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

Macquarie rates AIA as Outperform

The NZ Commerce Commission is reviewing common rules for cost-of-capital across airports and other regulated infrastructure. The confirmed move to a five-year trailing risk-free rate for cost of debt reduces Macquarie's estimated post-tax mid-point WACC by -14 basis points, all else being equal.

A potential -30 basis points cut in the revised draft TAMRP methodology could lower the allowance to 6.5% from 7.0%, reducing Auckland International Airport's WACC by a further -30 basis points.

The changes are expected to reduce volatility in allowable returns between regulatory periods but the timing may concern investors, the broker suspects, given the recent increase in risk-free rates.

Outperform. Target is NZ$9.31.

Citi rates BPT as Sell

Ahead of September-quarter results, Citi adopts a more constructive outlook for oil and gas.

The broker upgrades 2026 core earnings forecasts for Woodside Energy and Santos by double-digit percentages on higher commodity prices.

Operational execution remains the key differentiator, the analyst explains, with Buy-rated Santos entering a free cash flow (FCF) expansion phase as Barossa reaches nameplate capacity and capex moderates.

Woodside Energy (Neutral) is seen as offering greater exposure to higher Asian LNG prices, but Scarborough commissioning remains critical.

Among smaller producers, Sell-rated Beach Energy must demonstrate improved Waitsia reliability, while Karoon Energy (Buy) seeks to restore investor confidence, the broker believes.

Citi sees value in Santos and Karoon, with Middle East conflict risks underpriced.

Target of 80c for Beach Energy.

Bell Potter rates OMA as Speculative Buy

Omega Oil & Gas has results from the Canyon-4 well on its acreage which intersected a 589m gross oil and gas-bearing sequence with 197m of aggregate net pay.

Multiple reservoir levels were intersected through the full Permian sequence to a total depth of 4,017m.

Bell Potter observes it improves the Canyon-3 results released in late August 2026 in terms of net pay and reservoir quality.

The company is de-risking a new unconventional oil and gas play near Australia's east coast energy markets.

Speculative Buy rating maintained. Target is $1.40.