Whitehaven Coal's FY20 first half result fell 10% shy of the broker, thanks to higher than expected depreciation, and the dividend fell about 70% shy of consensus, albeit in line with the distribution policy.

Nonetheless, Morgans takes comfort in the balance sheet (gearing of 15.4%) combined with reconfirmed guidance for a second-half operational recovery.

The thermal price outlook remains uncertain given the coronavirus and the LNG oversupply but the broker believes this is captured in the share price. Target price falls to $3.12 from $3.46. Add rating retained given the stock is trading at a 30% discount to the target price.

Sector: Energy.

Target price is $3.12.Current Price is $2.24. Difference: $0.88 - (brackets indicate current price is over target). If WHC meets the Morgans target it will return approximately 28% (excluding dividends, fees and charges - negative figures indicate an expected loss).

© 2020 Acquisdata Pty Ltd., source FN Arena