Top Ten Weekly Recommendation, Target Price, Earnings Forecast Changes

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The past week has been another big one for upgrades in ratings, as among the eight brokers covered in the FNArena database there have been 27 ratings upgrades against just 11 downgrades. This brings the total proportion of Buy ratings to 56.2%, up from around 55% last week.

Among those enjoying upgrades were Domino's Pizza ((DMP)), Mermaid Marine ((MRM)) and Webjet ((WEB)) on the back of solid or better than expected earnings results. There were also valuation based upgrades for the likes of Macmahon Holdings ((MAH)), David Jones ((DJS)) and Mount Gibson ((MGX)).

Extract Resources ((EXT)) was upgraded during the week to reflect potential upside from an increase in reserves, while Oakton ((OKN)) enjoyed upgrades on the back of turnaround potential.

On the other side of the ledger valuation issues saw Imdex ((IMD)) and Challenger Diversified Property ((CDI)) downgraded, while questions over the cost of future growth were behind cuts to ratings for Newcrest ((NCM)). 

Along with an upgrade in rating, Macmahon enjoyed some increases to both earnings estimates and price targets, while a record result from ARB Group ((ARP)) similarly generated increases to both earnings estimates and price targets.

Domino's Pizza continued to enjoy upgrades to numbers following its well received profit result, while signs of operating improvement at Telstra ((TLS)) were enough for brokers to lift expectations for the telco giant. 

Weak fourth quarter sales meant cuts to numbers for David Jones, while a tough outlook saw estimates and price targets reduced for GWA International ((GWA)). Computershare ((CPU)) delivered a weaker earnings result as expected, but brokers have still responded by lowering price targets for the stock, while ongoing issues for the domestic steel market saw cuts to targets for OneSteel ((OST)). 

A strategic review at Ten Network ((TEN)) has prompted brokers to lower earnings expectations and as a result price targets, while weaker revenue assumptions at UGL ((UGL)) have prompted a similar reaction.

Earnings estimates for Woodside ((WPL)) benefited from a rolling forward of a broker's model for the company, while a solid earnings result for Echo Entertainment ((EGP)) has meant increases to estimates in coming years. 

As with OneSteel, forecasts for BlueScope ((BSL)) have been trimmed to reflect the impact of the strong Australian dollar, while lower margin expectations contribute to reductions to earnings estimates for Alumina ((AWC)) and a challenging operating environment prompted cuts to forecasts for Salmat ((SLM)). 

Total Recommendations	Recommendation Changes
Broker Recommendation Breakup

 

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