Weekly Reports | 11:00 AM
Broker Rating Changes (Post Thursday Last Week)
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BENDIGO & ADELAIDE BANK LIMITED ((BEN)) Upgrade to Overweight from Neutral by Jarden.B/H/S: 0/0/0
Jarden upgrades Bendigo & Adelaide Bank to Overweight with an unchanged $11.00 target price following the announcement of licence conditions imposed by regulatory authorities to uplift non-financial risk management.
The analyst highlights that this remediation will cost an estimated -$70m pre-tax over three years and will be booked as a provision in FY26, alongside early unaudited financial results demonstrating strong underlying business trends.
The broker's estimates show that second-half performance proved optimisation strategies are working as margins stabilised despite intense competition and volume growth.
Management continues to navigate outstanding regulatory matters such as an unresolved AUSTRAC issue that is likely to result in a fine, commentary suggests.
The valuation is supported by the analyst's view that these headwinds are now fully factored into the share price.
CSL LIMITED ((CSL)) Upgrade to Overweight from Neutral by Jarden.B/H/S: 0/0/0
Jarden upgrades CSL to Overweight from Neutral with its target price increased to $207.00 from $191.00 following an FY26 result that demonstrated better-than-expected operating profit across every division.
The analyst highlights that, although a step-up in sales force investment weighed on FY26 net profit after tax, constant currency performance landed marginally ahead of guidance.
The broker's estimates factor in restored confidence through FY27 guidance, which anticipates mid-single-digit growth for Behring and mid-to-high single-digit growth for immunoglobulin, easing prior fears regarding plasma collection.
Management expects low single-digit growth for Seqirus, whereas Vifor continues to face headwinds resulting in a projected -25% revenue decline for its portfolio in FY27.
The valuation is supported by a better overall growth outlook, cost-out initiatives, sales force reinvestment, and a US$1.1b share buyback.
MIRVAC GROUP ((MGR)) Upgrade to Buy from Overweight by Jarden.B/H/S: 0/0/0
Jarden upgrades to a Buy rating for Mirvac Group with a $2.24 target price following an FY26 operating earnings per share result of 12.9c and initial FY27 guidance of 13.2c to 13.4c.
The analyst highlights that residential sales volumes and settlement guidance imply resilience alongside a newly announced share buyback of up to $200m supported by gearing of 24.1%.
The broker's estimates factor in sound fourth-quarter residential sales and steady performance across office, industrial, and retail portfolios.
Management continues to benefit from strong pre-sales and manageable debt costs without assuming dilutive asset sales, the report concludes.
STORAGE KING GROUP ((SKG)) Upgrade to Neutral from Underweight by Jarden.B/H/S: 0/0/0
Jarden upgrade to a Neutral rating for Storage King with its target price decreased to $1.24 from $1.42 following significant earnings downgrades across the forecast period.
The analyst notes the stock trades on an updated FY27 price-to-earnings multiple of 23x compared to its 20x historical average since listing, reflecting fair valuation given improved growth following the rebase and corporate appeal as the sole ASX-listed storage operator.
Softer operating conditions, low debt hedging of 41% into FY28, and limited clarity surrounding long-term development funding present key operational headwinds.
The broker's estimates incorporate outer-year earnings downgrades, driving the reduced target price while maintaining a balanced risk profile.
The analyst highlights potential sector consolidation and stronger medium-term expansion off a rebased FY27 foundation as key supports for the investment case.
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