Australian Broker Call

Macquarie rates AGL as Neutral (3) -

The broker has reviewed small-scale renewable energy certificate liabilities and movements in large-scale RECs. The upshot is a doubling in SREC liabilities, given a jump in residential solar rollouts, will impact earnings in FY19 but result in earnings growth from FY20.

A drop in REC prices leads to cuts in earnings forecasts. Target falls to $22.50 from $22.92, Neutral retained.

Target price is $22.50 Current Price is $21.92 Difference: $0.58
If AGL meets the Macquarie target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $23.91, suggesting upside of 9.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.4

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

Morgans rates AOG as Add (1) -

The company has upgraded FY18 earnings guidance by 6% because of higher profits at its Newstead development. Morgans expects established earnings to come in below the bottom end of the guidance range, offset by higher retirement development earnings.

FY19 guidance is in line with expectations and in response to some early signs of a housing slowdown the company will temper its delivery on developments, a prudent move in the broker's opinion. Add rating maintained. Target rises to $3.52 from $3.50.

Target price is $3.52 Current Price is $2.34 Difference: $1.18
If AOG meets the Morgans target it will return approximately 50% (excluding dividends, fees and charges).

Current consensus price target is $3.61, suggesting upside of 54.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.9

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

Credit Suisse rates API as Neutral (3) -

The company will acquire Clearskincare Clinics for $127.4m. Credit Suisse considers the transaction multiple of around 7.6x over three years is fair.

Funding of the deal initially will be via a new term facility of $65m, with the balance being determined when required in 2020 and 2021.

The broker calculates the deal being around 7% accretive in FY19 and 12% in FY20. Neutral rating retained. Target raised to $1.63 from $1.50.

Target price is $1.63 Current Price is $1.46 Difference: $0.17
If API meets the Credit Suisse target it will return approximately 12% (excluding dividends, fees and charges).

The company's fiscal year ends in August.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: -0.5

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

Deutsche Bank rates CBA as Hold (3) -

CBA intends to de-merge its wealth management assets. Deutsche Bank finds this transaction has its merits as it would complete a neat exit from wealth management.

The broker suggests there will be limited impact on the bank's returns in the short term. The proposed de-merger also means capital returns in the form of cash to shareholders are less likely. Hold rating and $76 target maintained.

Target price is $76.00 Current Price is $71.93 Difference: $4.07
If CBA meets the Deutsche Bank target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $73.63, suggesting upside of 2.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: -0.1

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

Macquarie rates CBA as Neutral (3) -

The bank intends to de-merge its wealth management and mortgage broking business. Macquarie understands the new entity will include funds management, financial planning and Aussie Home Loans.

General insurance will not be part of the new entity but be subject to a strategic review. The broker still believes the earnings trends are challenging and there is uncertainty around the level at which earnings are likely to settle.

Macquarie maintains a Neutral rating and $75.50 target and considers the stock's premium is hard to justify.

Target price is $75.50 Current Price is $71.93 Difference: $3.57
If CBA meets the Macquarie target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $73.63, suggesting upside of 2.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: -0.1

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

Ord Minnett rates CBA as Hold (3) -

The bank will separate its wealth management and mortgage broking business, forming CFS Group, and will undertake a review of its general insurance business, including considering a potential sale.

This includes Colonial First State, CFS Global Asset Management and a number of the bank's third-party distribution businesses. CBA has also announced executive appointments including its deputy CEO, chief risk officer and head of retail banking services but is yet to fill the CFO role.

Ord Minnett's Hold rating and $76 target are maintained.

Target price is $76.00 Current Price is $71.93 Difference: $4.07
If CBA meets the Ord Minnett target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $73.63, suggesting upside of 2.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: -0.1

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

UBS rates CBA as Neutral (3) -

The bank plans to de-merge its wealth management and mortgage broking business into a new entity known as CFS Group.

These businesses generate net profit of over $500m, which represents around 6% of the group. The transaction is expected to be completed in 2019.

UBS is not surprised at the announcement and continues to support CBA given its strong franchise and market position. The outlook remains challenging nonetheless and the broker believes the risks are skewed to the downside.

Neutral rating and $74 target retained.

Target price is $74.00 Current Price is $71.93 Difference: $2.07
If CBA meets the UBS target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $73.63, suggesting upside of 2.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: -0.1

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

Deutsche Bank rates CLQ as Buy (1) -

The company has released the definitive feasibility study for the Sunrise project. The capital expenditure estimate has been increased by 90% on the scaling up of the refinery to allow for higher cobalt production.

Deutsche Bank updates numbers to reflect the higher expenditure and to align with the production schedule. Buy rating maintained. Target is reduced to $1.40 from $1.50.

Target price is $1.40 Current Price is $0.89 Difference: $0.51
If CLQ meets the Deutsche Bank target it will return approximately 57% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 1.0

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

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

The company is guiding to operating earnings in FY18 of $9-11m, downgraded from $13.5-16m. FY19 guidance is $17-20m. Morgan Stanley moves to the bottom of the guidance range for both years.

Write-downs of $150m have also been announced, implying a very large change in reported earnings in FY18. The company has also exited the enterprise market.

Morgan Stanley reduces the target to $0.26 from $0.29 and maintains an Equal-weight rating. In-Line view retained.

Target price is $0.26 Current Price is $0.27 Difference: minus $0.01 (current price is over target).
If CSV meets the Morgan Stanley 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 June.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.0

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

Macquarie rates DCN as Outperform (1) -

Dacian has reported strong results from infill drilling in Beresford North and South which supports the inferred inventory in the 2016 pre-feasibility study, the broker notes.

No change to forecasts, Outperform and $3.70 target retained.

Target price is $3.70 Current Price is $2.66 Difference: $1.04
If DCN meets the Macquarie target it will return approximately 39% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 1.0

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

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

The stock has rallied 15% over the past month and is now trading above Morgans' valuation so the rating is downgraded to Hold from Add. In the medium term the broker believes the company is capable of delivering around 15% net profit growth.

In the short term the broker continues to believe that hitting 20% net profit growth in FY18 is a tall order, although any miss is likely to be modest. Target is steady at $51.51.

Target price is $51.51 Current Price is $52.93 Difference: minus $1.42 (current price is over target).
If DMP meets the Morgans target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $48.64, suggesting downside of -8.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.3

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

Ord Minnett rates ENN as Accumulate (2) -

The company has released distribution guidance for the second half of 8.6c per share, implying around $16m in core earnings for FY18.

Ord Minnett primarily values the recurring component of the funds management business alongside the balance sheet assets and co-investments. The broker finds the transaction earnings less appealing.

Target is raised to $2.28 from $2.06. Accumulate maintained.

Target price is $2.28 Current Price is $2.05 Difference: $0.23
If ENN meets the Ord Minnett target it will return approximately 11% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.5

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

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

Renewable energy certificate prices are falling, and every -$10 drop could add $19 pre-tax for ERM, Macquarie notes, although the company's hedge position is not known. Meanwhile, growth in the core domestic market is flattening and the curve is in backwardation, which is positive for ERM's competitiveness.

Addressing the US market remains a major catalyst, but downside risk is priced in, Macquarie believes. Upgrade to Neutral from Underperform. Target rises to $1.44 from $1.39.

Target price is $1.44 Current Price is $1.44 Difference: $0
If EPW meets the Macquarie target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $1.59, suggesting upside of 10.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.0

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

UBS rates FLT as Buy (1) -

UBS acknowledges earnings upgrades are needed in order for the stock to outperform ahead of consensus in FY19. The main drivers will be robust travel markets and achieving medium-term targets.

The broker suggests the FY18 result in August could be the next catalyst and continues to believe guidance for pre-tax profit of $360-385m is conservative because it implies 5-6% underlying growth. UBS estimates are around 2% above this range.

The broker maintains a Buy rating and raises the target to $69.00 from $60.70.

Target price is $69.00 Current Price is $62.72 Difference: $6.28
If FLT meets the UBS target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $54.17, suggesting downside of -13.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.0

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

Macquarie rates GTN as Outperform (1) -

GTN's push into Brazil is a key driver of medium term earnings upside, the broker believes, given strong economic growth, concentration of metro population, and growing radio ad spend. It would also provide potential for expansion into other South American countries and/or into Asia.

Sentiment has been weak post the US exit but an attractive ad platform, underpinned by a monopoly position, robust growth and strong cash generation, should provide for a re-rating on successful execution of growth opportunities, the broker suggests.

Outperform retained, target rises to $2.60 from $2.40.

Target price is $2.60 Current Price is $2.12 Difference: $0.48
If GTN meets the Macquarie target it will return approximately 23% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 1.0

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

Credit Suisse rates IAG as Neutral (3) -

Commonwealth Bank ((CBA)) has announced a strategic review of CommInsure General Insurance, including a potential sale.

With an abundance of capital and a logical growth opportunity in a strategic partnership with CBA, Credit Suisse considers Insurance Australia Group as a likely interested party.

The environment remains favourable for IAG and the broker notes management has a lot of options because of the balance sheet strength. Neutral. Target is $7.50.

Target price is $7.50 Current Price is $8.60 Difference: minus $1.1 (current price is over target).
If IAG meets the Credit Suisse target it will return approximately minus 13% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $7.67, suggesting downside of -10.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.0

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

Morgans rates IEL as Initiation of coverage with Hold (3) -

The company is the largest international provider of student placements to tertiary educational institutions and operates English testing as a co-owner of the proficiency tests IELTS.

Morgans notes the stock boasts strong returns, cash conversion and low sustaining capital expenditure.

The broker initiates coverage with a Hold rating and $10.70 target, noting the stock has enjoyed a strong re-rating, and awaits a better entry point.

Target price is $10.70 Current Price is $10.86 Difference: minus $0.16 (current price is over target).
If IEL meets the Morgans target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $8.68, suggesting downside of -20.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.2

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

Macquarie rates IFN as Outperform (1) -

Renewable energy certificate prices are falling and the curve remains in backwardation, the broker notes. Some 30% of Infigen's revenue is exposed to the REC price, hence the downward trajectory is material.

The broker has cut its valuation to 51c but retains a 78c target, representing the potential for corporate activity following Brookfield's appearance on the register. Outperform maintained.

Target price is $0.78 Current Price is $0.67 Difference: $0.11
If IFN meets the Macquarie target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $0.67, suggesting downside of -0.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.3

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

Deutsche Bank rates IPL as Buy (1) -

The company has signed an interim gas supply agreement with Central Petroleum ((CTP)) for the Gibson Island plant from the commencement of commercial operations on the Northern Gas Pipeline. Deutsche Bank views the announcement as a minor positive as it provides options in relation to the plant.

Incitec Pivot has confirmed that manufacturing costs will increase by around $50m in FY19, consistent with guidance provided in May and Deutsche Bank's forecasts.

Buy and $4.30 target retained.

Target price is $4.30 Current Price is $3.40 Difference: $0.9
If IPL meets the Deutsche Bank target it will return approximately 26% (excluding dividends, fees and charges).

Current consensus price target is $3.80, suggesting upside of 11.9% (ex-dividends)

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.3

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

Ord Minnett rates IPL as Buy (1) -

Ord Minnett updates its model to incorporate the Gibson Island gas supply agreement and manufacturing costs that were announced.

The broker increases its gas cost estimate from the second half of FY19 to $6.50 per gigajoule per day. Analysis shows that the increase in gas costs and meeting the requirements to run the plant result in an increase in manufacturing costs of about $50m.

Buy rating. Target reduced to $3.90 from $4.00.

Target price is $3.90 Current Price is $3.40 Difference: $0.5
If IPL meets the Ord Minnett target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $3.80, suggesting upside of 11.9% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.3

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

Macquarie rates KMD as Outperform (1) -

If anyone loves a cold snap early in winter it's Kathmandu, who yesterday cited higher than expected sales in upgrading earnings guidance. The broker has lifted FY18 forecasts by 8.8%.

Recent improvement in the company's momentum is being maintained, the broker notes. Outperform retained, target rises to $2.98 from $2.78.

Target price is $2.98 Current Price is $2.67 Difference: $0.31
If KMD meets the Macquarie target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $2.67, suggesting downside of -0.2% (ex-dividends)

The company's fiscal year ends in July.

Forecast for FY18:

Forecast for FY19:

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

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

The company reports sales growth has surprised to the upside in the second half and gross margins have improved because of less discounting.

Morgan Stanley welcomes the strong performance and will seek further information regarding how much should be extrapolated into FY19.

The broker retains an Equal-weight rating. Target is $2.35. Industry view is In-Line.

Target price is $2.35 Current Price is $2.67 Difference: minus $0.32 (current price is over target).
If KMD meets the Morgan Stanley target it will return approximately minus 12% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.67, suggesting downside of -0.2% (ex-dividends)

The company's fiscal year ends in July.

Forecast for FY18:

Forecast for FY19:

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

Morgans rates KSL as Add (1) -

The company has acquired ANZ's ((ANZ)) retail and commercial/SME banking business in PNG. Morgans believes the acquisition makes strategic sense as it increases the company's PNG loan and deposit market share by 4-5%.

Financials also appear attractive as the broker estimates the acquisition is 25-35% accretive in FY20-21, post synergies.

Add rating maintained. Target is raised to $1.34 from $1.14.

Target price is $1.34 Current Price is $0.86 Difference: $0.48
If KSL meets the Morgans target it will return approximately 56% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

Forecast for FY18:

Forecast for FY19:

This company reports in PGK. 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

Citi rates MTS as Sell (5) -

Citi analysts remain of the view that Metcash may look "cheap", but that is for good reason. The analysts cannot get past the potential risk of another major customer loss by 2020.

In a generalised sense, Citi sees a company that lacks organic growth while the cost cutting exercise is now getting long in the tooth. The analysts also question whether a share buyback is the smartest option for the company's cash.

Sell rating retained. Target $2.55.

Target price is $2.55 Current Price is $2.79 Difference: minus $0.24 (current price is over target).
If MTS meets the Citi target it will return approximately minus 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.03, suggesting upside of 8.4% (ex-dividends)

The company's fiscal year ends in April.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.1

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

Credit Suisse rates MTS as Underperform (5) -

Credit Suisse observes the alternative of setting the business up for a significantly smaller independent supermarket share does not appear to feature in the company's post-results strategy.

The broker believes food distribution is particularly vulnerable to a reduction in sales and the realisation of contingent liabilities on retail leases, debt guarantees and equity options.

The issue which is yet to be explained to the satisfaction of Credit Suisse is why Drakes Supermarkets could find it financially rational to spend $80m on a new warehouse rather than being supplied by Metcash.

Underperform rating maintained. Target is lowered to $2.51 from $2.65.

Target price is $2.51 Current Price is $2.79 Difference: minus $0.28 (current price is over target).
If MTS meets the Credit Suisse target it will return approximately minus 10% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.03, suggesting upside of 8.4% (ex-dividends)

The company's fiscal year ends in April.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.1

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

Deutsche Bank rates MTS as Hold (3) -

Results from the food business were in line with the pre-announcement. Deutsche Bank notes liquor and hardware delivered solid results.

The broker observes the outlook commentary is in line with recent trends and the main question centres on the additional cost reductions beyond FY19 because, if not, it may be difficult to avoid further earnings declines in food.

Hold maintained. Target is $2.80.

Target price is $2.80 Current Price is $2.79 Difference: $0.01
If MTS meets the Deutsche Bank target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $3.03, suggesting upside of 8.4% (ex-dividends)

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.1

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

Macquarie rates MTS as Neutral (3) -

Metcash's result was in line, driven by Hardware and efficiency savings, the broker notes. No guidance was provided as expected, but the broker suggests further efficiency savings will be partially offset by tough conditions in grocery and $10m in opex investment.

Beyond earnings accretion from the buyback, a path back to growth is difficult to identify at this time, the broker believes. Neutral retained. Target falls to $3.17 from $3.50 to reflect the risk of further contract losses.

Target price is $3.17 Current Price is $2.79 Difference: $0.38
If MTS meets the Macquarie target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $3.03, suggesting upside of 8.4% (ex-dividends)

The company's fiscal year ends in April.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.1

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

Morgan Stanley rates MTS as Overweight (1) -

A buyback and a lift in synergy targets for hardware should fuel earnings upgrades, Morgan Stanley believes. The broker suggests the market is under appreciating the growing liquor/hardware story and overestimates the structural pressures in food & grocery.

FY18 food & grocery earnings met expectations, despite a softer top line that was driven by tough markets in Western Australia and Queensland as well as lower joint venture profits. The broker expects that, as grocery competition moderates in 2018, food deflation should ease and enable an improved top line.

Overweight rating maintained. Cautious sector view. Target is $3.90.

Target price is $3.90 Current Price is $2.79 Difference: $1.11
If MTS meets the Morgan Stanley target it will return approximately 40% (excluding dividends, fees and charges).

Current consensus price target is $3.03, suggesting upside of 8.4% (ex-dividends)

The company's fiscal year ends in April.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.1

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

Ord Minnett rates MTS as Accumulate (2) -

FY18 underlying net profit was in line with Ord Minnett's forecasts. The broker believes the food contract risk is well incorporated and deflation is easing, so there is capital management potential besides the off-market buyback of $125m that was announced.

Following the result the broker reduces normalised earnings forecast by -6.1% for FY19 and -1.3% for FY20. Accumulate rating and $3.25 target maintained.

Target price is $3.25 Current Price is $2.79 Difference: $0.46
If MTS meets the Ord Minnett target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $3.03, suggesting upside of 8.4% (ex-dividends)

The company's fiscal year ends in April.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.1

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

UBS rates MTS as Buy (1) -

Underlying FY18 results were in line with UBS estimates. The broker welcomes the commentary regarding improved trading in food, upgrade to hardware synergies and the $125m buyback.

The broker makes modest revisions to estimates, cutting underlying earnings by -5%, which is offset by the accretion from the buyback. UBS believes the structural headwinds are more than priced into the stock. Buy rating and $3 target maintained.

Target price is $3.00 Current Price is $2.79 Difference: $0.21
If MTS meets the UBS target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $3.03, suggesting upside of 8.4% (ex-dividends)

The company's fiscal year ends in April.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.1

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

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

The company has reached a binding agreement with First Solar to acquire its first Australian solar plant in Manildra for $113m. All output from Manildra is fully contracted to Energy Australia under a 10-year offtake.

The company negotiated a gross yield of 7.6% compared with 5.15-5.6% on the existing US assets. Equal-weight retained. Industry view: Cautious. Target is $1.53.

Target price is $1.53 Current Price is $1.49 Difference: $0.04
If NEW meets the Morgan Stanley target it will return approximately 3% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.0

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

Macquarie rates OML as No Rating (-1) -

The broker notes the Adshell acquisition is complimentary for oOh!media and modestly earnings accretive. A capital raising will follow.

The broker is advising, and hence is restricted from making a recommendation.

Current Price is $5.35. Target price not assessed.

Current consensus price target is $5.38, suggesting upside of 0.5% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.6

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

Ord Minnett rates OML as Accumulate (2) -

The company will acquire Adshel from HT&E ((HT1)) for $570m through a combination of scrip and debt. Ord Minnett considers the transaction sensible and an improvement in market structure is likely to also generate some revenue synergies.

Nevertheless, the price is considered full, as it is more than 20% above that offered in April. With risks relating to Adshel's renewal of the contract with Brisbane City Council the broker suspects the value accretion may be more muted.

Accumulate maintained. Target rises to $5.60 from $4.90.

Target price is $5.60 Current Price is $5.35 Difference: $0.25
If OML meets the Ord Minnett target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $5.38, suggesting upside of 0.5% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.6

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 will commence work on an NZ$250m nutritional plant at Pokeno so that capacity is in place for the 2019/20 season. Credit Suisse considers the announcement a signal of the company's confidence in the demand for its products.

The broker believes the market is taking a positive view that the company is well-placed to de-risk the outlook and replicate the return it is achieving on a growing capital base.

Target is raised to NZ$7.34 from NZ$6.64. Underperform maintained on a valuation/risk basis, given customer concentration, investment execution risks and agri/food safety.

Current Price is $10.50. Target price not assessed.

Current consensus price target is N/A

The company's fiscal year ends in July.

Forecast for FY18:

Forecast for FY19:

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