Australian Broker Call

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

Morgans lowers its rating to Hold from Add following a 26% share price rally in the last month (8% yesterday) which leaves the price just shy of the broker's 12-month target price of $15.40.

The likelihood of substantial contract price increases for carbonate is becoming less likely (though possible) and the analyst expects prices to moderate over the next one to two years.

Morgans still rates Allkem as one of the best lithium pure plays on the market.

Target price is $15.40 Current Price is $15.17 Difference: $0.23
If AKE meets the Morgans target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $15.76, suggesting downside of -1.2% (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

Credit Suisse rates AZJ as Outperform (1) -

Credit Suisse reinstates coverage on Aurizon Holdings following a period of research restriction.

The broker notes Aurizon plans to divest its East Coast Rail asset to alleviate concerns about its OneRail acquisition, which Credit Suisse estimates could achieve a de-merger value of $960m, or more in the case of a trade sale. 

The broker expects higher proceeds for the East Coast Rail divestment, as well as higher regulatory weighted average cost of capital and coal margin recovery to be potential catalysts for the stock price.

Credit Suisse reinstates coverage with an Outperform rating and a target price of $4.60.

Target price is $4.60 Current Price is $3.73 Difference: $0.87
If AZJ meets the Credit Suisse target it will return approximately 23% (excluding dividends, fees and charges).

Current consensus price target is $3.97, suggesting upside of 6.4% (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

Macquarie rates BOE as Outperform (1) -

Macquarie has lifted its uranium price forecasts 17% and 21% for FY24 and FY25 respectively and increases its long-term pricing to US$60 per pound from US$55 per pound, anticipating further strength in the market. 

For Boss Energy, the update drives earnings increases of 7%, 36% and 12% through to FY26. Macquarie notes Boss Energy recently announced board approval of its final investment decision for its Honeymoon project, targeting first production in the last quarter of 2023.

The Outperform rating is retained and the target price increases to $3.30 from $2.60.

Target price is $3.30 Current Price is $2.79 Difference: $0.51
If BOE meets the Macquarie 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

UBS rates CCX as Neutral (3) -

After examing 2Q results for US plus-size competitor Torrid, UBS notes flat sales growth and lower gross margins due to higher discounts and promotions (to clear inventory) and increased product and transportation costs.

As Torrid intends to reduce site-wide promotions, the analyst sees positives for City Chic Collective in less promotional intensity by plus-sized competitors.

The Neutral rating and $2.00 target price are unchanged.

Target price is $2.00 Current Price is $1.63 Difference: $0.37
If CCX meets the UBS target it will return approximately 23% (excluding dividends, fees and charges).

Current consensus price target is $2.52, suggesting upside of 52.6% (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 DEG as Outperform (1) -

De Grey Mining has released its pre-feasability study for its Mallina project. Macquarie notes the study is a material uplift from the scoping study, with total gold production of 6.4m ounces up 49% from previous estimates. 

Macquarie notes mine life has extended 14% to 13.6 years, with production in the first five years lifted 16% to 550,000 ounces. Pre-production costs lifted 18% to $1,053m, and all in sustaining costs in the first five years lifted 10% to $1,220 per ounce. 

A final investment decision is proposed for mid-2023. Macquarie lowers earnings per share -1%, -27%, -27% and -9% through to FY29. The Outperform rating is retained and the target price increases to $1.65 from $1.60.

Target price is $1.65 Current Price is $0.97 Difference: $0.68
If DEG meets the Macquarie target it will return approximately 70% (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 JIN as Overweight (1) -

Jumbo Interactive is one of the stocks where Morgan Stanley was more bullish than consensus expectations prior to the August reporting season. And this has remained the case post result. FY22 results suggested robust trends through the jackpot cycle.

The broker feels take rates and the company's pricing power are being underestimated by the market, and retains its Overweight rating and $17.40 target price. Further catalysts are expected via accretive M&A and potential for Mon/Wed Lotto pricing changes.

Industry view: In-line.

Target price is $17.40 Current Price is $13.39 Difference: $4.01
If JIN meets the Morgan Stanley target it will return approximately 30% (excluding dividends, fees and charges).

Current consensus price target is $17.01, suggesting upside of 31.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.8

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

Macquarie rates JMS as Outperform (1) -

Having downgraded manganese price assumptions -8% for FY23, Macquarie has adjusted its forecasts for Jupiter Mines beyond FY24. The broker notes the manganese price has rapidly declined to a current US$4.90 per tonne from a peak of US$7.90 per tonne in March and April.

Macquarie reiterates consolidation in the Kalahari Manganese Fields could improve the manganese market, starting with ownership consolidation of Tshipi. 

The Outperform rating is retained and the target price decreases to $0.25 from $0.30.

Target price is $0.25 Current Price is $0.20 Difference: $0.05
If JMS meets the Macquarie target it will return approximately 25% (excluding dividends, fees and charges).

The company's fiscal year ends in February.

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 MIN as Outperform (1) -

Mineral Resources is reportedly considering a US listed spin off of its lithium division, which Credit Suisse believes could realise the value of the division. 

The broker believes Mineral Resources' four divisions of Services, Iron Ore, Lithium and Gas have traded for the price of the lithium division alone, and expects a lithium spin off could see shares re-rate by as much as $90 per share. 

Credit Suisse estimates the lithium operations as a standalone could demand a $122 per share price.

The Outperform rating and target price of $75.00 are retained.

Target price is $75.00 Current Price is $62.96 Difference: $12.04
If MIN meets the Credit Suisse target it will return approximately 19% (excluding dividends, fees and charges).

Current consensus price target is $79.76, suggesting upside of 11.7% (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 MND as Accumulate (2) -

Accumulate rating retained for Monadelphous Group following a briefing with management at the services provider. Ord Minnett lauds the many insights provided on the cycle and the industry generally.

Perhaps, surmises the broker, it has sharpened appreciation for how this time could genuinely be different.

Bottom line: Ord Minnett believes Monadelphous is excellently positioned for sustainable growth in the years to come. Target $12.80 (unchanged).

Target price is $12.80 Current Price is $13.05 Difference: minus $0.25 (current price is over target).
If MND meets the Ord Minnett target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $12.62, suggesting downside of -8.9% (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 PDN as Outperform (1) -

Macquarie has lifted its uranium price forecasts 17% and 21% for FY24 and FY25 respectively and increases its long-term pricing to US$60 per pound from US$55 per pound, anticipating further strength in the market. 

For Paladin Energy, the update drives earnings increases of 25%, 34% and 12% through to FY26. Macquarie notes the company has recently undertaken a  US$177.1m capital raising, leaving it positioned to fund a restart of Langer Heinrich, targeting first production in early 2024.

The Outperform rating is retained and the target price increases to $1.10 from $0.90.

Target price is $1.10 Current Price is $0.92 Difference: $0.18
If PDN meets the Macquarie target it will return approximately 20% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

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

Market Sentiment: 1.0

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

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

Following recent research on Tyro Payments, Morgan Stanley highlighted the global trend of consolidation in the merchant acquiring space.

On cue, the company has announced, and the board has rejected, a conditional bid by a private equity consortium led by Potentia at $1.27/share.

The Equal-weight rating and $1.40 target are maintained. Industry view: Attractive.

Target price is $1.40 Current Price is $1.26 Difference: $0.14
If TYR meets the Morgan Stanley target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $1.50, suggesting upside of 8.7% (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

UBS rates TYR as Buy (1) -

Tyro Payments has rejected a $1.27/share takeover bid by the Potentia-led consortium.

Grok Ventures (12.5% shareholder) is willing to accept the takeover bid, or vote in favour of a scheme of arrangement proposed by Potentia at the offer price, subject to certain conditions.

UBS explains Grok can't take action under a competing proposal unless the proposal is valued 25c higher than the most recent Potentia bid. It's noted Grok has an option to remain a private investor under private equity and the current proposal.

The Buy rating and $1.80 target are unchanged.

Target price is $1.80 Current Price is $1.26 Difference: $0.54
If TYR meets the UBS target it will return approximately 43% (excluding dividends, fees and charges).

Current consensus price target is $1.50, suggesting upside of 8.7% (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 WTC as Upgrade to Neutral from Underperform (3) -

Reflecting on WiseTech Global's existing CargoWise One business and upcoming CargoWise Neo platform, Macquarie forecasts the company achieving a 21% revenue compound annual growth rate over the next three years. 

The broker notes launch of CargoWise Neo could be as soon as six months, but that the platform remains 1-2 years from delivering revenue. Macquarie estimates CargoWise Neo, as a standalone, to contribute $12.90 per share to the company's valution. 

The rating is upgraded to Neutral from Underperform and the target price increases to $55.00 from $46.00.

Target price is $55.00 Current Price is $59.00 Difference: minus $4 (current price is over target).
If WTC meets the Macquarie target it will return approximately minus 7% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $58.43, suggesting downside of -4.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.1

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