Australian Broker Call

Macquarie rates A4N as Resume Coverage with Outperform (1) -

Macquarie assesses Alpha HPA is poised to benefit from semiconductor sector tailwinds in the next 12-18 months, with a product that is "right time, right place with high purity alumina emerging as a favoured ceramic".

The use of this in chip packaging substrates will drive improvement in thermal performance and allowing GPU accelerators to run hotter/faster. The broker also points out pricing is inelastic and has provided a tailwind to project economics.

The stock is considered a compelling opportunity for long-term investors as it has exposure to the rapidly scaling up AI theme. Coverage is reinstated with an Outperform rating and $1.05 target.

Target price is $1.05 Current Price is $0.74 Difference: $0.31
If A4N meets the Macquarie target it will return approximately 42% (excluding dividends, fees and charges).

Current consensus price target is $1.15, suggesting upside of 45.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 1.0

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Ord Minnett rates A4N as Initiation of coverage with Speculative Buy (1) -

Ord Minnett initiates coverage of Alpha HPA with a Speculative Buy rating, highlighting the company's proprietary solvent extraction technology.

This technology is expected to deliver high-purity alumina (HPA) at low operating costs and with a lower carbon footprint than incumbent producers.

HPA is a fast-growing specialty chemical used for high tech applications including lithium-ion batteries and semiconductors.

A 10ktpa plant under construction in Gladstone is scheduled for completion in late 2027.

The analyst sees strong long-term demand from semiconductor and battery markets, supported by high customer switching costs and product qualification requirements.

Ord Minnett believes Alpha HPA is well positioned to benefit from growing demand for low-alpha HPA products. A 90c target is set.

Target price is $0.90 Current Price is $0.74 Difference: $0.16
If A4N meets the Ord Minnett target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $1.15, suggesting upside of 45.6% (ex-dividends)

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 1.0

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Citi rates ABG as Buy (1) -

Citi updates its estimates for Aspen Group and Abacus Group following Aspen's internalisation of management rights previously owned by Abacus, as well as higher interest rate and bond yield assumptions.

The broker reduces its target for Abacus Group to $1.30 from $1.40 on marginally lower earnings forecasts.

Citi maintains its Buy rating, noting the stock trades at a -43% discount to NTA and offers a very attractive dividend yield.

Buy. Target $1.30.

Target price is $1.30 Current Price is $0.99 Difference: $0.31
If ABG meets the Citi target it will return approximately 31% (excluding dividends, fees and charges).

Market Sentiment: 0.5

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Bell Potter rates AMA as Buy (1) -

Bell Potter believes AMA Group remains on track to achieve FY26 guidance despite concerns around high fuel prices and softer traffic volumes.

Traffic conditions have remained relatively normal, the analysts explain. The absence of a trading update, alongside the commencement of the share buy-back, also suggest earnings expectations remain intact.

The broker expects a traditionally stronger fourth quarter to support earnings and cash flow.

Buy rating maintained. Target lowered to $1.00 from $1.10.

Target price is $1.00 Current Price is $0.46 Difference: $0.54
If AMA meets the Bell Potter target it will return approximately 117% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 1.0

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Citi rates APZ as Buy (1) -

Citi updates its estimates for Aspen Group and Abacus Group following Aspen's internalisation of management rights previously owned by Abacus, as well as higher interest rate and bond yield assumptions.

The broker reduces Aspen's earnings forecasts by -3.5%-6.7% across FY26-FY28 but retains its Buy rating and $5.40 target.

Citi notes Aspen trades at around a -20% discount to net tangible assets (NTA), on 21 times forward earnings and an attractive dividend yield.

Target price is $5.40 Current Price is $4.89 Difference: $0.51
If APZ meets the Citi target it will return approximately 10% (excluding dividends, fees and charges).

Market Sentiment: 1.0

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Citi rates ARB as Neutral (3) -

Citi expects competition to increase for ARB Corp after Super Retail ((SUL)), owner of BCF and Super Cheap Auto, outlined plans to expand into 4WD accessories and fitment services.

Supercheap Auto will trial stores offering fitment for products such as bullbars and winches. Commentary notes Supercheap Auto's 362-store network compares with ARB Corp's 79 stores.

BCF plans more than 50 fitment locations, with its first Western Australian store partnering with ARB competitor Ironman.

The broker believes these initiatives enhance Ironman's market position and could intensify competitive pressures for ARB Corp.

Neutral. Target $17.40.

Target price is $17.40 Current Price is $18.13 Difference: minus $0.73 (current price is over target).
If ARB meets the Citi target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $25.12, suggesting upside of 38.1% (ex-dividends)

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.8

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Bell Potter rates AUE as Speculative Buy (1) -

Aurum Resources has completed its pre-feasibility study (PFS) for its Boundiali Gold Project in Cote d'Ivoire. The study outlined a maiden Ore Reserve of 1.21Moz and average production of 185kozpa during the first five years, Bell Potter highlights.

The broker assesses strong project economics, including a post-tax NPV of around US$1.5bn, an internal rate of return of 119% and a payback period of less than one year. It's felt recent resource growth leaves scope for further improvements.

Management has commenced the definitive feasibility study (DFS), targeting completion in late 2026 and first production in early 2028.

Bell Potter retains a Speculative Buy rating and lifts its target to $1.50 from $1.30.

Target price is $1.50 Current Price is $0.56 Difference: $0.94
If AUE meets the Bell Potter target it will return approximately 168% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 1.0

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Macquarie rates AZJ as Neutral (3) -

Aurizon Holdings experienced a rebound in volumes in May albeit this was still below target. Macquarie assesses volumes are likely to be around 208mt for FY26, similar to the prior year, and cash flow will lag earnings as a result.

The FY27 target of 220mt has not been achieved in the system since 2020, the broker adds. Coal volumes became progressively stronger during the half year with the Goonyella corridor strong, especially from BHP Group ((BHP)).

Macquarie points out leverage to these volumes is low given the higher take-or-pay threshold. Neutral rating retained. Target rises to $4.00 from $3.91.

Target price is $4.00 Current Price is $4.37 Difference: minus $0.37 (current price is over target).
If AZJ meets the Macquarie target it will return approximately minus 8% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.65, suggesting downside of -16.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: -0.6

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Ord Minnett rates BRE as Upgrade to Speculative Buy from Hold (1) -

Brazilian Rare Earths reported encouraging exploration results from the Velhinhas prospect, according to Ord Minnett.

Drilling, geophysics and rock-chip sampling have outlined a rare earth corridor extending more than 9km south of the Monte Alto project.

The results reinforce the potential for a district-scale rare earth system and provide longer-term growth opportunities beyond the company's core Monte Alto deposit, the broker believes.

Commentary also notes Velhinhas could benefit from shared infrastructure and lower development costs due to its proximity to Monte Alto.

Ord Minnett upgrades its rating to Speculative Buy from Hold and retains a $6.95 target.

Target price is $6.95 Current Price is $5.11 Difference: $1.84
If BRE meets the Ord Minnett target it will return approximately 36% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 1.0

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Citi rates BXB as Buy (1) -

Citi believes Brambles' latest trading update has introduced uncertainty due to several moving parts and limited guidance on how current headwinds may evolve.

The broker attempts to quantify these factors and forecasts FY27 earnings (EBIT) growth of 4%-6% at constant currency. This estimate sits modestly below current market expectations, the analyst notes, and may result in consensus earnings downgrades.

Despite potential for downgrades, Citi retains a positive view following the recent share price pullback.

The broker maintains a Buy rating while remaining cautious ahead of the August result. Target is lowered to $22.80 from $23.55.

Target price is $22.80 Current Price is $18.31 Difference: $4.49
If BXB meets the Citi target it will return approximately 25% (excluding dividends, fees and charges).

Current consensus price target is $21.23, suggesting upside of 11.7% (ex-dividends)

Forecast for FY26:

Forecast for FY27:

This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.

Market Sentiment: 0.5

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Bell Potter rates FAL as Initiation of coverage with Speculative Buy (1) -

Bell Potter initiates coverage of Falcon Metals with a Speculative Buy rating and $1.10 target.

The company owns the high-grade Blue Moon gold project at Bendigo, Victoria. Drilling has confirmed multiple zones of visible gold within quartz reefs hosted by the Garden Gully anticline.

Four stacked high-grade target zones have been identified including Morning Glory, Jasmine, Lotus and Dahlia. Each remains open along strike and down dip.

For valuation purposes, Bell Potter assumes a potential future mineral inventory of 6.3mt at 14.5g/t gold for 6.9m ounces of contained gold.

The broker believes the market is increasingly valuing Blue Moon as a district-scale extension of the Bendigo system rather than a one-off discovery.

Target price is $1.10 Current Price is $0.48 Difference: $0.62
If FAL meets the Bell Potter target it will return approximately 129% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 1.0

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Citi rates GMG as Buy (1) -

Citi believes Goodman Group's key data centre developments are progressing steadily. Several projects across Tokyo, Paris, Los Angeles and Australia already engaged in exclusive negotiations with hyperscale customers.

The broker expects lease agreements to be secured before the end of 2026, potentially sooner. Lease execution is seen as the most important near-term catalyst as speculative developments convert into contracted long-term income.

The analyst also highlights Goodman's expanding power bank, which provides a significant competitive advantage.

Commentary suggests project completions, lease signings and associated performance fees could drive earnings upside beyond the company's FY26 growth target.

Buy rated. Target $40.

Target price is $40.00 Current Price is $30.83 Difference: $9.17
If GMG meets the Citi target it will return approximately 30% (excluding dividends, fees and charges).

Current consensus price target is $34.68, suggesting upside of 10.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.9

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Citi rates LLC as Buy (1) -

Lendlease Group has announced Nick O'Neil, formerly head of real assets at AustralianSuper, will join as CEO from September 10, replacing Tony Lombardo.

Citi notes core Investment Management guidance of 28cps-34cps was reaffirmed as part of a market update.

Management has secured $4.7bn of development project wins and $6.5bn of construction contract wins in FY26 year-to-date, the analysts highlight, supporting future earnings and backlog growth.

Asset sales have been delayed again, the broker observes, with transactions now expected from early FY27 and gearing likely to remain above the mid-30% range at FY26 end.

Citi sees the delay as a potential negative but continues to identify significant value in the shares. Buy. Target lowered to $4.50 from $6.30.

Target price is $4.50 Current Price is $2.74 Difference: $1.76
If LLC meets the Citi target it will return approximately 64% (excluding dividends, fees and charges).

Current consensus price target is $3.90, suggesting upside of 35.8% (ex-dividends)

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.5

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Ord Minnett rates LLC as Hold (3) -

Lendlease Group has announced a new CEO, Nick O'Neill, who is currently Head of Real Assets at AustralianSuper.

He will commence on September 10 and is replacing Tony Lombardo, who is stepping down by June 30 at the latest, Ord Minnett notes.

With a background at Macquarie Group's ((MQG)) US and Latin American infrastructure and property businesses, the analyst views the appointment positively, particularly given the group's underperformance.

On the negative side, Lendlease also announced a rise in its FY26 underlying gearing ratio, and the broker has lifted its forecast by 10.3 percentage points to 35.7%.

Funds from operations forecasts are lowered by -75.9% for FY27 and by -8.5% for FY28.

The target price is unchanged at $2.85 and the Hold rating is retained.

Target price is $2.85 Current Price is $2.74 Difference: $0.11
If LLC meets the Ord Minnett target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $3.90, suggesting upside of 35.8% (ex-dividends)

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.5

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Ord Minnett rates MEI as Speculative Buy (1) -

Meteoric Resources has reported its pilot plant from Caldeira has demonstrated consistent production and stable operations, with average MREO recoveries of 71% in line with the pre-feasibility study.

Recent optimisation has also delivered higher recoveries, around 80%, highlighting the upside potential to the base case, Ord Minnett notes, and progress demonstrates a key de-risking step as the project heads towards the definitive feasibility study and final investment decision.

Offtake agreements should be key to unlocking the project value over the next 12-18 months, the broker adds. Speculative Buy rating and $0.25 target retained.

Target price is $0.25 Current Price is $0.16 Difference: $0.09
If MEI meets the Ord Minnett target it will return approximately 56% (excluding dividends, fees and charges).

Current consensus price target is $0.32, suggesting upside of 86.3% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 1.0

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Morgans rates MVF as Speculative Buy (1) -

Monash IVF's trading update, released earlier today, proved weaker-than-anticipated. Morgans has reduced its price target to 80c from 90c in response, while retaining its Speculative Buy rating.

Soft industry cycles are to blame, the broker comments, with weakness continuing into May and June.

Morgans continues to see longer-term value in the business and reminds investors Monash IVF is the second largest in the Australian market.

Today's rapid update has seen a -12% reduction in underlying net profit forecast to $17.4m. FY27/28 forecasts have been lowered by -6.5%-7.5%.

Target price is $0.80 Current Price is $0.67 Difference: $0.13
If MVF meets the Morgans target it will return approximately 19% (excluding dividends, fees and charges).

Current consensus price target is $0.81, suggesting upside of 16.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.7

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Morgans rates NCK as Initiation of coverage with Buy (1) -

Morgans has initiated coverage of Nick Scali with a Buy rating and $17.84 target price.

The analyst views the stock as a high-quality retailer which has achieved longer-term EPS growth for investors via store rollouts, organic growth, operating leverage and "best-in-class" margins.

The broker's FY26 net profit after tax forecast is around -3% below consensus, with FY27/FY28 estimates below consensus by -5% and -6%, respectively.

Historically, the stock has traded around 14x forecast earnings, which Morgans reckons under-rates the company's current platform, and a more apposite valuation is 17x FY26 earnings.

The analyst highlights that the A&NZ store rollout cadence may be slower than expected and online competition is lifting, but Nick Scali is considered to have a robust moat. The UK proposition offers longer-term upside.

Target price is $17.84 Current Price is $15.05 Difference: $2.79
If NCK meets the Morgans target it will return approximately 19% (excluding dividends, fees and charges).

Current consensus price target is $17.46, suggesting upside of 12.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.6

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Citi rates REA as Buy (1) -

Citi feels the market reaction to proposed changes to negative gearing and capital gains tax has been excessive, with REA Group's share price falling -15% since the Federal Budget.

The broker lowers its FY27 profit forecast by -6% to reflect weaker listings activity but expects management to offset some of the impact through tighter cost control. Forecast operating expense growth is reduced to around 3%.

The analyst views the housing policy changes as a largely one-off headwind and notes a pick up in investor selling could provide a partial offset.

Citi retains a Buy rating and lowers its target to $181.15 from $201.00.

Target price is $181.15 Current Price is $147.13 Difference: $34.02
If REA meets the Citi target it will return approximately 23% (excluding dividends, fees and charges).

Current consensus price target is $192.45, suggesting upside of 34.9% (ex-dividends)

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.4

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Bell Potter rates SHV as Buy (1) -

Bell Potter believes California's Sustainable Groundwater Management Act (SGMA) could drive a multi-year reduction in almond supply, supporting a prolonged upswing in almond prices.

The broker notes California accounts for around 77% of global almond production and expects water-use restrictions to result in orchard removals and lower output over time.

It's felt almond production has likely passed its peak, with supply pressures expected to intensify beyond 2029.

The analysts identify Select Harvests as the best ASX-listed exposure to this theme. Potential benefits for the company are thought to be higher almond prices, rising orchard values and growth opportunities in Australian production and processing.

Bell Potter retains its Buy rating and $5.30 target.

Target price is $5.30 Current Price is $3.81 Difference: $1.49
If SHV meets the Bell Potter target it will return approximately 39% (excluding dividends, fees and charges).

The company's fiscal year ends in September.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 1.0

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Citi rates SUL as Buy (1) -

Citi acknowledges competitive risks to Super Retail from new entrants in automotive and sporting goods retailing, including Bunnings and Sports Direct.

Despite these threats, the broker believes management has opportunities to offset these pressures through regional expansion at Rebel and greater private-label penetration.

New store formats and 4WD offerings across Supercheap Auto and BCF are seen as additional buffers to competition.

In short, Citi believes the longer-term growth opportunities remain attractive. Buy rating maintained. Target trimmed by -10c to $14.20.

Target price is $14.20 Current Price is $12.35 Difference: $1.85
If SUL meets the Citi target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $13.55, suggesting upside of 10.4% (ex-dividends)

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.3

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Macquarie rates SUL as Outperform (1) -

The new CEO of Super Retail has outlined a five-year strategy with the transformation program "Ignite" aiming to generate $75m in savings from FY29.

The company will also focus on footprint expansion which Macquarie questions, given online retail is growing faster than in-store. A focus on regional markets is a positive, as a hybrid in-store/online model is considered necessary for servicing these areas.

The broker notes there was little detail on electric vehicles and the shift is a structural threat to demand for the company's business given lower requirements for parts and servicing.

Macquarie still finds the valuation compelling and retains an Outperform rating. Target rises to $15.90 from $15.50.

Target price is $15.90 Current Price is $12.35 Difference: $3.55
If SUL meets the Macquarie target it will return approximately 29% (excluding dividends, fees and charges).

Current consensus price target is $13.55, suggesting upside of 10.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.3

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Morgan Stanley rates SUL as Underweight (5) -

Super Retail has announced what Morgan Stanley describes as an "ambitious" set of FY31 network targets, which infer around 3.2% group store CAGR, underpinned by circa 3% CAGR in Supercheap Auto, around 5% CAGR in Rebel and 3% in Boating, Camping and Fishing.

Management is positioning to refocus on the customer and offer, which the analyst views as the correct strategy for the retailer. Regional expansion is also a proposed area for growth, alongside brand optimisation and better store layouts.

Group unallocated costs are guided higher, above previous expectations, to over -$60m for FY27-FY29. Some circa $75m in program savings from 'Ignite' are flagged to offset the cost rises.

The target price rises to $11.20 per share from $10.90 previously. There is no change to the Underweight rating. Industry view: Cautious.

EPS forecasts are tweaked lower for FY27 and higher for FY28

Target price is $11.20 Current Price is $12.35 Difference: minus $1.15 (current price is over target).
If SUL meets the Morgan Stanley target it will return approximately minus 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $13.55, suggesting upside of 10.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.3

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Morgan Stanley rates WBC as Underweight (5) -

Morgan Stanley points out Westpac has described the current operating environment as "uncertain" and, regarding the proposed tax changes, the mood is characterised as "concern rather than crisis".

Since the Budget announcement, mortgage applications have fallen -23% compared with the December quarter and are down around -18% on the March quarter, the broker highlights.

Management noted loans for existing properties represented around 94% of new investor loans in April. The broker forecasts Westpac's housing loan growth to soften to circa 3.5% in FY27 from over 7.5% growth ex RAMS in FY26.

The Underweight rating and $31.50 target are unchanged. Industry view: Cautious.

Target price is $31.50 Current Price is $34.50 Difference: minus $3 (current price is over target).
If WBC meets the Morgan Stanley target it will return approximately minus 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $33.85, suggesting downside of -2.9% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: -0.7

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Bell Potter rates WTM as Speculative Buy (1) -

Waratah Minerals has a further round of assays from drilling at Spur and Consols, part of the Spur gold project which is around 5km from the Cadia copper-gold mine in NSW.

There are now 10 active drill rigs which continue to extend known mineralisation, discovering new high-grade shoots. Highlights include 26.8m at 1.58g/t gold from 540.2m and 51m at 1.5g/t gold from 629m.

Similarly another hole, SPD031, extends high-grade lodes hit in hole SPD019 by 160m up dip, establishing continuity to shallower depth and towards historical surface workings at Spur.

Bell Potter assesses a substantial scale gold-copper deposit is indicated. Speculative Buy rating and $1.05 target.

Target price is $1.05 Current Price is $0.62 Difference: $0.435
If WTM meets the Bell Potter target it will return approximately 71% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 1.0

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources