Weekly Reports | 10:00 AM
Weekly update on stockbroker recommendation, target price, and earnings forecast changes.
By Mark Woodruff
Guide:
The FNArena database tabulates the views of eight major Australian and international stockbrokers: Citi, Bell Potter, Macquarie, Morgan Stanley, Morgans, Ord Minnett, Shaw and Partners and UBS.
For the purpose of broker rating correlation, Outperform and Overweight ratings are grouped as Buy, Neutral is grouped with Hold and Underperform and Underweight are grouped as Sell to provide a Buy/Hold/Sell (B/H/S) ratio.
Ratings, consensus target price and forecast earnings tables are published at the bottom of this report.
Summary
Period: Monday July 7 to Friday July 11, 2025
Total Upgrades: 9
Total Downgrades: 12
Net Ratings Breakdown: Buy 61.15%; Hold 31.47%; Sell 7.37%
For the week ended Friday, July 11, 2025, FNArena tracked nine upgrades and twelve downgrades for ASX-listed companies from brokers monitored daily.
Uranium miner Boss Energy received separate rating downgrades from Ord Minnett and Macquarie to Hold or equivalent from Buy following a share price rise of more than 70% in 2025.
Macquarie expects ASX-listed uranium equities to remain closely correlated to the daily spot price until term pricing shows improvement, potentially in September or October.
The Sprott Physical Uranium Trust (SPUT), managed by Sprott Asset Management, recently launched an upsized capital raise, securing US$200m to purchase physical uranium.
With this buying program nearing completion this week, the broker anticipates spot prices may need to retreat to levels more attractive for utility-driven carry trades.
Short positions in Boss are unwinding in an orderly fashion, noted Ord Minnett, and have declined to 14% of shares from a peak level of 26%.
As any chance of a short squeeze sending the price as high as $6.00 per share has passed for now, the broker last week lowered its target to $4.10 from $6.00.
Elsewhere, reductions in average earnings forecasts far outweighed rises in the FNArena database while average target price increases edged out falls, as illustrated in the tables below.
Lifestyle Communities' average target fell by -37% following an unfavourable ruling by a Victorian tribunal that deferred management fees (DMF) contained in its residential services agreements were not legally enforceable in that state.
Ord Minnett and Citi downgraded their ratings to Hold or equivalent and lowered their respective targets to $5.35 from $8.20 and to $4.50 from $9.00.
Ord Minnett expects the company will remain within its banking covenants despite the setback and sees no need for a capital raise, though Citi noted an elevated risk around the interest cover ratio due to potential short-term softness in sales.
While uranium developer Deep Yellow received the largest percentage earnings forecast downgrade in the FNArena database, the FY25 forecast numbers involved are very small.
In fact, Macquarie raised its target price for Deep Yellow by 21% to $2.05 after assuming a capital raise at a higher equity price level to reflect improving market conditions.
The broker also raised its percentage inclusion of Mulga Rock forecasts after a highly encouraging resin mini-pilot metallurgical program enhanced project economics.
Located in the Great Victoria Desert, Western Australia, around 290 km from Kalgoorlie, the Mulga Rock project is one of Australia's largest undeveloped uranium resources.
Pilbara Minerals features second on the earnings downgrade list below with fellow lithium miner IGO Ltd in third place, after Macquarie adjusted estimates when previewing fourth quarter results for critical minerals companies under coverage.
Considered as a relative safe haven, IGO Ltd remains the broker's preferred lithium exposure while Pilbara Minerals offers strong leverage to lithium upside. Both remain Outperform rated by Macquarie.
For IGO, the analyst's FY25 spodumene production forecast for Greenbushes of 377kt is in line with the consensus estimate, while the broker's prediction for fourth quarter FY25 spodumene shipments for Pilbara Minerals of 197kt is 7% ahead of consensus.
Tourism Holdings Rentals and Domino's Pizza Enterprises were next with falls in average earnings forecasts of around -20% apiece.
Ord Minnett noted yet another profit downgrade for Tourism Holdings as the unwind of the covid-induced recreation vehicle super cycle continues.
Management guided to FY25 profit in the range of $27-34.4m compared to the consensus expectation for $33m.
Morgans explained manufacturing divisions for the company in Australia and New Zealand faced a challenging second half of FY25, as production volumes declined due to efforts to right-size manufacturing and overall inventory levels.
Additionally, a sharp fall in demand for inbound travel to the US weighed on US Rental revenue, noted the broker.
Regarding Domino's, here Morgans lowered its target to $22.20 from $29.40 and UBS to $22 from $25, though both brokers can now see positives emerging.
UBS upgraded to Buy from Neutral based on valuation support after a further share price fall when the company announced its CEO will be stepping down.
This broker now feels the risk reward ratio is more attractive given confirmation regarding FY25 underlying profit and the company's solid balance sheet. It's also felt cost savings will be accelerated, providing greater support to sales and earnings for both the company and its franchisees.
Following an earnings call with analysts, it was evident to Morgans the Domino's turnaround is set to accelerate under Executive Chairman Jack Cowin's leadership on the back of cost-out initiatives.
While sales led earnings growth is vital for long-term value creation, the broker pointed to the recent positive outcome for Collins Foods, showing cost-led growth can be just as positive for the share price.
On the flip side, Aurelia Metals received a 26% boost to its average target price, solely due to Shaw and Partners adopting a 50c 12-month target in inaugural research.
The broker described Aurelia's current valuation as a "compelling" entry point for investors into a multi-metal producer with multiple growth catalysts.
Unperturbed by recent underwhelming FY26 guidance, Ord Minnett also anticipates share price upside from near-term delivery of projects and free cash flow (FCF) inflection around FY27 as explained further at https://fnarena.com/index.php/2025/07/11/aurelia-metals-shift-to-copper-excites/
Cobram Estate Olives and multi-faceted financial services provider Challenger were next with average target price increases of 22% and 10%, respectively.
Unaudited earnings guidance of circa $115m for FY25 came in 5% ahead of Ord Minnett's prior forecast for Cobram, suggesting the company's price points have remained firm during the second half in the face of increased international volumes and on-shelf discounting.
This broker raised its target to $2.66 from $2.23 to reflect a higher near-term earnings base and improving local free cash flows, while its rating was downgraded to Accumulate from Buy on valuation.
Oil production volumes were below Bell Potter's forecasts yet the return per litre has improved due to a shift in sales mix to higher priced Cobram brands, prompting this broker to raise its target to $2.35 from $1.95.
Shaw and Partners went further, raising its target to $2.85 from $2.25 having gained confidence management is making progress in smoothing out year-on-year variability as its olive groves mature.
For Challenger, regulatory changes are expected to be a positive, noted Ord Minnett, and the stock price still offers strong valuation appeal despite recent gains.
Macquarie expects APRA to implement its new capital standards for Life insurers on July 1, 2026, with a capital return announcement from Challenger likely at the August 2026 result. Over the next year, Macquarie anticipates a share buyback and the announcement of an additional sales partnership in Japan.
Following implementation of APRA's proposed changes and over time, Citi believes Challenger should be able to alter its asset allocation to materially lower its capital requirements, leading to a substantial capital release.
Total Buy ratings in the database comprise 61.15% of the total, versus 31.47% on Neutral/Hold, while Sell ratings account for the remaining 7.37%.
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