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

Citi rates NXT as Buy

Citi views NextDC's $1.5bn equity raising, expanded hybrid issuance to $1.7bn and 250MW contract win as positive. It's felt these transactions highlight strong demand and the company’s ability to secure large hyperscale deals.

The capital raise is seen as removing a funding overhang by bringing forward funding requirements. Pricing for the new contract is also stronger than the broker had expected.

Management highlighted a favourable pricing environment amid ongoing supply constraints and flagged potential for joint venture structures,alongside exploring securitisation of cash flows.

Focus is likely to shift to the return profile of the contract and whether a similar funding structure will be used for future developments, including S7, the analyst suggests.

Target $19. Buy.

Morgans rates SUL as Downgrade to Hold from Accumulate

Morgans lowers forecasts for Super Retail, amid a more cautious outllook for consumer discretionary expenditure, and a view that the stock remains cyclically exposed. FY26-28 EPS forecasts are lowered by -6%-7%.

The broker considers Supercheap Auto best placed within the group, given a relatively defensive exposure, and remains careful regarding the outlook for Rebel and BCF, given greater sensitivity to the economic cycle and affordability.

Macpac has shown good momentum, the broker adds. Target is reduced to $12.90 from $17.00 and the rating is downgraded to Hold from Accumulate.

UBS rates WOR as Buy

UBS observes Middle East disruptions are impacting Worley’s near-term outlook due to productivity challenges and project delays.

Management now estimates a -$30m-40m adverse impact to FY26 underlying earnings (EBITA), implying to the broker around -4% downside to the consensus estimate.

While no project cancellations have been reported, the company is unlikely to meet prior guidance for moderate earnings growth (on its own admission).

Ongoing headwinds are anticipated while the conflict persists, but the broker sees longer-term upside from repair work and increased energy investment.

UBS lowers its target to $17.50 from $19.00 on earnings forecast downgrades and retains a Buy rating.