Weekly Recommendation, Target Price, Earnings Forecast Changes

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            [2] => ((CRZ))
            [3] => ((EGP))
            [4] => ((GFF))
            [5] => ((GPT))
            [6] => ((JBH))
            [7] => ((MQG))
            [8] => ((QAN))
            [9] => ((SEK))
            [10] => ((WBC))
            [11] => ((CBA))
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            [7] => MQG
            [8] => QAN
            [9] => SEK
            [10] => WBC
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            [12] => EGP
            [13] => LYC
            [14] => MYR
            [15] => DJS
            [16] => TME
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This story features AMP LIMITED, and other companies.
For more info SHARE ANALYSIS: AMP
The company is included in ASX100, ASX200, ASX300 and ALL-ORDS

By Rudi Filapek-Vandyck, Editor FNArena

Guide:

The FNArena database tabulates the views of eight major Australian and international stock brokers: BA-Merrill Lynch, CIMB, Citi, Credit Suisse, Deutsche Bank, JP Morgan, Macquarie and UBS.

Ratings, consensus target price and forecast earnings tables are published at the bottom of this report.

Summary

Period: Monday February 3 to Monday February 7, 2013
Total Upgrades: 13
Total Downgrades: 5
Net Ratings Breakdown: Buy 39.38%; Hold 43.61%; Sell 17.01%

Australian shares may have become a little cheaper in the first six weeks of the new calendar year, but certain stocks are simply too cheap. This was the dominant theme last week with stockbroking analysts lifting recommendations on the likes of AMP, Goodman Fielder, Qantas and Echo Entertainment.

The latter was dubbed "probably the cheapest casino operator in the world" by analysts at Credit Suisse during the week.

Early reports into the local reporting season look promising and electronics retailer JB Hi-Fi in particular features prominently on the upgrade side of the ledger after a financial report that forced shorters to run for cover and others to revise their estimates upwards.

Banking analysts at BA-Merrill Lynch made a remarkable switch during the week by upgrading Westpac while downgrading CommBank.

With the exception of Treasury Wine Estates, which issued yet another profit warning, overall changes in targets and estimates remain minor as the securities analysts' community prepares for the upcoming flood in corporate reports.

Upgrades

AMP ((AMP)) upgraded to Neutral from Underperform by Macquarie. B/H/S: 0/7/1

Despite the problems in life insurance Macquarie has decided to upgrade AMP to Neutral from Underperform. This reflects the decline in the share price and contraction in the price/earnings multiple as well as reduced regulatory impact. The broker concedes the issues are not behind the company. Lapse rates remain elevated and claims trends are not improving. Nevertheless, the share price is now more appropriately factoring in the situation, according to Macquarie.The price target is raised to $4.70 from $4.60.

Challenger ((CGF)) upgraded to Neutral from Underperform by BA-Merrill Lynch. B/H/S: 4/3/1

The broker believes Challenger offers a unique value proposition in a market that could grow significantly in coming years, controlling 55% of annuities and attracting almost all new flows. Given CGF's structure, margin improvement and solid funds management performance the broker can no longer justify an Underperform rating. The stock has run hard since its last result but the broker does not yet see the price as stretched. Target rises to $6.30 from $4.35.

Carsales.com ((CRZ)) upgraded to Outperform from Neutral by Macquarie. B/H/S: 3/1/3

Macquarie has reviewed the investment thesis on carsales.com and finds the stock worthy of an upgrade to Outperform from Neutral following the recent sell off. The broker expects top line growth momentum will slow in the months ahead but the company remains in a good position. Macquarie has reduced assumptions for dealer revenue in FY14 to growth of 11% from growth of 16%. Display revenue growth expectations have also been ratcheted down. The price target increases to $10.40 from $9.40.

Echo Entertainment ((EGP)) upgraded to Outperform from Neutral by Credit Suisse and to Buy from Hold by Deutsche Bank. B/H/S: 5/0/3

Credit Suisse believes Echo is in a good position regarding new Queensland licences because it is the incumbent. The government will announce the winner of the Brisbane tender in early 2015. The government has also stated it is unlikely to issue a new casino licence on the Gold Coast.  The broker believes improved confidence in the earnings base could be the catalyst for the stock. Credit Suisse calculates that, based on the stock trading at 5.8 times FY15 forecasts, it is one of the cheapest casino stocks in the world. Echo's result was a slight beat on the earnings line but a miss operationally, with Queensland casinos in particular disappointing for Deutsche Bank. The broker, nevertheless, feels earnings may have bottomed, with costs reduced and domestic gaming showing signs of improvement.

See also EGP downgrade.

Goodman Fielder ((GFF)) upgraded to Neutral from Underweight by JP Morgan. B/H/S: 2/5/1

Following Goodman's share price fall the broker has upgraded to Neutral, suggesting value is now fair on both a relative and absolute basis. The broker feels Goodman Fielder will need to continue reinvesting its efficiency savings but also sees some upside through NZ dollar exposure.

GPT ((GPT)) upgraded to Outperform from Neutral by Credit Suisse. B/H/S: 2/5/0

Price target has fallen to $4.00 from $4.12, but the rating has been lifted to Outperform from Neutral as the analyst believes the immediate outlook has effectively been de-risked by the company pre-informing the market about its earnings guidance for the December half. There are still some reservations, in particular given the company's difficulties executing on significant acquisitions.

JB Hi-Fi ((JBH)) upgraded to Neutral from Underperform by BA-Merrill Lynch and to Overweight from Neutral by JP Morgan. B/H/S: 4/3/1

JB Hi-Fi's solid result has provided enough reason for Merrills to upgrade to Neutral. JB Home is performing ahead of the broker's expectations and with a more favourable outlook than peers, Merrills acknowledges JBH deserves better than the broker's conservative earnings forecasts. The broker does not see the stock as Buy at this level given concerns over a retail slowdown through 2014 and the impact of the lower Australian dollar. Earnings margins are proving resilient, with JB Home a source of growth, and JP Morgan is becoming more confident in the sales outlook for the second half. The stock is better positioned than other small cap peers which will suffer more later in the year from a lower Australian dollar, the broker suggests.

Macquarie Group ((MQG)) upgraded to Buy from Neutral by BA-Merrill Lynch. B/H/S: 3/4/0

Merrills believes Macquarie's day has finally come after years of wallowing in capital market inactivity. With developed economies expected to cycle upward and the AUD on the slide, the broker notes MQG is set to benefit, while financial strength provides room for accretive acquisitions and/or capital management. MQG may have seen solid PE expansion of late but has posted the earnings to back this up, the broker notes. Target rises to $62.00 from $53.75. Upgrade to Buy.

Qantas ((QAN)) upgraded to Add from Hold by CIMB Securities. B/H/S: 1/6/1

All the bad news is captured in the share price, in CIMB's view,and the upcoming results could become a catalyst if management outlines more details around the cost reductions and potential asset sales. The broker is therefore upgrading to Add from Hold and raising the target to $1.39 from $1.14. CIMB is quoting history, suggesting the time to buy airlines is when things are bad and that time is now. The broker thinks any action that management takes is likely to be viewed positively by the market.

SEEK ((SEK)) upgraded to Buy from Neutral by Deutsche Bank. B/H/S: 2/3/2

Deutsche Bank expects solid earnings growth in he first half with a supportive combination of pricing power and new products. The rating is upgraded to Buy from Hold as the stock has come off its highs and underlying conditions improve. The price target is raised to $13.65 from $12.85.

Westpac Banking Corp ((WBC)) upgraded to Buy from Neutral, Low Risk by BA-Merrill Lynch. B/H/S: 3/3/2

Westpac lagged its peers in the Dec quarter but seasonal factors alone suggest to the broker there's improvement in the months ahead. WBC's capital ratio is the most attractive after the regulatory changes and the bank offers a stronger return on equity than peers.Target falls to $32.40 from $32.80 but rating upgraded to Buy.

Downgrades

Commonwealth Bank ((CBA)) downgraded to Underperform from Neutral, Low Risk by BA-Merrill Lynch. B/H/S: 1/3/4

The broker believes CBA is set to post a strong first half result but that it's already in the price, with the stock trading at a substantial premium to its underlying return. The broker also notes the impending regulatory changes will affect CBA the most and impact on return on equity. Target falls to $68.30 from $76.20. Downgrade.

Echo Entertainment ((EGP)) downgraded to Reduce from Hold by CIMB Securities. B/H/S: 5/0/3

On the back of the first half results CIMB finds there's little reason to change a cautious stance. Revenue growth remains weak and profit growth looks to be negative in the short term. Moreover, there is an information vacuum when it comes to the potential of Brisbane and the broker does not see this changing this year. The target is lowered to $2.07 from $2.35 and the recommendation is downgraded to Reduce.

See also EGP upgrades.

Lynas Corp ((LYC)) downgraded to Neutral from Overweight by JP Morgan. B/H/S: 0/4/0

There are still issues with the LAMP which have delayed the achievement of phase 1 capacity. JP Morgan is disappointed and believes the catalysts for an upgrade are also delayed. It may be one of the cheapest stocks under coverage but, until the company can demonstrate the plant is operating at capacity, the broker thinks the market will not be positive on the stock. The rating is downgraded to Neutral from Overweight. The broker now has a 70% risk weighting to derive the price target, which is reduced to 40c from 65c.

Myer Holdings ((MYR)) downgraded to Neutral from Outperform by Credit Suisse. B/H/S: 1/5/2

Were Myer to merge with David Jones ((DJS)), Myer shareholders would be the losers and DJs' shareholders the winners, the broker suggests. The broker has described Myer's synergy suggestion as "sleight of hand". Even if the two could increase scale as one, the time and cost required to bed down the merger would be an offset anyway, the broker suggests. Better just to get their acts together individually. Target drops to $2.70 from $3.10 and rating downgraded to Neutral on the suggestion.

Trade Me ((TME)) downgraded to Hold from Buy by Deutsche Bank. B/H/S: 2/4/1

Deutsche Bank analysts report a small number of real estate agents have angrily voted with their feet and taken their listings to competitor realestate.co.nz. While to date this is a small response to recent fee increases, who's to say this won't grow larger?  Trade Me is the market leader and will ultimately come out on top, predict the analysts, but at the least it will be forced to increase marketing spending. Deutsche Bank has decided to downgrade to Hold from Buy. Price target NZ$4.55 (was NZ$4.81).

Total Recommendations	Recommendation Changes
Broker Recommendation Breakup

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