Australian Broker Call

Citi rates BAP as Neutral (3) -

Citi flagged a possible downgrade might be in the wings for Bapcor post the AGM, and today's 1H26 downgrade is disappointing given guidance for FY26 was given in October. It is surprising to the analyst, given five directors purchased shares on market post-AGM.

The company has lowered 1H26 net profit after tax guidance to a net loss of -$5m to -$8m versus $3m-$7m profit previously, with FY26 guidance for net profit after tax downgraded by -33% at the midpoint.

Bapcor expects some improvements in 2H26, as trading conditions in October and November have been below expectations.

Rated Neutral. Target $3.10.

Target price is $3.10 Current Price is $2.35 Difference: $0.75
If BAP meets the Citi target it will return approximately 32% (excluding dividends, fees and charges).

Current consensus price target is $2.94, suggesting upside of 57.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.0

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

Citi rates BRG as Buy (1) -

Citi conducted its own analysis of Breville Group performance during the crucial US Black Friday sales window. The broker also looked into the company's discounting approach, based on Citi Research Innovation Lab data.

The broker notes US Black Friday sales were solid, led by e-commerce growth, and appliances were a standout online category. Retailer checks pointed to a highly promotional holiday quarter, with tariffs still a margin risk, though Breville may benefit from holding prices in key lines, in the broker's view.

Discounts were strongest across ovens/air fryers and other small appliances, with espresso deals expanding later in the period, and early feedback showed Breville’s Australian Black Friday sales performed very well.

Buy retained. Target unchanged at $36.03.

Target price is $36.03 Current Price is $29.73 Difference: $6.3
If BRG meets the Citi target it will return approximately 21% (excluding dividends, fees and charges).

Current consensus price target is $37.38, suggesting upside of 26.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.8

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

Bell Potter rates BUB as Speculative Hold (3) -

At the AGM, Bubs Australia's provided FY26 revenue guidance of $120-125m, marking a y/y growth of 22-27% vs 1Q26 annualised run-rate of $102m, Bell Potter remarks.

Gross margin is guided to 40-45% with extra spend on marketing and freight/tariffs, a one-off settlement gain, and reported EBITDA expected at $1-2m alongside a $15-20m inventory build.

The broker reckons the inventory build suggests it will be funded by available liquidity of $22.9m. The broker cut FY26 EBITDA forecast by -56%, but lifted FY27 by 37%.

Speculative Hold maintained. Target trimmed to 17.0c from 17.5c.

Target price is $0.17 Current Price is $0.14 Difference: $0.025
If BUB meets the Bell Potter target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $0.19, suggesting upside of 32.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.5

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

Bell Potter rates CBO as Hold (3) -

Bell Potter updated its forecasts for Cobram Estate Olives' $183m capital raise earlier in the year to expand US orchards, adding 1,600Ha and targeting 2,580Ha planted by FY26-28. 

This is expected to boost long-term oil output but dilutes near-term EPS, the broker states. Input costs are rising sharply for the company, led by water prices nearly doubling y/y to $268-275/ML, with modest inflation also seen in fertiliser and crop protection.

Pricing signals are mixed, with EU inventory values down -41% y/y, while local packaged goods pricing is slightly up, though promotions in supermarkets have increased, the broker notes.

EPS forecast for FY26 cut by -3% and by -2% for FY27. Hold maintained and target unchanged at $2.90 as dilution is offset by upgrades to US orchard NPVs.

Target price is $2.90 Current Price is $2.89 Difference: $0.01
If CBO meets the Bell Potter target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $3.24, suggesting upside of 13.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.5

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

Macquarie rates COL as Outperform (1) -

Macquarie's High Frequency Consumer Data Series points to solid gains for online retailers, pharmacies, and furniture during the Black fortnight. Electronics growth cooled, and feedback was mixed.

So far in 4Q2025, pharmacy and furniture remain bright spots in Australia, whereas alcohol is still lagging despite a slight improvement, the broker highlights.

The broker remains bullish on Coles Group, supported by market share wins and expanding supply-chain investments that should lift earnings. Outperform with an unchanged target of $26.10.

Target price is $26.10 Current Price is $21.77 Difference: $4.33
If COL meets the Macquarie target it will return approximately 20% (excluding dividends, fees and charges).

Current consensus price target is $24.90, suggesting upside of 14.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.8

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

Macquarie rates EDV as Underperform (5) -

Macquarie's High Frequency Consumer Data Series points to solid gains for online retailers, pharmacies, and furniture during the Black fortnight. Electronics growth cooled, and feedback was mixed.

So far in 4Q2025, pharmacy and furniture remain bright spots in Australia, whereas alcohol is still lagging despite a slight improvement, the broker highlights.

The broker notes on-premise alcohol sales grew faster, up 3% y/y, likely helped by the first Ashes Test, while off-premise sales are still weak but the decline is moderating. Overall, it is a mixed, but marginally positive picture for Endeavour Group.

Underperform with an unchanged target of $3.50.

Target price is $3.50 Current Price is $3.69 Difference: minus $0.19 (current price is over target).
If EDV 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 $3.92, suggesting upside of 7.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.0

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

Morgans rates EPI as Initiation of coverage with Speculative Buy (1) -

Morgans initiated coverage of Epiminder with a Speculative Buy rating and target price of $2.33.

The company is developing the FDA-approved Minder sub-scalp electroencephalography (EEG) for continuous brain monitoring to improve epilepsy diagnosis and treatment vs short EEG tests.

It will initially target drug-resistant epilepsy patients with inconclusive EEGs, with up to 45,000 US patients per year and a US$1.1bn market, ahead of a phased US launch in 2H26.

The broker expects the $125m IPO raising and cash reserves to last until the end of 2027, helping to build the next-gen G1 Minder, and set up US commercial capabilities. Assumption is for reasonable revenue generation in FY29.

Target price is $2.33 Current Price is $1.11 Difference: $1.22
If EPI meets the Morgans target it will return approximately 110% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 1.0

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

Macquarie rates HVN as Neutral (3) -

Macquarie's High Frequency Consumer Data Series points to solid gains for online retailers, pharmacies, and furniture during the Black fortnight. Electronics growth cooled, and feedback was mixed.

So far in 4Q2025, pharmacy and furniture remain bright spots in Australia, whereas alcohol is still lagging despite a slight improvement, the broker highlights.

Furniture is still delivering mid-single-digit growth, the broker remarks, a positive outcome for Harvey Norman even with a softer RBA outlook that could weigh on new housing starts.

Neutral with an unchanged target of $7.60.

Target price is $7.60 Current Price is $7.32 Difference: $0.28
If HVN meets the Macquarie target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $7.48, suggesting upside of 4.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.2

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

Macquarie rates IAG as Neutral (3) -

Macquarie's deep dives into the potential impacts of AI on insurance companies, with most stakeholders flagging cost control and efficiency gains as two notable areas.

Since the last analysis, the broker highlights Konkrd (pronounced 'conquered') has entered the Australian market, the country's first autonomous AI digital broker. It is starting with health insurance and aiming to expand into 12 additional products in three years.

The areas include home, personal motor and business insurance. AI technology is likely to change the cost of customer acquisition, the lifetime value of a customer and other aspects of the insurance life cycle, the analyst states.

Australian Unity was the first insurer to embrace the technology, and Macquarie expects another 10 will follow in 2026.

The Neutral rating for Insurance Australia Group is maintained. Target unchanged at $9.10.

Target price is $9.10 Current Price is $7.82 Difference: $1.28
If IAG meets the Macquarie target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $9.03, suggesting upside of 14.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.2

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

Macquarie rates JBH as Outperform (1) -

Macquarie's High Frequency Consumer Data Series points to solid gains for online retailers, pharmacies, and furniture during the Black fortnight. Electronics growth cooled, and feedback was mixed.

So far in 4Q2025, pharmacy and furniture remain bright spots in Australia, whereas alcohol is still lagging despite a slight improvement, the broker highlights.

Within Discretionary, JB Hi-Fi is still the broker's top choice after the recent share price dip, though it is keeping a close eye on consumer spending trends. Outperform with an unchanged target of $121.

Target price is $121.00 Current Price is $94.67 Difference: $26.33
If JBH meets the Macquarie target it will return approximately 28% (excluding dividends, fees and charges).

Current consensus price target is $108.50, suggesting upside of 16.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.0

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

Shaw and Partners rates LAU as Buy (1) -

Post Lindsay Australia's acquisition of SRT Logistics in June this year, Shaw and Partners visited SRT's Tasmanian assets recently and came away believing the assets offer both a good cultural and strategic fit.

There are multiple cost synergies and the broader network should offer revenue growth options and a way to offset more seasonally cyclical earnings.

The broker makes no changes to earnings forecasts. Buy. Target unchanged at $1.

Target price is $1.00 Current Price is $0.66 Difference: $0.345
If LAU meets the Shaw and Partners target it will return approximately 53% (excluding dividends, fees and charges).

Current consensus price target is $0.93, suggesting upside of 40.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 1.0

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

Macquarie rates NCK as Outperform (1) -

Macquarie's High Frequency Consumer Data Series points to solid gains for online retailers, pharmacies, and furniture during the Black fortnight. Electronics growth cooled, and feedback was mixed.

So far in 4Q2025, pharmacy and furniture remain bright spots in Australia, whereas alcohol is still lagging despite a slight improvement, the broker highlights.

Among small and mid-caps, Nick Scali is the broker's preferred household retail name, backed by market-share gains as the furniture market improves. Outperform with an unchanged target of $28.20.

Target price is $28.20 Current Price is $22.86 Difference: $5.34
If NCK meets the Macquarie target it will return approximately 23% (excluding dividends, fees and charges).

Current consensus price target is $25.76, suggesting upside of 13.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.5

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

Morgan Stanley rates NSR as Upgrade to Equal-weight from Underweight (3) -

National Storage REIT is upgraded to Equal-weight from Underweight with a higher target of $2.86 from $2.55 by Morgan Stanley. It aligns with the takeover Scheme Implementation Deed entered into by the REIT and the GIC/Brookfield consortium.

The deal is subject to FIRB approval, anticipated over the next one to two months, and by the Overseas Investment Office in NZ. ACCC approval has been flagged as in place.

Industry view: In-Line.

Target price is $2.86 Current Price is $2.79 Difference: $0.07
If NSR meets the Morgan Stanley target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $2.66, suggesting downside of -4.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.7

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

Morgan Stanley rates PLS as Overweight (1) -

Morgan Stanley notes strong ESS (energy storage system) demand is likely to remain into 2026 with shipments coming in well above installations with the scaling of the market.

Demand is being underpinned by AI related electricity demand, acceleration in the renewable energy sector build out and Chinese policy changes to support the sector.

PLS Group in lithium offers the highest near term organic growth in production and remains a key stock pick.

Target $2.85. Overweight. Industry View: Attractive.

Target price is $2.85 Current Price is $4.03 Difference: minus $1.18 (current price is over target).
If PLS meets the Morgan Stanley target it will return approximately minus 29% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.32, suggesting downside of -18.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: -0.1

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

Morgan Stanley rates PME as Overweight (1) -

Morgan Stanley's AlphaWise survey of 100 US-based hospital executives has reinforced the broker's positive stance on Pro Medicus.

The greatest upside potential is from academic medical centres, where 68% of respondents noted a high likelihood of adoption of Visage 7, including 28% at "very likely".

Hospitals also infer a positive adoption pipeline with 45% of the cohort indicating they are "very likely" or "somewhat likely" to deploy Visage 7. The analyst points to cost savings as a major incentive for deploying Visage 7, as noted by around 64% of respondents, followed by speed and efficiency.

No changes to the broker's earnings forecasts.

Morgan Stanley reiterates the Overweight rating. Target unchanged at $350. Industry View: Attractive.

Target price is $350.00 Current Price is $246.67 Difference: $103.33
If PME meets the Morgan Stanley target it will return approximately 42% (excluding dividends, fees and charges).

Current consensus price target is $322.77, suggesting upside of 30.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.6

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

Ord Minnett rates QBE as Hold (3) -

QBE Insurance announced its North American A&H (accident and health) unit has dragged profits and lifted its combined operating ratio (COR). However, Ord Minnett is relaxed about the volatility because the line can also deliver upside.

A&H is a US medical stop-loss/reinsurance product for employers’ self-funded plans and is about 4% of the insurer's net earned premium, with medical inflation the key risk, the broker notes.

The positive is this business can be repriced quickly, supporting gross written premiums and earnings growth despite occasional timing hits. The broker reminds QBE’s loss ratio has generally beaten industry trends over the past decade.

Ord Minnett leaves EPS forecasts unchanged, waiting for FY25 results in February. Hold maintained and target unchanged at $22.

Target price is $22.00 Current Price is $19.03 Difference: $2.97
If QBE meets the Ord Minnett target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $23.69, suggesting upside of 23.2% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY25:

Forecast for FY26:

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

Market Sentiment: 0.8

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

Macquarie rates RIO as Neutral (3) -

Macquarie attended presentations by Rio Tinto's lithium division and reports the company has for the first time since consolidation provided short-/medium-term cost guidance for key assets.

Nameplate C1 costs are unchanged from last year at US$6/kg for Olaroz and US$6-7/kg for Sal de Vida.

Encouragingly, comments the broker, Fenix and Rincon unit costs (at full ramp-up) are guided at US$5/kg and below US$5/kg, both in the first quartile of the cost curve.

Today's update also mentions management reiterated capital discipline, noting growth capex will stay at -US$1.1bn in the medium term.

Management also confirmed its targeted US$5-10bn monetisation excludes lithium projects, three of which remain under care and maintenance, the broker reports.

Neutral. Target $130.

Target price is $130.00 Current Price is $137.18 Difference: minus $7.18 (current price is over target).
If RIO 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 $132.42, suggesting downside of -3.4% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY25:

Forecast for FY26:

This company reports in USD. 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

UBS rates SFR as Sell (5) -

UBS details Sandfire Resources' pathway to achieve 150ktpa Cu/200ktpa CuEq production via its recent earn-in agreement for an 80% stake in Kalkaroo alongside Black Butte.

Kalkaroo remains early stage and an updated preliminary feasibility study might be two years away, and a final investment decision in FY28 with a two year build for FY31 production. The analyst models a larger 10Mtpa processing plant with around 100mt of material to be added to inventory.

Applying the broker's long-term copper price forecast of U$5/lb and an internal rate of return of around 12.6%, the net present value adds $1.20/share to the stock's valuation.

The definitive feasibility study for Black Butte is expected by Christmas. Target price is raised 7% to $16.65 from $15.55 previously. No change to Sell rating.

Target price is $16.65 Current Price is $16.89 Difference: minus $0.24 (current price is over target).
If SFR meets the UBS target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $14.82, suggesting downside of -10.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

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

Market Sentiment: -0.3

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

Macquarie rates SIG as Underperform (5) -

Macquarie's High Frequency Consumer Data Series points to solid gains for online retailers, pharmacies, and furniture during the Black fortnight. Electronics growth cooled, and feedback was mixed.

So far in 4Q2025, pharmacy and furniture remain bright spots in Australia, whereas alcohol is still lagging despite a slight improvement, the broker highlights.

Overall in October/November, Pharmacy continued to show steady low double-digit growth, in line with recent momentum for Sigma Healthcare, the broker notes.

Underperform with an unchanged target of $2.90.

Target price is $2.90 Current Price is $2.79 Difference: $0.11
If SIG meets the Macquarie target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $3.18, suggesting upside of 11.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.3

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

Macquarie rates UNI as Outperform (1) -

Macquarie's High Frequency Consumer Data Series points to solid gains for online retailers, pharmacies, and furniture during the Black fortnight. Electronics growth cooled, and feedback was mixed.

So far in 4Q2025, pharmacy and furniture remain bright spots in Australia, whereas alcohol is still lagging despite a slight improvement, the broker highlights.

In apparel retail, Universal Store is the broker's top pick, supported by strong US/PS sales growth and a rising private-label mix that’s lifting gross margins. Outperform with an unchanged target of $10.20.

Target price is $10.20 Current Price is $8.41 Difference: $1.79
If UNI meets the Macquarie target it will return approximately 21% (excluding dividends, fees and charges).

Current consensus price target is $10.56, suggesting upside of 26.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 1.0

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

UBS rates VGL as Neutral (3) -

A more difficult outlook for the long-term box office has resulted in UBS downgrading Vista International's target price to NZ$2.80 from NZ$3.65.

The analyst is assuming the US market does not recover to pre-COVID levels due to fewer titles, studio consolidation and a more concentrated release window impacting attendance.

As the company moves more to SaaS from on-premises, it is becoming more reliant and exposed to box office performance, the analyst states. Every US$1bn change in global box office equals around NZ$2m in revenue.

UBS lowers its earnings (EBITDA) forecasts by -7% for 2025 and -18% for 2026. No change to Neutral rating.

Current Price is $2.31. Target price not assessed.

Current consensus price target is $3.66, suggesting upside of 61.2% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY25:

Forecast for FY26:

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

Market Sentiment: 0.5

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