Australian Broker Call

Morgan Stanley rates A2M as Underweight (5) -

Nielsen data suggests infant formula sales growth moderated to 40% in January/February while total market volumes wer down -9% after growing marginally in December.

Morgan Stanley considers this a positive outcome, given retail disruption and channel shift.

The outlook remains clouded by the coronavirus crisis but the broker notes a2 Milk has outperformed, and the stock appears to be pricing in an upgrade, leaving little room for error.

Underweight rating. Target is NZ$12.50. Industry view is Cautious.

Current Price is $18.73. Target price not assessed.

Current consensus price target is $17.78, suggesting downside of -5.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

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

Ord Minnett rates ABC as Upgrade to Accumulate from Hold (2) -

Despite the prospects of a recession, Ord Minnett believes there is significant potential value in quality companies, such as those that are category leaders with proven business models, strong liquidity and significant valuation support.

Adelaide Brighton's rating is upgraded to Accumulate from Hold and the target is lowered to $3.00 from $3.20.

Target price is $3.00 Current Price is $2.52 Difference: $0.48
If ABC meets the Ord Minnett target it will return approximately 19% (excluding dividends, fees and charges).

Current consensus price target is $2.82, suggesting upside of 11.9% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.2

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

Morgans rates AFG as Downgrade to Hold from Add (3) -

Morgans expects most lenders will offer moratoriums on debt of up to 6 months for home-loan borrowers facing hardship. The interest is expected to be capitalised and the loans unlikely to be classified as arrears or non-performing.

However, the issue the broker ponders is whether lenders will continue to pay trailing commissions in cases where moratoriums have been granted.

Morgans expects Australian Finance's board will be more conservative with dividend settings and significantly reduces earnings and dividend forecasts.

Rating is downgraded to Hold from Add and the target lowered to $1.70 from $3.25.

Target price is $1.70 Current Price is $1.39 Difference: $0.31
If AFG meets the Morgans target it will return approximately 22% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.5

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

Citi rates APT as Downgrade to Neutral from Buy (3) -

Citi continues to expect the business model will survive a recession and there is sufficient capital to accelerate growth when the situation normalises. However, growth is expected to slow significantly in the near term.

Merchant sales are expected to be negatively affected by weak consumer discretionary expenditure and more stringent risk controls.

Citi downgrades to Neutral/High Risk from Buy/High Risk. Target raised to $27.10 from $21.10.

Target price is $27.10 Current Price is $27.20 Difference: minus $0.1 (current price is over target).
If APT meets the Citi target it will return approximately minus 0% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $27.04, suggesting downside of -0.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.3

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

UBS rates APX as Buy (1) -

Appen has reaffirmed 2020 earnings guidance of $125-130m based on a US$0.70 exchange rate. The broker's forecast is at $130m.

Buy and $32 target retained.

Target price is $32.00 Current Price is $23.81 Difference: $8.19
If APX meets the UBS target it will return approximately 34% (excluding dividends, fees and charges).

Current consensus price target is $28.30, suggesting upside of 18.9% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 1.0

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

Macquarie rates AST as Outperform (1) -

An issue paper from the Australian Energy Regulator signals the risks around the regulatory re-set is lower for Ausnet Services.

In this, Macquarie notes the company differed from Spark Infrastructure ((SKI)) during the Victorian re-set, as it adopted a higher level of consumer engagement throughout a trial program.

The broker considers the stock attractive and retains an Outperform rating. Target is $1.87.

Target price is $1.87 Current Price is $1.80 Difference: $0.07
If AST meets the Macquarie target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $1.79, suggesting downside of -0.5% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.2

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

UBS rates AVN as Neutral (3) -

UBS has reviewed its retail REIT valuations in light of the government's new landlord/tenant "code of conduct". While the code is tenant-friendly, the broker notes, there could be some offset for landlords in the form of state/local tax relief and covenant relief from banks.

Balance sheets and liquidity positions are generally sound but the broker expects June half dividends to be withheld and longer term payout ratios reduced to preserve capital.

Overall impact varies by REIT, subject to retail exposure. Neutral retained for Aventus Group, target falls to $1.65 from $2.76.

Target price is $1.65 Current Price is $1.54 Difference: $0.11
If AVN meets the UBS target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $2.21, suggesting upside of 43.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.3

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

UBS rates BWP as Upgrade to Neutral from Sell (3) -

UBS has reviewed its retail REIT valuations in light of the government's new landlord/tenant "code of conduct". While the code is tenant-friendly, the broker notes, there could be some offset for landlords in the form of state/local tax relief and covenant relief from banks.

Balance sheets and liquidity positions are generally sound but the broker expects June half dividends to be withheld and longer term payout ratios reduced to preserve capital.

Overall impact varies by REIT, subject to retail exposure. Upgrade to Neutral from Sell for BWP Trust, target rises to $3.37 from $3.24.

Target price is $3.37 Current Price is $3.42 Difference: minus $0.05 (current price is over target).
If BWP 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 $3.15, suggesting downside of -8.0% (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

Citi rates BWX as Initiation of coverage with Buy (1) -

Citi initiates coverage with a Buy rating and $4.20 target. BWX is expected to benefit from the expanded distribution of its products in Australia and the US and more sustainable strategies following the change of management.

The focus on marketing and new product development has been increased and unprofitable promotions have been reduced. The broker understands the increased consumer focus on environmental, ethical and health issues is supportive of the company's core brands.

Target price is $4.20 Current Price is $3.31 Difference: $0.89
If BWX meets the Citi target it will return approximately 27% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 1.0

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

Citi rates CCL as Upgrade to Neutral from Sell (3) -

Citi expects 2020 Australian earnings will drop -1% and New Zealand -9%, given reduced sales in the out-of-home channel. This channel represents around 40% of volume but may be around 50% of earnings (EBIT) on the broker's estimates.

Moreover, coronavirus cases continue to grow in Indonesia and the company's products are likely to be adversely affected if celebrations around Ramadan are suppressed.

While shareholders are attracted to the high and consistent dividend pay-out , Citi envisages the dividend will drop, but only modestly to $0.46 from $0.51 in 2020, with Citi suggesting there is potential for it to fall as low as $0.42.

Rating is upgraded to Neutral from Sell, given the de-rating in the stock. Target is reduced to $10.10 from $10.60.

Target price is $10.10 Current Price is $9.19 Difference: $0.91
If CCL meets the Citi target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $10.85, suggesting upside of 18.1% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.3

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

UBS rates CQR as Upgrade to Buy from Neutral (1) -

UBS has reviewed its retail REIT valuations in light of the government's new landlord/tenant "code of conduct". While the code is tenant-friendly, the broker notes, there could be some offset for landlords in the form of state/local tax relief and covenant relief from banks.

Balance sheets and liquidity positions are generally sound but the broker expects June half dividends to be withheld and longer term payout ratios reduced to preserve capital.

Overall impact varies by REIT, subject to retail exposure. Upgrade to Buy from Neutral for Charter Hall Retail, target falls to $3.50 from $4.80.

Target price is $3.50 Current Price is $3.20 Difference: $0.3
If CQR meets the UBS target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $3.87, suggesting upside of 20.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: -0.2

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

Ord Minnett rates CSR as Upgrade to Hold from Lighten (3) -

Despite the prospects of a recession, Ord Minnett believes there is significant potential value in quality companies, such as those that are category leaders with proven business models, strong liquidity and significant valuation support.

CSR's rating is upgraded to Hold from Lighten and the target lowered to $3.80 from $4.00.

Target price is $3.80 Current Price is $3.23 Difference: $0.57
If CSR meets the Ord Minnett target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $4.21, suggesting upside of 30.2% (ex-dividends)

The company's fiscal year ends in March.

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 ING as Neutral (3) -

Inghams Group has outperformed the index by 18% in the past three months, which the broker puts down to the perceived defensiveness of grocery sales, including 60% chicken.

While those sales are expected to be up 14% in the half to June, sales to fast food and food service businesses are likely to be down materially, leaving the broker cautious. And feed costs are up 25%.

The balance sheet is solid, and while earnings risk is to the downside, the broker believes, current pricing is fair. Neutral and $3.10 target retained.

Target price is $3.10 Current Price is $3.40 Difference: minus $0.3 (current price is over target).
If ING meets the UBS target it will return approximately minus 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.54, suggesting upside of 4.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.3

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

Morgans rates IVC as Add (1) -

InvoCare has completed a $200m institutional placement to improve the capacity for growth initiatives. Morgans expects this will allow the business to move through the next 6-12 months with a much stronger balance sheet.

Long-term prospects are considered solid and the broker retains an Add rating. Target is raised to $13.36 from $12.16.

Target price is $13.36 Current Price is $11.14 Difference: $2.22
If IVC meets the Morgans target it will return approximately 20% (excluding dividends, fees and charges).

Current consensus price target is $12.71, suggesting upside of 14.1% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.5

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

UBS rates IVC as Upgrade to Neutral from Sell (3) -

InvoCare's business has been impacted by the government's funeral restrictions but UBS sees a greater risk ahead stemming from lower flu-related deaths this year due to measures imposed on the elderly for Covid-19.

InvoCare has de-risked its balance sheet in raising -$200m of new capital, which more importantly underpins the company's Protect & Grow and acquisition strategies.

The broker forecasts a -5% drop in volumes in FY20, with earnings gradually normalising by FY22. Target falls to $11.85 from $12.35. Upgrade to Neutral from Sell.

Target price is $11.85 Current Price is $11.14 Difference: $0.71
If IVC meets the UBS target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $12.71, suggesting upside of 14.1% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.5

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

Credit Suisse rates LLC as Outperform (1) -

In examining the balance sheet and cash flow, Credit Suisse does not believe an equity raising is required at this stage.

An equity raising is likely to require events such as failure to sell targeted developments, construction activity coming to a halt or, to a lesser extent, a decline in investment income.

The broker downwardly revises FY20 and FY21 forecasts for earnings per share by -13.3% and -8.3% respectively. Target is lowered to $15.41 from $19.85 and an Outperform rating is maintained.

Target price is $15.41 Current Price is $11.60 Difference: $3.81
If LLC meets the Credit Suisse target it will return approximately 33% (excluding dividends, fees and charges).

Current consensus price target is $18.67, suggesting upside of 60.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.6

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

UBS rates LYC as Buy (1) -

Lynas Corp's quarterly performance was much as the broker expected, with weaker production due to mandated shutdowns offset by higher realised rare earth prices.

The company has applied to the Malaysian government for exemption as a critical industrial producer but this has not yet been granted.

Lynas has three years to shift part of its processing back to Australia and the broker believes that as the only non-Chinese producer of rare earths, funding should not be an issue.

The broker's longer term thesis is based on increasing EV demand driving higher neodymium/praseodymium prices. Buy and $2.70 target retained.

Target price is $2.70 Current Price is $1.47 Difference: $1.23
If LYC meets the UBS target it will return approximately 84% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 1.0

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

Morgans rates MSV as Add (1) -

A flexible workforce, with longer rosters and sourcing local accommodation, has enabled Mitchell Services to maintain operations to date, despite the restrictions.

Morgans is pleasantly surprised by the outcome and trims forecasts modestly. The broker considers the stock oversold. Speculative Buy (Add) retained. Target is reduced to $0.98 from $1.03.

Target price is $0.98 Current Price is $0.42 Difference: $0.56
If MSV meets the Morgans target it will return approximately 133% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 1.0

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

Ord Minnett rates NGI as Hold (3) -

Ord Minnett was pleased with the quarterly update, to the extent that assets under management had not deteriorated as badly as feared. However, redemption indications were worse than expected.

Over the next 3 months, Lighthouse expects redemptions of around -US$1.1bn. Ord Minnett prefers to remain on the sidelines and retains a Hold rating. Target is reduced to $1.40 from $1.70.

Target price is $1.40 Current Price is $1.22 Difference: $0.18
If NGI meets the Ord Minnett target it will return approximately 15% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

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

Market Sentiment: 0.0

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

UBS rates ORG as Buy (1) -

The broker has revised forecasts to reflect -15% lower Brent prices in 2020, Origin Energy's prudent decision to cut capex in the face of uncertain electricity demand, and -15% higher bad debt provisions in FY21.

The broker notes the OPEC-Plus production cuts are but a small step towards oil price recovery, but with Origin's share price implying an APLNG price of only US$35/bbl, any further oil price support could provide for significant share price upside.

Buy retained, target falls to $7.50 from $7.80.

Target price is $7.50 Current Price is $5.00 Difference: $2.5
If ORG meets the UBS target it will return approximately 50% (excluding dividends, fees and charges).

Current consensus price target is $6.44, suggesting upside of 28.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.5

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

Citi rates OZL as Buy (1) -

March quarter results were strong and Citi expects FY20 guidance is "safe". Importantly, Carrapateena is on schedule.

Meanwhile, production at Prominent Hill was affected by heavy rain, although it beat estimates because of higher-than-expected head grades and recovery.

Buy/High Risk retained. Target is $10.70.

Target price is $10.70 Current Price is $9.01 Difference: $1.69
If OZL meets the Citi target it will return approximately 19% (excluding dividends, fees and charges).

Current consensus price target is $10.34, suggesting upside of 14.7% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

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) -

First quarter results were mixed, Macquarie observes, with strong copper and gold production offset by higher-than-expected cash costs.

2020 guidance is unchanged and the ramp up at Carrapateena is running ahead of expectations. Macquarie retains an Outperform rating and $10.80 target.

Target price is $10.80 Current Price is $9.01 Difference: $1.79
If OZL meets the Macquarie target it will return approximately 20% (excluding dividends, fees and charges).

Current consensus price target is $10.34, suggesting upside of 14.7% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.6

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

Morgan Stanley rates OZL as Overweight (1) -

Most metrics are tracking in line with, or better than, guidance, Morgan Stanley notes. Copper production in the March quarter was in line while gold exceeded expectations. Carrapateena is progressing well.

OZ Minerals remains the preferred copper exposure. Target is $10. Overweight retained. Industry view: In Line.

Target price is $10.00 Current Price is $9.01 Difference: $0.99
If OZL meets the Morgan Stanley target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $10.34, suggesting upside of 14.7% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.6

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

Morgans rates OZL as Upgrade to Add from Hold (1) -

Morgans observes OZ Minerals was quick to implement mitigation strategies in view of the coronavirus crisis and has reported no material adverse effects to date. Carrapateena's ramp up is ahead of schedule.

Deferral of $150m in 2020 expenditure has eased any pressure on what was already a strong balance sheet, the broker points out.

With the stock now trading at a -18% discount to valuation the rating is upgraded to Add from Hold. Target is reduced to $10.65 from $10.85.

Morgans trims 2020-21 estimates by -8-10% because of weaker copper prices.

Target price is $10.65 Current Price is $9.01 Difference: $1.64
If OZL meets the Morgans target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $10.34, suggesting upside of 14.7% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.6

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

UBS rates OZL as Buy (1) -

OZ Minerals' quarterly revealed higher Prominent Hill production, lower costs and better cash flow than the broker had forecast. News on Carrapateena was mostly positive, the broker suggests, with ramp-up ahead of schedule.

Net costs have been reduced due to record high prices for by-product gold. Buy and $10.90 target retained.

Target price is $10.90 Current Price is $9.01 Difference: $1.89
If OZL meets the UBS target it will return approximately 21% (excluding dividends, fees and charges).

Current consensus price target is $10.34, suggesting upside of 14.7% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.6

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

Morgan Stanley rates PDL as Overweight (1) -

March quarter funds under management were -5% below Morgan Stanley's forecasts. This implies some downside risk to second half and FY21 cash earnings.

The broker continues to find the balance sheet and dividend yield attractive. Overweight rating. Target is $6.30. Industry view: In-Line.

Target price is $6.30 Current Price is $5.31 Difference: $0.99
If PDL meets the Morgan Stanley target it will return approximately 19% (excluding dividends, fees and charges).

Current consensus price target is $5.90, suggesting upside of 11.2% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.6

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

Ord Minnett rates PDL as Accumulate (2) -

March quarter funds under management declined, although Ord Minnett notes the impact of equity market falls was mitigated somewhat by the diversity in the company's asset class and geography.

The near-term outlook for flows is uncertain but the broker believes the current share price presents an attractive risk/reward balance over the medium term relative to other ASX-listed asset managers.

Ord Minnett maintains an Accumulate rating and reduces the target to $7.20 from $9.40.

Target price is $7.20 Current Price is $5.31 Difference: $1.89
If PDL meets the Ord Minnett target it will return approximately 36% (excluding dividends, fees and charges).

Current consensus price target is $5.90, suggesting upside of 11.2% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.6

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

Credit Suisse rates PPH as Initiation of coverage with Neutral (3) -

Credit Suisse initiates coverage on Pushpay Holdings with a Neutral rating and NZ$4.53 target. The broker envisages a structural growth opportunity, driven by the company's increasing share of digital payments in the US faith sector.

However, this is moderated by concerns around slowing new customer growth, potential margin compression and a likely decrease in donations in a challenging economic environment.

Current Price is $3.88. Target price not assessed.

Current consensus price target is $2.72, suggesting downside of -29.9% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY20:

Forecast for FY21:

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

Morgan Stanley rates QBE as Overweight (1) -

Morgan Stanley expects the capital raising will improve earnings certainty in FY20 and offset an investment-driven first half loss. The dividend is also likely to be cut.

QBE reported strong rate increases in the first quarter and 9% growth in gross written premium. Morgan Stanley suspects this level of growth will be hard to sustain and assumes none will occur in the rest of FY20.

Overweight rating maintained. Target is reduced to $12.00 from $15.50. Industry view is In-Line.

Target price is $12.00 Current Price is $8.73 Difference: $3.27
If QBE meets the Morgan Stanley target it will return approximately 37% (excluding dividends, fees and charges).

Current consensus price target is $11.92, suggesting upside of 36.5% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

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

UBS rates SCG as Neutral (3) -

UBS has reviewed its retail REIT valuations in light of the government's new landlord/tenant "code of conduct". While the code is tenant-friendly, the broker notes, there could be some offset for landlords in the form of state/local tax relief and covenant relief from banks.

Balance sheets and liquidity positions are generally sound but the broker expects June half dividends to be withheld and longer term payout ratios reduced to preserve capital.

Overall impact varies by REIT, subject to retail exposure. Neutral and $1.53 target retained for Scentre Group.

Target price is $1.53 Current Price is $2.04 Difference: minus $0.51 (current price is over target).
If SCG meets the UBS target it will return approximately minus 25% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.49, suggesting upside of 21.8% (ex-dividends)

The company's fiscal year ends in December.

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 SCP as Neutral (3) -

UBS has reviewed its retail REIT valuations in light of the government's new landlord/tenant "code of conduct". While the code is tenant-friendly, the broker notes, there could be some offset for landlords in the form of state/local tax relief and covenant relief from banks.

Balance sheets and liquidity positions are generally sound but the broker expects June half dividends to be withheld and longer term payout ratios reduced to preserve capital.

Overall impact varies by REIT, subject to retail exposure. Neutral retained for Shopping Centres Australasia, target falls to $2.27 from $2.84.

Target price is $2.27 Current Price is $2.14 Difference: $0.13
If SCP meets the UBS target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $2.30, suggesting upside of 7.3% (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

Macquarie rates SLR as Outperform (1) -

March quarter production was stronger than Macquarie expected. FY20 guidance is upgraded by 10,000 ounces.

The main positive development was at Mount Monger with strong grades from French Kiss driving record mine output.

Macquarie believes Silver Lake is well-placed to increase underground inventory and diversify its production base over 2020. Outperform maintained. Target increases 11% to $2.10.

Target price is $2.10 Current Price is $1.81 Difference: $0.29
If SLR meets the Macquarie target it will return approximately 16% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 1.0

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

Credit Suisse rates SXY as Outperform (1) -

Gas production beat expectations in both the Cooper Basin and Roma North. FY20 guidance is unchanged despite the drop in oil prices.

The weakness in gas prices does not change Credit Suisse's view, with upside from 2022 envisaged as stimulus could increase domestic gas demand.

The broker suspects Senex Energy may wait to expand Roma North, instead building a buffer in the balance sheet and securing contracts.

Target is raised to $0.29 and $0.26 and an Outperform rating is maintained.

Target price is $0.29 Current Price is $0.20 Difference: $0.09
If SXY meets the Credit Suisse target it will return approximately 45% (excluding dividends, fees and charges).

Current consensus price target is $0.36, suggesting upside of 81.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.9

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

Macquarie rates SXY as Outperform (1) -

Production revenue beat expectations in the third quarter, largely because the ramp up at Roma North was ahead of schedule.

The company has indicated that 95% of its 2020 gas and 60% of its 2021 & 2022 gas is contracted. FY20 guidance is reiterated. Macquarie maintains an Outperform rating and $0.30 target.

Target price is $0.30 Current Price is $0.20 Difference: $0.1
If SXY meets the Macquarie target it will return approximately 50% (excluding dividends, fees and charges).

Current consensus price target is $0.36, suggesting upside of 81.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.9

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

Morgans rates SXY as Add (1) -

Gas volumes in the Surat Basin continued to ramp up in the March quarter. Gas output rose 61%. Full year production guidance has been maintained.

Morgans assesses Senex Energy has demonstrated it can operate with no visible capital constraints despite the oil price collapse.

The broker maintains an Add rating and raises the target to $0.49 from $0.48.

Target price is $0.49 Current Price is $0.20 Difference: $0.29
If SXY meets the Morgans target it will return approximately 145% (excluding dividends, fees and charges).

Current consensus price target is $0.36, suggesting upside of 81.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.9

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

Ord Minnett rates SXY as Accumulate (2) -

March quarter production revealed operations are on track, with both Roma North and Atlas increasing production.

Ord Minnett is positive on the stock, noting the free cash flow yield, stable balance sheet and fixed-price contracts.

Accumulate rating and $0.34 target maintained.

Target price is $0.34 Current Price is $0.20 Difference: $0.14
If SXY meets the Ord Minnett target it will return approximately 70% (excluding dividends, fees and charges).

Current consensus price target is $0.36, suggesting upside of 81.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.9

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

UBS rates TAH as Buy (1) -

Tabcorp's gambling offerings are materially impacted by pub/club closures, the broker notes. Lottery ticket impact at newsagents is unclear in the lockdown.

Can racing (80% of wagering) continue with everything else suspended? How much offset can be gleaned from increased online activity?

These questions lead the broker to cut near term earnings its target to $4.60 from $5.40, while noting the balance sheet is solid.

The broker believes Tabcorp's underperformance of the index would quickly reverse at the first sign of restrictions being lifted. Buy retained on a look-through.

Target price is $4.60 Current Price is $2.90 Difference: $1.7
If TAH meets the UBS target it will return approximately 59% (excluding dividends, fees and charges).

Current consensus price target is $3.48, suggesting upside of 19.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.3

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

UBS rates TLS as Buy (1) -

Telstra is now offering discounted mobile plans to JobKeeper-eligible customers, among others, which is all very noble but not great for earnings, the broker notes.

UBS analysts also now believe travel bans could extend to the end of 2020, impacting on roaming revenues, and that SME bad debts will inevitably rise.

To that end, the broker is now forecasting a cut in the dividend to 14c compared to consensus of 16c. UBS also forecasts a deeper earnings trough in FY21, but has left its $3.70 target and Buy rating intact.

Target price is $3.70 Current Price is $3.15 Difference: $0.55
If TLS meets the UBS target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $3.86, suggesting upside of 22.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.6

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

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

Nielsen data shows US sales continue to rise as consumers stockpile in response to the pandemic. While this may help in the short term, Morgan Stanley believes it will be unlikely to resolve the oversupply of commercial/bulk wine.

The extent to which this reflects a pulling forward of demand is unclear. Equal-weight rating and Cautious industry view maintained. Target is $12.50.

Target price is $12.50 Current Price is $10.59 Difference: $1.91
If TWE meets the Morgan Stanley target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $11.46, suggesting upside of 8.2% (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

UBS rates VAH as No Rating (-1) -

Virgin Australia has entered a trading halt as discussions are being held with regard financial assistance and restructuring alternatives.

There may be some government assistance provided to keep flights operating to maintain essential services, but for now the uncertainty leads the broker to put its valuation and rating under review and withdraw forecasts given the potential for significant changes to the operating environment.

Current Price is $0.09. Target price not assessed.

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: -1.0

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

UBS rates VCX as Neutral (3) -

UBS has reviewed its retail REIT valuations in light of the government's new landlord/tenant "code of conduct". While the code is tenant-friendly, the broker notes, there could be some offset for landlords in the form of state/local tax relief and covenant relief from banks.

Balance sheets and liquidity positions are generally sound but the broker expects June half dividends to be withheld and longer term payout ratios reduced to preserve capital.

Overall impact varies by REIT, subject to retail exposure. Neutral and $1.22 target retained for Vicinity Centres.

Target price is $1.22 Current Price is $1.36 Difference: minus $0.14 (current price is over target).
If VCX meets the UBS target it will return approximately minus 10% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $1.76, suggesting upside of 29.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: -0.3

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