Weekly Reports | 11:00 AM
A summary of the highlights from Broker Call Extra updates throughout the week past.
Broker Rating Changes (Post Thursday Last Week)
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GREATLAND RESOURCES LIMITED ((GGP)) Upgrade to Buy from Hold by Moelis.B/H/S: 0/0/0
Moelis upgrades its rating for Greatland Gold to Buy from Hold with a $11.00 target price following a first-quarter production report featuring gold production of 70.1koz and copper output of 2.9kt.
Production exceeded estimates on stronger-than-expected processing throughput and recoveries despite a planned 15-day mill shutdown, keeping the company on track to achieve FY27 production guidance of 260koz to 300koz.
Construction formally commenced at Havieron while development and drilling advanced at Telfer's West Dome ahead of upcoming resource and reserve updates in H2 FY27.
Moelis's estimates reflect updated capital expenditure timing and tax top-up payments, resulting in a -7.4% reduction to FY27 NPAT forecasts.
The analyst highlights that recent share price weakness provides an attractive entry point for investors seeking exposure to a large-scale, long-life gold asset.
GENESIS MINERALS LIMITED ((GMD)) Upgrade to Buy from Hold by Moelis.B/H/S: 0/0/0
Moelis upgrades its rating for Genesis Minerals to Buy from Hold with its target price increased to $8.00 from $7.90 following a September quarter production result featuring 72.1koz of gold alongside all-in sustaining costs of $2,966 per ounce.
Gold output marginally missed Moelis's estimate of 73.2koz, while costs exceeded expectations due to ongoing pressures in the Western Australian labour market.
Moelis adjusts earnings models to formally incorporate the anticipated Vault Minerals ((VAU)) merger, assuming an $875m cash inflow and a $500m consideration outflow, driving an 89.9% increase in FY28 net profit after tax estimates to $1,311.9m alongside a -9% reduction in the net present value per share to $7.28.
The analyst suggests the recent share price decline uncovers better valuation support, forecasting the combined balance sheet can sustain a 10c annual dividend.
Moelis identifies a $1.3bn pre-tax net present value for non-core Deflector, Mount Monger, and Sugar Zone operations, noting potential divestments could optimise the Leonora asset integration.
ORA BANDA MINING LIMITED ((OBM)) Buy by Moelis.B/H/S: 0/0/0
Moelis maintains a Buy rating for Ora Banda Mining with its target price decreased to $1.40 from $1.55 following a soft first-quarter production result featuring 33.3koz of gold output.
Operations fell short of estimates due to weather impacts and a planned shutdown at the Davyhurst processing facility, resulting in elevated all-in sustaining costs of $4,214 per ounce.
Elevated capital spending combined with lower sales volumes drove a material cash drawdown, leaving the quarter-end cash position at $207m.
The analyst anticipates the company will extend third-party toll treating to maximise headline production ounces, pushing near-term cost profiles higher.
Moelis's estimates incorporate these lower volume and higher cost assumptions, driving a -40.9% reduction in FY27 EPS forecasts to 6.1c and a -7.7% reduction in FY28 EPS estimates.
ORICA LIMITED ((ORI)) Upgrade to Buy from Overweight by Jarden.B/H/S: 0/0/0
Jarden upgrades to a Buy rating for Orica with its target price decreased to $26.00 from $26.40 ahead of the FY26 result scheduled for November.
Forecast FY26 underlying EBIT of $1,045m sits slightly ahead of consensus expectations of $1,039m.
The analyst notes a recent update provided confidence regarding US ammonium nitrate supply for FY27, though concerns remain over the short 12-month contract duration and potential margin impacts from higher sourcing costs.
The company intends to mitigate the cost impost through targeted savings initiatives.
Jarden downgrades core EPS estimates by -2% across FY27 and FY28 to account for weaker Blasting Solutions EBIT expectations, driving the target price reduction alongside updated valuation inputs.
SANDFIRE RESOURCES LIMITED ((SFR)) Upgrade to Neutral from Underweight by Jarden.B/H/S: 0/0/0
Jarden lifts its rating for Sandfire Resources to Neutral from Underweight with its target price at $20.50 following a soft start to FY27.
First-quarter copper equivalent production fell -18% quarter-on-quarter to 39kt, missing Jarden's estimates by -5%, while group EBITDA of US$272m missed expectations by -10%.
Management retained full-year production and cost guidance, though higher exploration expenditure drove a -4% reduction in forecast FY27 EBITDA to US$1.15bn.
The analyst notes valuation metrics remain supportive following a retracement of more than -20% from August peaks, with the stock trading at a modest -4% discount to valuation.
Long-term upside potential is backed by the high-quality Matsa and Motheo operations alongside ongoing exploration at the Kalkaroo project.
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ARISTOCRAT LEISURE LIMITED ((ALL)) Downgrade to Overweight from Buy by Jarden.B/H/S: 0/0/0
Jarden adjusts its rating for Aristocrat Leisure to Overweight from Buy with its target price increased to $67.00 from $66.00 ahead of upcoming full-year results.
Jarden expects an in-line FY26 result featuring EBITDA of $2,232m and EPS of 261cps.
Jarden details gaming leads performance with net installs reaching 5.0k, offsetting Interactive -6% and Digital -1% segment impacts.
Jarden highlights FY27 net installs are forecast at 4.5k, sitting -3% below consensus as Dragon Link peaks.
Jarden views stock quality as fully priced at 22x FY27 price-to-earnings multiples.
BOTANIX PHARMACEUTICALS LIMITED ((BOT)) Downgrade to Hold from Buy by Canaccord Genuity.B/H/S: 0/0/0
Canaccord Genuity reduces its rating for Botanix Pharmaceuticals to Hold from Buy with its target price reduced to $0.01 from $0.14 following a weaker-than-expected 1Q FY27 update.
Both prescription volumes and gross-to-net yield missed expectations, with Sofdra net revenue remaining flat quarter-on-quarter.
Management implemented cost reductions targeting approximately -50% reduction in operating expenditure and approximately -60% reduction in headcounts, though Canaccord expects these measures to constrain top-line growth.
Updated estimates reflect lowered FY27-FY29 sales forecasts by -24%-43% following the restructure.
KAROON ENERGY LIMITED ((KAR)) Overweight by Jarden.B/H/S: 0/0/0
Jarden maintains its Overweight rating for Karoon Energy with its target price reduced to $2.05 from $2.10 following September quarter production outperforming forecasts.
Production reached 2.27 mmboe due to a strong contribution from the Who Dat AI sidetrack well, offsetting softer oil price realisations in Brazil.
Revenue of US$192m exceeded Jarden's estimates by 28% supported by four Brazil cargoes.
The analyst highlights the G1 sidetrack timeline has been pushed back alongside adjustments to cargo timing and price realisations.
The rating is underpinned by strong leverage to oil prices despite revised valuation inputs.
OFX GROUP LIMITED ((OFX)) Downgrade to Hold from Buy by Canaccord Genuity.B/H/S: 0/0/0
Canaccord Genuity lowers its rating for OFX Group to Hold from Buy with its target price decreased to $0.40 from $0.86 following weaker second-quarter net operating income and tightening cash reserves.
Net operating income reached $45.3m during the quarter, representing growth of 3.1% quarter-on-quarter alongside a decline of -9.6% year-on-year.
Canaccord Genuity highlights approximately $15m in annualised cost savings executed primarily through headcount reductions to offset softer trading conditions.
Net available cash stood at $36.6m while discussions with potential bidder Equals Group remain ongoing without a firm recommitment to exclusivity.
The analyst expects shares to drift prior to any meaningful operational turnaround or inbound merger activity amid broader macroeconomic uncertainties.
| Order | Company | New Rating | Old Rating | Broker | |
|---|---|---|---|---|---|
| Upgrade | |||||
| 1 | GENESIS MINERALS LIMITED | Buy | Neutral | Moelis | |
| 2 | GREATLAND RESOURCES LIMITED | Buy | Neutral | Moelis | |
| 3 | ORA BANDA MINING LIMITED | Buy | Buy | Moelis | |
| 4 | ORICA LIMITED | Buy | Buy | Jarden | |
| 5 | SANDFIRE RESOURCES LIMITED | Neutral | Sell | Jarden | |
| Downgrade | |||||
| 6 | ARISTOCRAT LEISURE LIMITED | Buy | Buy | Jarden | |
| 7 | BOTANIX PHARMACEUTICALS LIMITED | Neutral | Buy | Canaccord Genuity | |
| 8 | KAROON ENERGY LIMITED | Buy | Buy | Jarden | |
| 9 | OFX GROUP LIMITED | Neutral | Buy | Canaccord Genuity | |
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