Weekly Reports | 10:05 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 August 25 to Friday August 29, 2025
Total Upgrades: 25
Total Downgrades: 44
Net Ratings Breakdown: Buy 58.45%; Hold 32.70%; Sell 8.85%
In the last week of the reporting season, ending Friday, August 29, 2025, FNArena tracked twenty-five upgrades and forty-four downgrades for ASX-listed companies from brokers monitored daily.
During results season, this article aims to provide commentary on the tables below while also complementing FNArena’s Corporate Results Monitor, which keeps track of all the beats, misses, and in-line results at https://fnarena.com/index.php/reporting_season/
In common with the Monitor, the positive change to average earnings table reflects earnings 'beats' for 29Metals, Mineral Resources and Neuren Pharmaceuticals and 'misses' for Megaport, Telix Pharmaceuticals, Monash IVF, and Aurelia Metals.
As was the case in the prior week, the size of percentage rises in average target prices outweighed reductions.
Positive changes to average targets also arose from earnings 'beats' by Zip Co, Codan, Tabcorp Holdings, Aussie Broadband, Eagers Automotive, Lovisa Holdings, and Cobram Estate Olives.
Negative changes to targets reflect disappointments from Reece, Guzman y Gomez, Inghams Group, Domino’s Pizza Enterprises, and Woolworths Group.
Zip Co’s average target price rose by 37%, the largest move, after EPS forecasts for FY26 and FY27 of three daily covered brokers in the FNArena database jumped by 33% and 66%, respectively.
On the flipside, Reece suffered the largest fall in consensus target after its earnings forecast for FY26 was reduced by just over -14%.
Seven of the ten upward revisions to targets align with results that beat expectations, while the same ratio of downward revisions corresponds to disappointments.
Increases in earnings forecasts outpaced reductions. It should be noted, however, we are no longer comparing apples with apples, as some of the upward moves stem from brokers rolling forward their financial models to FY26 forecasts (companies having released FY25 financials).
The earnings tables show the biggest increase to forecasts was reserved for Lynas Rare Earths, despite a reporting seasons 'miss' (see Monitor for commentary), while Megaport received the largest decrease in earnings forecasts.
Lithium miners IGO Ltd and Pilbara Minerals appear in the earnings upgrade table, despite disappointing against expectations in the reporting season, helped by higher commodity pricing forecasts by UBS.
This broker has yet again raised its forecasts for lithium to US$1,250/1,150/1,350/t for 2026-28 versus spot of US$940/t "driven by Chinese supply disruptions and potential for more".
Pilbara Minerals remains Macquarie's preferred lithium producer given its operating leverage and solid balance sheet. This analyst sees upside from both productivity improvements and cost-out programs at the Pilgan operation, the company’s flagship mine located at Pilgangoora in Western Australia’s Pilbara region.
At first glance, the positions of Paladin Energy and Stanmore Resources in the earnings upgrade table appear at odds with their respective reporting of financials.
Positively, management at Paladin assigned a valuation of US$1.325bn to the company’s Patterson Lake South project, prompting Shaw and Partners to upgrade its own valuation to US$1.088bn from US$917m.
Also, UBS has turned incrementally more bullish on uranium, suggesting the U3O8 spot price has plateaued near US$75/lb and fundamentals are improving.
Ord Minnett considers Paladin its top uranium growth pick under the broker’s coverage on the ASX, with production forecast to reach circa 17mlb annually by FY33, a 24% compound growth rate from FY25.
For Stanmore Resources, here the percentage uptick in average earnings forecast was exaggerated by the small forecast numbers involved.
Ord Minnett noted profit was better than expected due to lower depreciation, while cash of US$181m was in line with debt at US$272m, slightly lower than anticipated.
Apparent aberrations in the earnings downgrade table relate to NextDC, Cobram Estate Olives, and Perseus Mining, which all exceeded expectations during reporting season.
NextDC’s FY25 results were positively received, with the majority of earnings upgrades by brokers relating to FY27 due to a faster than expected ramp up in billing. Shorter-term, higher spending weighs on forecasts.
Similarly, the positives for Cobram Estate Olives are expected further out. In the US, pricing and mix are expected to provide tailwinds, noted Shaw and Partners, with significant supply expected from FY27-29 from maturing groves. The company’s average target price increased by nearly 20% last week in anticipation.
For Perseus Mining, UBS explained FY26 will be an investment year with lower production, higher costs, and negative free cash flow due to funding of the Central Ashanti Mine in Ghana and the Nyanzaga gold project in Tanzania.
Separate to reporting season, management at Nufarm (September year-end) issued a trading update where metrics came in slightly below consensus across most measures, noted Macquarie, including leverage guidance, net debt, and implied earnings.
Operationally, the analyst assured investors conditions are broadly unchanged versus the first half, with AgChem earnings momentum continuing amidst margin improvement across "most markets".
Bell Potter also noted Nufarm’s balance sheet is trending better on leverage despite higher absolute debt, leaving its 12-month target price unchanged at $3.45.
Sigma Healthcare received two upgrades by separate brokers following its maiden FY25 result as a merged entity with Chemist Warehouse which represents a full twelve months’ contribution from Chemist Warehouse and four and a half months of Sigma.
Store count and synergies grew as explained at https://fnarena.com/index.php/2025/08/29/sigma-healthcares-four-pillars-of-growth/
Following an earnings beat, the average target for Lovisa Holdings rose by around 20%, but the retailer received three downgrades from brokers upon a rapidly surging share price.
Elsewhere, Fortescue and Lynas Rare Earths received respectively three and two downgrades, after their respective earnings releases disappointed.
Total Buy ratings in the database comprises 58.45% of the total, versus 32.70% on Neutral/Hold, while Sell ratings account for the remaining 8.85%.
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