Australian Broker Call

Citi rates AGL as Upgrade to Buy from Neutral (1) -

Citi analysts had been absent since April (last rating Neutral). They made a come-back by going against the grain, upgrading to Buy on the argument that investor concerns about political intervention risks are by now well and truly priced in, and possibly with too much emphasis on potential downside.

There is one caveat, in that the reintroduction of a carbon price if Labor is reelected could still materially impact on the valuation of the business. Price target $20.27.

Target price is $20.27 Current Price is $18.61 Difference: $1.66
If AGL meets the Citi target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $20.63, suggesting upside of 10.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.1

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

Citi rates APX as Buy (1) -

Citi analysts reiterate their Buy rating, while lifting the price target to $17.31 from $17.13 following yet another profit guidance upgrade by Appen management. This company is a market leader, highlight the analysts, while emphasising they remain positive on its outlook.

The analysts note the company's guidance is based upon AUD/USD at 80c, which suggests further upside almost seems like a given. Part of the broker's optimism stems from synergies from the LeapForce acquisition, which are yet to kick in, and longer term from the strong demand for Artificial Intelligence services.

Target price is $17.31 Current Price is $12.98 Difference: $4.33
If APX meets the Citi target it will return approximately 33% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.5

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

UBS rates APX as Neutral (3) -

The company has upgraded 2018 operating earnings guidance (EBITDA) for the second time in three months, now expecting $62-65m. The reason for the upgrade is a sharp increase in monthly revenue, largely relating to existing projects.

While currency will be a tailwind, UBS understands an assumption for the Australian dollar of US$0.80 applies for the remainder of the year. Therefore, should the spot price of US$0.72 hold for the remainder of the year this would drive an extra 2% to the top end of guidance.

UBS maintains a Neutral rating and $15.65  target.

Target price is $15.65 Current Price is $12.98 Difference: $2.67
If APX meets the UBS target it will return approximately 21% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.5

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

Citi rates AZJ as Sell (5) -

Citi analysts report the Queensland Competition Authority has announced the extension of transitional tariffs for Aurizon's Network business until 30 June 2019, or the date of approval of a replacement undertaking. While this is consistent with the broker's base case, there are a few implications that should have investors' attention.

The analysts believe the decision could prove a positive for Network earnings in FY19, but there could be a halving of earnings in FY20 "if the UT5 Final decision reflects the Draft decision released in December 2017". The outcome of the Final UT5 decision is expected before the end of this month. Sell. Target price $3.80.

Target price is $3.80 Current Price is $4.18 Difference: minus $0.38 (current price is over target).
If AZJ meets the Citi target it will return approximately minus 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.24, suggesting upside of 1.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.1

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

Credit Suisse rates CQR as Neutral (3) -

Management has reaffirmed FY19 guidance at the AGM. Free funds from operations are expected to grow by 2% and the distribution payout-out ratio is expected to be between 90-95%.

Credit Suisse incorporates the recent asset disposals into forecasts and makes minor changes to earnings estimates. Neutral maintained. Target rises to $4.17 from $4.16.

Target price is $4.17 Current Price is $4.34 Difference: minus $0.17 (current price is over target).
If CQR meets the Credit Suisse target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.08, suggesting downside of -6.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.4

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

Macquarie rates ECX as Outperform (1) -

Results were in line with the August downgrade, Macquarie observes. All segments are expected to deliver revenue and profit growth in FY19. Capitalisation stabilised in the second half and an improvement in FY19 is expected.

Macquarie maintains an Outperform rating on the back of the McMillan Shakespeare ((MMS)) merger proposal and the potential for another bid. Target is reduced to $2.52 from $2.56.

Target price is $2.52 Current Price is $2.63 Difference: minus $0.11 (current price is over target).
If ECX meets the Macquarie target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.54, suggesting downside of -3.3% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.4

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

UBS rates ECX as No Rating (-1) -

FY18 results were in line with estimates. UBS found the result mixed, with higher operating costs offset by lower second half tax rate. FY19 guidance is for growth across all business segments.

The broker expects a solid performance from the core Australasian fleet and commercial business.

The broker is advising on the merger with McMillan Shakespeare ((MMS)) and is currently restricted on a recommendation or target price.

Current Price is $2.63. Target price not assessed.

Current consensus price target is $2.54, suggesting downside of -3.3% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.4

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

Morgans rates FTT as Downgrade to Reduce from Add (5) -

The phase 2 trial for Factor Therapeutics' treatment for venous leg ulcers failed at all levels. Ongoing development has been halted and the company will now look for ways to reduce costs and preserve cash and intellectual property.

Morgans downgrades to Reduce from Add. Target falls to 0.6c from 0.093c

Target price is $0.06

The company's fiscal year ends in December.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: -1.0

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

Morgan Stanley rates GEM as Equal-weight (3) -

The company has updated guidance in conjunction with the investor briefing. Occupancy appears to be flattening ahead of Morgan Stanley's expectations. Guidance is for 2018 operating earnings (EBIT) of $136-139m, in line with consensus forecasts.

The company has provided longer-term targets, including improving occupancy to 81% by FY22, although Morgan Stanley believes it is too early to extrapolate the momentum.

Equal-weight maintained. Target is $2.30. Industry view is In-Line.

Target price is $2.30 Current Price is $2.84 Difference: minus $0.54 (current price is over target).
If GEM meets the Morgan Stanley target it will return approximately minus 19% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.41, suggesting downside of -15.1% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.5

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

Ord Minnett rates GEM as Buy (1) -

The trading update highlighted that second half occupancy is now running slightly ahead of expectations. While the company signalled a slight downgrade to earnings expectations, largely because of the acquisition of Oxanda, the occupancy update is considered encouraging for underlying operations.

Ord Minnett suspects this update could mark the low point for the stock and will look for evidence of operating improvement going forward. Buy rating maintained. Target is raised to $2.85 from $2.55.

Target price is $2.85 Current Price is $2.84 Difference: $0.01
If GEM meets the Ord Minnett target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $2.41, suggesting downside of -15.1% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.5

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

Credit Suisse rates GNC as Outperform (1) -

FY19 is becoming a particularly difficult year for grain growers on the east coast but Credit Suisse believes the market is underestimating the structural improvements being made in Graincorp's business and the opportunities for asset rationalisation.

The broker acknowledges catalysts depend on asset sales and crop production and reduces the target to $9.04 from $9.10 because of near-term earnings downgrades.

As peak capital expenditure has passed, the broker expects net debt to fall in FY19 and commodity inventory to unwind quickly. Outperform maintained.

Target price is $9.04 Current Price is $7.74 Difference: $1.3
If GNC meets the Credit Suisse target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $8.38, suggesting upside of 8.3% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.4

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

Deutsche Bank rates GNC as Buy (1) -

Deutsche Bank considers the FY18 result positive, with the performance of the malt division exceeding already strong growth expectations.

The crop outlook was incrementally worse in terms of FY19 expectations, although the broker believes the market will overlook the record drought and focus on growth, diversification and cost reductions in FY20.

Buy rating maintained. Target is $9.40.

Target price is $9.40 Current Price is $7.74 Difference: $1.66
If GNC meets the Deutsche Bank target it will return approximately 21% (excluding dividends, fees and charges).

Current consensus price target is $8.38, suggesting upside of 8.3% (ex-dividends)

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.4

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

Macquarie rates GNC as Neutral (3) -

FY18 net profit was in line with expectations. While operating earnings for grains were better than Macquarie expected, this was only one-third of FY17 levels.

Meanwhile, the outlook for the FY19 crop is even weaker still, and the broker's estimate for receivables now means grains will move into a loss situation.

Malt continues to be the mainstay, driven by craft beer and the broker estimates 9% growth in earnings in the year ahead.

Macquarie reduces FY19 estimates for earnings per share by -55%. Target is lowered to $7.86 from $8.12. Neutral rating maintained.

Target price is $7.86 Current Price is $7.74 Difference: $0.12
If GNC meets the Macquarie target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $8.38, suggesting upside of 8.3% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.4

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

Morgans rates GNC as Hold (3) -

Graincorp's FY18 result was weak as expected, thanks to a drought-impacted east coast grain crop. But the broker does not believe the current share price is fully acknowledging the severity of the as yet unbroken drought, which could see the company's worst year for grains in a decade in FY19, which sees the broker cut forecasts accordingly and its target to $7.20 from $7.22.

In the shorter term, the broker sees asset sales or corporate activity as the only potential catalysts. In the longer term, conditions will materially improve at some point, albeit not until FY21, the broker warns. While FY20 may see better conditions, or not, a lack of carry-over grain due to weak seasons will impact in FY20 regardless.

Hold retained.

Target price is $7.20 Current Price is $7.74 Difference: minus $0.54 (current price is over target).
If GNC meets the Morgans target it will return approximately minus 7% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $8.38, suggesting upside of 8.3% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.4

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

UBS rates GNC as Neutral (3) -

FY18 results were in line with expectations, albeit weak. UBS notes cash conversion was worse than in recent years and the result was boosted by a $9.2m gain on the sale of non-current assets.

The near-term outlook has consistently deteriorated in recent months as a result of the severe drought and the broker reduces estimates for FY19 earnings per share to around zero.

Neutral rating maintained. Target is reduced to $8.40 from $8.70.

Target price is $8.40 Current Price is $7.74 Difference: $0.66
If GNC meets the UBS target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $8.38, suggesting upside of 8.3% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.4

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

Credit Suisse rates GPT as Neutral (3) -

The company has upgraded 2018 guidance, expecting free funds from operations and distribution growth of 3.5%, previously 3.0%.

Retail metrics improved during the September quarter, Credit Suisse observes, while office and industrial assets are performing well.

The broker maintains a Neutral rating and $5.34 target.

Target price is $5.34 Current Price is $5.23 Difference: $0.11
If GPT meets the Credit Suisse target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $5.36, suggesting upside of 2.5% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: -0.1

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

Morgan Stanley rates IFL as Overweight (1) -

Despite the uncertainty, Morgan Stanley envisages value in the stock. The broker believes the market's overly bearish tone reflects the Royal Commission and concerns that ANZ Wealth will fail to realise synergies.

The risks look to be factored into the price although, until greater confidence emerges on the outlook, the broker suspects volatility will continue. Still, Morgan Stanley considers the fears of vertical integration are overdone.

Meanwhile, the ANZ Wealth asset is performing well and the broker suspects the synergies target of $65m has been struck conservatively. Overweight maintained. Target is reduced to $10.80 from $12.00. Industry view: In Line.

Target price is $10.80 Current Price is $6.87 Difference: $3.93
If IFL meets the Morgan Stanley target it will return approximately 57% (excluding dividends, fees and charges).

Current consensus price target is $9.37, suggesting upside of 36.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.8

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

UBS rates IFL as Neutral (3) -

UBS does not believe sufficient value has emerged to compensate investors for realistic risk, despite the stock having underperformed the market by around -30% over the year to date.

Allowing for reduced flow prospects, rising fee pressure and softer equity markets, UBS reduces FY20 estimates for earnings per share by -14%.

Although the acquisition of ANZ Wealth is accretive, rising regulatory scrutiny has led the broker to reduce estimates as several factors have changed. ANZ Smart Choice re-pricing now appears unlikely and net flows are deteriorating.

Neutral rating maintained. Target is reduced to $7.00 from $9.30.

Target price is $7.00 Current Price is $6.87 Difference: $0.13
If IFL meets the UBS target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $9.37, suggesting upside of 36.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.8

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

Credit Suisse rates MGR as Neutral (3) -

The company has reaffirmed FY19 guidance with growth expected in the range of 2-4% amid distribution growth of 5%. Mirvac is on track to settle over 2500 residential lots.

Going forward, Credit Suisse expects residential headwinds will impact sentiment on the stock. Neutral rating and $2.52 target maintained.

Target price is $2.52 Current Price is $2.21 Difference: $0.31
If MGR meets the Credit Suisse target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $2.48, suggesting upside of 12.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.1

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

Ord Minnett rates MIN as Accumulate (2) -

Mineral Resources has announced settled prices that are on average 14% ahead of Ord Minnett's forecasts and more than 20% above the China spot price of US$740-770/t.

Ord Minnett observes, as the settled price in the fourth quarter is lower than the third quarter, this signals realised prices have likely peaked, albeit consistent with forecasts.

The broker believes this update supports Mineral Resources, as well as other equities with hard rock assets, and maintains an Accumulate rating and $18 target.

Target price is $18.00 Current Price is $13.38 Difference: $4.62
If MIN meets the Ord Minnett target it will return approximately 35% (excluding dividends, fees and charges).

Current consensus price target is $17.83, suggesting upside of 33.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.5

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

Credit Suisse rates MYO as Neutral (3) -

The company has maintained guidance for 2018 at its investor briefing. Organic revenue growth is expected in the high single digits and an operating earnings margin (EBITDA) of 42-44% is anticipated.

Medium-term guidance provided earlier in the year is unchanged. The company has provided further detail on the composition of SME revenue, with 'do-it-yourself' products comprising 88% of the revenue base despite accounting for only 42% of subscribers.

Growth in DIY product customers has been the key driver of revenue growth in the SME segment, Credit Suisse observes. Neutral rating and $3.77 target maintained, as the offer from KKR is considered likely to be a more significant driver of the share price.

Target price is $3.77 Current Price is $3.42 Difference: $0.35
If MYO meets the Credit Suisse target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $3.29, suggesting downside of -3.9% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.0

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

Morgan Stanley rates NEA as Overweight (1) -

Morgan Stanley observes the company has experienced a strong start to FY19, with momentum in both Australia and the US.

Given the second and fourth quarters are seasonally stronger, the broker suspects the latest trading update is an indicator that the business is tracking close to FY19 forecasts.

Overweight maintained. Target is $2.00. Industry view: In-Line.

Target price is $2.00 Current Price is $1.60 Difference: $0.4
If NEA meets the Morgan Stanley target it will return approximately 25% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

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

Citi rates ORG as Upgrade to Buy from Neutral (1) -

Citi analysts have upgraded to Buy on the argument that investor concerns about political intervention risks are by now well and truly priced in, and possibly with too much emphasis on potential downside.

There is one caveat, in that the reintroduction of a carbon price if Labor is reelected could still materially impact on the valuation of the business. Excluding this scenario, Citi thinks there is enough upside potential for an upgrade to Buy from Neutral. Price target $8.52 (was $8.74).

The analysts also point out, were they to use a US$70/bbl long term oil price then the target price would increase to $/9.62shr.

Target price is $8.52 Current Price is $6.96 Difference: $1.56
If ORG meets the Citi target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $9.13, suggesting upside of 31.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.6

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

Macquarie rates OZL as Outperform (1) -

A site tour to Prominent Hill has revealed the transition to underground is now complete. Expanding the underground mining rate appears likely and the company is undertaking an extension study.

Macquarie does not incorporate an increase in the 4.0mtpa underground mining rate in forecasts, however acknowledges that running a 6.0mtpa scenario from 2022 by investing in additional haulage infrastructure could lift production by 50% per annum.

The broker maintains an Outperform rating and $11.60 target.

Target price is $11.60 Current Price is $9.10 Difference: $2.5
If OZL meets the Macquarie target it will return approximately 27% (excluding dividends, fees and charges).

Current consensus price target is $10.63, suggesting upside of 16.8% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.7

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

Ord Minnett rates PDL as Hold (3) -

FY18 net profit was up 16.5% and ahead of forecasts. Ord Minnett finds the near-term outlook soft, given volatile markets and the expected lower contribution from performance fees.

The broker expects the share price to remain under pressure in the near term, particular given the sell down by Westpac ((WBC)). Westpac has announced an intention to sell its remaining 10% holding following the first half result.

Ord Minnett maintains a Hold rating and $9 target.

Target price is $9.00 Current Price is $8.21 Difference: $0.79
If PDL meets the Ord Minnett target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $9.38, suggesting upside of 14.2% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.2

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

Morgan Stanley rates RHC as Equal-weight (3) -

The latest private health statistics show a further -0.4% decline in insured persons and growth of only 0.3% in overnight hospital episodes. Morgan Stanley believes this supports Ramsay Health Care reiterating an FY19 target for earnings growth of up to 2%.

Weak hospital volumes were anticipated but further softness in private health coverage suggest to the broker hospital volumes are unlikely to recover in the near term. Equal-weight rating. Target is $59. Industry view is In-Line.

Target price is $59.00 Current Price is $54.58 Difference: $4.42
If RHC meets the Morgan Stanley target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $59.12, suggesting upside of 8.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.3

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

Credit Suisse rates SCG as Outperform (1) -

The company has reaffirmed guidance, expecting growth of around 4% in 2018. The distribution is expected to be 22.16c, an increase of 2%.

Credit Suisse maintains an Outperform rating and $4.70 target. Risks envisaged include a more protracted retail sales slowdown and potential for development leasing shortfalls.

Target price is $4.70 Current Price is $3.89 Difference: $0.81
If SCG meets the Credit Suisse target it will return approximately 21% (excluding dividends, fees and charges).

Current consensus price target is $4.40, suggesting upside of 13.0% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.1

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

Credit Suisse rates SCP as Downgrade to Underperform from Neutral (5) -

Since the acquisition of the Vicinity Centres ((VCX)) in early October Credit Suisse observes the share price is now trading at a 13% premium to the last stated net tangible assets.

While the broker commends management on its ability to execute on its corporate strategy, the hefty premium to valuation is considered a stretch.

Rating is downgraded to Underperform from Neutral. Target is steady at $2.25.

Target price is $2.25 Current Price is $2.58 Difference: minus $0.33 (current price is over target).
If SCP meets the Credit Suisse target it will return approximately minus 13% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.38, suggesting downside of -7.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.6

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

Credit Suisse rates SGP as Neutral (3) -

The company maintained earnings guidance at its first quarter update, expecting free funds from operations growth of 5-7%, supported by residential settlements. Distribution growth of 4% is also forecast, at the lower end of the target pay-out ratio.

Credit Suisse believes the outlook is challenging for Stockland, although there is some flexibility as a result of embedded margins in the residential business.

The broker maintains a Neutral rating and reduces the target to $3.76 from $4.35.

Target price is $3.76 Current Price is $3.64 Difference: $0.12
If SGP meets the Credit Suisse target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $4.10, suggesting upside of 12.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.1

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

Macquarie rates SGR as Outperform (1) -

Macquarie assesses the risk of a new large-scale integrated resort/casino on the Gold Coast as low, given the market structure/return hurdles. The broker envisages challenges generating an appropriate return on a development larger than $400m, which compares with media speculation centred on one around $2bn.

The Gold Coast is not the most attractive market for a new casino, in the broker's opinion, relative to other regions within Australia. Outperform rating maintained. Target is $5.95.

Target price is $5.95 Current Price is $4.44 Difference: $1.51
If SGR meets the Macquarie target it will return approximately 34% (excluding dividends, fees and charges).

Current consensus price target is $5.94, suggesting upside of 33.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.9

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

Credit Suisse rates VCX as Outperform (1) -

The company has reaffirmed FY19 guidance. The distribution pay-out ratio is expected to be at the upper end of the target range of 95-100%. Credit Suisse observes retail metrics improved in the September quarter.

The broker expects management to continue pursuing a buyback as the stock is trading below net tangible assets. The wholesale funds business is also expected to become a more important part of the platform.

Outperform maintained. Target is reduced to $3.00 from $3.03.

Target price is $3.00 Current Price is $2.68 Difference: $0.32
If VCX meets the Credit Suisse target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $2.90, suggesting upside of 8.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.3

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

Deutsche Bank rates WES as Hold (3) -

Deutsche Bank has been building a new model for Coles on a stand-alone basis but for the time being imports the resultant earnings into Wesfarmers forecasts.

The broker believes the first year for Coles as a stand-alone business will be difficult, given the strong momentum at Woolworths ((WOW)).

Wesfarmers will have capacity for meaningful M&A but finding a large deal which generates acceptable returns will not be easy, in the broker's view.

Allowing for the challenges, the broker believes Wesfarmers is trading at the sum of its parts and retains a Hold rating. Target is reduced to $46 from $48.

Target price is $46.00 Current Price is $44.37 Difference: $1.63
If WES meets the Deutsche Bank target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $47.52, suggesting upside of 7.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.1

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

Morgan Stanley rates WES as Underweight (5) -

At the AGM Wesfarmers indicated that momentum at  Bunnings is in line with its fourth quarter  FY18 performance, which implies 6% sales growth and is stronger than Morgan Stanley expected.

Kmart trading has slowed, as apparel was affected by a delayed start to spring and the business has exited DVDs and CDs. The Coles convenience business continues to experience declines in fuel volumes because of higher petrol prices.

The company has also indicated that, despite its poor experience in the UK, it is not deterred from an offshore acquisition.

Underweight rating, $45 target and Cautious industry view maintained.

Target price is $45.00 Current Price is $44.37 Difference: $0.63
If WES meets the Morgan Stanley target it will return approximately 1% (excluding dividends, fees and charges).

Current consensus price target is $47.52, suggesting upside of 7.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.1

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

Ord Minnett rates WES as Hold (3) -

The AGM signalled a slowdown in trade at Bunnings, as first half like-for-like sales growth is expected to ease to around the June quarter levels of 4.9%. Coles had a strong first quarter because of the Little Shop campaign.

Ord Minnett was impressed with the more frank discussion of the challenges facing fuel volumes and operating earnings in the convenience segment. Kmart apparel sales have also been negatively affected by later start to spring.

The broker maintains a Hold rating and $50 target.

Target price is $50.00 Current Price is $44.37 Difference: $5.63
If WES meets the Ord Minnett target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $47.52, suggesting upside of 7.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.1

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

Credit Suisse rates XRO as Underperform (5) -

Credit Suisse believes, with the issue of US$300m in convertible notes and free cash flow approaching break-even, the company is well-placed to pursue an acquisition agenda.

Xero has purchased a UK accounts preparation and tax filing solution, Instafile, for GBP5.25m over three years, which follows the purchase of Canadian data capture business, Hubdoc, in August.

While the new capability is helpful, Credit Suisse believes subscriber growth is a priority and, with the Australasian contribution likely to ease at some point, looks to other geographies for this growth.

Underperform rating maintained. Target is raised to $35.00 from $32.50.

Target price is $35.00 Current Price is $42.11 Difference: minus $7.11 (current price is over target).
If XRO meets the Credit Suisse target it will return approximately minus 17% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $44.66, suggesting upside of 6.0% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY19:

Forecast for FY20:

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

Market Sentiment: 0.1

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