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

Citi rates ANZ as Buy

Citi notes the outlook for Australian banks is becoming more stagflationary, with forecasts for higher interest rates alongside weaker growth and elevated inflation.

While potential additional rate hikes provide modest support to margins, this is expected to be offset by slower credit growth and rising credit costs.

The broker cautions that, despite recent market resilience, persistent inflation pressures may weigh on bank fundamentals and limit earnings upside.

Regarding results on May 1, Citi expects ANZ Bank's 1H26 cash profit of $3.8bn will be broadly in line with consensus, with a modest beat driven by operating costs skewing to the second half as investment spending ramps up.

Buy. Target $40.30.

This research was released by Citi on April 13.

Macquarie rates GQG as Neutral

GQG Partners announced net outflows of -US$1.2bn in March, an improvement on the outflow of -US$3.2bn in Feb and -US$4.1bn in Jan, and better than Macquarie's forecast at -US$2.2bn and consensus of -US$1.6bn).

FUM of US$162.5bn proved in line with expectations.

The broker notes outflows were driven by Emerging Markets down -US$0.8bn, or -22.8%, and Global down -US$0.3bn, or -9.1%, while International and US were broadly flat.

Recent fund performance has improved, although longer-term returns remain weak, including Global down -14.5% (1yr) and EM down -16.9% (1yr).

Macquarie lowers EPS forecasts slightly reflecting marginally higher assumed outflows of -11.9%. Neutral retained with an unchanged $1.60 target price.

Macquarie rates STO as Outperform

Macquarie expects a mixed 1Q update from Santos, forecasting production of 23.2MMboe and sales of 22.9MMboe, both below consensus, with revenue of US$1,245m broadly in line.

Delays at Barossa and Pikka are expected to weigh on near-term volumes, although a sequential uplift is expected through 2026 as both projects ramp.

Management's FY26 guidance of 101–111MMboe is still expected to be met at the lower end, versus consensus of 103.5MMboe.

The analyst highlights a potential US$1.3bn post-tax earnings tailwind in 2026 from higher commodity prices, alongside positive Quokka-1 appraisal results supporting Alaska development.

EPS forecasts are cut -9% for 2026, with minor downgrades beyond. Outperform retained with an unchanged $8.75 target.