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

Bell Potter rates CDA as Upgrade to Buy from Hold

Bell Potter upgrades Codan to Buy from Hold with a higher target of $60 from $54 with the analyst expecting upgrades in Communications Services revenues over FY27.

The analyst asserts the Comm Services division can meet 20% revenue guidance for FY27 dependent on the supply chain remaining resilient, with scope for the target to be beaten.

There has been a "surge" in the growth in Group 2 unmanned platforms used in conflict zones, year-to-date, but the broker flags some caution as Silvus, a competitor, brings new capacity online in early 2027.

Re Zetron, commentary suggests management's 10%-15% growth target over the longer term is feasible and momentum remains robust post the introduction of new products for Minelab in the rest of the world and Africa.

EBIT forecasts rise 4% for FY28 and 8% for FY29.

Macquarie rates IAG as Upgrade to Neutral from Underperform

Macquarie raises its target for Insurance Australia Group to $8.20 from $7.10 and upgrades to Neutral from Underperform following settlement of the Credit Suisse trade-credit proceedings.

Management expects no material effect on its FY27 results or financial position, which Macquarie interprets as net exposure below -$50m, and the broker anticipates no effect on the first-half dividend.

With the larger Greensill Bank claim previously settled, only the comparatively minor $170m White Oak proceedings remain, leaving the broader Greensill litigation overhang largely resolved, the analyst explains.

Citi rates TLS as Buy

Citi believes AI assistants could increase pricing transparency and customer churn by comparing telecommunications plans, recommending alternatives and initiating switching.

However, completing a mobile transfer requires personal details including government-issued identification, and consumers may be reluctant to entrust these documents to an AI-controlled vault.

This friction could slow adoption of fully automated switching and limit disruption, the broker believes.

Citi considers broadband/NBN more exposed than mobile because mobile providers retain meaningful network, coverage and speed differentiation.

Commentary highlights Telstra Group also varies service quality across its brands: Belong accesses the wholesale network with speed caps, while Boost receives the full Telstra network experience.

It's felt the rollout of 5G Advanced and network slicing should further differentiate mobile plans and brands.

Unchanged Buy rating and $5.25 target for Telstra Group.