Bell Potter released an updated broker research report on ERD on 14 April 2021 and increased their 12 month price target from $4.87 to $5.62.  

If you read the report though, the new Australian contract resulted "in very minor revisions to our EPS estimate (<0.1%).  We roll forward our DCF, reflecting the end of FY21e (March YE), increasing our Price Target to A$5.62ps".

The change in target price from $5.62 to $4.87 is $0.75, a +15.4% increase.

I highly doubt the value derived from these estimated DCF calculations in a company that is still cash flow negative and with the Bell Potter analyst estimates of -$9.1m free cash flow (FCF) in FY22 to +$49.4m FCF in FY31. That is a huge assumption.

 [Disclosure: I hold but purchased around $3.70]

Bell Potter Initiates coverage of ERD with a 12 month target price of $4.87.

For FY21, they estimate sales of NZ$85.3; Underlying EBITDA $30.0 and NPAT of $1.7.m.

With a current market cap of $328m, looks expensive from the EBITDA and NPAT persective.