Rudi’s View: Catalyst Metals, Dexus, Neuren, Stockland, ResMed & More

This story features JAMES HARDIE INDUSTRIES PLC, and other companies.
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The company is included in ASX50, ASX100, ASX200, ASX300 and ALL-ORDS

In today's update:

-Another August Record: Volatility!
-Greenshoots For Resi
-A-REITs Are Winners
-Gold Bull Awakens
-No Change At Morgan Stanley
-Healthcare Needs A Cure

By Rudi Filapek-Vandyck, Editor

When I finished writing Weekly Insights on Tuesday afternoon, it was my intention to dig deeper into individual companies and performances during the August results season, but time has not worked in my favour on Thursday.

So that idea has now shifted to the next Weekly Insights coming Monday. Meanwhile, below are some of the cherries from analysts’ conclusions and responses post August results.

Another August Record: Voilatility!

If your impression is that volatility for Australian equity has seldom been as high during results season as in the past month, you’re most likely on the mark.

Some statistics gathered by analysts at Wilsons:

-Average post-result intraday trading range 7.7% (a record)
-Circa 50% of ASX200 constituents experienced share price moves of 5% or more
-Some 30% of on-the-day share price moves exceeded 10%

Among the heaviest hit were large caps James Hardie ((JHX)), down -25%, CSL ((CSL)), down -21%, WiseTech Global ((WTC)), down -15%, Amcor ((AMC)), down -11%, and Woolworths Group ((WOW)), down -9%.

August results triggered a number of changes for Wilsons’ Focus Portfolio.

On reduced confidence, exposure to CSL has been downgraded (by half) while no confidence was left after James Hardie’s newest debacle, so all shares in that company have been divested.

Winners already in the Portfolio that saw their weighting increased; Goodman Group ((GMG)), ResMed ((RMD)) and Pinnacle Investment Management ((PNI)).

Post August, the Portfolio’s largest overweight positions are ANZ Bank ((ANZ)), ResMed, Pinnacle Investment Management and Goodman Group.

Other high conviction holdings currently include Stockland ((SGP)), CAR Group ((CAR)), WiseTech Global ((WTC)), Xero ((XRO)), The Lottery Corp ((TLC)), and Brambles ((BXB)).

From a sector perspective, the Focus Portfolio’s largest overweights are in Consumer Services, Technology and Real Estate.

Banks remain underweighted through no exposure to CommBank ((CBA)) or National Australia Bank ((NAB)), with the analysts referring to valuation concerns and uncompelling growth.

Greenshoots For Resi

One of the greenshoots that emerged from the August reporting season is a renewed uptrend in residential property development and the general consensus seems to be that Stockland ((SGP)) is the best option available on the ASX to seek leverage to the theme.

As mentioned above, Wilsons’ Model Portfolio added the stock following the release of FY25 financials in August. Sector analysts at Morgan Stanley too have articulated their preference for Stockland over Mirvac Group ((MGR)), though both should be natural beneficiaries.

Depending on how strong exactly the sector upswing will prove to be, and further RBA rate cuts might prove influential in this regard, but Morgan Stanley suggests both companies should achieve guidance for the year ahead, with risk to the upside.

Stockland is preferred because it has a relatively higher exposure to the residential segment, construction risk is deemed lower and the shares are trading on a cheaper valuation.

A-REITs Are Winners

Another sector that marked August as a true ‘come back’ experience are ASX-listed REITs. Jarden’s sector analysts report “there is much to be excited about”.

Not unimportant: Jarden is counting on two further RBA rate cuts over the coming 6-9 months.

Among the positives cited are transaction volumes picking up, cap rates starting to move down while rental/price growth, helped by limited supply across most asset classes, is driving up asset values. Also: balance sheets across the sector are in good shape and most REITs have a range of capital management options to fund the next leg of the growth cycle.

Jarden’s post-August sector update includes no fewer than 16 fresh price targets and four rating changes. The over-riding conclusion is there should be ample of opportunity to achieve double-digit gains from the sector in the year ahead.

Firstly, the rating changes. Ingenia Communities ((INA)) has been upgraded to Buy from Overweight. Both Abacus Storage King ((ASK)) and Charter Hall Retail REIT ((CQR)) have been upgraded to Overweight from Neutral. Overweight sits in between Buy and Neutral.

The one downgrade went to HMC Capital ((HMC)), former highflyer whose market update flopped in August, with Jarden’s rating falling to Neutral from Overweight.

Now over to the sector team’s preferences. At this point of the cycle, Jarden continues to like active fund managers in the sector, which in this case reflects well on both Goodman Group ((GMG)) and Charter Hall ((CHC)).

For exposure to residential property through REITs, Jarden’s favourite is Ingenia Communities. Again (see also above), Stockland is preferred over Mirvac.

Jarden also likes Self-storage and Arena REIT ((ARF)).

Are all rated Buy:

-Goodman Group
-Ingenia Communities
-National Storage ((NSR))
-HomeCo Daily Needs REIT ((HDN))

Seven more REITs are rated Overweight. Seven others are rated Neutral.

This leaves the following on Underweight:

-Dexus ((DXS))
-Lifestyle Communities ((LIC))
-BWP Trust ((BWP))
-Centuria Office ((COF))
-Charter Hall long WALE ((CLW))

Jarden has currently no Sell ratings in this sector.

Sector analysts at UBS are a little less bullish, but still positively biased overall. UBS finds the sector is now much more “fairly” valued, following a positive August experience, but further upside can definitely be achieved on the back of RBA rate cuts or stronger earnings growth “if accretive acquisitions can be equity funded”.

UBS has Sell ratings for Vicinity Centres ((VCX)) and Charter Hall. While Goodman Group’s FY25 update didn’t quite meet high expectations, the shares are still expected to find solid support.

The one key negative market update last month is identified as the one delivered by Centuria Office. Key standout results, as far as UBS is concerned, were released by Centuria Capital Group ((CNI)), Stockland, Lifestyle Communities, and GPT Group ((GPT)).

This broker’s Key Buy ratings are reserved for Dexus, Lifestyle Communities, Centuria Industrial REIT ((CIP)), BWP Trust, and National Storage.

Gold Bull Awakens

The local gold mining sector crowned itself as one of the stand-out performers in August. A renewed uptrend for the price of bullion provided the necessary trigger as the world’s anxiety grows (yet again) about how governments in Europe and inside the Whitehouse plan to finance their budget deficits.

Analysts at Morgans see plenty of evidence a fresh bull market for the sector is unfolding. Among the signals: significant capital flowing into small and micro-cap equity exposures.

Morgans has lifted its long-term bullion price forecast to US$2500/oz from US$2200.

And now for the tricky part; amongst the many (and strong) share price rallies, which ASX-listed gold miner/explorer/developer is still a comfortable Buy?

Morgans prefers Northern Star ((NST)) over Newmont Corp ((NEM)), Catalyst Metals ((CYL)) among MidCappers, and rates alternative favourites Meeka Metals ((MEK)) and Minerals 260 ((MI6)) both as Speculative Buys.

A few days ahead of Morgans’ update, gold sector analysts at Macquarie had equally switched their preference among large caps to Northern Star from Newmont.

Among MidCaps, Macquarie prefers Genesis Minerals ((GMD)) and Vault Minerals ((VAU)).

Only one Underperform rating is currently active at Macquarie and it’s reserved for Evolution Mining ((EVN)).

No Change At Morgan Stanley

In contrast with Wilsons’ Focus List (above), Morgan Stanley’s Australia Macro+ Focus List has seen no changes since April this year.

Hence, the ten stocks included remain (note the continuous inclusion of James Hardie):

-Aristocrat Leisure ((ALL))
-ANZ Bank
-Car Group
-Goodman Group
-GPT Group
-James Hardie
-Orica ((ORI))
-Santos ((STO))
-Suncorp Group ((SUN))
-Xero

Healthcare Needs A Cure

The title of most disappointing sector in August goes to Healthcare and analysts at Wilsons, for one, report they cannot remember a time when the disparity between companies in the sector they like or dislike has been as stark as post August 2025.

Wilsons number one sector favourite –“far and away”– is ResMed, with Fisher & Paykel Healthcare ((FPH)) a distant second.

During August, Wilsons upgraded Pro Medicus ((PME)) to Overweight. Cochlear ((COH)) is believed to be cum downgrade.

And while the analysts are happy to keep CSL on Marketweight, they’d hoped to become more positive on each of Ramsay Health Care ((RHC)), Monash IVF ((MVF)) and Healius ((HLS)), but were disappointed, yet again.

Other favourites are Neuren Pharmaceuticals ((NEU)), Clarity Pharmaceuticals ((CU6)), Clinical Labs ((ACL)), and Somnomed ((SOM)).

Healthcare sector analysts at Canaccord Genuity have identified their candidates for a re-rating over the year ahead. Ahead of the plans to merge with Wilsons, Canaccord’s focus is still very much on the smaller end of the ASX.

Key stocks to potentially re-rate over the next 6 months:

-Botanix Pharmaceuticals ((BOT))
-Clarity Pharmaceuticals
-Integral Diagnostics ((IDX))
-PYC Therapeutics ((PYC))

Key stocks to potentially re-rate over the next 12 months:
-EBR Systems ((EBR))
-Immutep ((IMM))
-Imricor Medical Systems ((IMR))
-Neuren Pharmaceuticals

P.S. Whenever RBC Capital releases a list of international key picks for exposure to energy it standard features Woodside Energy ((WDS)). That has not changed.

(Do note that, in line with all my analyses, appearances and presentations, all of the above names and calculations are provided for educational purposes only. Investors should always consult with their licensed investment advisor first, before making any decisions.)  

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P.S. II – If you are reading this story through a third party distribution channel and you cannot see charts included, we apologise, but technical limitations are to blame.

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