Jefferies expects strong retail earnings from Australian fuel retailers

Waypoint REIT

07/02/2023 20:43

** Jefferies expects earnings for Australia's Ampol  ALD.AX  and Viva Energy
 VEA.AX  to more than double, says retail margins through the Dec. quarter
remained well above the long-run average 
    ** Jefferies says the strong retail margins combined with COVID volume
recovery and robust shop sales should underpin strong retail earnings for both
the cos
    ** Jefferies expects optimistic outlook commentary by cos, says brokerage is
positive on both names given attractive valuations and yields
    ** Ampol (PT A$36.50, Buy): Brokerage forecasts full-year continuing RCOP
(Replacement cost operating profit) Earnings Before Interest and Taxes of
A$1,246 mln ($865.10 mln), making it the best result on record
    ** Viva Energy (PT A$3.25, BUY): Jefferies forecasts EBITDA of A$234 mln in
2H, which is below the A$371 million in 1H, but is still at very high levels 
    ** Six of 10 analysts rate VEA "buy" or higher, four "hold";  their median
PT is A$3.25- Refinitiv data  
    ** Eight of 10 analysts rate ALD "buy" or higher, two "hold"; their median
PT is A$36.50 – Refinitiv data     
    ** ALD and VEA have risen 9.8% and 7.3%, respectively, this year, as of last
close
($1 = 1.4403 Australian dollars)
 (Reporting by Nausheen Thusoo in Bengaluru)
 ((Nausheen.Thusoo@thomsonreuters.com;))