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

Macquarie rates DDR as Outperform

Macquarie assesses its upgrade going into the first half results for Dicker Data was well founded with turnover growth strong. Relative to the January-April update, gross profit increased to 9.8% in the first half, implying 10.4% across May-June. AI sales also accelerated.

The broker retains conservative assumptions for 2026, forecasting 34% pre-tax profit growth, slowing to 7% in 2027. On the positive side, AI deals and a return to supply in NZ are countered by negative catalysts such as rate increases and the emergence of hardware supply constraints.

Outperform rating. Target is raised to $16.70 from $12.85.

Bell Potter rates IRI as Downgrade to Hold from Buy

Integrated Research's FY26 result was better than Bell Potter expected, with revenue down -16% y/y but 1% ahead of forecast and towards the top end of guidance.

The EBITDA loss of -$2.1m was also better than the broker's -$3.1m forecast, while an unexpected 3c final dividend and 2c special dividend provided the major positive surprise.

The analyst observes visibility remains limited with the FY27 renewals book weighted to 2H27 and management continuing to invest in new products and product-led growth, which is expected to weigh on near-term profitability.

FY27/FY28 EBITDA forecasts are lowered by -7%/-29%, although the broker expects management to return to positive EBITDA and NPAT in both periods.

Bell Potter downgrades to Hold from Buy and lowers its target price to $0.36 from $0.38.

Citi rates NXT as Buy

In a follow-up to initial research on NextDC's FY26 results last week, Citi highlights bullish management commentary on the demand pipeline. The S4 data centre is expected to be sold out in FY27, with further large contracts dependent on development approvals.

The broker views plans to shorten construction times positively, particularly as build-to-suit developments have only recently become a greater focus.

While operational results were solid, Citi believes a re-rating will require greater clarity on the future funding structure, particularly for hyperscale developments.

Separately, Citi sees Nvidia reportedly pausing revenue-sharing deals with neoclouds as broadly neutral for NextDC.

Neoclouds represent only a small portion of NextDC's contracted order book and do not appear to comprise a significant part of the pipeline, the broker observes.

Target $19.10. Buy.

First take: Citi highlights NextDC's FY26 underlying EBITDA of $248m, up 15% y/y, was 4% ahead of both the broker's forecast and consensus, primarily due to stronger-than-expected net revenue, while operating costs were slightly better than forecast.

The underlying NPAT loss of -$22m was also substantially better than Citi's -$103m estimate, helped by a tax benefit and lower net finance costs.