Australian Broker Call

Ord Minnett rates CLV as Buy (1) -

First half results beat Ord Minnett's forecasts, with revenue and net profit up 10% and 29% respectively. Gross margins continue to rise, supported by a full period of renegotiated contracts and further scale efficiencies.

Ord Minnett expects gross margins to continue rising once the new spray dryer is commissioned in FY21. The broker maintains a Buy rating and raises the target to $2.00 from $1.70.

Target price is $2.00 Current Price is $1.89 Difference: $0.11
If CLV meets the Ord Minnett target it will return approximately 6% (excluding dividends, fees and charges).

The company's fiscal year ends in July.

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

UBS rates CLV as Buy (1) -

First half results revealed strong margin expansion. However, UBS notes cash flow was weak, although explained by increased investment in inventory in anticipation of strong demand in China and Europe.

The broker continues to believe the company has a strong growth outlook and there is upside risk to revenue forecasts. UBS upgrades estimates for earnings per share by 6-8% over FY19-21.

Buy rating maintained. Target rises to $2.10 from $1.80.

Target price is $2.10 Current Price is $1.89 Difference: $0.21
If CLV meets the UBS target it will return approximately 11% (excluding dividends, fees and charges).

The company's fiscal year ends in July.

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

Deutsche Bank rates COH as Downgrade to Sell from Hold (5) -

While services revenue growth remains strong, Deutsche Bank expects growth will slow in the second half as N7 upgrades move through the typical product cycle.

The broker also forecasts lower expense ratios will be needed if the company is to achieve the lower end of its FY19 guidance range.

A patent dispute with a competitor also looms, which may lead to a large payment of damages. Rating is downgraded to Sell from Hold. Target is $157.

Target price is $157.00 Current Price is $176.98 Difference: minus $19.98 (current price is over target).
If COH meets the Deutsche Bank target it will return approximately minus 11% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $167.74, suggesting downside of -5.2% (ex-dividends)

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

Morgan Stanley rates CTD as Overweight (1) -

The company has updated its investor presentation and guided to FY19 total transaction value of $6.5bn. The company is targeting 15% organic growth in operating earnings (EBITDA) from FY20 to FY21.

FY19 guidance in a range of $144-150m has been reiterated. Overweight rating. Target is $31. In-Line industry view.

Target price is $31.00 Current Price is $25.26 Difference: $5.74
If CTD meets the Morgan Stanley target it will return approximately 23% (excluding dividends, fees and charges).

Current consensus price target is $31.01, suggesting upside of 22.8% (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

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

The company has retracted prior guidance for net profit to be broadly in line with FY18 and disclosed that, for the five months to February, net profit was down -42%. Notwithstanding the headwinds, Citi believes EclipX is oversold and upgrades to Buy/High Risk from Neutral.

The broker expects an improvement in the second half, amid some of the commercial contract extensions ceasing, cost savings being realised and the company's normal skew to the second half.

Divestment of Grays and Right2Drive has been flagged. Meanwhile, McMillan Shakespeare ((MMS)) refused a request to extend the merger negotiations deadline.

Citi does not believe this will be an end to consolidation, although it may result in other interested parties entering the fray. The broker reduces the target to $1.29 from $2.38.

Target price is $1.29 Current Price is $0.73 Difference: $0.56
If ECX meets the Citi target it will return approximately 77% (excluding dividends, fees and charges).

Current consensus price target is $2.16, suggesting upside of 195.9% (ex-dividends)

The company's fiscal year ends in September.

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

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

The company's trading performance has worsened, with its fourth downgrade to profits since August 2018. Morgan Stanley expects the share price to come under pressure.

Grays and Right2Drive are expected to detract around -$12-17m in 2019 on the broker's estimates.

The positive aspect is that management has guided for the rest of the business to report flat net profit and this is where Morgan Stanley believes the market will continue to focus. Equal-weight. Industry view In-Line. Target is $2.32.

Target price is $2.32 Current Price is $0.73 Difference: $1.59
If ECX meets the Morgan Stanley target it will return approximately 218% (excluding dividends, fees and charges).

Current consensus price target is $2.16, suggesting upside of 195.9% (ex-dividends)

The company's fiscal year ends in September.

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 FSF as No Rating (-1) -

The first half results suggest to Credit Suisse that FY19 will be another disappointing year. The broker considers the company's strategic and asset portfolio review is a necessary precursor to obtaining a better understanding of where the business is headed.

The company has indicated it is committed to financial discipline and a final dividend will be decided based on a full-year earnings outcome and balance sheet.

Credit Suisse takes a cautious approach and assumes no dividend in FY19. The broker is restricted on providing a rating and target at present.

Current Price is $4.10. Target price not assessed.

Current consensus price target is N/A

The company's fiscal year ends in July.

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: -0.5

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

Macquarie rates FSF as Underperform (5) -

First half results were weak, down -29%, and there were a number of volume and margin issues, Macquarie observes. While the company has reduced full year guidance, the broker suspects the mid point may still be challenging.

Macquarie finds it unclear as to what the new normal earnings base is, given one-off issues/structural changes. However, the stock is not assessed as cheap, particularly given the extreme volatility in earnings.

Underperform rating and target price reduced to NZ$4 from NZ$5.

Current Price is $4.10. Target price not assessed.

Current consensus price target is N/A

The company's fiscal year ends in July.

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: -0.5

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

UBS rates FSF as Neutral (3) -

UBS was disappointed with the first half result, with all divisions underperforming. Guidance points to a substantially better outcome in the second half.

The broker suspects the return to a respectable level of profitability is being limited by the scope for greater price-based competition.

While UBS continues to envisage significant upside from structural change/separation it appears premature to incorporate anything into the estimates, given the company's history.

UBS retains a Neutral rating and reduces the target to NZ$4.55 from NZ$5.05.

Current Price is $4.10. Target price not assessed.

Current consensus price target is N/A

The company's fiscal year ends in July.

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: -0.5

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

Deutsche Bank rates HLS as Upgrade to Buy from Hold (1) -

Deutsche Bank notes market conditions have become more challenging and this has led to a downgrade to FY19 guidance. Still, the company is making some progress in its transformation, in the broker's view.

There is a high number of GP additions as well as margin expansion in imaging. Given the 16% total shareholder return implied by forecasts the broker upgrades to Buy from Hold.

Deutsche Bank also expects the share price will be supported if another takeover proposal is announced. Target is $3.01.

Target price is $3.01 Current Price is $2.79 Difference: $0.22
If HLS meets the Deutsche Bank target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $2.94, suggesting upside of 5.5% (ex-dividends)

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

UBS rates HVN as Neutral (3) -

After a tour of the Malaysian and Singaporean operations UBS is more positive, increasingly confident in both store targets and margin upside. The broker lifts estimates for earnings per share by 1-2% for the group and Asian operating earnings forecasts (EBITDA) by 1-9%.

The broker believes Harvey Norman is a more agile business than the market appreciates offshore, but the franchise model in Australia and exposure to housing remain of concern. Neutral rating maintained. Target rises to $3.40 from $3.25.

Target price is $3.40 Current Price is $3.74 Difference: minus $0.34 (current price is over target).
If HVN 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 $3.74, suggesting downside of -0.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.0

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

Macquarie rates IGO as Underperform (5) -

The company has updated grade and cost assumptions at Tropicana and Macquarie has materially downgraded medium-term production forecasts.

The broker observes that, while production will be partly offset by underground mining at Boston Shaker, it has come at a higher cost.

However, Nova reserves have increased by 3000t of nickel net of depletion and this results in an increase of six months to the broker's mine life expectations.

Underperform rating maintained. Target rises to $4.00 from $3.90.

Target price is $4.00 Current Price is $4.83 Difference: minus $0.83 (current price is over target).
If IGO meets the Macquarie target it will return approximately minus 17% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.50, suggesting downside of -6.8% (ex-dividends)

The company's fiscal year ends in June.

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 MMS as Overweight (1) -

The profit downgrade from EclipX Group ((ECX)) has resulted in McMillan Shakespeare refusing an extension to the merger proposal end date of April 30, 2019, with EclipX stating that the merger is unlikely to proceed.

Morgan Stanley believes this is positive for McMillan Shakespeare, which has de-rated -30% since the merger announcement in November. The broker expects the stock has potential to re-rate and maintains an Overweight rating.Target is $16.60. In-Line sector view.

Target price is $16.60 Current Price is $12.65 Difference: $3.95
If MMS meets the Morgan Stanley target it will return approximately 31% (excluding dividends, fees and charges).

Current consensus price target is $15.12, suggesting upside of 19.5% (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

Citi rates NUF as Buy (1) -

Citi observes the shares have been pummelled, dropping -24% to near five-year lows amid concerns about the reduction to FY19 guidance and pressure on the balance sheet.

The broker also believes sentiment has been affected by the second glyphosate trial going against Bayer, an industry peer. Citi assesses that the value is compelling, albeit sentiment is weak.

The company remains confident of staying within its covenant ratios by the end of FY19, although a lot depends on seasonal breaks in North America and Europe.

Citi believes the stock offers compelling value and retains a Buy rating. Target is reduced to $6.20 from $7.20.

Target price is $6.20 Current Price is $4.53 Difference: $1.67
If NUF meets the Citi target it will return approximately 37% (excluding dividends, fees and charges).

Current consensus price target is $6.44, suggesting upside of 42.2% (ex-dividends)

The company's fiscal year ends in July.

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 NUF as Outperform (1) -

Credit Suisse believes the main issue in the first half result is the mismatch between market expectations and the ability or willingness of the company to effectively manage working capital fluctuations.

The outcome for shareholders is the suspension of the interim dividend. Credit Suisse believes there is a value opportunity on the basis that the market is over-weighting the weather-driven fluctuations in earnings.

The broker believes it will be important for investors to separately consider litigation and regulatory risks, largely related to glyphosate. The broker maintains an Outperform rating and reduces the target to $8.90 from $9.53.

Target price is $8.90 Current Price is $4.53 Difference: $4.37
If NUF meets the Credit Suisse target it will return approximately 96% (excluding dividends, fees and charges).

Current consensus price target is $6.44, suggesting upside of 42.2% (ex-dividends)

The company's fiscal year ends in July.

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

Deutsche Bank rates NUF as Buy (1) -

The downgrade to full year earnings and cash flow guidance was greater than Deutsche Bank expected, and this has heightened the balance sheet risks.

The broker observes this is exacerbated by glyphosate litigation risk, with a second US trial finding the use of glyphosate was a substantial factor in causing cancer.

The broker notes guidance for cash flow is predicated on normal seasonal conditions, which may not eventuate. Notwithstanding the risks, the broker retains a Buy rating, as the stock is trading at a -26% discount to valuation. Target is $5.70, reduced from $6.00.

Target price is $5.70 Current Price is $4.53 Difference: $1.17
If NUF meets the Deutsche Bank target it will return approximately 26% (excluding dividends, fees and charges).

Current consensus price target is $6.44, suggesting upside of 42.2% (ex-dividends)

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

Macquarie rates NUF as Outperform (1) -

The headline loss in the first half of -$11.5m was similar to what Macquarie feared. FY19 guidance for operating earnings (EBITDA) has been cut by -12% at the mid point, lowered to $440-470m.

Macquarie found the European business disappointing and notes supply chain risk in China is materialising. The broker suggests there is some buffer at the lower end of the company's guidance to allow for worse-than-expected Chinese supply impacts.

The company is no longer assuming normal weather patterns in Australia in the second half.

The broker continues to believe the balance sheet is manageable and maintains an Outperform rating. Valuation is considered attractive. Target is reduced to $6.38 from $7.19.

Target price is $6.38 Current Price is $4.53 Difference: $1.85
If NUF meets the Macquarie target it will return approximately 41% (excluding dividends, fees and charges).

Current consensus price target is $6.44, suggesting upside of 42.2% (ex-dividends)

The company's fiscal year ends in July.

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

Morgan Stanley rates NUF as Overweight (1) -

The revision to FY19 guidance was worse than Morgan Stanley expected, however the share price appears to have capitalised the short-term seasonal headwinds.

The broker continues to believe the stock is oversold and cash generation in the second half remains key to a re-rating.

The broker retains an Overweight rating but acknowledges the risks around timing and the normalisation of the balance sheet/earnings.

Target is reduced to $7.10 from $8.00. Industry view is Cautious.

Target price is $7.10 Current Price is $4.53 Difference: $2.57
If NUF meets the Morgan Stanley target it will return approximately 57% (excluding dividends, fees and charges).

Current consensus price target is $6.44, suggesting upside of 42.2% (ex-dividends)

The company's fiscal year ends in July.

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

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

Cash flow in the first half was significantly worse than Morgans expected and the company's balance-sheet position remains of concern. The extent of the revision to guidance was also worse than the broker expected.

European acquisitions are now not expected to achieve their original earnings guidance until FY20. Yet, following severe weakness in the share price the broker upgrades to Add from Hold.

Another tough half-year is anticipated and Morgans acknowledges short-term catalysts are limited. Target is reduced to $6.30 from $6.85.

The broker believes the current share price undervalues the existing business and provides no value for the Omega-3 seeds project.

Target price is $6.30 Current Price is $4.53 Difference: $1.77
If NUF meets the Morgans target it will return approximately 39% (excluding dividends, fees and charges).

Current consensus price target is $6.44, suggesting upside of 42.2% (ex-dividends)

The company's fiscal year ends in July.

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

Ord Minnett rates NUF as Downgrade to Hold from Buy (3) -

Ord Minnett notes, while first half operating earnings were in line with expectations, the underlying net loss of -$11.5m was below forecasts. The interim dividend is suspended temporarily in order to manage cash flow.

A poor weather outlook in Australasia and supply issues in Europe continue to dog the stock. Glyphosate is also of concern, because of the recent Bayer court case progressing to the second phase.

Ord Minnett reduces estimates for earnings by -30% for FY19 and by -26% for FY20. This leads to a downgrade to Hold from Buy and a reduced target, cut to $4.50 from $7.25.

Target price is $4.50 Current Price is $4.53 Difference: minus $0.03 (current price is over target).
If NUF meets the Ord Minnett target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $6.44, suggesting upside of 42.2% (ex-dividends)

The company's fiscal year ends in July.

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

Deutsche Bank rates OFX as Hold (3) -

The company's trading update was in line with Deutsche Bank's estimates. Guidance is for FY19 operating earnings of $30.9-32.0m.

Management has pointed to tough macro economic conditions, with lower levels of currency volatility leading to softer spot transaction volumes. Hold rating and $1.75 target maintained.

Target price is $1.75 Current Price is $1.77 Difference: minus $0.02 (current price is over target).
If OFX meets the Deutsche Bank target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Market Sentiment: 0.0

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

Macquarie rates OFX as Neutral (3) -

The company has provided FY19 operating earnings (EBTDA) guidance of $30.9-32.0m. This is supported by higher capital expenditure, lower second half promotion expenditure and a boost from a reversal of first half employee remuneration provisions.

Macquarie reduces forecasts by -8.2% and does not believe the business is showing sufficient growth and/or operating leverage to change its view. Neutral maintained. Target is reduced to $1.70 from $1.87.

Target price is $1.70 Current Price is $1.77 Difference: minus $0.07 (current price is over target).
If OFX meets the Macquarie target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

The company's fiscal year ends in March.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.0

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

Macquarie rates PNL as Outperform (1) -

The company has refinanced its debt by entering into a US$56m facility, with Tribeca Global Resources Credit. Paringa Resources is now well funded to progress its operations to the 2.8mtpa target.

However, Macquarie observes this comes with an increased debt burden and material increase in interest expenses.

The broker notes the current sales agreements have significantly increased the risk for the first two years of operations and a smooth ramp up of production is needed over 2019. Outperform rating maintained. Target is $0.27.

Target price is $0.27 Current Price is $0.16 Difference: $0.11
If PNL meets the Macquarie target it will return approximately 69% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

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

Market Sentiment: 1.0

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

Morgan Stanley rates PTM as Underweight (5) -

The company's co-founder, Kerr Neilson, has sold 60m shares, or 10.3% of the company, at a -9% discount to the last closing price and committed to no further selling down in the next 12 months.

Morgan Stanley believes this adds to the perception that Kerr Neilson is reducing his alignment with Platinum Asset Management. For the first time since listing the two co-founders now own less than 50% of the business.

Morgan Stanley retains an Underweight rating, assessing the stock as the most expensive asset manager in its Australian coverage and one of the most expensive globally. In-Line industry view. Target is $3.40.

Target price is $3.40 Current Price is $4.95 Difference: minus $1.55 (current price is over target).
If PTM meets the Morgan Stanley target it will return approximately minus 31% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.41, suggesting downside of -11.0% (ex-dividends)

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

Deutsche Bank rates RMD as Upgrade to Buy from Hold (1) -

The second quarter result was weaker than Deutsche Bank expected, although the core US sleep & respiratory care market continues to grow at solid rate of 9%.

The broker notes sales weakness can be attributed to rest-of-world devices because of a high comparable period, and slower upgrades to tele-monitored devices in France and Japan.

The broker believes the business has a large opportunity to grow from the increased awareness and further penetration of the sleep apnoea market. The broker upgrades to Buy from Hold. Target is US$125.

Current Price is $13.90. Target price not assessed.

Current consensus price target is $15.08, suggesting upside of 8.5% (ex-dividends)

Forecast for FY19:

Forecast for FY20:

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

Market Sentiment: 0.3

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

Credit Suisse rates SM1 as Underperform (5) -

The company is on track to record solid growth in finished infant formula, although Credit Suisse ascertains that capital investment and operating expenditure in FY19 mean profit growth will be substantially lower than FY18. Importantly, net profit is still expected to be up on FY18.

The extent of the impact on margins from the new contract being negotiated with a2 Milk ((A2M)) is not possible to determine, in the broker's view. Strong profit growth is expected to return in FY20.

Underperform rating maintained. Target rises to NZ $7.95 from NZ$7.66.

Current Price is $10.00. Target price not assessed.

Current consensus price target is N/A

The company's fiscal year ends in July.

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: -1.0

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

Macquarie rates SM1 as Underperform (5) -

First half results were were softer than Macquarie expected and down around -10%. The company has signalled margin pressure from the renegotiation of the a2 Milk ((A2M)) contract renegotiation.

The broker continues to envisage a positive long-term outlook for volumes and believes the company's diversification strategy makes sense.

Macquarie maintains an Underperform rating on valuation. Target is raised to NZ$9.15 from NZ$8.40.

Current Price is $10.00. Target price not assessed.

Current consensus price target is N/A

The company's fiscal year ends in July.

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: -1.0

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

Deutsche Bank rates SYD as Hold (3) -

Traffic results for February were weak, as Deutsche Bank expected. Domestic and international passenger growth was affected by the early start to the Lunar New Year.

Underlying fundamentals remain robust but the short-term growth outlook does not support current trading multiples, in the broker's view. Deutsche Bank maintains a Hold rating and $7.50 target.

Target price is $7.50 Current Price is $7.14 Difference: $0.36
If SYD meets the Deutsche Bank target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $7.09, suggesting downside of -0.7% (ex-dividends)

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.0

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

Macquarie rates SYD as Underperform (5) -

February traffic data has revealed domestic passenger numbers went backwards, down -2.7%. International growth was 0.4%.

Macquarie finds the stock's multiple is comparable to recent privatisation sales but envisages a risk that soft passenger growth and aeronautical renegotiations will restrict increases in cash flow.

The broker maintains an Underperform rating, assessing that the recent rally reflects bond price movements rather than improving fundamentals. Target is $6.69.

Target price is $6.69 Current Price is $7.14 Difference: minus $0.45 (current price is over target).
If SYD meets the Macquarie target it will return approximately minus 6% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $7.09, suggesting downside of -0.7% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.0

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

Citi rates WES as Sell (5) -

Citi observes Wesfarmers is looking to position Bunnings for growth, given the extended slowdown in housing over the next 12 months. While the strategic initiatives, such as online, trade and category expansion makes sense, these are considered long-dated.

The broker believes an elevated multiple is being applied to Bunnings given the current stage in the housing cycle, and retains a Sell rating and $29 target for Wesfarmers.

Target price is $29.00 Current Price is $34.53 Difference: minus $5.53 (current price is over target).
If WES meets the Citi target it will return approximately minus 16% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $32.42, suggesting downside of -6.1% (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

Morgan Stanley rates WES as Underweight (5) -

Morgan Stanley is becoming concerned by the reduced financial disclosure and lack of meaningful commentary on the earnings drivers for Bunnings, at a time when the housing market is turning and online investments are to be made.

Bunnings has declared it has aspirations for the commercial/trade business to rival the consumer business in size. The broker understands this represents around 30% of sales at present and has been growing faster than the overall business.

The broker suspects Bunnings is reluctant to invest in a transaction website, as it could be expensive and dilutive to margins. Underweight rating. Target is $29. Cautious industry view.

Target price is $29.00 Current Price is $34.53 Difference: minus $5.53 (current price is over target).
If WES meets the Morgan Stanley target it will return approximately minus 16% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $32.42, suggesting downside of -6.1% (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

Morgans rates WES as Add (1) -

Morgans notes the company's presentation on Bunnings highlighted the changes in the consumer environment. Several growth opportunities are being considered, such as expanding product categories and services online.

Bunnings is also expanding its trade offering to gain greater share of that market. Morgans maintains an Add rating and $36.50 target, believing the stock is a core portfolio holding and the strength of the balance sheet should allow the company to remain agile.

Target price is $36.50 Current Price is $34.53 Difference: $1.97
If WES meets the Morgans target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $32.42, suggesting downside of -6.1% (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

UBS rates WES as Sell (5) -

The main message UBS received from the Bunnings tour was the company's belief there is significant opportunity to grow via category expansion and mitigate near-term housing headwinds.

There was no trade update/guidance other than store growth is expected to continue at 10-14%. UBS maintains a Sell rating and $32.60 target.

Target price is $32.60 Current Price is $34.53 Difference: minus $1.93 (current price is over target).
If WES meets the UBS target it will return approximately minus 6% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $32.42, suggesting downside of -6.1% (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 WGN as Outperform (1) -

Wagners has disputed the validity of the competitor pricing notice received from Boral ((BLD)) and has elected to suspend supply for a maximum of six months rather than match the offer.

Credit Suisse notes the offer by an established competitor is an escalation in a market where cost inflation and vertical integration have previously overcome known excess capacity.

The question now exists as to whether the competitor is successful in capturing volume. As a proxy for the escalation in competition, Credit Suisse models the six-month suspension and a subsequent -10% decrease in the Boral contract price.

Outperform rating maintained. Target is reduced to $3.55 from $3.80.

Target price is $3.55 Current Price is $2.17 Difference: $1.38
If WGN meets the Credit Suisse target it will return approximately 64% (excluding dividends, fees and charges).

Current consensus price target is $2.76, suggesting upside of 27.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.0

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