Australian Broker Call

Macquarie rates AFG as Outperform (1) -

Australian Finance Group's level of lodgement activity supports the securitisation book growth and wholesale funding costs support margins, observes Macquarie.

The broker also highlights lower wholesale funding costs are benefiting the net interest margin and partially offset back book to front book pricing pressure. 

Led by supporting operating conditions, Macquarie retains its Outperform rating with a target of $3.06. 

Target price is $3.06 Current Price is $2.76 Difference: $0.3
If AFG meets the Macquarie target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $3.12, suggesting upside of 14.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 1.0

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

Macquarie rates CCP as Outperform (1) -

Macquarie highlights the US purchase debt ledger (PDL) market appears to be a material source of growth for Credit Corp Group and the group has the physical capacity to purchase almost $200m per annum of PDLs.

Pricing of US PDL acquisitions was cheaper for both Encore and PRA (competitors) between the first quarter of 2020 to the first quarter of 2021 except PRA in the first quarter of 2020. US PDL volumes were up 29% for PRA and flat for Encore albeit both were down almost -50% over last year.

Macquarie expects about $300m PDLs to be purchased by Credit Corp in the US over FY22-23, with the added notion there is potential to scale up to $200m per annum (i.e. $400m over the period).

The broker believes Credit Corp, the number six in the sector in the US, remains competitive and able to increase its market share. Outperform rating is maintained and a target of $34.80.

Target price is $34.80 Current Price is $27.45 Difference: $7.35
If CCP meets the Macquarie target it will return approximately 27% (excluding dividends, fees and charges).

Current consensus price target is $33.25, suggesting upside of 18.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.3

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

Macquarie rates CPU as Outperform (1) -

Computershare's unpaid principal balances growth (UPB) dropped -2% in the third quarter versus last year leading to a market share decline of -3bps to 0.98%

Macquarie's UPB forecast remains unchanged and the broker expects UPBs to decline -2.5% in the second half compared with growth of 10-15% per annum in the medium term.

Further, while normalising since February, the broker notes the Mortgage Bankers Association (MBA) refinance index remains elevated at 33%. 

Outperform rating. Target drops to $20.95 from $21.

Target price is $20.95 Current Price is $14.06 Difference: $6.89
If CPU meets the Macquarie target it will return approximately 49% (excluding dividends, fees and charges).

Current consensus price target is $15.85, suggesting upside of 11.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: 0.1

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

Morgans rates ELD as Hold (3) -

In anticipation of first half results on May 17, Morgans forecasts over 35% earnings (EBIT) growth, underpinned by a much improved summer cropping season and high livestock prices.

Additionally, a buoyant real estate market and a full six months of the Australian Independent Rural Retailers (AIRR) acquisition should bolster earnings.

A Hold rating is kept due to high multiples and caution that earnings growth will moderate after the first half and cattle prices will eventually fall back. In the meantime, Morgans upgrades forecasts for higher than expected livestock prices and raises the target to $11.85 from $11.68.

Target price is $11.85 Current Price is $11.58 Difference: $0.27
If ELD meets the Morgans target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $12.95, suggesting upside of 11.0% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.7

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

Citi rates GMG as Buy (1) -

The third quarter update highlighted to Citi improving operating conditions. This was considered shown by development work-in-progress rising ahead of the company's prior expectations, improving rental growth and continued high occupancy. 

The broker sees management's unchanged FY21 guidance as conservative, and in fact believes in a strong growth outlook beyond FY21. It's estimated this could result in further upside to medium-term consensus earnings.

Buy rating. The target price is raised to $22.10 from $21 on a lift in Citi's EPS forecasts, due to a strong development outlook, valuation roll-forward and lower cap rates.

Target price is $22.10 Current Price is $19.24 Difference: $2.86
If GMG meets the Citi target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $20.53, suggesting upside of 5.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 1.0

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

Macquarie rates GMG as Outperform (1) -

In its third-quarter update, Goodman Group reaffirmed the FY21 earnings guidance of 64.4c. Macquarie is slightly ahead at 65.1c and is confident the group will surpass its current guidance at the full-year result.

Underlying investments and management business both remain strong, observes the broker, with NPI growth expanding to 3.3% in March from 3% in December and strong valuation uplifts driven by rental growth/cap-rate compression. 

Outperform rating with the target increasing slightly to $20.87 from $20.39. 

Target price is $20.87 Current Price is $19.24 Difference: $1.63
If GMG meets the Macquarie target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $20.53, suggesting upside of 5.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 1.0

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

Morgan Stanley rates GMG as Overweight (1) -

In a quarterly update, Goodman Group reiterated FY21 guidance. Morgans Stanley likes that work in progress is now $9.6bn, up from $8.4bn as at December 2020, and is expected to increase further by June 2021. 

Also, the company has upped its annualised production rate of workbook to "approximately $6bn". As recently as February results, management had guided to $5bn, highlights the broker.

In addition, like-for-like income growth across the portfolio is at 3.3%, a strong number and beating the 3% reported in the last few years, explains the analyst. The Overweight rating and target of $20.90 are retained. In-Line industry view.

Target price is $20.90 Current Price is $19.24 Difference: $1.66
If GMG meets the Morgan Stanley target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $20.53, suggesting upside of 5.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 1.0

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

Ord Minnett rates GMG as Buy (1) -

Goodman Group delivered "another solid" result, exclaims Ord Minnett, driven by strong growth in the development workbook which has doubled in the past 12 months while maintaining its strong margins.

Ord Minnett thinks this will drive a step-change in development earnings and gives the broker increased confidence about growth over the FY22-24 period. Earnings estimates are increased by 4% per annum from FY23.

Buy rating with the target rising to $21 from $20.

Target price is $21.00 Current Price is $19.24 Difference: $1.76
If GMG meets the Ord Minnett target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $20.53, suggesting upside of 5.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 1.0

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

UBS rates GMG as Buy (1) -

Key highlights from Goodman Group's update, the broker suggests, were reaffirmed guidance of 12% earnings growth and work in progress expected to top $10bn by the end of June. Development yield continues to impress at 6.8%.

While the size of the development business means increasing capital intensity, Goodman's preference to sell holdings rather than increase gearing means funding remains intact, the broker notes.

Buy and $18.70 target retained.

Target price is $18.70 Current Price is $19.24 Difference: minus $0.54 (current price is over target).
If GMG 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 $20.53, suggesting upside of 5.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 1.0

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

Credit Suisse rates HMC as Neutral (3) -

Credit Suisse has revised its FY22 estimates for Home Consortium in light of news that the company will sell 7 assets to its managed HomeCo Daily Needs REIT ((HDN)) for $266.4m and will double its HealthCo spin-off to $1bn from $0.5bn.

FY21 guidance remains intact. While the transfer of assets for equity co-investments should be relatively earnings neutral, the broker notes the forecast upgrades for FY22 and beyond are driven by a higher expected fee income.

Neutral maintained. Target is raised to $4.51 from $3.90.

Target price is $4.51 Current Price is $4.84 Difference: minus $0.33 (current price is over target).
If HMC meets the Credit Suisse target it will return approximately minus 7% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.36, suggesting downside of -11.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.3

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

UBS rates MFG as Neutral (3) -

Magellan Financial grew funds under management by 4.1% in April, but the broker estimates a third consecutive month of retail outflows. Investment performance was solid in April but May has seen a pullback.

While Magellan's long term track record remains strong, the flagship Global Fund has underperformed by -15.9% over one year and the Infrastructure Fund by -9.9%.

Neutral retained, target falls to $49.50 from $52.00.

Target price is $49.50 Current Price is $46.90 Difference: $2.6
If MFG meets the UBS target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $50.48, suggesting upside of 7.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.1

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

Citi rates MQG as Sell (5) -

Despite a strong second half, Citi maintains a Sell rating as the valuation and expectations appear stretched near-term. There's considered risks around the prospect of higher interest rates and higher US taxes as well as an altered mix towards lower returning businesses.

The group has recovered back to the FY19 $3bn profit level. However, growth beyond around $3bn is not expected until FY24 with excess capital continuing to keep the return on equity at circa 14%, explains the broker. Despite this, Citi raises the target to $140 from $125.

Target price is $140.00 Current Price is $158.45 Difference: minus $18.45 (current price is over target).
If MQG meets the Citi target it will return approximately minus 12% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $161.20, suggesting upside of 1.9% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.3

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

Credit Suisse rates MQG as Neutral (3) -

Following Macquarie Group's FY21 result, Credit Suisse upgrades its FY22 earnings by 2% mainly due to lower expenses and higher gains on equity investments. The result was also aided by higher commodities trading income and higher fees, notes Credit Suisse.

According to the broker, the strong FY21 result highlights the resilience of the group's operating model and while the group's outlook commentary suggests a number of challenges in FY22, Credit Suisse also points towards a favourable asset realisation environment.

Neutral rating retained. Target rises to $150 from $145.

Target price is $150.00 Current Price is $158.45 Difference: minus $8.45 (current price is over target).
If MQG meets the Credit Suisse target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $161.20, suggesting upside of 1.9% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.3

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

Morgan Stanley rates MQG as Overweight (1) -

The FY21 profit beat Morgan Stanley's estimate and consensus by 2.5% and eclipsed the FY19 record. It shows the diversity of growth options, fueled by strong private markets and structural tailwinds in renewables and infrastructure, explains the analyst.

The broker expects better gains on sale and growth in asset management and Banking and Financial Services (BFS) though Commodities revenues are likely to normalise in FY22.

Overweight rating with the target rising to $175 from $172. In-Line industry view maintained.

Target price is $175.00 Current Price is $158.45 Difference: $16.55
If MQG meets the Morgan Stanley target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $161.20, suggesting upside of 1.9% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.3

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

Morgans rates MQG as Add (1) -

The full year profit (NPAT) beat Morgans estimates with a very strong performance in Commodities and Global Markets (CGM) offsetting flatter or weaker results in other divisions. I's considered the result was pretty clean and largely as expected.

The second half dividend of $3.35 was 4 cents above consensus. The broker concludes from management commentary a flattish FY22 group profit outlook, with positive momentum in Macquarie Capital (MC) and the bank, to be negated by profit normalisation in CGM. 

The Add rating is unchanged and the target price increased to $171 from $162.3 on a valuation roll forward.

Target price is $171.00 Current Price is $158.45 Difference: $12.55
If MQG meets the Morgans target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $161.20, suggesting upside of 1.9% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.3

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

Ord Minnett rates MQG as Accumulate (2) -

Macquarie Group's FY21 net profit at $3.015bn was at the top end of its 5-10% guidance range and 1.6% ahead of Ord Minnett’s forecast. A final dividend of $3.35 per share was below the broker's $3.60 forecast.

No guidance has been provided for FY22 although Ord Minnett believes the group will be able to more than offset the likely headwind from the normalisation of its commodities and global markets (CGM) division.

Further, Macquarie Asset Management's (MAM) underlying drivers look very strong, notes the broker, led by record fundraising and net inflows into Macquarie Investment Management (MIM).

Despite the recent rerating, Ord Minnett sees further potential upside and maintains its Accumulate recommendation with the target price lifted to $170 from $165.

Target price is $170.00 Current Price is $158.45 Difference: $11.55
If MQG meets the Ord Minnett target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $161.20, suggesting upside of 1.9% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.3

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

Morgan Stanley rates NEA as Overweight (1) -

Morgan Stanley sees the biggest risk from legal proceedings is near-term liquidity rather than earnings power. The Overweight rating and $3.30 target price are retained by the broker, despite increased uncertainty.

Even assuming a bearish legal outcome plus a significant cash outflow for damages, the broker estimates the current share price still implies a much lower value for North America versus A&NZ.

This lower value is despite an estimated similar revenue base, higher growth and superior economics, explains the analyst. It's considered the next likely update in early July will be telling. Industry view is In-Line.

Target price is $3.20 Current Price is $1.72 Difference: $1.48
If NEA meets the Morgan Stanley target it will return approximately 86% (excluding dividends, fees and charges).

Current consensus price target is $2.98, suggesting upside of 63.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.7

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

Credit Suisse rates NWS as Outperform (1) -

News Corp's reported third-quarter results were ahead of market expectations, observes Credit Suisse, with both revenue and operating income higher than Credit Suisse expected.

The broker highlights the operating income beat was driven by better-than-expected performance across all divisions except news media albeit somewhat offset by higher corporate costs.

The company has guided to higher costs across a number of divisions for the last quarter but despite this, the revenue trends look favourable to the broker. With News Media hit hard by covid last year, comps are expected to be favourable in the June quarter.

Outperform rating retained with the target rising to $36.50 from $32.50.

Target price is $36.50 Current Price is $32.16 Difference: $4.34
If NWS meets the Credit Suisse target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $37.57, suggesting upside of 16.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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 NWS as Overweight (1) -

Third quarter earnings were a small beat versus Morgan Stanley's expectations. However, critical for the broker's bullish view was that the positive surprises came from Move and Dow Jones/WSJ.  There's considered further earnings and valuation upside for both.

Morgan Stanley thinks the current FY21 consensus earnings (EBITDA) estimates are conservative in implying the fourth quarter will be up 7% on the pcp. Overweight rating retained. Industry view: Attractive. Target is US$31.

Current Price is $32.16. Target price not assessed.

Current consensus price target is $37.57, suggesting upside of 16.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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 NWS as Buy (1) -

In a flash response, the broker notes News Corp's third quarter result was again solid, led by digital estate (REA Group ((REA)), Move) but featuring strength across the board.

The fourth quarter should see benefits from partnerships with Google and Facebook and recent acquisitions, although cost declines should moderate.

The broker has its $32.20 target under review. Buy retained.

Target price is $32.20 Current Price is $32.16 Difference: $0.04
If NWS meets the UBS target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $37.57, suggesting upside of 16.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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

Credit Suisse rates ORI as Outperform (1) -

Market indicators till the end of March look consistent with Orica's February update and Credit Suisse makes no change to the forecasts ahead of the first half result on May 13.

The broker believes Orica's main debt covenant is based on leverage and so impairments should not create a balance sheet issue.

Outperform rating with a target of $16.84.

Target price is $16.84 Current Price is $13.95 Difference: $2.89
If ORI meets the Credit Suisse target it will return approximately 21% (excluding dividends, fees and charges).

Current consensus price target is $14.94, suggesting upside of 7.2% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.3

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

UBS rates PPH as Neutral (3) -

Pushpay Holdings reports its FY21 result on Wednesday, which will be the first result for the new CEO. Focus will be on FY22 guidance, the broker suggests, which is likely to include costs associated with Catholic expansion opportunity.

On movement in the NZ dollar exchange rate, the broker lowers its target to NZ$1.90 from NZ$2.05. Neutral retained.

Current Price is $1.60. Target price not assessed.

Current consensus price target is $1.95, suggesting upside of 26.6% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: 0.3

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

Credit Suisse rates REA as Neutral (3) -

REA Group's third-quarter results ended up being slightly ahead of Credit Suisse's estimates with revenue at $225.6m and operating income of $121.9m. The broker notes the beat primarily reflected better-than-expected growth in residential listings.

Expecting an increase in the residential listing volume estimates, the broker forecasts a 20% year on year volume growth in the second half. The stock's earnings are expected to benefit from a cyclical recovery in both residential listings and developer volumes. 

Neutral rating with the target rising to $148 from $136.70.

Target price is $148.00 Current Price is $156.05 Difference: minus $8.05 (current price is over target).
If REA meets the Credit Suisse target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $156.52, suggesting downside of -2.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.3

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

Morgan Stanley rates REA as Overweight (1) -

A first take by Morgan Stanley on third quarter numbers suggests an in-line to a small beat on expectations. However, forward looking comments are broadly supportive of the broker's positive investment thesis.

The analyst considers there is potential for a "super-cycle" for earnings over 2021-22 from a rebound in Sydney/Melbourne listings post-covid and higher property "churn" as Australians re-think their work and living locations

Additionally, Morgan Stanley highlights the potential for price/yield increases and margin expansion with flattish costs. The Overweight rating and $175 target are retained. Industry view: Attractive.

Target price is $175.00 Current Price is $156.05 Difference: $18.95
If REA meets the Morgan Stanley target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $156.52, suggesting downside of -2.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.3

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

Morgans rates REA as Hold (3) -

A continued rebound in REA group's domestic listings during the third quarter were above Morgans' expectations. This was offset by slightly increased cost growth and lower depth penetration, explains the broker.

With a dominant position, the company is increasingly looking to monetise on the consumer side (Financial Services, other leads) and also on the agent side (Agent Match, Connect), highlights the analyst. The recent acquisition of Mortgage Choice is one such example.

The Hold rating is unchanged and the target is increased to $139.4 from $131. Morgans considers the near-term earnings growth and longer term optionality is adequately balanced by a full valuation.

Target price is $139.40 Current Price is $156.05 Difference: minus $16.65 (current price is over target).
If REA meets the Morgans target it will return approximately minus 11% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $156.52, suggesting downside of -2.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.3

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

Ord Minnett rates REA as Hold (3) -

REA Group's March-quarter operating earnings at $415.1m were broadly in line with Ord Minnett’s estimate. Listings volumes rose 8% over last year with Sydney up 5% and Melbourne up 13%.

Ord Minnett expects listings growth of 17.5% in the second half with a price increase of 8% in FY22. Core operating expenses are expected to increase slightly in FY21 due to revenue-related variable costs.

Hold rating with a target price of $145.

Target price is $145.00 Current Price is $156.05 Difference: minus $11.05 (current price is over target).
If REA meets the Ord Minnett target it will return approximately minus 7% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $156.52, suggesting downside of -2.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.3

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

UBS rates REA as Neutral (3) -

REA Group's 13% increase in March quarter revenues and 10% in earnings beat the broker, thanks to higher than expected numbers for volumes and commercial/developer. The broker notes the June quarter is cycling a huge jump in listings a year ago.

But underlying conditions remain strong, and listing levels remain above those seen in 2018, the broker points out. Cost guidance is "flat", and the broker has increased forecasts. Price increases are planned for FY22-23.

Target rises to $160 from $155, Neutral retained.

Target price is $160.00 Current Price is $156.05 Difference: $3.95
If REA meets the UBS target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $156.52, suggesting downside of -2.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.3

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

Credit Suisse rates RMD as Outperform (1) -

ResMed has announced the launch of its new CPAP device, AirSense 11. This is expected to be widely launched in the US by the end of 2021. Credit Suisse believes the main differentiator will be the improved software.

Credit Suisse analyses the upgrade opportunities and is conservative in assuming that about 20% of machines bought between FY15-19 would be upgraded over the first 10 quarters post the launch of the AirSense 11.

This leads the broker to forecast 18-19% US device sales growth in FY22-23, potentially leading to an additional circa 5% upside to operating income estimate for FY23.

Outperform rating maintained with a target of $29.

Target price is $29.00 Current Price is $24.85 Difference: $4.15
If RMD meets the Credit Suisse target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $28.01, suggesting upside of 11.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: 0.4

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

Morgans rates SIQ as Hold (3) -

A first half trading update revealed a six months run-rate of $107m revenue and $33m profit (NPATA), which is flat on the second half of 2020.

A net cash position by year end remains a key positive, which allows for further capital management or acquisition potential, explains the broker.

The analyst cautions the company’s largest contract is undergoing tender, posing some short-term risk. The Hold rating is maintained and the target price is increased to $7.88 from $7.75

Target price is $7.88 Current Price is $7.00 Difference: $0.88
If SIQ meets the Morgans target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $7.44, suggesting upside of 6.7% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

Macquarie rates SLK as Neutral (3) -

SeaLink Travel Group has acquired Go West, a specialist bus transportation services provider for the Western Australia resources sector.

Macquarie notes the acquisition will help SeaLink diversify into contracted defensive transportation services. The group's update was in line with the broker's expectations for the existing business.

Neutral rating with the target rising to $9.50 from $9.30.

Target price is $9.50 Current Price is $9.72 Difference: minus $0.22 (current price is over target).
If SLK meets the Macquarie target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.5

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

Ord Minnett rates SLK as Buy (1) -

Following the Transit Systems Group transaction, Ord Minnett notes SeaLink Travel Group continues to enhance its growth profile with the $72.4m acquisition of Go West Tours.

Ord Minnett estimates more than 90% of the group's revenue is derived from the resources sector where it provides specialist bus services to producers in the key Western Australia regions.

The contracts are mostly fixed price 3-5-year contracts with major clients including BHP Group ((BHP)), Rio Tinto ((RIO)) and South32 ((S32)). 

Buy rating retained. Target rises to $10.69 from $8.79.

Target price is $10.69 Current Price is $9.72 Difference: $0.97
If SLK meets the Ord Minnett target it will return approximately 10% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.5

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 Corporation and Optus have increased their mobile phone plan prices over the past 12 months but despite this, Ord Minnett does not expect Telstra’s average revenue per user (ARPU) to grow until FY22.

Notwithstanding this, the broker remains positive on Telstra and expects the company to gain more market share in the post-paid market given its head-start in the rollout of 5G infrastructure.

Buy rating with the target rising to $4.10 from $4.05.

Target price is $4.10 Current Price is $3.47 Difference: $0.63
If TLS meets the Ord Minnett target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $3.80, suggesting upside of 8.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.8

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