Australian Broker Call

Morgans rates ACF as Add (1) -

Morgans upgrades its FY23-25 earnings (EBITDA) forecasts for Acrow Formwork and Construction Services by 12% in reaction to a beat for FY22 results. Formwork, Industrial Services and Commercial Scaffold delivered growth of 30%, 110% and 2%, respectively.

Management expects FY23 revenue and earnings growth of 15% and 20%. The broker's target price rises to $0.80 from $0.76 and the Add rating is retained.

Target price is $0.80 Current Price is $0.55 Difference: $0.25
If ACF meets the Morgans target it will return approximately 45% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 1.0

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

Citi rates AKE as Buy (1) -

In a first take, Allkem's FY22 results were largely in line with Citi's estimates. Citi suspects shareholders will be disappointed that guidance from the June quarter has been revised down.

Mount Cattlin is now expected to produce less because of delays in pre-stripping of waste and a poor processing performance of upper lens material.

Costs have risen to US$900/t. On the positive side, lithium prices moved up amid concerns around supply because of power shortages.

Buy rating and $15.50 target.

Target price is $15.50 Current Price is $13.88 Difference: $1.62
If AKE meets the Citi target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $15.12, suggesting upside of 9.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.7

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

Credit Suisse rates APA as Neutral (3) -

FY22 results were in line with Credit Suisse estimates. The pay-out of $0.53 per security represents 58% of operating cash flow and was below the target of 60-70%. The broker is disappointed with the guidance for 4% growth in FY23, given CPI revenue indexation.

APA Group's reasoning is that it also needs to fund organic growth, avoiding calls on equity. Neutral rating maintained. Target increases to $11.10 from $9.60 because of higher inflation and growth that more than offsets an increase in the discount rate.

Target price is $11.10 Current Price is $11.30 Difference: minus $0.2 (current price is over target).
If APA meets the Credit Suisse target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $10.91, suggesting downside of -0.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.0

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

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

APA Group has delivered full year earnings of $1,692m, equating to 4% yearly growth, and free cash flow of $1,081m, equating to 20% yearly growth. Morgan Stanley notes earnings missed its estimates by -3%, while free cash flow beat by 6%. 

The company announced decarbonisation targets, aiming for a -35% reduction in power intensity by 2030, targeting net zero by 2040, and a -30% reduction in gas infrastructure by 2030, targeting net zero in 2050. Morgan Stanley notes Scope 3 targets will be set in 2025. 

The Equal-weight rating is retained and the target price increases to $10.66 from $10.00. Industry view: Cautious. 

Target price is $10.66 Current Price is $11.30 Difference: minus $0.64 (current price is over target).
If APA meets the Morgan Stanley target it will return approximately minus 6% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $10.91, suggesting downside of -0.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.0

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

Morgans rates APA as Hold (3) -

FY22 earnings (EBITDA) for APA Group were in line and free cash flow exceeded Morgans' expectation. The Hold rating is retained on caution over rising FY23 spending and the longer-term value headwind from climate change.

The broker also notes from the FY22 asset performance a downward trend in the take-or-pay/contracted percentage of revenues. The unsettled management team is also referenced.

No FY23 guidance was provided. The analyst makes immaterial forecast changes and the target rises to $10.31 from $10.04.

Target price is $10.31 Current Price is $11.30 Difference: minus $0.99 (current price is over target).
If APA meets the Morgans target it will return approximately minus 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $10.91, suggesting downside of -0.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.0

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

UBS rates APE as Neutral (3) -

The first half results were previously guided and adjusted pre-tax profit was broadly in line with UBS estimates. No guidance was provided.

In an initial assessment, growth in the order book increased throughout July and August which signals demand is still outstripping supply, providing a strong foundation heading into 2023.

While penetration trends for Eagers Automotive remain consistent, UBS cites industry statistics which have moderated since May and that may be an early sign demand is easing back. Neutral rating and $12.90 target maintained.

Target price is $12.90 Current Price is $13.31 Difference: minus $0.41 (current price is over target).
If APE meets the UBS target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $13.78, suggesting upside of 4.7% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.8

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

Citi rates APX as Sell (5) -

First half financials, at first glance, were in line with previously reported figures. Citi notes growth of work-in-hand has slowed and is now in line with the prior corresponding period.

Moreover, Appen has not experienced any improvement in July and August and flagged uncertainty regarding the conversion of forward orders to sales.

The company continues to expect work will be skewed towards the fourth quarter and 2022 revenue to be down year-on-year. Sell rating and $4.40 target maintained.

Target price is $4.40 Current Price is $4.17 Difference: $0.23
If APX meets the Citi target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $3.97, suggesting downside of -3.7% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: -0.7

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

Macquarie rates ASG as Outperform (1) -

Autosports Group's FY22 profit before tax outpaced consensus and Macquarie's forecasts by 13% and 11% accordingly, as continued expansion in gross margins offset a supply-chain-induced miss on revenue.

FY23 guidance also outpaced with margin expansion expected to continue in FY23, and the broker postpones margin normalisation forecasts to FY25. The broker notes that such normalisation would likely be offset by a growth in volume and revenue.

Management reports the order backlog has risen 66% since December 2021, with orders outpacing deliveries by 25%.

EPS forecasts rise 38% in FY23 and 16.1% in FY24 before rising just 2% thereafter. Outperform rating retained. Target price rises to $3.25 from 2.90.

Target price is $3.25 Current Price is $2.04 Difference: $1.21
If ASG meets the Macquarie target it will return approximately 59% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 1.0

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

UBS rates ASG as Buy (1) -

Having delivered a record 5.6% underlying profit margin the second half, UBS notes operating conditions remain positive for Autosports Group, with demand continuing to outstrip supply and driving further order bank growth.

While the company believes this can persist as far as FY24, UBS remains cautious around moderation in new car demand but does expect margins will remain strong in the coming year.

The Buy rating is retained and the target price increases to $3.10 from $2.90.

Target price is $3.10 Current Price is $2.04 Difference: $1.06
If ASG meets the UBS target it will return approximately 52% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 1.0

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

Credit Suisse rates AUB as Outperform (1) -

FY22 results beat estimates amid strong growth and margin expansion in broking/agencies. AUB Group has flagged 510 basis points margin improvement and 41% revenue growth and remains confident of further margin expansion in FY23 and beyond.

Credit Suisse upgrades estimates but delays the estimated completion date for Tysers. The stock is considered compelling at current levels and an Outperform rating is reiterated. Target is raised to $25.30 from $21.10.

Target price is $25.30 Current Price is $21.59 Difference: $3.71
If AUB meets the Credit Suisse target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $25.15, suggesting upside of 14.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 1.0

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

Macquarie rates AUB as No Rating (-1) -

AUB Group's FY22 result fell at the top end of guidance thanks to strong revenue growth and margin expansion.

Management guidance predicts recent strong rises in premium rates will ease in FY23 but expects rate rises will accelerate in New Zealand.

The Tysers acquisition is expected to be finalised in late 2022 pending approvals, and the broker notes the company's growth accelerated into the June quarter. Management is still on the acquisition path, looking for either bolt-ons and expanded capabilities in targets.

EPS forecasts rise 1.3% in FY23; 0.2% in FY24; and 0.6% in FY25.

Macquarie is on rating restriction.

Current Price is $21.59. Target price not assessed.

Current consensus price target is $25.15, suggesting upside of 14.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 1.0

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

UBS rates CCX as Neutral (3) -

FY22 EBITDA was below UBS estimates. On first view, the first seven weeks of the first half of FY23 are broadly in line with the prior corresponding period amid a return to positive momentum in August.

Retail price increases have been instigated by City Chic Collective to mitigate the risk of margin compression and in order to grow market share. Neutral rating and $2 target maintained.

Target price is $2.00 Current Price is $2.46 Difference: minus $0.46 (current price is over target).
If CCX meets the UBS target it will return approximately minus 19% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.79, suggesting upside of 39.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.6

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

Citi rates CHC as Neutral (3) -

FY22 profit of $543m was below Citi's forecast. At first glance, growth in earnings was partially driven by performance fees from certain funds and this is likely to be lower in FY23.

Importantly, around $3.5bn of net acquisitions have already been made in FY23 and that puts Charter Hall on a solid footing, suggests the broker.

Hence, Citi expects the stock will react positively to the results with the main issues being movement in investment earnings, the outlook for asset values and the appetite for real estate investment. Neutral rating and $12.60 target maintained.

Target price is $12.60 Current Price is $12.54 Difference: $0.06
If CHC meets the Citi target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $14.67, suggesting upside of 9.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.7

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

Citi rates COL as Buy (1) -

Coles Group reported FY22 earnings some -1% below Citi's expectations and 2% above consensus with the 30c dividend lower than 32c forecast.

Management pointed to an improvement in market share post Easter, following previous losses and Citi awaits the 1Q23 results for a trading update.

The $250m capital costs for Witron and Ocado were noted by the analyst as disappointing but Witron is expected to be a major earnings contributor in FY25.

Citi adjusts earnings forecasts by -3% for FY23 and -5% for FY24 for the updated supermarket sales and the lower than anticipated FY22 results, while highlighting food inflation is earnings neutral.

A Buy rating is retained and the target price is lowered to $20.10 from $21.00.

Target price is $20.10 Current Price is $17.84 Difference: $2.26
If COL meets the Citi target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $18.74, suggesting upside of 6.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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

Credit Suisse rates COL as Neutral (3) -

FY22 results were largely in line with forecasts and Credit Suisse notes accelerating costs and capital expenditure pushed "inflation" into the background.

The broker assesses Coles Group's cost guidance for FY23 is actually lower than previous guidance while FY24 is around $100m ahead of its forecasts.

Sales momentum is hard to estimate, the broker adds, given previous cumulative impacts. Neutral maintained. Target is reduced to $18.62 from $19.02.

Target price is $18.62 Current Price is $17.84 Difference: $0.78
If COL meets the Credit Suisse target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $18.74, suggesting upside of 6.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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

Macquarie rates COL as Outperform (1) -

Coles Group's FY22 result met consensus and Macquarie's forecasts.

The broker expects the company will encounter further cost inflation in FY23, which could well offset operating leverage from price rises.

On the upside, Macquarie expects Coles' value proposition should appeal to consumers as budgets are reined in.

EPS forecasts fall -2.5% in FY23; -3% in FY24; and -3.5% in FY25.

Outperform rating and $18.90 target price retained, reflecting caution heading into FY23, the broker expecting higher mortgage rates and inflation will hit discretionary spending.

Target price is $18.90 Current Price is $17.84 Difference: $1.06
If COL meets the Macquarie target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $18.74, suggesting upside of 6.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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

Morgans rates COL as Add (1) -

Morgans assesses FY22 results for Coles Group were slightly above expectations with earnings (EBIT) and profit 2% and 5% beats, respectively. Earnings for Supermarkets and Liquor were better than expected and overall market share improved in the 4Q.

More negatively, the group earnings margin fell by -20bps to 4.7% due to cost inflation and investments.

The broker revises FY23-25 underlying earnings forecasts by between -2% and 1% and lowers its target to $20.00 from $20.65. The Add rating is retained with defensive characteristics holding the business in good stead in a weaker economic environment.

Target price is $20.00 Current Price is $17.84 Difference: $2.16
If COL meets the Morgans target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $18.74, suggesting upside of 6.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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

Ord Minnett rates COL as Lighten (4) -

FY22 underlying net profit was ahead of Ord Minnett's forecast as was the final dividend of $0.30. Coles Group delivered 3.1% sales growth in the fourth quarter which was half the rate of growth in the market.

Moreover, Ord Minnett suspects the gap between like-for-like sales and inflation will widen further in the first quarter of FY23 to reflect market share losses, trading down and slowing volumes as lockdowns are cycled.

These factors have led the broker to reduce forecasts by -1% for FY23 and -7% for FY24. Lighten rating retained. Target is reduced to $16.80 from $17.00.

Target price is $16.80 Current Price is $17.84 Difference: minus $1.04 (current price is over target).
If COL meets the Ord Minnett target it will return approximately minus 6% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $18.74, suggesting upside of 6.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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

UBS rates COL as Neutral (3) -

UBS notes Coles Group has delivered an in-line earnings result for the year, down -0.2% on the previous year to $1,869m, while sales and net profit rose 2.0% and 4.3% respectively, with Supermarkets and Express both weaker than expected. 

The broker noted like-for-like sales growth only reached 3.7% in the fourth quarter, attributing the uncommon decline in growth to reduced supply availability, especially in produce. The broker anticipates food inflation will accelerate in the coming half. 

Earnings per share forecasts decrease -8.9% and -6.6% respectively, accounting for performance from Supermarkets and Express. The Neutral rating is retained and the target price decreases to $18.00 from $18.75.

Target price is $18.00 Current Price is $17.84 Difference: $0.16
If COL meets the UBS target it will return approximately 1% (excluding dividends, fees and charges).

Current consensus price target is $18.74, suggesting upside of 6.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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

Citi rates DMP as Buy (1) -

Citi assesses the Domino's Pizza Enterprises reported FY22 results as largely in line but some -4% below consensus forecasts, with a $9m increase in asset/lease disposals on the previous year.

The broker envisages higher wage inflation in the September quarter, although cheese and wheat prices appear to be moderating and management is still aiming for same store sales growth of 3-6% for FY23, with a possible tailwind from the FIFA World Cup and lower year-on-year comparisons.

Citi's earnings forecasts are lowered by -2% and -13% for FY23 and FY24, respectively, adjusting for a slower rollout in new stores and lower same store sales.

Gearing is forecast to rise to 2.5x from 1.7x due to the Asian acquisitions and the expected exercising of the German call option in January 2023.

A Buy rating and the target is lowered to $84.40 from $92.95 due to changes in the earnings forecasts.

Target price is $84.40 Current Price is $72.15 Difference: $12.25
If DMP meets the Citi target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $84.32, suggesting upside of 28.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.7

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

Credit Suisse rates DMP as Neutral (3) -

FY22 results missed forecasts. Comparable store sales are down -1.3% in FY23 to date and Credit Suisse suspects currency is likely to be a headwind. Therefore, achieving guidance of 3-6% growth  in FY23 would require an improving trend.

Credit Suisse points out Domino's Pizza Enterprises, having discussed potential acquisitions for some time, has timed the acquisitions in Malaysia, Singapore and Cambodia to coincide with its results.

The acquisitions comprise 287 stores yet the broker considers the opportunity uncertain, given the nature of these markets. Neutral maintained. Target is raised to $76.96 from $73.09.

Target price is $76.96 Current Price is $72.15 Difference: $4.81
If DMP meets the Credit Suisse target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $84.32, suggesting upside of 28.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.7

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

Macquarie rates DMP as Neutral (3) -

Domino's Pizza Enterprises' FY22 result missed Macquarie's forecasts as a sharp slowdon in Europe in response to inflation hit earnings.

On the upside, the broker considers the highlight of FY22 to be the acqusition of 287 stores in Malaysia, Singapore and Cambodia, which it expects will open a long-term growth opportunity in Asia.

Macquarie estimates the purchases to be 5% EPS accretive and says management is targeting a total of 600 stores across the three geographies.

Meanwhile, the broker considers the recent introduction of a 6% delivery fee in Australia ad New Zealand to be a success, with delivery service times and net promoter scores improving. Franchisee profitability remains attractive, albeit down from its covid peak.

EPS forecasts fall -7.9% in FY23; -9.2% in FY24 and -5.4% in FY25. Neutral rating retained. Target price falls to $74.90 from $76.20.

Target price is $74.90 Current Price is $72.15 Difference: $2.75
If DMP meets the Macquarie target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $84.32, suggesting upside of 28.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.7

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

Morgan Stanley rates DMP as Overweight (1) -

Morgan Stanley notes Domino's Pizza Enterprises' results missed expectations, with same store sales declining -1.1%, but despite this anticipates same store sales growth in the coming year to be within the company's provided 3-6% range. 

Positively, the broker highlights the company has been successful in offsetting inflationary pressures in Australia, New Zealand and Asia, although margins in Europe, where inflation is ahead of other markets, did come under pressure. 

Domino's is also set to acquire three new markets, Singapore, Malaysia and Cambodia, for -$214m, with the broker expecting the company will leverage existing infrastructure to build the business.

The Overweight rating is retained and the target price decreases to $95.00 from $100.00. Industry view is In-Line.

Target price is $95.00 Current Price is $72.15 Difference: $22.85
If DMP meets the Morgan Stanley target it will return approximately 32% (excluding dividends, fees and charges).

Current consensus price target is $84.32, suggesting upside of 28.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.7

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

Morgans rates DMP as Add (1) -

Following FY22 results for Domino's Pizza Enterprises, Morgans believes earnings (EBIT) will improve from now, and forecasts 12.9%  growth in FY23, followed by 19.5% growth in FY24.

The analyst also expects margins to rise in FY23 with relief from commodity price inflation emerging and reduced losses in Denmark. Cost inflation is already being offset in A&NZ and Asia via higher prices, operating efficiencies and menu enhancements.

Lower sales forecasts sees the broker reduce its earnings (EBITDA) estimates in FY23 and FY24 by -4% and -3%, respectively, and the target price falls to $90 from $93. Add.

Target price is $90.00 Current Price is $72.15 Difference: $17.85
If DMP meets the Morgans target it will return approximately 25% (excluding dividends, fees and charges).

Current consensus price target is $84.32, suggesting upside of 28.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.7

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

Ord Minnett rates DMP as Buy (1) -

FY22 net profit was below Ord Minnett's forecast as was the final dividend. The broker assesses the positive reaction in the share price was driven by low expectations in the first place.

Deteriorating economic conditions in Europe impacted the result which compared with strong momentum in Australasia, where Domino's Pizza Enterprises has combated inflation with measured price rises, maintaining key value price points as well as introducing delivery service fees.

This strategy will be rolled out in Europe in FY23. Ord Minnett lowers the target to $84 from $88 and maintains a Buy rating.

Target price is $84.00 Current Price is $72.15 Difference: $11.85
If DMP meets the Ord Minnett target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $84.32, suggesting upside of 28.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.7

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

UBS rates DMP as Buy (1) -

While Domino's Pizza Enterprises reported 4.6% sales growth for the year, UBS notes earnings and net profit declined -10.5% and -12.5% respectively. The broker highlights Europe was a driver of the decline, with inflation not being fully offset and Denmark delivering an earnings loss.

The broker noted energy, food and labour inflation remain key challenges for franchisees, and weighs on sentiment. With both Australia New Zealand and Japan managing inflation better than expected, the approach is now being implemented in Europe.

Domino's Pizza Enterprises also announced it will acquire 100% of operations in Malaysia, Singapore and Cambodia, a total 287 stores, for -$214m. 

The Buy rating is retained and the target price decreases to $85.00 from $90.00.

Target price is $85.00 Current Price is $72.15 Difference: $12.85
If DMP meets the UBS target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $84.32, suggesting upside of 28.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.7

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

Credit Suisse rates EBO as Outperform (1) -

FY22 results were ahead of expectations and Credit Suisse notes growth accelerated in the second half. EBOS Group provided no FY23 guidance while Credit Suisse estimates group revenue in FY23 to be up 8.7% and EBITDA up 28%.

Outside of life healthcare, the broker assumes flat margins in healthcare in FY23, given cost inflation. A stronger rebound in elective surgery would provide the upside for institutional healthcare. Target is lowered to $40.00 from $42.50. Outperform maintained.

Target price is $40.00 Current Price is $34.54 Difference: $5.46
If EBO meets the Credit Suisse target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $39.08, suggesting upside of 14.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.6

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

Macquarie rates EBO as Outperform (1) -

Ebos Group's FY22 result sharply outpaced Macquarie's forecasts by 23% thanks to a 48% beat in gross operating revenue courtesy sales of new specialty medicines and solid inorganic and organic growth in medical consumables and devices.

Community Pharmacy proved a star, and the broker believes the company is managing inflation well.

EPS forecasts rise 5% in FY23; 5% in FY24; and 3% in FY25.

Outperform rating retained, the broker noting the company is trading -5% below peers. Target price is steady at NZ$44.52, the broker expecting increased capital investment.

Current Price is $34.54. Target price not assessed.

Current consensus price target is $39.08, suggesting upside of 14.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.6

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

Morgans rates EBO as Hold (3) -

Following a consensus-beating FY22 result, Morgans suggests shares of Ebos Group should be bought on any weakness, and in the meantime retains its Hold rating. 

Management is expecting another strong year of profit growth in FY23 and elevated capital expenditure.

The broker makes only minor forecast changes and raises its target price to $36.81 from $36.75.

Target price is $36.81 Current Price is $34.54 Difference: $2.27
If EBO meets the Morgans target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $39.08, suggesting upside of 14.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.6

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

Ord Minnett rates ECF as Accumulate (2) -

Elanor Commercial Property Fund's FY22 result and FY23 guidance nosed out consensus, thanks to strong leasing success and solid momentum.

Ord Minnett reports management now assumes less than a year's downtime on impending expiries and points to a strong opportunity to raise rents.

Net tangible assets rose 1c to $1.20 in the June half as valuations rose. Gearing rose to 36.3%.

Accumulate rating retained. Target price rises to $1.04 from $1.01.

Target price is $1.04 Current Price is $1.01 Difference: $0.03
If ECF meets the Ord Minnett target it will return approximately 3% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.5

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

Macquarie rates EHE as Neutral (3) -

Estia Health's FY22 result fell well short of Macquarie's estimate as revenue and occupancy levels (covid-induced) fell and cost and labour inflation outpaced, squeezing margins.

The broker spies signs of an improvement in occupancy rates as covid unwinds but says uncertainty over government funding continues, as does the outcome of proposed higher wages before the Fair Work Commission. Some government grant recovery is expected in FY23.

Macquarie appreciates the medium-to-long dated fundamentals but spies near-term earnings risk and uncertainty around government regulation.

EPS forecasts fall -1% in FY23 and -4% in FY24.

Neutral rating retained. Target price falls to $2.15 from $2.30.

Target price is $2.15 Current Price is $2.04 Difference: $0.11
If EHE meets the Macquarie target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $2.18, suggesting upside of 7.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.0

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

Ord Minnett rates EHE as Hold (3) -

Covid costs and lower occupancy, according to Ord Minnett, were behind the -$10m underlying FY22 loss for Estia Health compared to the broker's forecast for a -$4m loss. Delays to expected government support payments were also considered a factor.

As these delayed payments and other promised government reforms occur, management expects a significant lift in FY23 conditions.

The broker retains its Hold rating, though raises its FY23 earnings forecast by 60% after incorporating the delayed payment of government grants. Despite this, the target falls to $2.20 from $2.30.

Target price is $2.20 Current Price is $2.04 Difference: $0.16
If EHE meets the Ord Minnett target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $2.18, suggesting upside of 7.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.0

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

Morgan Stanley rates ELO as Overweight (1) -

Elmo Software's full year result has delivered no surprises given key financials were pre-announced, but Morgan Stanley liked that the company expects to deliver operating leverage to gross margins, sales and marketing, general and administrative and research and development.

Given balance sheet strength, the company will also review options to repay a proportion of its debt facility. The Overweight rating and target price of $3.50 are retained. Industry view: In-Line.

Target price is $3.50 Current Price is $2.97 Difference: $0.53
If ELO meets the Morgan Stanley target it will return approximately 18% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 1.0

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

Macquarie rates FCL as Outperform (1) -

Fineos Corp's FY22 result met guidance and outpaced Macquarie's forecasts by 1.6%.

Management guides to stronger revenue growth in FY23, citing a strong pipeline of cross-sell and up-sell opportunities from existing customers, and Macquarie lifts revenue forecasts accordingly.

But the broker says there is little sign of a revival in new customers.

EPS forecasts are fairly steady, given the small base. Outperform rating retained, the broker expecting new-customer acquisition should kick in eventually. Target price steady at $2.37.

Target price is $2.37 Current Price is $1.54 Difference: $0.83
If FCL meets the Macquarie target it will return approximately 54% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

This company reports in EUR. 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

Morgans rates FDV as Add (1) -

Morgans makes only nominal changes to forecasts for Frontier Digital Ventures following 1H results, which were slightly adrift of expectations. The target falls to $1.32 from $1.41 and the Add rating is unchanged.

The analyst highlights ongoing solid growth for both portfolio revenue and earnings (EBITDA), and the key goal of becoming operating cashflow breakeven was achieved.

Target price is $1.32 Current Price is $0.83 Difference: $0.49
If FDV meets the Morgans target it will return approximately 59% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 1.0

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

Citi rates FLT as Sell (5) -

At first glance, as the underlying operating earnings loss was pre-reported in July, there were no surprises in the FY22 result. Citi asserts revenue margins of around -25% below pre-pandemic levels are unsustainable and need to normalise before there is a proper recovery.

Moreover, capacity revisions are heading down instead of up. Hence, the broker calculates, for Flight Centre Travel to hit FY23 consensus revenue estimates at existing take rates implies 11% more than the total transaction value the market is expecting.

The Sell rating and $15.55 target are retained.

Target price is $15.55 Current Price is $17.34 Difference: minus $1.79 (current price is over target).
If FLT meets the Citi target it will return approximately minus 10% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $16.50, suggesting downside of -0.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: -0.5

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

UBS rates FLT as Neutral (3) -

At first glance, Flight Centre Travel's FY22 result has outpaced consensus by 6% and UBS by 3%.

Strong corporate contract wins and an uptick in leisure underpinned the beat, with Australia outpacing the broker by 31% and Asia by 69%. The Americas proved a -28% miss. Most geographies were profitable by the second half.

No guidance was provided but the company reports a solid start to FY23, with corporate and leisure continuing their upward path.

Tight cost control, combined with improved June-half momentum pleased UBS.

Rating and target price are under review.

Target price is $18.65 Current Price is $17.34 Difference: $1.31
If FLT meets the UBS target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $16.50, suggesting downside of -0.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: -0.5

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

UBS rates GEM as Buy (1) -

UBS notes G8 Education delivered a solid result in a challenging environment, with revenue and earnings beating the broker's estimates by 5% and 6% respectively. 

The broker notes occupancy recovery is progressing well, and estimates G8 Education could get back to pre-covid levels by December, which could add $3m upside to earnings forecasts. UBS highlights labour remains a key challenge, with the industry arguing for skilled teachers to be an immigration priority.

The Buy rating and target price of $1.35 are retained.

Target price is $1.35 Current Price is $1.00 Difference: $0.35
If GEM meets the UBS target it will return approximately 35% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.5

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

Credit Suisse rates HMC as Neutral (3) -

FY22 results were ahead of Credit Suisse estimates. No FY23 guidance was provided, with Home Consortium alluding to the "unpredictable nature" of transaction income. A flat distribution in FY23 is guided, at $0.12.

Credit Suisse believes the challenge is in replacing $28m in trading profits and the $30.6m in acquisition fees derived in FY22. The broker does not rule out achieving important transaction activity but lowers estimates to reflect softer growth.

Neutral maintained. Target is reduced to $5.82 from $6.16.

Target price is $5.82 Current Price is $5.21 Difference: $0.61
If HMC meets the Credit Suisse target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $6.15, suggesting upside of 15.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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

Macquarie rates HMC as Neutral (3) -

Alternative asset manager Home Consortium's FY22 result outpaced guidance by 7% and the broker by 6% thanks to strong trading profits.

Management failed to provide specific guidance but the broker expects funds under management (FUM) should rise 41% ($1.6bn) in FY23. 

The asset manager launched two new funds totalling roughly $1.3bn in FY22 - a $1bn last-mile logistics fund and its $250m Camden Healthcare Fund.

FFOPS forecasts fall -1.4% in FY23; rise 0.3% for FY24 and fall -2.6% for FY25.

Neutral rating retained. Target price rises to $5.52 from $5.25 to reflect the pull-forward of the group's $10bn fund by 6-12 months, says the broker, noting it is difficult to fully incorporate the contribution from growing FUM prior to execution.

Target price is $5.52 Current Price is $5.21 Difference: $0.31
If HMC meets the Macquarie target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $6.15, suggesting upside of 15.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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

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

Home Consortium delivered full year funds from operations of 31 cents per share, a beat to its 29 cents per share guidance, but has refrained from providing earnings guidance for the coming year, citing the unpredictable timing of transaction income.

Morgan Stanley notes the company did reiterate its $10m assets under management target by end of FY24, and that the company claims to be tracking 6-12 months ahead. 

The Equal-weight rating and target price of $5.45 are retained. Industry view: In-Line.

Target price is $5.45 Current Price is $5.21 Difference: $0.24
If HMC meets the Morgan Stanley target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $6.15, suggesting upside of 15.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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

Ord Minnett rates HSN as Buy (1) -

FY22 results for Hansen Technologies were a -4% miss versus Ord Minnett's forecast, as 2H operating margins disappointed, due to  investment requirements and inflation impacts.

Operating cash flow was excellent, according to the analyst and there's potential for improving margins toward the end of FY23. 

The Buy rating is kept while the target falls to $6.40 from $6.50.

Target price is $6.40 Current Price is $4.90 Difference: $1.5
If HSN meets the Ord Minnett target it will return approximately 31% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 1.0

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

Macquarie rates IEL as Outperform (1) -

Macquarie's sees strong beats versus both its forecast and consensus expectations in an initial review of today's FY22 results from IDP Education. The beats arose from better-than-expected margins in both IELTS and Student Placement.

Gross margins of 85% for student placements in FY22 implies to the broker 86% for the 2H, the highest ever achieved by the company.

Management stated synergies were significantly ahead of plan for the IELTS India acquisition.

The broker sees evidence that market share gains in Multi-destination will occur in FY23, and notes forward looking indicators remain positive for A&NZ and Multi-destination student placements.

The Outperform rating and $30 target price are unchanged.

Target price is $30.00 Current Price is $26.80 Difference: $3.2
If IEL meets the Macquarie target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $33.24, suggesting upside of 15.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.7

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

UBS rates IEL as Buy (1) -

IDP Education has released yet another strong result, UBS concludes upon first read. The broker highlights the recovery in student placements in Australia has been "extremely strong", and this despite bottlenecks in the visa processing.

Revenue slightly missed expectations, the broker suggests, but all other metrics, including the 13.5c final dividend proved better than the broker's estimates and beating consensus too.

No specific guidance was provided but one of the comments made is that delays in processing visas has pushed out "many" students into autumn intake.

Buy. Target $34.60.

Target price is $34.60 Current Price is $26.80 Difference: $7.8
If IEL meets the UBS target it will return approximately 29% (excluding dividends, fees and charges).

Current consensus price target is $33.24, suggesting upside of 15.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.7

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

Credit Suisse rates ILU as Downgrade to Neutral from Outperform (3) -

Credit Suisse found the first half mixed, with net profit ahead of estimates and underlying EBITDA in line. The interim dividend was substantially below expectations.

Iluka Resources has dismissed the prospect of softening demand, instead focusing on supply chain and customer desire for supply security.

The broker disagrees with this and forecasts price weakness as the global economy stumbles in 2023. Rating is downgraded to Neutral from Outperform. Target is lowered to $10.00 from $10.48.

Target price is $10.00 Current Price is $10.38 Difference: minus $0.38 (current price is over target).
If ILU meets the Credit Suisse target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $11.17, suggesting upside of 6.3% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.4

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

Macquarie rates ILU as Outperform (1) -

Macquarie's second read of Iluka Resources' June-half result confirms operating earnings (EBITDA) outpaced Macquarie's forecasts by 6% thanks largely to non-cash items such as lower depreciation expenses, and earnings outpacing by 31%. Free cash flow was within 2% of forecasts.

The dividend was dandy and the company increased the cash balance to $600m.

Iluka Resources has signalled zircon demand in China has softened but the market remains tight for premium zircon. Demand is still robust in Europe despite the higher power costs.

Management expects rutile prices will rise to the low double digits in the December half. Macquarie has increased its rutile price deck by 7% in 2022 and 9% in 2023. Zircon estimates are unchanged.

Earnings forecasts rise 11% for 2022 and 10% for 2023. EPS forecasts rise 2% and 5% respectively.

Outperform rating retained. Target price rises to $12.60 from $12.10.

Target price is $12.60 Current Price is $10.38 Difference: $2.22
If ILU meets the Macquarie target it will return approximately 21% (excluding dividends, fees and charges).

Current consensus price target is $11.17, suggesting upside of 6.3% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.4

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

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

Iluka Resources delivered first half earnings of $525m, a 12% beat to Morgan Stanley's estimates, and a dividend of 25 cents per share, a 51% beat to the broker's estimates. The broker notes the higher than anticipated dividend was driven by a higher free cash flow payout.

The company announced a definitive feasibility study for Balranald is now due in the second half, having previously stated a final investment decision would be handed down in the fourth quarter. Morgan Stanley notes a pre-feasibility study for Wimmera Atacama is also expected in the coming half.

The Equal-weight rating is retained and the target price decreases to $10.90 from $11.40. Industry view: Attractive.

Target price is $10.90 Current Price is $10.38 Difference: $0.52
If ILU meets the Morgan Stanley target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $11.17, suggesting upside of 6.3% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.4

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

Ord Minnett rates ILU as Hold (3) -

Ord Minnett observes the outlook for zircon and titanium dioxide is strong into the second half and, while demand drivers are slowing, supply remains challenged.

High energy costs in Europe are affecting tile production but on the supply side inventory is near decade lows. The broker believes Iluka Resources is well placed to expand into rare earths and maintain a leading position in mineral sands.

Still, there is limited upside to valuation and a Hold rating is retained. Target is raised to $11.10 from $10.50.

Target price is $11.10 Current Price is $10.38 Difference: $0.72
If ILU meets the Ord Minnett target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $11.17, suggesting upside of 6.3% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.4

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

Citi rates JDO as Buy (1) -

At first glance, Judo Capital's FY22 maiden result met consensus and Citi's forecasts.

More importantly to the broker, which downgraded the target price sharply 10 days ago ahead of the result on concerns about FY23 given rising rates, management guided to another strong year of growth in FY23, expecting its loan book to rise to more than $9bn from $6bn.

Citi's now reverses the downgrade and the target price returns to $1.90 from $1.30.

But the broker is seeking greater clarity about the reasons for management's confidence given expectations of rising interest rates.

Outperform rating retained.

Target price is $1.90 Current Price is $1.22 Difference: $0.68
If JDO meets the Citi target it will return approximately 56% (excluding dividends, fees and charges).

Current consensus price target is $1.95, suggesting upside of 50.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 1.0

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

Ord Minnett rates KLS as Buy (1) -

Kelsian Group's FY22 normalised profit of $67.1m was a miss versus the $73.3m expected by Ord Minnett, weighed down by covid-related labour shortages, travel restrictions and increased costs.

The Tourism & Marine division was most impacted with earnings (EBITDA) down -6% as omicron arrived during the peak domestic summer season, explains the analyst. While headwinds are expected to ease, prior earnings estimates for the division will likely fall short.

The Bus division is spared from cost pressures due to the nature of contracts, and the Aussie Bus division result was in line (aided by the GO West acquisition), while the International Bus division exceeded expectations.

The broker's EPS forecasts fall by -12-15% across FY23-25 and the target falls to $7.52 from $8.38. Buy.

Target price is $7.52 Current Price is $6.36 Difference: $1.16
If KLS meets the Ord Minnett target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $8.34, suggesting upside of 49.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 1.0

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

UBS rates KLS as Buy (1) -

According to UBS, Kelsian Group has delivered a solid result in the second half despite facing challenging operating conditions, noting revenue proved defensive while earnings were flat on the previous half.

The broker noted rising costs are becoming more evident, with fuel costs rising to 9.2% of revenue from 7.8% in the previous half and wages increasing 6.5% year-on-year.

Rising costs saw earnings margins slip -30 basis points in the half. The broker warns these headwinds look to continue over the coming year. 

The Buy rating is retained and the target price decreases to $8.80 from $9.50.

Target price is $8.80 Current Price is $6.36 Difference: $2.44
If KLS meets the UBS target it will return approximately 38% (excluding dividends, fees and charges).

Current consensus price target is $8.34, suggesting upside of 49.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 1.0

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

Ord Minnett rates LYC as Lighten (4) -

Lynas Rare Earths' plan to expand production at its Mt Weld mine in Western Australia surprised Ord Minnett, the broker considering it to be expensive and potentially ill-timed, increasing the broker's concerns regarding execution risk.

The company also signalled another two growth projects. Overall, the broker concedes the expansion should deliver longer-term growth. 

Lighten recommendation retained. Target price rises to $5.35 from $5.

Target price is $5.35 Current Price is $8.84 Difference: minus $3.49 (current price is over target).
If LYC meets the Ord Minnett target it will return approximately minus 39% (excluding dividends, fees and charges - negative figures indicate an expected loss).

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: -0.5

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

Ord Minnett rates NAN as Lighten (4) -

Ord Minnett attributes lower operating costs and a tax refund for Nanosonics FY22 underlying net profit of $3.7m exceeding the broker's forecast of a -$0.5m loss.

The new CORIS device should launch in FY24 though first US sales are unlikely until FY25 due to regulatory hurdles.

The broker lowers its EPS forecasts by -50% (on small numbers), largely due to lower-than-expected FY23 revenue guidance. The target falls to $3.60 from $3.70 and the Lighten rating is unchanged.

Target price is $3.60 Current Price is $4.42 Difference: minus $0.82 (current price is over target).
If NAN meets the Ord Minnett target it will return approximately minus 19% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.11, suggesting downside of -5.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: -0.7

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

UBS rates NEC as Buy (1) -

FY22 results were ahead of UBS estimates. On initial review, the broker assesses first half guidance is softer because of higher TV costs and the probability of slower advertising markets.

Stan ARPU growth of 9% occurred in the second half but subscriber momentum appears to have slowed. UBS maintains a Buy rating and $3.90 target.

Target price is $3.90 Current Price is $2.00 Difference: $1.9
If NEC meets the UBS target it will return approximately 95% (excluding dividends, fees and charges).

Current consensus price target is $3.34, suggesting upside of 53.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.8

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

Morgans rates NSR as Hold (3) -

Morgans retains its Hold rating and increases its target to $2.30 from $2.16 after National Storage REIT reported FY22 results in line with guidance.

Management guided to EPS growth of at least 5% in FY23 which allowed for new acquisitions and at least 4% growth in revenue per available square meter (REVPAM). FY23 EPS guidance of 11.1cpu was a beat versus the analyst's forecast for 10.4cpu.

Target price is $2.30 Current Price is $2.41 Difference: minus $0.11 (current price is over target).
If NSR meets the Morgans target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.39, suggesting downside of -1.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.0

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

Citi rates NWL as Neutral (3) -

Netwealth Group reported FY22 results in line with consensus and -1% below Citi's expectations with the analyst highlighting the year was "tough", including an increase in expenses, adverse market volatility and lower cash margins affecting revenue margins.

FY23 has started with an improvement in funds under administration (FuA) with $1.4bn in inflows, year-to-date, compared to $1.2bn in the previous period, as well as management highlighting better adviser and transaction activity.

Citi adjusts earnings forecasts by 1% for FY23 and 4% for FY24 due to operating leverage from higher FuA and the improved market conditions to date.

Neutral rating is unchanged and the target is raised to $14.05 from $12.95.

Target price is $14.05 Current Price is $14.02 Difference: $0.03
If NWL meets the Citi target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $15.04, suggesting upside of 9.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.5

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

Credit Suisse rates NWL as Outperform (1) -

Netwealth Group delivered underlying net profit in FY22 that was in line with expectations. Flow guidance of $11-13 bn has been flagged for FY23. Credit Suisse asserts guidance should counter market concerns that a slowdown in flows in the second half was permanent.

The broker looks for further deceleration in expenses growth beyond FY23 as the company gains scale. Outperform rating reiterated. Target is reduced to $15.50 from $15.70.

Target price is $15.50 Current Price is $14.02 Difference: $1.48
If NWL meets the Credit Suisse target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $15.04, suggesting upside of 9.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.5

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

Macquarie rates NWL as Outperform (1) -

Macquarie says Netwealth Group's FY23 net flow guidance suggests the reduced net flow in the June quarter was an exception and the company is back on trend.

Management says cost growth is likely to slow but is still high at 18%, but strong structural growth and favourable comps should prove supportive.

Still, Macquarie prefers HUB24 ((HUB)) as a sector pick, expecting inflation will more than offset growth.

EPS forecasts fall -2.5% for FY23; -0.2% for FY24 and less than -1% in later years. Outperform rating retained. Target price rises to $16.20 from $16.

Target price is $16.20 Current Price is $14.02 Difference: $2.18
If NWL meets the Macquarie target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $15.04, suggesting upside of 9.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.5

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

Morgans rates NWL as Hold (3) -

FY22 results for Netwealth Group were in line with consensus expectations. While Morgans expects meaningful margin expansion, with a revenue tailwind from pooled cash earnings, valuation remains a hurdle, and the Hold rating is retained.

Management is very confident in the pipeline of new adviser and institutional business and FY23 net inflow guidance is for $11-13bn, compared to $13bn in FY22, which the analyst regards as "solid".

The broker sees new revenue opportunities from existing and new clients from the company's launch of the multi-asset portfolio service.

The target price rises to $15.45 from $15.15.

Target price is $15.45 Current Price is $14.02 Difference: $1.43
If NWL meets the Morgans target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $15.04, suggesting upside of 9.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.5

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

Macquarie rates PAN as Downgrade to Neutral from Outperform (3) -

Having fully examined Panoramic Resources's FY22 result, Macquarie downgrades to Neutral from Outperform and cuts the target price to 24c from 25c.

Macquarie is surprised by the drawing down of the revolving credit facility, which stems from the delay of a fifth shipment and was secured in April 2021 as part of the US$45m financing package with Trafigura. The facility is now fully drawn.

As a result, Macquarie expects the company's net debt is expected rise to $45m at the end of the September quarter, increasing balance-sheet risk. Should the facility be repaid in the quarter, the company's cash balance would fall to $13.4m.

The company has signalled a previously planned August shipment has been delayed because of ongoing tightness in international sea freight markets, with 11,000t of nickel-copper-cobalt concentrate now stockpiled at Wyndham.

Macquarie now expects there will be only one shipment during the first quarter of FY23. On the positive side, Panoramic Resources has arranged the revolving credit facility for use in these situations and this will not affect the ramp up at Savannah in FY23.

EPS forecasts fall -11% in FY23; -15% in FY24; -9% in FY25; and -23% in FY26. IGO ((IGO)) is a major shareholder of the company.

Target price is $0.24 Current Price is $0.23 Difference: $0.01
If PAN meets the Macquarie target it will return approximately 4% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.5

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

Credit Suisse rates PPM as Outperform (1) -

First half results were in line with expectations. Credit Suisse notes net interest margins have already declined meaningfully because of higher funding costs and competitive pressures, and the pace of decline is expected to moderate over the next 12-18 months.

Credit quality is strong yet the broker allows for some deterioration in 2023-24. The offset is very strong growth and continued opportunity in asset finance.

While acknowledging there are no near-term catalysts, Credit Suisse continues to believe Pepper Money will deliver better outcomes than what is currently priced in by the market. Outperform maintained. Target rises to $2.00 from $1.85.

Target price is $2.00 Current Price is $1.51 Difference: $0.49
If PPM meets the Credit Suisse target it will return approximately 32% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 1.0

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

Macquarie rates PPM as Outperform (1) -

Pepper Money printed a mixed result, some -4% below Macquarie's profit estimates.

While origination volumes continue to surprise and pre-payment rates decelerated, this was broadly offset by stronger than expected margin compression as competition and higher funding costs weighed on mortgage and asset finance margins.

While a disappointing result, the broker notes the larger skew to non-prime mortgages and asset finance leaves Pepper Money better placed than peers to recoup margin impacts moving forward through asset repricing initiatives.

With valuation undemanding, Outperform retained, Target falls to $1.70 from $2.80.

Target price is $1.70 Current Price is $1.51 Difference: $0.19
If PPM meets the Macquarie target it will return approximately 13% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 1.0

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

Macquarie rates PSI as Outperform (1) -

PSC Insurance has released a strong FY22 result, Macquarie suggests, beating consensus and featuring broad-based growth across all segments. While FY23 earnings guidance is ahead of consensus, it includes the Tysers UK retail joint venture with AUB Group ((AUB)).

This was not factored into AUB’s FY23 guidance, and ex-Tysers, PSC's guidance is slightly below consensus. But balance sheet strength positions it for a further forecast 10% earnings growth from acquisitions post Tysers.

PSC benefits from the defensive characteristics of insurance brokers, with upside potential, Macquarie suggests. Outperform retained, target rises tom $5.30 from $4.75.

Target price is $5.30 Current Price is $4.79 Difference: $0.51
If PSI meets the Macquarie target it will return approximately 11% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

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 Equal-weight (3) -

After adjusting for unrealised investment losses, FY22 results for Platinum Asset Management were broadly in line with both Morgan Stanley's and consensus forecasts.

The dividend missed consensus by -9% and the broker by -15%, while base fees of 115bps were in line with Morgan Stanley's estimate.

The Equal-weight rating and $1.85 target are maintained. Industry view is In-Line. 

Target price is $1.85 Current Price is $1.82 Difference: $0.03
If PTM meets the Morgan Stanley target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $1.91, suggesting upside of 1.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: -0.4

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

Citi rates REH as Sell (5) -

Citi views the Reece FY22 reported results as "good" with better than expected revenues and after tax earnings boosted by a $28m tax benefit.

The US operations beat expectations with inflation tailwinds assisting, and Australia was in line with consensus. US store count of 204 was below the 210 anticipated.

Looking ahead, Citi upgrades FY23 EBITDA for the strong FY22 results, however the analyst considers the stock trades at an excessive 70% premium to James Hardie ((JHX)) and Reliance Worldwide ((RWC)) and the higher exposure to US new home construction is reason for concern. 

A Sell rating is retained and the price target is lowered to $14.63 from $16.85.

Target price is $14.63 Current Price is $16.15 Difference: minus $1.52 (current price is over target).
If REH 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 $15.76, suggesting downside of -1.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: -0.2

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

Macquarie rates REH as Neutral (3) -

Reece reported in line with Macquarie's expectations but it required a better than expected performance in the US to offset reduced margins in A&NZ due to cost pressures, while sales were relatively stable.

Management noted market conditions are expected to soften, and the broker sees a gradual slowdown in A&NZ with the US new construction market at slightly greater near-term risk.

Reece is gaining solid traction in its US strategy, but Macquarie thinks the current valuation fairly reflects this given the macro complexity.

Neutral retained, target falls to $15.20 from $15.80.

Target price is $15.20 Current Price is $16.15 Difference: minus $0.95 (current price is over target).
If REH 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 $15.76, suggesting downside of -1.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: -0.2

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

Morgan Stanley rates REH as Underweight (5) -

Following FY22 results for Reece, Morgan Stanley feels the current high price earnings multiple is unsustainable and lowers its target to $12.20 from $16.10, and maintains an Underweight rating. Industry view In-Line. 

Management expects an upcoming softening of conditions.

FY22 profit was a -4% miss versus the analyst's forecast, while adjusted earnings (EBIT) for A&NZ also missed by -6%, while the US registered a 9% beat.

Operating cash flow was -29% below Morgan Stanley's estimate and included a -$480m working capital build. The 15cps final dividend was in line with the broker's forecast. 

Target price is $12.20 Current Price is $16.15 Difference: minus $3.95 (current price is over target).
If REH meets the Morgan Stanley target it will return approximately minus 24% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $15.76, suggesting downside of -1.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: -0.2

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

Ord Minnett rates REH as Buy (1) -

Ord Minnett assesses a solid FY22 result for Reece with profit well ahead of consensus expectations and 2% better than the broker's forecast. In A&NZ and the US, sales increased by 12% and 33%, respectively.

A 15cps final dividend brings the total FY22 payout to 22.5cps, in line with the analyst's forecast.

The broker retains its Buy rating and increasingly sees the US as the driver for growth via industry consolidation and organic expansion. The relatively more mature domestic business is considered more beholden to the construction cycle.

The Buy rating is unchanged, while the target falls to $18.50 from $23.00.

Target price is $18.50 Current Price is $16.15 Difference: $2.35
If REH meets the Ord Minnett target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $15.76, suggesting downside of -1.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: -0.2

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

Macquarie rates RIO as Neutral (3) -

Rio Tinto has lifted its cash offer for the 49.2% of shares in Turquoise Hill Resources it does not own by 18%. The offer is subject to majority approval from the minority shareholders and a positive recommendation from the Special Committee.

Macquarie estimates the US$3.1bn offer is equivalent to a net present value for Turquoise Hill using a US$3.50/lb copper price in perpetuity.

Neutral and $100 target retained.

Target price is $100.00 Current Price is $97.10 Difference: $2.9
If RIO meets the Macquarie target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $107.50, suggesting upside of 10.7% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY22:

Forecast for FY23:

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

Market Sentiment: 0.6

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

Morgan Stanley rates RIO as Overweight (1) -

The European team of analysts has updated post failed attempt to acquire the remaining 49% in Turquoise Hill with Rio Tinto already owning the other 51%.

Rio Tinto, apparently, has submitted an improved proposal and the Special Committee at the target is now looking into it.

Morgan Stanley suggests were Rio Tinto prepared to offer a higher price in order to achieve full ownership this would trigger additional scrutiny around the board's capital discipline.

Industry View: Attractive. The European rating is Equal-Weight, though the most recent update in Australia suggests Overweight.

Target price is $115.50 Current Price is $97.10 Difference: $18.4
If RIO meets the Morgan Stanley target it will return approximately 19% (excluding dividends, fees and charges).

Current consensus price target is $107.50, suggesting upside of 10.7% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY22:

Forecast for FY23:

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

Market Sentiment: 0.6

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

Citi rates S32 as Buy (1) -

At a glance, South32's FY22 result slightly outpaced consensus, the company entering FY23 with net cash of $538m ($499m after dividends and capital management).

Management guided to higher costs in FY23, in line with sector trends, and South32 expects copper production to rise 14%.

Buy rating and $4.90 target price are under review.

Target price is $4.90 Current Price is $4.23 Difference: $0.67
If S32 meets the Citi target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $5.27, suggesting upside of 23.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

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

Macquarie rates S32 as Outperform (1) -

In an initial glace at today's FY22 results for South32, Macquarie notes a better cash generation outcome than expected, while FY23 cost guidance was -10-20% worse than forecast in Australia.

Underlying earnings (EBITDA) were -4% short of the broker's forecasts, while FY23 and FY24 volume guidance was broadly in line. A special dividend of US3cps, along with a US22.7cps final dividend boosted cash returns 4% above estimates.

FY23 unit cost guidance for Worsley and GEMCO was around -20% worse than the broker's forecast, while costs at Cannington and Cerro Matoso were around -10% worse than expected.

Macquarie retains its Outperform rating and $5.90 target price.

Target price is $5.90 Current Price is $4.23 Difference: $1.67
If S32 meets the Macquarie target it will return approximately 39% (excluding dividends, fees and charges).

Current consensus price target is $5.27, suggesting upside of 23.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

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

UBS rates S32 as Buy (1) -

South32 has announced it will not proceed with a US$700m investment in the Illawarra Metallurgical Coal Dendrobium Next Domain project, citing expected returns are insufficient. UBS notes the decision reinforces South32's move toward future facing commodities and decarbonisation. 

The broker highlights the decision by South32 results in a production decline at Illawarra to 5.5m tonnes per annum from FY24 and 4m tonnes per annum from FY29, from a current 6.5m tonnes, as the site is depleted. 

The Buy rating is retained and the target price decreases to $5.40 from $5.60.

Target price is $5.40 Current Price is $4.23 Difference: $1.17
If S32 meets the UBS target it will return approximately 28% (excluding dividends, fees and charges).

Current consensus price target is $5.27, suggesting upside of 23.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

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

Citi rates SHL as Neutral (3) -

Citi assesses, globally, all pathology companies are over-earning. Despite upgrading estimates for FY23, earnings per share are expected to decline -40%.

While it is possible that PCR testing will continue at higher rates the broker predicts, eventually, the industry will grow earnings at around 4-5%.

A Neutral rating and $34.75 target, raised from $34.00, are predicated on more normal earnings. Sonic Healthcare's balance sheet flexibility, while hard to value, presents upside risk to forecasts, Citi adds.

Target price is $34.75 Current Price is $35.24 Difference: minus $0.49 (current price is over target).
If SHL meets the Citi target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $36.15, suggesting upside of 0.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.2

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

Credit Suisse rates SHL as Outperform (1) -

FY22 underlying EBITDA was slightly ahead of Credit Suisse estimates. No FY23 guidance was provided, yet Sonic Healthcare anticipates long-term covid-19 volumes will be 10-20% of peak levels.

The broker believes key regions are still operating above this and Australia is likely to remain above this range as long as dedicated PCR infrastructure is in place.

Scale and diversified geography have allowed the business to outperform peers in a period when the base business growth has been volatile because of disruptions related to the pandemic.

Credit Suisse expects this situation will continue. Outperform retained. Target rises to $38.50 from $38.00.

Target price is $38.50 Current Price is $35.24 Difference: $3.26
If SHL meets the Credit Suisse target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $36.15, suggesting upside of 0.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.2

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

Macquarie rates SHL as Underperform (5) -

Sonic Healthcare's earnings and profit came in slightly below Macquarie. Second half revenue fell -4% and earnings -16%, highlighting negative operating leverage. 

Base business trends were subdued in FY22, although the broker notes some positive signs, while covid testing is moderating.

With revenue forecast to moderate in coming years, and noting potential for higher-than-expected operating costs and/or fee reductions, Macquarie sees the risk to earnings as skewed to the downside.

Target falls to $31.50 from $32.00, Underperform retained.

Target price is $31.50 Current Price is $35.24 Difference: minus $3.74 (current price is over target).
If SHL meets the Macquarie target it will return approximately minus 11% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $36.15, suggesting upside of 0.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.2

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

Morgan Stanley rates SHL as Overweight (1) -

Revenue and earnings (EBITDA) margins within FY22 results for Sonic Healthcare exceeded consensus forecasts and revenue exceeded Morgan Stanley's forecasts in all regions.

The broker had expected cost inflation to be a key risk, and pressures weren't evident, while the base business accelerated more than expected.

Despite recent Medicare data suggesting a softening of diagnostic imaging growth, the company delivered 2% organic growth and the 2H earnings margin showed resilience, according to the analyst.

The target rises to $38.60 from $36.35 and the Overweight rating is unchanged. Industry view: In-Line.

Target price is $38.60 Current Price is $35.24 Difference: $3.36
If SHL meets the Morgan Stanley target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $36.15, suggesting upside of 0.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.2

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

Morgans rates SHL as Hold (3) -

Expanding margins and double-digit profit growth for Sonic Healthcare were aided by ongoing covid testing, and meant FY22 results exceeded Morgans forecasts. Base testing (ex covid) was considered solid, while growth in Imaging and Clinical Services was subdued.

FY23 guidance was not provided due to “covid-related unpredictability”. As peak covid appears to have passed, the analyst expects pressure on profits, despite the improving base business and good cost control.

The Hold rating is maintained, while the target falls to $37.57 from $39.93.

Target price is $37.57 Current Price is $35.24 Difference: $2.33
If SHL meets the Morgans target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $36.15, suggesting upside of 0.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.2

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

Ord Minnett rates SHL as Downgrade to Hold from Accumulate (3) -

FY22 underlying net profit was broadly in line with Ord Minnett's forecast largely underpinned by stronger higher-margin coronavirus testing.

Sonic Healthcare has emerged from the pandemic with a refreshed balance sheet but will face a tougher cost environment and a health system with funding and staffing challenges, the broker asserts.

Even with acquisitions supporting growth, group earnings are expected to more than halve as coronavirus testing volumes slow. Volumes are now declining across all major markets, signalling the end of a period of super profits.

Ord Minnett downgrades to Hold from Accumulate and lowers the target to $36.00 from $37.50.

Target price is $36.00 Current Price is $35.24 Difference: $0.76
If SHL meets the Ord Minnett target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $36.15, suggesting upside of 0.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.2

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

Credit Suisse rates SPK as Downgrade to Neutral from Outperform (3) -

Spark New Zealand's FY22 results were in line with estimates. Guidance for FY23 is better than Credit Suisse expected, with the midpoint of EBITDAI of NZ$1.185-1.225bn implying 5% growth.

Capital management, foreshadowed after the TowerCo sale, is in the form of an NZ$350m buyback. Despite the strong guidance the upside is limited and the broker downgrades to Neutral from Outperform. Target is raised to $5.00 from $4.90.

Target price is $5.00 Current Price is $4.83 Difference: $0.17
If SPK meets the Credit Suisse target it will return approximately 4% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

This company reports in NZD. 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

Macquarie rates SPK as Neutral (3) -

Spark New Zealand reported in line with Macquarie. Having sold 70% of its tower assets, the company lifted it dividend to NZ27c and is considering a buyback.

Once the deal is completed, a buyback would depend on market conditions at the time, management noted, and if not favourable, alternative capital management would be considered.

Neutral retained, target rises to NZ$5.10 from NZ$4.80.

Current Price is $4.83. Target price not assessed.

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

This company reports in NZD. 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 SRV as Buy (1) -

In an initial response to Servcorp's full year result, UBS notes the company delivered 1% year-on-year revenue growth to $272m and 17% profit before tax growth to $35.2m. 

The broker notes while profit did miss its estimates by -1%, this included a -$2.8m impact from cloud computing costs, and excluding this profit would have exceeded forecasts. 

The company is guiding to profit before tax of $41-43m in the coming year, as well as 5,318 offices. The Buy rating and target price of $4.45 are retained.

Target price is $4.45 Current Price is $3.42 Difference: $1.03
If SRV meets the UBS target it will return approximately 30% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 1.0

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

Credit Suisse rates SVW as Outperform (1) -

Underlying FY22 EBIT of $987m was in line with estimates. Credit Suisse acknowledges there are no short-term catalysts but believes the stock is materially undervalued.

Despite negative sentiment regarding the risks surrounding a turnaround the broker assesses Seven Group offers growth at a price which is implying none.

The level of debt is likely to be a concern for some investors but Credit Suisse believes strong cash generation in WesTrac and Coates, amid management's intention to bring debt down to an adjusted 2.5x EBITDA over the next 12-18 months, is achievable.

Outperform reiterated. Target is raised to $22.25 from $22.15.

Target price is $22.25 Current Price is $18.08 Difference: $4.17
If SVW meets the Credit Suisse target it will return approximately 23% (excluding dividends, fees and charges).

Current consensus price target is $23.48, suggesting upside of 26.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 1.0

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

Macquarie rates SVW as Outperform (1) -

Seven Group's FY22 earnings rose 25%, meeting guidance for 8-10% growth and beating Macquarie by 4%. FY23 guidance is for high single to low double digit earnings growth.

While the Boral ((BLD)) stake disappointed, WesTrac and Coates exceeded expectations, and all of WesTrac, Coates, the Beach Energy ((BPT)) stake and the Seven West Media ((SWM)) stake increased margins over the period.

The results highlight resilient businesses containing privileged assets, the broker notes, with the ability to manage inflationary and other operational or macro pressures.

Outperform retained. A mark to market of aforementioned stakes leads to a target cut to $24.25 from $27.10.

Target price is $24.25 Current Price is $18.08 Difference: $6.17
If SVW meets the Macquarie target it will return approximately 34% (excluding dividends, fees and charges).

Current consensus price target is $23.48, suggesting upside of 26.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 1.0

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

Ord Minnett rates SVW as Buy (1) -

FY22 underlying operating earnings were 39% ahead of FY21, revealing continued strong demand and resilient margins in WesTrac and Coates. Ord Minnett suggests this underpins confidence in earnings guidance and forecasts EBIT growth of 14% in FY23.

The main issue is a turnaround at Boral ((BLD)). The broker finds the Seven Group valuation undemanding and maintains a Buy rating, reducing the target to $22.00 from $25.00.

Target price is $22.00 Current Price is $18.08 Difference: $3.92
If SVW meets the Ord Minnett target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $23.48, suggesting upside of 26.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 1.0

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

UBS rates SVW as Buy (1) -

Seven Group has delivered 8% earnings growth in its full year, in line with UBS's estimates. The broker notes strong performance from WesTrac and Coates, with earnings growth of 6% and 16% respectively, offset Boral ((BLD)), which faced weather and energy headwinds.

The company is guiding to earnings growth between high single-digit and low double-digits for the coming year, and while broadly in line with UBS's forecast of 13% growth, the broker finds guidance conservative. 

The broker forecasts an earnings growth outlook for Seven Group in the coming year, supported by ongoing strength in the mining, infrastructure and east coast energy cycles. The Buy rating is retained and the target price decreases to $25.40 from $25.50.

Target price is $25.40 Current Price is $18.08 Difference: $7.32
If SVW meets the UBS target it will return approximately 40% (excluding dividends, fees and charges).

Current consensus price target is $23.48, suggesting upside of 26.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 1.0

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

Credit Suisse rates TAH as Outperform (1) -

FY22 results have signalled to Credit Suisse that value creation should be measurable over the next 6-12 months. Estimates for earnings per share are upgraded by 20-35% on lower depreciation guidance, which had been hard to model in the light of the demerger.

The broker notes, although June quarter disclosure reflected what appeared to be a weak May and June for Tabcorp Holdings, there was an improvement. Tote revenue growth also accelerated to over 5% in the second half. Outperform maintained. Target is steady at $1.30.

Target price is $1.30 Current Price is $0.96 Difference: $0.34
If TAH meets the Credit Suisse target it will return approximately 35% (excluding dividends, fees and charges).

Current consensus price target is $1.08, suggesting upside of 7.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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

Macquarie rates TAH as Outperform (1) -

Macquarie does not articulate whether Tabcorp's result met forecasts or not. But the broker forecasts 7% compound annual earnings growth to FY25, with added upside risk following the launch of the new wagering app in the second half of FY23, and ongoing regulatory reforms.

While having the ability to serve all Australian markets via digital, Macquarie takes a view that Tabcorp may not acquire or renew retail licences in WA or Victoria, if equity is required.

Outperform retained, target falls to $1.10 from $1.20.

Target price is $1.10 Current Price is $0.96 Difference: $0.14
If TAH meets the Macquarie target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $1.08, suggesting upside of 7.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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

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

After a first look at yesterday's FY22 results for Tabcorp Holdings, Morgan Stanley estimates a slight miss on earnings (EBITDA) versus the consensus forecast and a slight beat on revenue. The 15.2% earnings margin was slightly lower than the 15.4% expected.

A dividend of 6.5cps included a contribution from Lotteries, prior to the demerger.

Management noted July revenue was up 14.6% versus the previous corresponding period. Guidance included FY23 cost growth of 3-4% and FY23 capex of up to -$150m.

The Equal-weight rating and $1.00 target are retained. Industry view is In-Line.

Target price is $1.00 Current Price is $0.96 Difference: $0.04
If TAH meets the Morgan Stanley target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $1.08, suggesting upside of 7.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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

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

After Tabcorp Holdings reported in-line FY22 results, Morgans upgrades its rating to Add from Hold on the potential for the digital strategy (with enhancements) and sustainable cost efficiencies. The target price increases to $1.20 from $1.15.

With a new app coming and better marketing, the analyst expects the company's 24.9% digital revenue market share to improve. The dividend yield and a relatively low multiple are also considered an attraction.

Target price is $1.20 Current Price is $0.96 Difference: $0.24
If TAH meets the Morgans target it will return approximately 25% (excluding dividends, fees and charges).

Current consensus price target is $1.08, suggesting upside of 7.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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

UBS rates TAH as Neutral (3) -

Tabcorp Holdings delivered full year earnings of $361m, a marginal miss on UBS's forecasts, but the broker was pleased that wagering market share appears to have stabilised at around 25% into July, with digital market share excluding Western Australia at around 28%.

Looking ahead, the broker notes Tabcorp Holdings' new app, expected to launch in September, has been received positively in beta testing, and a number of new products are set to be launched before Christmas including a social betting feature and same race multi product.

The Neutral rating and target price of $1.00 are retained. 

Target price is $1.00 Current Price is $0.96 Difference: $0.04
If TAH meets the UBS target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $1.08, suggesting upside of 7.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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

Credit Suisse rates TLC as Neutral (3) -

Credit Suisse considers Lottery Corp better value now, given the fall in the share price. The FY22 lotteries EBITDA margin of 18.4% was below estimates because of higher costs.

The broker now models FY23 with an additional $10m in operating expenditure because of labour inflation, digital marketing and the resumption of corporate travel. Neutral rating maintained. Target is raised to $4.65 from $4.55.

Target price is $4.65 Current Price is $4.37 Difference: $0.28
If TLC meets the Credit Suisse target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $5.02, suggesting upside of 13.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.7

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

Macquarie rates TLC as Outperform (1) -

The Lottery Corp reported earnings in FY22 on a pro forma and pre dis-synergy basis of 12% growth year on year, but was -2% below Macquarie on a dis-synergy basis. Lotteries has started softly with poor jackpot activity FY23 to date with volumes down -21%.

But the Lotteries business supports more than 85% of earnings and delivered a record result during FY22, the broker notes, including 38% digital penetration.

Macquarie classes the company as a defensive high-quality business, being infrastructure-like considering visibility on earnings. Despite some volatility from jackpot activity, The Lottery Corp is seen offering attractive cash generation with low capital intensity.

Outperform retained, target falls to $4.65 from $5.00.

Target price is $4.65 Current Price is $4.37 Difference: $0.28
If TLC meets the Macquarie target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $5.02, suggesting upside of 13.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.7

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

Morgan Stanley rates TLC as Overweight (1) -

In a first look at yesterday's FY22 results for Lottery Corp, Morgan Stanley notes a minor earnings (EBITDA) miss and small revenue beat against consensus forecasts, while the earnings margin was in line. No guidance was provided and no dividend was declared as expected.

The broker highlights digital penetration increased sequentially half-on-half even with the domestic reopening, and will potentially not slow, due to ongoing enhancements for digital products.

The Overweight rating and $5.15 target are unchanged. Industry view: In-Line.

Target price is $5.15 Current Price is $4.37 Difference: $0.78
If TLC meets the Morgan Stanley target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $5.02, suggesting upside of 13.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.7

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

Morgans rates TLC as Add (1) -

FY22 revenue and earnings (EBITDA) for Lottery Corp slightly outpaced Morgans forecasts, with Lotteries growing earnings by 15% and Keno growth contracting by -4%. 

Digital lottery penetration rose to 37.7% from 32.8%. The broker expects the retail network to progress into new channels.

The analyst increases its earnings estimates by 6% in FY24, largely due to higher revenue growth assumptions. The $5.50 target is unchanged.

The broker maintains an Add rating and believes the company houses one of the highest performing lotteries businesses in the world.

Target price is $5.50 Current Price is $4.37 Difference: $1.13
If TLC meets the Morgans target it will return approximately 26% (excluding dividends, fees and charges).

Current consensus price target is $5.02, suggesting upside of 13.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.7

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

Ord Minnett rates TLS as Buy (1) -

Telstra has published the scheme document for the restructure to be presented to shareholders at the October 11 annual general meeting.

The restructure implementation date is scheduled for January 1, 2023, at which time Ord Minnett expects the InfraCo Fixed subsidiary will be ready for monetisation. The broker expects this could be achieved by June 30.

The broker would have liked to see more detail on agreements between InfraCo Fixed and ServeCo and more specificity over the former's earnings.

Overall, the broker considers Telstra to be holding prime position in the Australian mobile market and believes its lead on the 5G infrastructure rollout should prove lucrative. 

The establishment of sub-brands should also prove defensive for higher-quality services pricing.

Buy rating and $4.60 target price retained.

Target price is $4.60 Current Price is $4.03 Difference: $0.57
If TLS meets the Ord Minnett target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $4.38, suggesting upside of 8.6% (ex-dividends)