First-half results were ahead of estimates on the back of higher volumes and continued improvements in costs. Credit Suisse estimates the company could raise the dividend to $0.10 a share and keep gearing below 15% over the next five years.
However, the broker suspects Beach Energy will, and should, pursue further acquisitions instead. Outperform rating maintained. Target is raised to $1.91 from $1.75.
Target price is $1.91.Current Price is $1.78. Difference: $0.13 – (brackets indicate current price is over target). If BPT meets the Credit Suisse target it will return approximately 7% (excluding dividends, fees and charges – negative figures indicate an expected loss).