FXJ - Citi rates the stock as Upgrade to Buy
BY BROKER NEWS - 17/03/2010
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• FXJ - FAIRFAX MEDIA LIMITED
On the back of increased growth projections for the Australian economy in general by Citi economists, the team of media analysts has translated this into higher expectations for advertising. And who's leveraged to this? Australian media companies. Fairfax Media's rating has thus been upgraded to Buy and the price target jumps to $2.12 from $1.59.
While the increase in profit expectations remains a modest 5% for the present fiscal year, the impact on following years is much larger: FY11 went up by 25% to 12.6c and FY12 went up by 13% to 15c. Imagine, previous estimates assumed a lower EPS figure for FY11 than in FY10 while the latter estimate was 5% below where it is now.
Sector: Media.
Target price is $2.12.Current Price is $1.76. Difference: $0.36 - (brackets indicate current price is over target). If FXJ meets the Citi target it will return approximately 17% (excluding dividends, fees and charges - negative figures indicate an expected loss).
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