Weekly Reports | 10:30 AM
A summary of the highlights from Broker Call Extra updates throughout the week past.
Broker Rating Changes (Post Thursday Last Week)
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IMDEX LIMITED ((IMD)) Upgrade to Underweight from Sell by Jarden.B/H/S: 0/0/0
Jarden upgrades Imdex to an Underweight rating with its target price increased to $3.80 from $3.60 ahead of the upcoming FY26 financial results release.
The analyst notes fourth-quarter revenue growth must reach 24% to meet market consensus expectations.
The broker's estimates lift FY27 earnings per share by 3% and FY28 by 2%, remaining well below consensus forecasts.
Watch points for the result include second-half EBITDA margin expansion despite foreign exchange headwinds and the organic versus inorganic earnings split following recent acquisitions.
The suggestion is current valuation multiples appear stretched versus historical levels, with constructive market conditions largely priced into the stock.
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BETMAKERS TECHNOLOGY GROUP LIMITED ((BET)) Downgrade to Hold from Buy by Canaccord Genuity.B/H/S: 0/0/0
Canaccord Genuity downgrades Betmakers Technology to a Hold rating with its target price decreased to $0.24 from $0.25 following the announcement of a Scheme of Arrangement with Tabcorp Holdings ((TAH)).
Under the proposed transaction, shareholders will receive $0.24 per share in cash or partial scrip, valuing the entity at $283m and representing a 45.5% premium to the last closing price.
The board unanimously supports the deal alongside directors intending to vote their 10% holdings in favour, subject to an independent expert review and no superior proposal emerging.
The analyst considers a competing bid unlikely given the $30m in synergies Tabcorp expects to extract from the acquisition.
With the current share price trading near the proposed offer, the broker views the transaction as a fair representation of near-term value ahead of targeted completion in the third quarter of 2027.
COMPUTERSHARE LIMITED ((CPU)) Downgrade to Underweight from Neutral by Jarden.B/H/S: 0/0/0
Jarden maintains an Underweight rating for Computershare with its target price decreased to $31.10 from $31.90 following the release of FY26 results arriving in line with expectations.
Stronger margin income offset slower growth in core operating segments, particularly across Issuer Services and Corporate Trust where stranded costs and changing revenue composition created a drag.
Management provided maiden FY27 earnings guidance of US154cps, representing 4.8% growth supported by higher margin income, lowered debt levels, and an expanded cost-out program targeting $82m in total savings.
The broker lifts near-term earnings per share forecasts by 2%-3% to reflect these tailwinds.
Jarden remains cautious regarding the longer-term outlook, noting earnings composition is increasingly reliant on macroeconomic factors while disintermediation risks surrounding United States tokenisation programs remain a significant overhang.
CHARTER HALL RETAIL REIT ((CQR)) Downgrade to Hold from Buy by Moelis.B/H/S: 0/0/0
Moelis downgrades Charter Hall Retail REIT to a Hold rating while its target price is increased to $4.51 from $4.48 on valuation grounds.
The trust delivered a solid full-year operating result supported by active portfolio curation and debt refinancing, though higher interest rate assumptions lead to lower per-share earnings estimates.
Look-through gearing remains elevated above 40%, leaving earnings sensitive to interest rate movements as debt hedging coverage rolls off into FY28.
Operating performance across the underlying portfolio remains robust, with same-property net property income growing 3.0% and shopping centre vacancy tightening to a 15-year low of 0.9%.
Shares trade at an implied capitalisation rate of 6.0%, which the analyst views as relatively inexpensive but sitting close to fair value following recent share price outperformance.
INSURANCE AUSTRALIA GROUP LIMITED ((IAG)) Downgrade to Neutral from Overweight by Jarden.B/H/S: 0/0/0
Jarden downgrades to a Neutral rating for Insurance Australia Group with a $8.00 target price following full-year results displaying strong top-line momentum alongside margin compression.
Gross written premium grew 7.6% across FY26 to reach $18,412m, meeting consensus expectations through direct momentum acceleration in Australia and New Zealand during the fourth quarter.
Underlying insurance trading margins of 15.0% fell short of market expectations, reflecting slower remediation progress within the RACQ business.
For FY27, management provided gross written premium growth guidance of 5%-8% and a reported insurance trading margin target range of 14.5%-16.5%.
The analyst views the overall result as messy, noting tension between top-line expansion confidence and margin recovery concerns while awaiting regulatory review outcomes for the proposed RACWA acquisition.
OOH!MEDIA LIMITED ((OML)) Downgrade to Hold from Buy by Canaccord Genuity.B/H/S: 0/0/0
Canaccord Genuity downgrades oOh!media to a Hold rating with its target price decreased to $1.70 from $1.85 following the announcement of a binding Scheme Implementation Agreement with I Squared Capital.
Under the proposed transaction, shareholders will receive total cash consideration of $1.70 per share, comprising $1.68 in scheme consideration alongside an already declared 2.0c fully franked interim dividend.
The offer values the entity at an $898m equity value and a $1.04bn enterprise value, representing a 6.9% premium to the last closing price of $1.59.
The board unanimously recommends the market-tested outcome in the absence of a superior proposal, noting the potential payment of a 10c fully franked special dividend prior to implementation.
With the broker's estimates valuing the shares at 13.9x forward earnings, the analyst views the agreed consideration as a fully tested market outcome and aligns the valuation directly with the cash offer.
| Order | Company | New Rating | Old Rating | Broker | |
|---|---|---|---|---|---|
| Upgrade | |||||
| 1 | IMDEX LIMITED | Sell | Sell | Jarden | |
| Downgrade | |||||
| 2 | BETMAKERS TECHNOLOGY GROUP LIMITED | Neutral | Buy | Canaccord Genuity | |
| 3 | CHARTER HALL RETAIL REIT | Neutral | Buy | Moelis | |
| 4 | COMPUTERSHARE LIMITED | Sell | Neutral | Jarden | |
| 5 | INSURANCE AUSTRALIA GROUP LIMITED | Neutral | Buy | Jarden | |
| 6 | OOH!MEDIA LIMITED | Neutral | Buy | Canaccord Genuity | |
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