Australian Broker Call

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

Following recent share price weakness, Ord Minnett upgrades its rating for Ampol to Accumulate from Hold on valuation.

The broker's forecasts are unchanged and the $34.50 target is maintained.

Target price is $34.50 Current Price is $29.74 Difference: $4.76
If ALD meets the Ord Minnett target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $34.17, suggesting upside of 12.2% (ex-dividends)

The company's fiscal year ends in December.

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

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

Following recent share price weakness, Ord Minnett upgrades its rating for Bendigo & Adelaide Bank to Accumulate from Hold on valuation.

The broker's forecasts are unchanged and the $10.20 target is maintained.

Target price is $10.20 Current Price is $8.82 Difference: $1.38
If BEN meets the Ord Minnett target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $10.37, suggesting upside of 16.1% (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

Macquarie rates BHP as Outperform (1) -

Late last month another class action was lodged to add some 500,000 claimants to the existing 200,000 against BHP Group/Vale for the Samarco dam collapse. BHP is already one of the defendants in a claim brought by the Brazilian government seeking US$30bn, Macquarie notes. 

BHP will defend the claims and is progressing with remediation and compensation. This UK lawsuit appears to have some overlaps with existing legal cases and BHP has in excess of a US$3bn Samarco provision.

Despite ongoing legal disputes, Macquarie believes the market should focus on BHP’s solid free cash flow generation. Outperform and $52 target retained.

Target price is $52.00 Current Price is $43.39 Difference: $8.61
If BHP meets the Macquarie target it will return approximately 20% (excluding dividends, fees and charges).

Current consensus price target is $43.90, suggesting upside of 1.2% (ex-dividends)

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: 0.0

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

Macquarie rates CAJ as Initiation of coverage with Outperform (1) -

Capitol Health is a diagnostic imaging player in the Australian market, exposed to what Macquarie sees as attractive industry dynamics. Despite recent covid-related disruptions, the broker expects volume and benefits growth to return to historical levels from FY24.

Macquarie expects growth to be supported by a rebound in utilisation following weakness in FY20-22 as well as an increasing and ageing population.

Coverage initiated with an Outperform rating and 34c target.

Target price is $0.34 Current Price is $0.26 Difference: $0.085
If CAJ meets the Macquarie target it will return approximately 33% (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

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

Following recent share price weakness, Ord Minnett upgrades its rating for Challenger to Accumulate from Hold on valuation.

The broker's forecasts are unchanged and the $7.90 target is maintained.

Target price is $7.90 Current Price is $6.47 Difference: $1.43
If CGF meets the Ord Minnett target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $7.58, suggesting upside of 15.4% (ex-dividends)

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

Macquarie rates CNB as Outperform (1) -

Drilling results announced yesterday by Carnaby Resources were positive, Macquarie notes, and indicate the upside potential of Mount Hope. Further drilling should help to define the footprint of mineralisation at Mount Hope, highlighting the underground potential for the deposit.

Further drilling along strike and depth should help to define the size of the deposit, the broker notes.

Outperform and $1.70 target retained.

Target price is $1.70 Current Price is $1.05 Difference: $0.655
If CNB meets the Macquarie target it will return approximately 63% (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

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

Following recent share price weakness, Ord Minnett upgrades its rating for Computershare to Accumulate from Hold on valuation.

The broker's forecasts are unchanged and the $24.00 target is maintained.

Target price is $24.00 Current Price is $20.84 Difference: $3.16
If CPU meets the Ord Minnett target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $27.73, suggesting upside of 31.2% (ex-dividends)

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: 0.8

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

Morgan Stanley rates CTD as Overweight (1) -

Following the February reporting season, Corporate Travel Management has made Morgan Stanley's conviction list for small/mid cap stocks that should outperform on earnings.

The market is dubious, according to the broker, the company will meet FY23 guidance, which implies a much greater 2H performance. However, management pointed to a 30/70 split as far back as FY22 results and the split is consistent with peers, explains the analyst.

Morgan Stanley also likes the fact the company took advantage of covid to acquire at the bottom of the cycle.

Overweight rating and $28 target price retained. Industry view: In-line.

Target price is $28.00 Current Price is $16.73 Difference: $11.27
If CTD meets the Morgan Stanley target it will return approximately 67% (excluding dividends, fees and charges).

Current consensus price target is $20.85, suggesting upside of 20.2% (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

Macquarie rates FSF as Neutral (3) -

Fonterra Shareholders Fund reported first half profit up 50% year on year and earnings 18% ahead of Macquarie. The 10c dividend was in line. FY23 earnings guidance has been lifted to 55-75cps from 50-70cps.

Fonterra announced an intended 50c capital return in October, having previously flagged some level of capital return post asset sales.

Earnings upside is underpinned by commodity prices, Macquarie suggests, but the medium to long term growth track is largely priced in. Neutral retained, target falls to NZ$3.42 from NZ$3.52 on a higher risk free rate and cost of equity.

Current Price is $3.10. Target price not assessed.

The company's fiscal year ends in July.

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 HAS as Outperform (1) -

As reported yesterday, Hastings Technology Metals has progressed with Yangibana, expecting the main construction in the next few months. A review of the capital costs and timing is underway. The company has spent -$53m in the first half on early site works and 70% is now complete.

Early work at Onslow has also been underway with 25% now complete. Outperform rating maintained. Macquarie updated equity raising assumptions and reduced the target to $3.60 from $4.20.

Hastings has subsequently reported its results, with a 10% greater loss than Macquarie expected due to higher finance costs. The broker forecasts an increase in costs 22% above current guidance.

Target price is $3.60 Current Price is $2.51 Difference: $1.09
If HAS meets the Macquarie target it will return approximately 43% (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

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

Following recent share price weakness, Ord Minnett upgrades its rating for Inghams Group to Accumulate from Hold on valuation.

The broker's forecasts are unchanged and the $3.50 target is maintained.

Target price is $3.50 Current Price is $3.01 Difference: $0.49
If ING meets the Ord Minnett target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $3.10, suggesting upside of 1.1% (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

Morgan Stanley rates IPH as Overweight (1) -

Morgan Stanley expects news of a cyber security breach at IPH on March 13 will weigh on the near-term stock price until more clarity emerges on costs and timing.

The main risks the analyst envisages are client churn and greater future spending to secure the network, though the company may improve its competitive position with higher security compared to smaller scale peers.

The Overweight rating and target price of $10.50 are retained. Industry view: In-Line.

Target price is $10.50 Current Price is $7.50 Difference: $3
If IPH meets the Morgan Stanley target it will return approximately 40% (excluding dividends, fees and charges).

Current consensus price target is $10.85, suggesting upside of 45.4% (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 JRV as Outperform (1) -

Jervois Global's first concentrate from Idaho Cobalt Operations was expected by the end of this quarter but has now been extended by one quarter, Macquarie reports. Construction cost pressures have continued at ICO and budget is expected to rise by 15-25%.

Weak cobalt price performance has been a headwind for Jervois in 2023, down -34% year to date.

The delay to first concentrate at ICO is disappointing, Macquarie suggests, with limited labour availability the main reason for the delay. Positively, mining activities appear to be progressing well.

Outperform and 40c target retained.

Target price is $0.40 Current Price is $0.14 Difference: $0.265
If JRV meets the Macquarie target it will return approximately 196% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

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 KAR as Outperform (1) -

Karoon Energy's two-well Neon appraisal program has been successful and Macquarie now includes 60% of the value of a Neon/Goia development, or 69cps. Patola is now online strongly, with expected stabilised rates broadly consistent versus the broker's expectations.

The market will need to see the volumetric assessment from management in the next few months to gain more confidence, but Macquarie believes the well reports are sufficient reason to position ahead of this. Neon/Goia could be worth $1.16ps un-risked.

Target rises to $3.15 from $3.00, Outperform retained.

Target price is $3.15 Current Price is $2.00 Difference: $1.155
If KAR meets the Macquarie target it will return approximately 58% (excluding dividends, fees and charges).

Current consensus price target is $3.15, suggesting upside of 52.9% (ex-dividends)

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

Citi rates LFS as Neutral (3) -

Shares of Latitude Group on the ASX are in a trading halt pending more clarity following a material cyber attack.

While Citi finds it hard to quantity the impact on the company, cyber attack insurance should help mitigate any costs.

Over the medium term, the broker notes it is unclear what level of reputational damage will occur and any subsequent impact on volumes.

The Neutral rating and $1.30 target are retained.

Target price is $1.30 Current Price is $1.21 Difference: $0.095
If LFS meets the Citi target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $1.23, suggesting upside of 2.4% (ex-dividends)

The company's fiscal year ends in December.

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 LFS as Equal-weight (3) -

Over the past few days, Latitude Group has been subjected to a 'sophisticated and malicious' cyber attack, with documents and customer records being stolen. Up to 1-12% of customers have likely been impacted, notes Morgan Stanley.

While recent history of cyber attacks on other companies suggests the size of the breach may be upwardly revised, the analyst points out Latitude has cyber security insurance.

Also the cyber attacks occurred via external vendors, which may mitigate any financial impact, suggests the broker.

The Equal-weight rating and $1.20 target are retained.. Industry View: In-line.

Target price is $1.20 Current Price is $1.21 Difference: minus $0.005 (current price is over target).
If LFS meets the Morgan Stanley target it will return approximately minus 0% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $1.23, suggesting upside of 2.4% (ex-dividends)

The company's fiscal year ends in December.

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 LYC as Sell (5) -

Citi views Lynas Rare Earths as a play on increasing electric vehicle penetration, the global energy transition and rare earth supply chain security concerns. Research coverage is initiated with a Buy rating and $8.20 target.

The company's share price has slumped by around -30% since February highs on regulatory uncertainty in Malaysia and Tesla announcing (a rare earth free) magnet motor, explain the analysts.

Citi is also bullish on NdPr pricing and backs Lynas Rare Earths' decade-long experience in rare earth refining, as well as its ex-China market leadership. 

Target price is $8.20 Current Price is $6.43 Difference: $1.77
If LYC meets the Citi target it will return approximately 28% (excluding dividends, fees and charges).

Current consensus price target is $8.00, suggesting upside of 22.0% (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

Ord Minnett rates MND as Hold (3) -

Following recent share price weakness, Ord Minnett upgrades its rating for Monadelphous Group to Accumulate from Hold on valuation.

The broker's forecasts are unchanged and the $13.60 target is maintained.

Target price is $13.65 Current Price is $11.17 Difference: $2.48
If MND meets the Ord Minnett target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $13.46, suggesting upside of 18.4% (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 PAN as Outperform (1) -

Panoramic Resources has indicated that mine life at Savannah has increased to 12-plus years to FY35 versus Macquarie's previous expectation of FY34. The addition of one year of mine life is an incremental positive, the broker notes.

Savannah North remains open along strike and at depth, with the potential to bring additional inventory into the mine plan through positive drilling results. Positively, the ramp up at Savannah North appears largely complete.

Outperform and 20c target retained.

Target price is $0.20 Current Price is $0.13 Difference: $0.075
If PAN meets the Macquarie target it will return approximately 60% (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 PLL as Outperform (1) -

Piedmont Lithium’s JV partner at North American Lithium, Sayona Mining, has reported first saleable spodumene production.

Piedmont’s offtake agreement with NAL secures Piedmont 50% of spodumene production with a US$900/t price cap. The spodumene purchased under this offtake will be sold to Tesla and LG Chem at spot prices over the next three years.

Outperform and $2.10 target retained.

Target price is $2.10 Current Price is $0.81 Difference: $1.295
If PLL meets the Macquarie target it will return approximately 161% (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 PMT as Outperform (1) -

Patriot Battery Metals has announced a CA$50m private placement of flow-through shares, undertaken at a 90% premium to the last trade share price on Toronta Stock Exchange prior to the trading halt.

The raising is subject certain regulatory approvals, but no shareholder approvals are required.

On completion, the flow-through shares will be converted into Chess Depositary Interests, which would improve Patriot’s liquidity on the ASX, Macquarie points out.

The release of the maiden lithium resource estimate for Corvette by the end of June presents a key near-term catalyst. Outperform and $1.75 target retained.

Target price is $1.75 Current Price is $1.19 Difference: $0.565
If PMT meets the Macquarie target it will return approximately 48% (excluding dividends, fees and charges).

The company's fiscal year ends in March.

Forecast for FY23:

Forecast for FY24:

This company reports in CAD. 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

Ord Minnett rates PPH as Hold (3) -

Ord Minnett recommends Pushpay Holdings shareholders vote in favour of the revised scheme of arrangement to allow a takeover by the Sixth Street and BGH Capital consortium for NZ$1.42, up from prior offer of NZ$1.32.

While the revised offer falls short of the broker's standalone fair value of NZ$1.65, a higher price is seen as unlikely, as is an alternative scenario to realise value in the medium term. 

The Hold rating and $1.32 target are maintained.

Target price is $1.32 Current Price is $1.29 Difference: $0.03
If PPH meets the Ord Minnett target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $1.32, suggesting upside of 3.1% (ex-dividends)

The company's fiscal year ends in March.

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: 0.5

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

UBS rates PPH as Downgrade to Neutral from Buy (1) -

UBS downgrades its rating for Pushpay Holdings to Neutral from Buy and lowers its target to NZ$1.42 from NZ$1.50 to align with an increased takeover bid by the BGH and Sixth Street consortium (from NZ$1.34).

In the first scheme arrangement of its kind, notes the broker, a differential price has been accepted. Seven New Zealand shareholders have accepted the NZ$1.42 price and 10.6% of shareholders have accepted the original NZ$1.34 offer price to help fund the new bid.

The next step in April is a new scheme meeting and amended independent expert report, explains the analyst.

Current Price is $1.29. Target price not assessed.

Current consensus price target is $1.32, suggesting upside of 3.1% (ex-dividends)

The company's fiscal year ends in March.

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: 0.5

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

Morgans rates STM as Speculative Buy (1) -

Morgans notes drilling has started at Sunstone Metals' T2 target at El Pamar (in northern Ecuador) and copper and gold have been intersected in the T1 and T5 porphyry targets.

The 12c target and Speculative Buy rating are unchanged. The share price trajectory is beholden to further exploration results in Ecuador, notes the analyst.

Target price is $0.12 Current Price is $0.03 Difference: $0.089
If STM meets the Morgans target it will return approximately 287% (excluding dividends, fees and charges).

Market Sentiment: 1.0

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

Macquarie rates SYA as Outperform (1) -

Sayona Mining reported an underlying earnings loss 17% greater than Macquarie had anticipated, driven by higher interest expenses in the past six months. Free cash outflow was 72% higher than estimated, and net cash -36% below forecast.

Sayona also announced first saleable spodumene concentrate produced from its North American Lithium JV with Piedmont Mining in Quebec. The commissioning of the concentrate plant is proceeding on schedule and within budget and the first lithium shipment is expected in July.

Achieving first saleable spodumene production is an important milestone for NAL, Macquarie notes, but achieving product quality remains key during the ramp-up phase. Outperform and 30c target retained.

Target price is $0.30 Current Price is $0.22 Difference: $0.08
If SYA meets the Macquarie target it will return approximately 36% (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

Morgan Stanley rates TPW as Overweight (1) -

Morgan Stanley likes the announced on-market buyback program of $30m by Temple & Webster as it highlights balance sheet strength and suggests share price undervaluation.

The value of the  buyback  represents 7% of the company's market capitalisation and will commence on April 3 for up to 12 months.

Overweight rating. Target price of $5.60. Industry view: In-Line.

Target price is $5.60 Current Price is $3.42 Difference: $2.18
If TPW meets the Morgan Stanley target it will return approximately 64% (excluding dividends, fees and charges).

Current consensus price target is $4.43, suggesting upside of 36.3% (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 VHT as Add (1) -

In an incremental positive, according to Morgans, the FDA has finalised legislation requiring mammography facilties across the US to inform patients of their breast density.

While many states have existing legislation, the new FDA directive should raise awareness in both the US and globally, points out the analyst.

Volpara Health Technologies' TruDensity algorithm is the only FDA cleared AI volumetric density score that can be integrated into the BI-RADS classification (a reporting system used to describe mammogram results).

Volpara also announced a further contract win with Sutter Health for the Risk Pathways product for US$900,000 over three years.

Morgans makes no changes to its forecasts. The Add rating and $1.21 target are unchanged.

Target price is $1.21 Current Price is $0.77 Difference: $0.445
If VHT meets the Morgans target it will return approximately 58% (excluding dividends, fees and charges).

The company's fiscal year ends in March.

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: 1.0

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

Credit Suisse rates WOR as Upgrade to Neutral from Underperform (3) -

Not sure what's going on at Credit Suisse (not the parent company bailed out yet again, the local research department). After a long hiatus, the rating for Worley has been upgraded to Neutral from Underperform.

The target price has been lifted to $14 from the prior $10.70.

The decisions seem to be a delayed response to the interim results released in February. Those results, Credit Suisse asserts, proved a positive surprise.

The broker surmises Worley could prove a solid inflation hedge should the company continue to avoid margin compression, let alone see expansion.

Target price is $14.00 Current Price is $13.54 Difference: $0.46
If WOR meets the Credit Suisse target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $15.54, suggesting upside of 11.3% (ex-dividends)

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