% (excluding dividends, fees and charges). Current consensus price target is $9.06, suggesting downside of -5.7%(ex-dividends)The company's fiscal year ends in September.
Forecast for FY24:
Macquarie forecasts a full year FY24 dividend of 41.10 cents and EPS of 68.80 cents . At the last closing share price the estimated dividend yield is 4.28%. At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.97. How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 63.2, implying annual growth of -1.9%. Current consensus DPS estimate is 38.9, implying a prospective dividend yield of 4.0%. Current consensus EPS estimate suggests the PER is 15.2.
Forecast for FY25:
Macquarie forecasts a full year FY25 dividend of 48.00 cents and EPS of 78.50 cents . At the last closing share price the estimated dividend yield is 4.99%. At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.24. How do these forecasts compare to market consensus projections?
Current consensus EPS estimate is 70.3, implying annual growth of 11.2%. Current consensus DPS estimate is 43.7, implying a prospective dividend yield of 4.5%. Current consensus EPS estimate suggests the PER is 13.7.
Market Sentiment: 0.3All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources
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