Australian Broker Call

Bell Potter rates AEL as Buy (1) -

Amplitude Energy has entered into a 50:50 JV with O.G. Energy for the East Coast Supply project after the latter completes the acquisition of Mitsui's 50% interest.

Bell Potter notes the project has the potential to lift production by 90TJ/day from 2028 and double Amplitude's group revenue vs FY24.

The broker notes the company expects the committed capex (phase 1 high range -$270m) to take net debt to a maximum of around $350m in 2H26 from $254m at the end of December.

Buy rating and 26c target price are unchanged.

Target price is $0.26 Current Price is $0.22 Difference: $0.045
If AEL meets the Bell Potter target it will return approximately 21% (excluding dividends, fees and charges).

Current consensus price target is $0.27, suggesting upside of 21.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.8

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

Macquarie rates AEL as Outperform (1) -

Macquarie highlights O.E. Energy has been confirmed as the new Otway joint venture partner with Amplitude Energy, having acquired Mitsui's 50% shareholding.

The joint venture opens the way for the East Coast Supply Project to go ahead, and a three-well campaign is approved starting in the second half of 2025 with the aim of first gas by 2028.

The broker notes Amplitude will be reimbursed 50% of the costs at around $25m. Drilling will start at Eleanora in 2H 2025, followed by Juliet and Annie in 2026.

Macquarie raises its 2025 EPS estimate by 26% on reduced maintenance costs. Amplitude is the analyst's key pick in East Coast gas plays.

Outperform retained. Target price slips to 30c from 31c.

Target price is $0.30 Current Price is $0.22 Difference: $0.085
If AEL meets the Macquarie target it will return approximately 40% (excluding dividends, fees and charges).

Current consensus price target is $0.27, suggesting upside of 21.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.8

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

Ord Minnett rates AEL as Hold (3) -

Ord Minnett notes Amplitude Energy has entered into a 50:50 JV with O.G. Energy to progress the East Coast Gas Supply Project, which will be implemented after it acquires the 50% interest from Mitsui.

The broker notes the company has lifted the capex guidance with phase 1 at -$240-270m and phase 2 estimated at -$140-185m.

The broker raised risk weighting to 90%. Target price 23c and Hold rating.

Target price is $0.23 Current Price is $0.22 Difference: $0.015
If AEL meets the Ord Minnett target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $0.27, suggesting upside of 21.6% (ex-dividends)

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.8

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

Ord Minnett rates ALD as Buy (1) -

Ord Minnett made minor earnings revisions to Ampol's forecasts after the company provided details of lost production and the costs impact of Cyclone Alfred.

The company also advised the outlook for fuels and infrastructure international business remains robust, and retail business in NZ has been on a recovery path since 4Q24. The company also expects to exceed the -$50m cost reduction target by 2H25.

Target price unchanged at $33, and Buy rating retained.

Target price is $33.00 Current Price is $23.76 Difference: $9.24
If ALD meets the Ord Minnett target it will return approximately 39% (excluding dividends, fees and charges).

Current consensus price target is $30.85, suggesting upside of 29.6% (ex-dividends)

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.8

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

Macquarie rates BRG as Outperform (1) -

Macquarie observes Breville Group is one of the few Macquarie Kitchen Benchmark constituents with revenue levels above pandemic peaks.

The company continues to outperform due to the overweight exposure to coffee, expansion into new markets, and new product development investment.

Breville's 4Q 2024 Macquarie Kitchen Benchmark revenue was up 1.9% on a year earlier, and Breville Group's Global Products segment reported 13% revenue growth on the consecutive period in the second half of 2024.

The broker highlights US trade tariff policy remains unknown, notably with China, and management is in "full swing" moving 120V production out of China.

Outperform rating maintained with a $41.10 target price. No change to the analyst's earnings forecasts.

Target price is $41.10 Current Price is $31.91 Difference: $9.19
If BRG meets the Macquarie target it will return approximately 29% (excluding dividends, fees and charges).

Current consensus price target is $38.36, suggesting upside of 21.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.4

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

UBS rates BXB as Buy (1) -

UBS highlights the pick-up in US lumber prices to US$686, which is 15% higher on a year earlier and above the FY24 average by around 30%.

The broker notes when lumber prices rose in the pandemic, management adapted by minimising purchases, not purchasing new customers, and whitewood filled the supply shortages. Brambles looked to recover costs via pricing and lumber surcharges.

Compared to 2021–2022, the price spike has not been as severe and is not occurring at the same time as a spike in demand.

At this stage, UBS believes FY25 guidance holds for the company, but there might be risks to FY26 earnings if lumber prices continue to rise.

Buy rating and $22.80 target price are retained. No change to the broker's EPS estimates.

Target price is $22.80 Current Price is $20.62 Difference: $2.18
If BXB meets the UBS target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $21.24, suggesting upside of 4.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

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

Market Sentiment: 0.7

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

Bell Potter rates EBR as Speculative Buy (1) -

Bell Potter notes the FDA decision for EBR Systems' WiSE-CRT system is likely in the next couple of weeks and believes the risk of a negative outcome is relatively low at this point.

The broker, therefore, lowered the weighted average cost of capital forecast to 12.5% (down -200bps). This resulted in a rise in the target price to $2.69 from $2.26.

The broker has also revised its estimates to reflect lower gross margin estimates in the first few years of launch and increased SG&A costs. This pushed out the timeline for the forecast EBITDA breakeven by one year to FY29. 

Speculative Buy maintained.

Target price is $2.69 Current Price is $2.01 Difference: $0.68
If EBR meets the Bell Potter target it will return approximately 34% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

Forecast for FY25:

Forecast for FY26:

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 FCL as Buy (1) -

Citi focuses on Fineos Corp's balance sheet, with the company's cash balance declining to EUR20m.

The broker believes there is an increased risk of a possible equity raising, particularly if churn rates increase and/or cash receipts are softer than anticipated.

The company raised equity in August 2023 when cash holdings fell to around EUR25m, the analyst explains.

Citi has lowered revenue forecasts but increased earnings (EBITDA) estimates by 16% and 5% for FY25/FY26, respectively, due to lower expected operating costs.

Buy rating retained. Target $2.35.

Target price is $2.35 Current Price is $2.06 Difference: $0.29
If FCL meets the Citi target it will return approximately 14% (excluding dividends, fees and charges).

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

Bell Potter rates GOR as Buy (1) -

Gold Road Resources announced it rejected Gold Fields' offer on March 7 to buy the company for $3.05/share as it considered the offer to materially undervalue the company.

Gold Fields is a Gold Road's 50:50 JV partner in the Gruyere gold mine. The company, in return, offered to acquire Gold Fields' 50% JV interest, which was rejected.

Bell Potter has lifted its gold price forecasts and included a 30% premium to the valuation for Gruyere open pit, the Gilmour project and 65% risk-discounted valuation for a potential Gruyere underground. This lifts its valuation for the company to $3.60/share.

The broker concurs the Gold Fields' offer undervalues the company given the potential Gruyere upside but it also understands the reluctance to pay more given the resource definition is in early stages.

Target price rises to $3.20 from $2.95. Buy retained.

Target price is $3.20 Current Price is $2.82 Difference: $0.38
If GOR meets the Bell Potter target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $2.93, suggesting downside of -1.9% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.7

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

Ord Minnett rates JHX as Hold (3) -

Ord Minnett notes James Hardie Industries is acquiring a high-quality company in Azek but there are several challenges, including that it would be -7% EPS dilutive in FY26 and FY27. 

The broker believes the 37% premium paid on Azek's pre-announcement share price exceeds the synergy value, implying a negative NPV for its shareholders.

The broker also notes proforma leverage will rise to 2.5x in FY26 from 0.7x in FY24 in a weakening US housing market environment.

Target price cut to $47 from $59. Hold Rating (was Accumulate on February 21).

Target price is $47.00 Current Price is $37.96 Difference: $9.04
If JHX meets the Ord Minnett target it will return approximately 24% (excluding dividends, fees and charges).

Current consensus price target is $54.14, suggesting upside of 41.3% (ex-dividends)

Forecast for FY25:

Forecast for FY26:

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

UBS rates JHX as Buy (1) -

UBS observes Azek is a quality business, but the high acquisition valuation is causing concern for the analyst regarding James Hardie Industries.

The analyst states the company was always going to be challenged with M&A at a time when the cycle is depressed, and James Hardie's high margins offered some offset to the pressure on volumes.

UBS underscores the potential synergies of US$350m but queries how the cost savings can be achieved in more challenging macro conditions.

The broker retains a Buy rating and $60 target after a significant de-rating of the stock. It is the preferred building materials company but comes below Bluescope Steel ((BSL)) and Cleanaway Waste Management ((CWY)).

Target price is $60.00 Current Price is $37.96 Difference: $22.04
If JHX meets the UBS target it will return approximately 58% (excluding dividends, fees and charges).

Current consensus price target is $54.14, suggesting upside of 41.3% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY25:

Forecast for FY26:

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

Ord Minnett rates MVF as Hold (3) -

Today's healthcare sector update by Ord Minnett lists Monash IVF as rated Hold with a price target of $1.25. Less than a month ago, on February 28, the rating was Accumulate.

The analysts note within the Women’s Health funding package in the latest Federal Budget, the Government has introduced improved funding/access for Pergoveris (IVF hormone therapy).

Target price is $1.25 Current Price is $1.08 Difference: $0.17
If MVF meets the Ord Minnett target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $1.51, suggesting upside of 38.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.8

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

Macquarie rates NIC as Outperform (1) -

Macquarie explains unseasonally wet weather has affected Nickel Industries' pig iron nickel facility ONI in Indonesia, with a three-day operational suspension.

Management announced 1Q25 earnings (EBITDA) will come in the range of US$89m–US$90m versus the broker's estimate of US$92m and consensus at US$80m.

The broker lowers earnings estimates to the midpoint of the guidance range to US$87.5m. Nickel Industries also highlighted the Hengjaya mine delivered 2.6m wet metric tons (wmt) for the quarter to date versus Macquarie's forecast of 3m wmt.

The analyst lowers the EPS estimate for 2025 by -2% on the update. No change to Outperform rating and 85c target price.

Target price is $0.85 Current Price is $0.63 Difference: $0.225
If NIC meets the Macquarie target it will return approximately 36% (excluding dividends, fees and charges).

Current consensus price target is $1.16, suggesting upside of 84.4% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY25:

Forecast for FY26:

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 ORA as Outperform (1) -

Macquarie highlights there remains a lot of uncertainty on US tariffs and the extent of the possible impacts.

The broker estimates a US tariff rate of up to 50% on EU alcohol imports is manageable for Orora, and earnings before interest and tax for Saverglass would decline in the high single digits.

Saverglass represents around 50% of FY25 earnings before interest and tax for the company, and North America represents 45% of global spirit demand.

Macquarie highlights Orora has a strong balance sheet to deal with market uncertainties.

Outperform retained. Target is reduced to $2.42 from $2.50.

Target price is $2.42 Current Price is $1.96 Difference: $0.465
If ORA meets the Macquarie target it will return approximately 24% (excluding dividends, fees and charges).

Current consensus price target is $2.44, suggesting upside of 23.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.3

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

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

Following a deeper analysis of Pro Medicus' $330m 10-year deal with Trinity Health, Morgans understand revenue will be lower over the first 18 months and pick up across the final 8 years.

This is due to phased implementation given the complexity of replacement in sites under existing contracts. This has resulted in near-term downgrades in the broker's forecast and upgrades later, and hence no change in the valuation.

Target price retained at $250. Rating upgraded to Add from Hold following recent share price weakness.

Target price is $250.00 Current Price is $227.74 Difference: $22.26
If PME meets the Morgans target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $262.48, suggesting upside of 21.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.4

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

Citi rates REA as Buy (1) -

Regarding the potential CoStar acquisition of main competitor locally Domain Holdings Australia ((DHG)), Citi analysts had earlier already expressed their belief it will be difficult for CoStar to break the network effects of REA Group.

Today, they acknowledge shares in REA Group might face some headwinds from the above prospect, as increased marketing intensity ahead is impacting on investor sentiment, but share price weakness is nevertheless seen as a buying opportunity.

Hence, that Buy rating for REA Group is hereby re-iterated. Target price has been lifted by 20% to $275.

Citi's view is probably best summarised as "we expect REA’s strong product execution to deliver double-digit growth in its core Resi business as it continues to evolve and get closer to the transaction by leveraging data".

But also: "Overall, we see REA as being in a strong position but do see potential for growth over the medium-term to be lower than consensus expectations especially when considering that the forecast is for REA’s Residential revenue to increase from ~4x that of Domain to 4.7x by FY30e".

Target price is $275.00 Current Price is $235.51 Difference: $39.49
If REA meets the Citi target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $269.43, suggesting upside of 17.2% (ex-dividends)

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.6

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

Macquarie rates RMS as Upgrade to Outperform from Neutral (1) -

Macquarie upgrades Ramelius Resources to Outperform from Neutral with a higher target price by 9% to $2.50 on the back of the announcement to acquire Spartan Resources ((SRR)) for around -$2.4bn in a cash and/or cash/scrip offer.

Ramelius already owns 19% of Spartan, and deal completion will allow for the development of Dalgaranga's first ore in late 2025. Never Never and Pepper orebodies are expected to be fully ramped up in 2030.

The broker believes the acquisition is a good opportunity to boost asset quality and production growth.

Macquarie's EPS forecasts decline over FY26–FY29 by -20% to -53% on the back of higher depreciation and amortisation and an estimated 65% more shares on issue.

Target price is $2.50 Current Price is $2.28 Difference: $0.22
If RMS meets the Macquarie target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $2.58, suggesting upside of 12.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.8

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

Citi rates SCG as Buy (1) -

Citi analysts highlight the subordinated issuance and subsequent expected buyback of US subordinated notes is one catalyst for Scentre Group they have been waiting for.

Bottom line: the move should generate an annualised FFOps growth benefit of circa 1.8%.

As to why this is so important, the broker points out Scentre Group has one of the highest weighted average cost of debt profiles in the sector. 

The analysts still see further longer-term upside from the eventual refinancing of the remaining subordinated notes. Buy. Target $3.90.

Target price is $3.90 Current Price is $3.47 Difference: $0.43
If SCG meets the Citi target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $3.77, suggesting upside of 9.0% (ex-dividends)

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.3

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

Morgan Stanley rates SCG as Overweight (1) -

Morgan Stanley notes Scentre Group is taking action to refinance/replace US$1bn of subordinated debt issued in September 2020, which has an average debt margin of 475bps.

The company expects to replace the debt with $650m of AUD-denominated hybrids at an indicative margin of 225bps and $350m with traditional debt on a likely margin of less than 200bps.

The broker notes the company indicated the forex swap costs on these will be in tens of millions, and some degree of net debt cost savings was factored into the FY25 guidance.

Target price of $4.34 and Overweight rating maintained.

Target price is $4.34 Current Price is $3.47 Difference: $0.87
If SCG meets the Morgan Stanley target it will return approximately 25% (excluding dividends, fees and charges).

Current consensus price target is $3.77, suggesting upside of 9.0% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.3

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

Ord Minnett rates SIG as Hold (3) -

Ord Minnett's previous update on Sigma Healthcare dates from before the financial results release in March, at least on our observation.

This might explain why today's health sector update lists the broker's price target as $2.70 versus $2.15 back then. Hold.

Target price is $2.70 Current Price is $2.93 Difference: minus $0.23 (current price is over target).
If SIG meets the Ord Minnett target it will return approximately minus 8% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.83, suggesting downside of -2.9% (ex-dividends)

The company's fiscal year ends in January.

Forecast for FY25:

Forecast for FY26:

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 Outperform (1) -

Macquarie highlights Spark New Zealand continues to operate in a challenging downgrade earnings cycle with both structural and cyclical headwinds.

The analyst notes the company will need to achieve and deliver on seasonality, which has historically performed well, as well as cost savings across labour and other costs, and gross margin improvement to achieve FY25 guidance.

A capital structure review is anticipated by the broker, with a new dividend policy and a rebasing of FY26 dividend per share to NZ15c.

Macquarie EPS forecasts are adjusted for the dividend reinvestment plan, with the FY25 estimate up 5% and FY26 slipping by -5%.

Outperform retained. Target price falls to NZ$3 from NZ$3.46.

Current Price is $1.90. Target price not assessed.

Current consensus price target is N/A

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

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

Market Sentiment: 0.7

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

Citi rates TUA as Buy (1) -

On first take, Citi notes Tuas reported positive first half results with ongoing gain in market share.

The broker highlights both mobile and broadband came in better than expected, with margins also tracking above estimates, which is attributed to good cost management.

Mobile subscribers grew 4% to 1.16m from 1Q25 and were 3% above the analyst's forecast, which suggests around a 12% market share.

Broadband subscribers were 14,347, 205 above Citi's expectation, while 2Q25 revenue and earnings (EBITDA) were 6% and 5% higher, respectively, than 1Q. Broadband revenue was slightly below expectations.

Tuas shares are expected to move upwards. Buy. Target $7.10

Target price is $7.10 Current Price is $5.80 Difference: $1.3
If TUA meets the Citi target it will return approximately 22% (excluding dividends, fees and charges).

The company's fiscal year ends in August.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 1.0

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