Jefferies cuts rating, PT for Emeco on weak FY23 outlook

Emeco Holdings

17/11/2022 20:59

** Jefferies lowers its price target and rating for Emeco
Holdings  EHL.AX  as the Australian mining equipment provider
cuts its FY23 forecasts
    ** Brokerage cuts price target to A$0.85 from A$1.00, rating
to "hold" from "buy"
    ** Says EHL's FY23 revised operating EBITDA guidance of
A$245 mln ($163.73 mln) to A$260 mln is 5% below brokerage's
estimate of A$265 mln at midpoint  urn:newsml:reuters.com:*:nL4N32C4AZ
    ** Says EHL management's earlier estimates of greater than
5% increase in FY23 EBITDA now looks unattainable 
    ** Further adds that the key attraction for owning EHL stock
has fallen away with the A$32 mln payment recovery issue
andconfidence in the quality of cash flows has been impacted
 urn:newsml:reuters.com:*:nL4N31F0ZZ
    ** Brokerage cuts its FY23 EBITDA forecast by 8% to come in
line with EHL's outlook
    ** Also cuts its FY24-25 EBITDA forecasts by 1-2%, which
sees NPAT fall by 4% each year
    ** Five of six analysts rate the stock "buy" or higher, one
"hold"; their median PT is A$1.23 – Refinitiv data
    ** Stock had lost 17% this year, as of last close
($1 = 1.4963 Australian dollars)
 (Reporting by Echha Jain in Bengaluru)
 ((Echha.jain@thomsonreuters.com))