Australian Broker Call

Citi rates BKW as Neutral (3) -

Citi notes Brickworks' FY19 performance beat the company's own guidance (4% growth versus flat guidance), broadly showing off the inherent resilience that stems from a diversified set of operations. Record earnings from the Property business helped, of course.

The analysts highlight recent US brick acquisitions, Glen-Gery and Sioux City, are delivering incremental profit growth and further bolt-on acquisitions should be expected. Target price $18.50 with the analysts suggesting the domestic housing market is bottoming. Neutral.

Target price is $18.50 Current Price is $17.94 Difference: $0.56
If BKW meets the Citi target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $17.57, suggesting downside of -2.1% (ex-dividends)

The company's fiscal year ends in July.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.0

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Macquarie rates BKW as Neutral (3) -

FY19 net profit was slightly ahead of expectations. Property was the main driver of growth while earnings were softer in investments and building products.

Macquarie remains cautious, as a receding contribution from property and investments and uncertainties in building products means profits are under pressure and forward multiples remain comparatively unattractive.

Neutral rating retained. Target is raised to $17.05 from $16.10.

Target price is $17.05 Current Price is $17.94 Difference: minus $0.89 (current price is over target).
If BKW meets the Macquarie target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $17.57, suggesting downside of -2.1% (ex-dividends)

The company's fiscal year ends in July.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.0

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Morgans rates BKW as Hold (3) -

FY19 result was slightly ahead of forecasts. Property earnings stood out, up 68%, on the back of significant revaluation, profit within the trust and the completion of the sale of the Punchbowl property.

Earnings in Australian building products fell -27% and investments -16%. Morgans notes North American earnings in FY20 will be boosted by the recent acquisition of Sioux City Brick.

The broker maintains a Hold rating and raises the target to $17.15 from $16.01.

Target price is $17.15 Current Price is $17.94 Difference: minus $0.79 (current price is over target).
If BKW meets the Morgans target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $17.57, suggesting downside of -2.1% (ex-dividends)

The company's fiscal year ends in July.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.0

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Credit Suisse rates BPT as Neutral (3) -

ExxonMobil has announced its Victorian Bass Strait interests may be for sale as part of an ongoing evaluation of assets. Given the commercial complexity, a sale process could take 2-3 years, Credit Suisse assesses.

The broker considers Beach Energy a leading contender to possibly acquire the assets. In order to dilute balance sheet risk the company could participate as part of a consortium, or may even be able to solely fund the acquisition without an equity raising.

The broker envisages a strategic fit for Beach Energy. It could also push the company into the ASX30 from the ASX100. Neutral rating and $2.11 target.

Target price is $2.11 Current Price is $2.61 Difference: minus $0.5 (current price is over target).
If BPT meets the Credit Suisse target it will return approximately minus 19% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.25, suggesting downside of -13.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.0

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Ord Minnett rates BPT as Hold (3) -

ExxonMobil appears likely to sell its stake in the Gippsland Basin joint venture. Ord Minnett notes, in addition, Mitsui & Co could be looking to sell out of its 35% stake in the BassGas project. The broker believes Beach Energy is likely to participate in the processes.

However, funding an acquisition such as the ExxonMobil stake in the Gippsland Basin could be an issue, given its scale and the fact that BHP Group ((BHP)) is the joint venture partner.

BHP Group could either exercise pre-emptive rights or, equally, exit the assets, thus making an acquisition an even larger bite to digest. Hold rating and $2.55 target maintained.

Target price is $2.55 Current Price is $2.61 Difference: minus $0.06 (current price is over target).
If BPT meets the Ord Minnett target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.25, suggesting downside of -13.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.0

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Morgans rates CMA as Hold (3) -

The company has purchased two A-grade office assets in Sydney and Perth for $380.5m. The acquisitions will be funded via a placement and entitlement issue as well as new debt.

Morgans finds the FY20 distribution yield attractive, underpinned by contracted rental income. Near-term catalysts for the company relate to successful leasing outcomes. Hold rating maintained. Target rises to $2.90 from $2.83.

Target price is $2.90 Current Price is $2.96 Difference: minus $0.06 (current price is over target).
If CMA meets the Morgans target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.0

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

UBS rates CMA as Downgrade to Neutral from Buy (3) -

The company has acquired two assets for $380.5m, funded with a $273m equity raising. UBS increases the valuation, raising the target to $2.82 from $2.74, after incorporating the transaction, but downgrades to Neutral from Buy on valuation grounds.

The company has acquired 8 Central Avenue Eveleigh, Sydney, and William Square, Northbridge, Western Australia.

UBS assesses the overall transaction is neutral or marginally dilutive to free funds from operations (FFO). The company expects FFO in FY20 to be 18.7c per security.

Target price is $2.82 Current Price is $2.96 Difference: minus $0.14 (current price is over target).
If CMA meets the UBS target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.0

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Morgans rates ICQ as Add (1) -

The company has a binding agreement to purchase Carmudi Indonesia, after the offshore parent decided to quit Asia. This provides iCar Asia with the opportunity to buy the number two operator in Indonesia.

The deal delivers scale economies that are well ahead of what could have been achieved organically, Morgans observes. The broker expects the last unprofitable region for iCar Asia will now become cash positive two years earlier than previously expected.

Add rating maintained. Target rises to $0.38 from $0.32.

Target price is $0.38 Current Price is $0.30 Difference: $0.08
If ICQ meets the Morgans target it will return approximately 27% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 1.0

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Morgans rates IFN as Reinstate coverage with Hold (3) -

Morgans believes Infigen Energy's approach to delivering energy to customers is the future of the National Electricity Market and remains confident the company can grow retail volumes and earnings in the face of declining carbon prices.

The recent acquisition of gas-fired generation allows the company to hedge future retail growth more cheaply and with greater flexibility than the derivatives market. The broker reinstates coverage with a Hold rating and $0.64 target.

Target price is $0.64 Current Price is $0.64 Difference: $0
If IFN meets the Morgans target it will return approximately 0% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.7

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Macquarie rates MFG as Upgrade to Neutral from Underperform (3) -

Following a recent de-rating in the share price along with relative outperformance, Macquarie upgrades to Neutral from Underperform. Target is $50.

The company's $275m capital raising in isolation would result in just under -3% dilution, the broker calculates. Offsetting this, the proceeds will be used to launch the Magellan High Conviction Trust as well as a new retirement product and seed new investment strategies.

Target price is $50.00 Current Price is $52.38 Difference: minus $2.38 (current price is over target).
If MFG meets the Macquarie target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $49.17, suggesting downside of -6.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: -0.7

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

UBS rates OGC as Buy (1) -

The share price has declined -23% over 2019 to date and underperformed the gold price. UBS attributes this to the regulatory issues surrounding Didipio and to a lesser extent production issues at Haile.

The broker, having recently upgraded to Buy, assesses the share price does not include value for Didipio so any resolution would be a positive catalyst. Sequential production and cost improvements at Haile should also be considered positive developments.

Management remains very confident the mining lease at Didipio will be granted soon because of strong support from regulators and the office of the Philippines President. Target is $4.

Target price is $4.00 Current Price is $3.87 Difference: $0.13
If OGC meets the UBS target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $4.78, suggesting upside of 23.5% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY19:

Forecast for FY20:

This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.

Market Sentiment: 0.9

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Ord Minnett rates RWC as Accumulate (2) -

Ord Minnett found useful detail on the sale split by product and channel across the company's divisions at the US investor briefing. The focus was on the business outside of the Asia-Pacific region.

A key point for the broker is that 75% of the portfolio is expected to grow at above end-market trends. Accumulate rating and $4.50 target maintained.

Target price is $4.50 Current Price is $4.00 Difference: $0.5
If RWC meets the Ord Minnett target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $4.11, suggesting upside of 2.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.4

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources

Ord Minnett rates STO as Buy (1) -

Flow test results from Dorado-3 provided by Carnarvon Petroleum ((CVN)) were better than expected. The condensate-to-gas ratio was above the upper end of the range provided by fluid sampling from the earlier Dorado-2 well.

Ord Minnett considers this yield supports further de-risking of the development concept at Dorado. Buy rating and $7.90 target maintained.

Target price is $7.90 Current Price is $7.79 Difference: $0.11
If STO meets the Ord Minnett target it will return approximately 1% (excluding dividends, fees and charges).

Current consensus price target is $7.64, suggesting downside of -1.9% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY19:

Forecast for FY20:

This company reports in USD. All estimates have been converted into AUD by FNArena at present FX values.

Market Sentiment: 0.6

All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources