Project delays and wet weather are a fact of life in the construction game, the broker notes, but they have put a dampener on Wagner’s FY19 performance to date and led to the broker cutting earnings forecasts by -15% and -11%% in FY19-20. Confidence has been lost given FY19 was meant to be the big year in infrastructure with FY20 looking uncertain.
The broker has not changed its view on the Wagner business but infra is “frustratingly” lumpy and prone to delays. Target falls to $4.11 from $4.43 but the share price fall means Add retained.
Target price is $4.11.Current Price is $3.49. Difference: $0.62 – (brackets indicate current price is over target). If WGN meets the Morgans target it will return approximately 15% (excluding dividends, fees and charges – negative figures indicate an expected loss).