OUR QUEST IS NOT TO BE BULLISH OR BEARISH, BUT TO CORRECTLY ASSESS FUTURE TRENDS

Citi rates IFT as Buy

Following Infratil's Investor Day highlighting strong exposure to global AI infrastructure, Citi reiterates a Buy rating for its top Australian infrastructure pick. Target $15.18. Superior defensive growth and enduring multi-decade compounding power are noted.

Contracted growth at CDC Data Centres and Longroad alone is expected to match FY27 group earnings guidance by FY29/FY30.

CDC remains the portfolio's key asset, with a 28.7-year weighted average lease expiry (WALE), zero historical churn and readiness for hyperscale liquid cooling.

CDC is targeting $2.2bn of earnings (EBITDA) by FY30 versus $710m-$750m in FY27, the analyst highlight.

Citi notes higher interest rates are substantially mitigated by hedging, development cost pass-throughs and higher development pricing.

Morgans rates JHX as Upgrade to Accumulate from Hold

James Hardie Industries investor day in NY on Sept 15 was combined with Azek Investor Day and titled "built to outperform and resilient by design", Morgans points out.

Management guided to 4%-7% organic sales growth which is above consensus, and expected to be generated from growth initiatives and revenue synergies. Notably, the growth is not dependent on a recovery in the US housing sector.

FY27 guidance was reiterated and the FY27 free cash flow target has been raised. The organic growth is expected to achieve 35%-plus adj EBITDA margin, which the analyst believes will support a robust EPS outlook.

The stock is upgraded to Accumulate from Hold with a slightly lower target price of $43 from $45. The broker views James Hardie as a high-quality building materials stock which has been de-rated below its historical average PER valuation, which is viewed as an opportunity.

Macquarie rates RWC as Downgrade to Neutral from Outperform

Reliance Worldwide has now signed a binding agreement with Brookfield at US$3.38/share and the transaction should be completed by the first quarter of 2027, subject to various approvals.

Macquarie notes there is scope for a superior proposal and any such proposal is likely to come from a strategic buyer, with synergies helping to justify a higher price. Brookfield has committed up to US$1.5bn in equity and US$1.65bn in debt funding.

The agreement materially improves transaction certainty and, as the current share price captures most of the deal, the broker downgrades to Neutral from Outperform. Target is steady at $4.75.