Australian Broker Call

UBS rates A2M as Buy (1) -

UBS believes modest upside risk to guidance exists and a key catalyst would be a new product launch, suspected to be forthcoming in the short-medium term.

The broker's industry indicators suggest a2 Milk's share is likely to remain steady into June. Price increases are expected in FY21 to reflect rising costs and comparable competitor products in the A2 category being priced materially above a2 Platinum in Australia.

Buy rating retained. Target is NZ$22.00.

Current Price is $17.19. Target price not assessed.

Current consensus price target is $19.36, suggesting upside of 9.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

This company reports in NZD. 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

Citi rates ALG as Buy (1) -

Citi considers the sale of a 24% stake in Main Event is a positive move and should help fund the rolling out of centres. The broker expects the buyer, Redbird, will continue to support Main Event's growth, given prior experience with entertainment and leisure companies.

However, proceeds cannot be repatriated to Australia, which means Dreamworld is burning cash and has limited liquidity, with no clear path to a re-opening. The broker retains a Buy/High Risk rating and raises the target to $1.23 from $0.55.

Target price is $1.23 Current Price is $0.46 Difference: $0.77
If ALG meets the Citi target it will return approximately 167% (excluding dividends, fees and charges).

Current consensus price target is $1.04, suggesting upside of 100.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.3

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

Ord Minnett rates ALG as Hold (3) -

RedBird Capital Partners is set to acquire a 24.2% stake in Ardent Leisure Group’s Main Event Entertainment division. Ord Minnett considers this a positive move that will provide the group with additional financial support to cope with the pandemic-induced challenges.

The broker notes RedBird has been given the option to acquire an additional 26.8% interest which will take its total stake to 51% but will also transfer a significant proportion of the potential pandemic recovery upside to it. The broker is also concerned continued negative publicity on the group’s theme park division will weigh on investor sentiment.

Ord Minnett retains its Hold recommendation while reducing the target price to $0.5 from $1.15 to depict the impact of the pandemic.

Target price is $0.50 Current Price is $0.46 Difference: $0.04
If ALG meets the Ord Minnett target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $1.04, suggesting upside of 100.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.3

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

Ord Minnett rates AMI as Accumulate (2) -

Aurelia Metals announced a 2.5mt maiden mineral resource estimate for its Federation deposit in NSW (near the Hera Mine). Ord Minnett notes the polymetallic ore contains lead and zinc among other minerals and is of high-grade.

In fact, the ore is estimated to be worth $373/t which is much higher than the company’s current average of circa $220/t. A scoping study has commenced which puts the mine life at more than five years.

While the broker estimates the Federation deposit to be worth roughly $133m (pre-tax NPV basis), it takes a cautious approach for now and has refrained from incorporating the project into its model.

The broker reiterates its Accumulate recommendation with a target price of $0.55.

Target price is $0.55 Current Price is $0.45 Difference: $0.1
If AMI meets the Ord Minnett target it will return approximately 22% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.8

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

UBS rates BSL as Neutral (3) -

UBS updates modelling following a trough in earnings that appears shallower than previously expected. The broker now assesses the risk/reward is balanced and retains a Neutral rating.

US automotive manufacturers are slowly ramping up, although idled mills are coming back on line. In Australia a minimal impact from the pandemic is expected and market share momentum is intact.

Meanwhile, Australian detached construction is holding up well and Colorbond is outperforming the market, a trend the broker expects will continue. Target is raised to $11.50 from $10.50.

Target price is $11.50 Current Price is $11.54 Difference: minus $0.04 (current price is over target).
If BSL meets the UBS target it will return approximately minus 0% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $12.30, suggesting downside of -2.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.4

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

Macquarie rates CCX as Outperform (1) -

Rental negotiations stemming from the pandemic have been finalised. A decision has been made to close 14 stores where City Chic was unable to reach agreement on appropriate rents.

Macquarie believes this decision validates the discipline surrounding costs and store economics. The impact on future earnings is expected to be minimal, with customers redirected online and to nearby stores.

Macquarie notes the majority of staff have also been redeployed. The broker retains an Outperform rating and reduces the target to $3.13 from $3.25.

Target price is $3.13 Current Price is $2.71 Difference: $0.42
If CCX meets the Macquarie target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $2.91, suggesting upside of 6.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.7

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

Morgan Stanley rates CCX as Overweight (1) -

City Chic has reached agreements with landlords and has decided to close 14 stores. Morgan Stanley believes this demonstrates management's willingness to close shops if return hurdles are not met and considers the announcement earnings neutral.

The shift to online is accelerating and the broker believes the company is well able to close more stores over time if rents are unrealistic.

Morgan Stanley retains its Overweight recommendation with a target price of $2.75. Industry view is In-line.

Target price is $2.75 Current Price is $2.71 Difference: $0.04
If CCX meets the Morgan Stanley target it will return approximately 1% (excluding dividends, fees and charges).

Current consensus price target is $2.91, suggesting upside of 6.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.7

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

UBS rates CNI as Buy (1) -

UBS notes the cash and scrip offer of Augusta Capital for NZ$1 per share, which reflects a 46% premium to the last closing price. The acquisition will increase Centuria Capital's assets under management by 24% amid expansion to a new geography.

The broker considers this should be familiar enough to ensure risks can be appropriately managed. Acquisition metrics appear reasonable, relative to comparable transactions historically.

Still, the broker suspects investors will question Augusta Capital's reliance on transactions to generate profits. Buy rating and $2.34 target maintained.

Target price is $2.34 Current Price is $1.79 Difference: $0.55
If CNI meets the UBS target it will return approximately 31% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.8

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

Morgan Stanley rates CWN as Upgrade to Overweight from Equal-weight (1) -

Morgan Stanley switches its preference to Crown Resorts and upgrades to Overweight from Equal-weight. Target is raised to $12.00 from $6.60. The broker believes there is now more reliance on the domestic market, given travel restrictions.

This will become a fight for market share and Crown Sydney, which opens in December, is expected to be the winner. With capacity restrictions, Morgan Stanley does not forecast a recovery until FY22. Industry view: Cautious.

Target price is $12.00 Current Price is $9.95 Difference: $2.05
If CWN meets the Morgan Stanley target it will return approximately 21% (excluding dividends, fees and charges).

Current consensus price target is $10.21, suggesting downside of -1.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.8

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

Citi rates HLS as Buy (1) -

Healius has a binding agreement to sell its medical centre businesses to BGH Capital for $500m. Citi believes the outcome is positive for shareholders as the level of gearing was uncomfortably high.

Also, there was a high level of expenditure required to meet forecasts for divisional earnings, point out the analysts. Plus the medical centre businesses were very complex to run.

Citi makes no changes to estimates, pending the closure of the transaction, which is due by the end of 2020. Buy maintained. Target rises to $3.50 from $2.75.

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

Current consensus price target is $3.30, suggesting upside of 5.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 1.0

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

Credit Suisse rates HLS as Upgrade to Outperform from Neutral (1) -

Healius will sell its 69 medical centres, 13 Health & Co practices and 62 dental clinics for $500m. Proceeds of $470m are expected on completion. The sale to BGH Capital requires approval from the Foreign Investment Review Board and should be completed this year.

Meanwhile, trading conditions have improved in recent weeks with pathology revenue close to prior year levels and radiology revenue down in just single digits.

Credit Suisse raises FY20 earnings estimates by 20% and FY21 by 14%, expecting a stronger recovery from the pandemic.

Rating is upgraded to Outperform from Neutral, as the broker assesses the stock is trading in line with the multiple paid for medical centres, which is the least attractive and lowest-return business unit. Target is raised to $3.25 from $2.47.

Target price is $3.25 Current Price is $3.01 Difference: $0.24
If HLS meets the Credit Suisse target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $3.30, suggesting upside of 5.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 1.0

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

Macquarie rates HLS as Outperform (1) -

Healius has announced the sale of its primary care business for $500m with net proceeds used to repay debt and support growth initiatives in pathology and diagnostic imaging.

Macquarie considers the stock is leveraged to the improved activity levels in the main business heading into FY21. The divestment will result in a simpler structure and an improved balance sheet.

The broker retains an Outperform rating and raises the target to $3.40 from $3.00.

Target price is $3.40 Current Price is $3.01 Difference: $0.39
If HLS meets the Macquarie target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $3.30, suggesting upside of 5.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 1.0

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

Ord Minnett rates HLS as No Rating (-1) -

Healius has announced it will be selling its medical centres business (primary care portfolio) to BGH Capital for $500m by the end of 2020. This does not include day-hospitals and IVF clinics. Ord Minnett expects the company's gearing to drop to 1.5x post-sale completion.

A ramp-up in covid-19 testing was partly responsible for the improvement in the company's lab business in the second half. The broker expects higher revenue year on year in this segment, a trend that is expected to carry into FY21.

FY20 operating income estimate for FY21 has been raised by the broker, driven by the improving laboratory business.

Ord Minnett is currently research restricted (no rating/target price).

Current Price is $3.01. Target price not assessed.

Current consensus price target is $3.30, suggesting upside of 5.7% (ex-dividends)

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 1.0

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

UBS rates HLS as No Rating (-1) -

Healius has entered into a binding agreement to sell its primary care business to BGH Capital for $500m. The company will retain its day hospital business and Adora IVF.

UBS incorporates both the divestment and a more rapid recovery in diagnostic volumes. Significant upgrades to estimates for earnings per share are made in FY20 and FY21.

UBS is restricted on providing a rating and target at present.

Current Price is $3.01. Target price not assessed.

Current consensus price target is $3.30, suggesting upside of 5.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 1.0

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

Macquarie rates IPL as Outperform (1) -

Macquarie lifts forecasts for the Australian dollar and, whilst in isolation this is negative for reported earnings, a stronger currency is usually correlated positively with higher global fertiliser prices.

This is also then supportive of the Incitec Pivot share price, which is currently lagging global peers. Macquarie retains an Outperform rating and reduces the target to $2.60 from $2.80.

Target price is $2.60 Current Price is $1.89 Difference: $0.71
If IPL meets the Macquarie target it will return approximately 38% (excluding dividends, fees and charges).

Current consensus price target is $2.53, suggesting upside of 25.0% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.6

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

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

Morgan Stanley believes Mirvac may struggle to achieve its targets on the Indigo build-to-rent units. The broker has visited the site and finds attractive features across the two buildings but concludes that rents are quite expensive.

It comes down to whether or not tenants will pay a 10-15% premium for the features of the complex. Equal-weight rating retained. Target is raised to $2.60 from $2.45. Industry view is In-Line.

Target price is $2.60 Current Price is $2.29 Difference: $0.31
If MGR meets the Morgan Stanley target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $2.61, suggesting upside of 9.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.6

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

UBS rates MP1 as Downgrade to Neutral from Buy (3) -

UBS continues to like the business strategy but finds it hard to ignore the recent performance of the share price, which is up 13% since February and has outperformed the ASX small ordinaries by 29%.

The broker assesses there is upside in leveraging the platform to distribute complementary services but, without a business case, this is not factored in.

The short-term opportunity is reflected in the share price and UBS downgrades to Neutral from Buy. Target is raised to $14.05 from $11.90.

Target price is $14.05 Current Price is $13.97 Difference: $0.08
If MP1 meets the UBS target it will return approximately 1% (excluding dividends, fees and charges).

Current consensus price target is $12.63, suggesting downside of -9.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.3

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

Morgans rates OPC as Hold (3) -

Telco services company Uniti Group ((UWL)) has offered OptiComm shareholders $5.10 per share in cash and/or scrip in a full takeover bid. The board has recommended shareholders accept the bid unless a better one comes along. Given directors and associates own around 50% of the company the broker suggests a takeover is likely.

The broker is a little peeved as it was looking forward to being part of a "longer term valuation creation journey", but given the stock only listed last August, at $2.00, the broker is not unhappy at $5.10 plus dividends. Target rises to that figure from $4.54 to match the offer. Hold retained in case a better bid does come along.

Target price is $5.10 Current Price is $5.30 Difference: minus $0.2 (current price is over target).
If OPC meets the Morgans target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.0

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

Ord Minnett rates OPC as Downgrade to Hold from Buy (3) -

Uniti Group ((UWL)), an emerging telecommunications company, is set to acquire fibre network operator OptiComm. The group has proposed a 5-option scheme of arrangement transaction to OptiComm shareholders involving scrip, cash and a combination of both.

The board of OptiComm will vote their combined circa 32% of shares in favour of the scheme and has recommended the shareholders do the same. The broker sees the chances of a third-party counter bid slim at this stage.

Ord Minnett reduces its rating to Hold from Buy with a target price of $5.42.

Target price is $5.42 Current Price is $5.30 Difference: $0.12
If OPC meets the Ord Minnett target it will return approximately 2% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.0

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

Macquarie rates ORG as Outperform (1) -

Origin Energy has received $1.26bn in dividend from APLNG, at the upper end of guidance. Macquarie notes National Energy Market data continue to be soft, with weak demand and low-flat pricing.

Reduced generation at Eraring is a headwind. Macquarie makes minor changes to estimates and reduces the target to $7.58 from $7.67. Outperform maintained.

Target price is $7.58 Current Price is $5.57 Difference: $2.01
If ORG meets the Macquarie target it will return approximately 36% (excluding dividends, fees and charges).

Current consensus price target is $6.85, suggesting upside of 15.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.6

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

Ord Minnett rates QBE as Accumulate (2) -

The UK Financial Conduct Authority (FCA) recently put forward a list of arguments to the High Court in the UK to ascertain if insurers will have to pay out on certain business interruption (BI) insurance policies.

The FCA, representing policyholders, has questioned whether it is legal for insurers to deny BI coverage. This also includes three policies by QBE Insurance Group. The broker expected this to happen and points towards a similar situation expected to unfold in Australia.

QBE Insurance Group has maintained its BI related losses in the UK are limited to -US$75m, mostly because of the inclusion of catastrophic cover under reinsurance. Ord Minnett is unsure about this and believes catastrophic coverage may not be applicable here as pandemics are not usually named triggers of covers.

The FCA is taking an aggressive stance and wants all businesses affected by the slowdown to be covered and simply not the ones that were ordered to shut down. Ord Minnett maintains its Accumulate rating with a target price of $10.

Target price is $10.00 Current Price is $8.09 Difference: $1.91
If QBE meets the Ord Minnett target it will return approximately 24% (excluding dividends, fees and charges).

Current consensus price target is $10.65, suggesting upside of 23.1% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

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 SGR as Downgrade to Underweight from Overweight (5) -

Morgan Stanley believes Crown Sydney ((CWN)), which opens in December 2020, will be a winner in terms of the reliance on the domestic market and the ensuing fight for market share.

The broker does not believe this outlook and emphasis on domestic, has been factored into the share price for The Star.

The broker downgrades to Underweight from Overweight and acknowledges it is the sole underweight broker on the stock.

With capacity restrictions, a weaker domestic consumer and restrictions on international travel, the broker does not forecast a recovery in gambling stocks until FY22. Target is raised to $3.30 from $2.50. Industry view: Cautious.

Target price is $3.30 Current Price is $3.07 Difference: $0.23
If SGR meets the Morgan Stanley target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $3.38, suggesting upside of 5.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.4

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

Citi rates SUL as Buy (1) -

Citi believes the opportunistic equity raising removes the excess leverage on the balance sheet relative to peers.

Meanwhile, the trading update is considered mixed, with gross margin contraction and soft sales growth at Rebel partially offset by the resilient sales at Supercheap Auto and better sales growth at BCF.

Citi retains a Buy rating and raises the target to $9.70 from $8.00.

Target price is $9.70 Current Price is $7.81 Difference: $1.89
If SUL meets the Citi target it will return approximately 24% (excluding dividends, fees and charges).

Current consensus price target is $9.26, suggesting upside of 7.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.8

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

Credit Suisse rates SUL as Outperform (1) -

The company has raised $203m via an institutional entitlement offer and a retail offer. Credit Suisse expects this will put to rest any concerns regarding the balance sheet.

The broker finds reasons to be bullish about 2021 amid the likelihood of a substantial boost to domestic leisure expenditure, given the company's leading brands in relevant markets along with a strong online platform.

Credit Suisse expects a 10-15% boost to sales for BCF and Macpac along with a 2-3% boost to sales for the sports and automotive segments as a result of a higher level of expenditure on domestic holidays and recreational goods.

Year-to-date trading was ahead of forecast, although sales varied significantly over April and May. Outperform retained. Target is reduced to $9.92 from $9.97.

Target price is $9.92 Current Price is $7.81 Difference: $2.11
If SUL meets the Credit Suisse target it will return approximately 27% (excluding dividends, fees and charges).

Current consensus price target is $9.26, suggesting upside of 7.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.8

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

Morgan Stanley rates SUL as Overweight (1) -

Morgan Stanley notes trading in May has confirmed that Super Retail has benefited from a normalising of consumption. The capital raising of $203m also de-risks the balance sheet and allows for strategic flexibility.

Sales in the year to date are well ahead of Morgan Stanley's estimates and, assuming this is maintained and profitability is in line with the average, implies operating earnings (EBITDA) of $300m in FY20.

Overweight rating maintained. Target is $9.25. Industry View: Cautious.

Target price is $9.25 Current Price is $7.81 Difference: $1.44
If SUL meets the Morgan Stanley target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $9.26, suggesting upside of 7.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.8

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

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

A sharp fall in Super Retail's sales in April was offset by an equivalent rebound in May, to a net -1.7% loss over the two months, Clearly the company has come out of the lockdowns relatively unscathed, Morgans notes, and it would have performed better but for more stringent restrictions in NZ. Success represents a balance of a big increase in online sales and a reduction in costs per unit.

Super Retail now wants to beef up its digital offering after paying down debt hence a $203m capital raising. While the raising is -6% dilutive to FY21 earnings, Morgans believes the resilience the business has shown over the period deserves a higher market rating. Target rises to $9.25 from $7.84. Upgrade to Add from Hold.

Target price is $9.25 Current Price is $7.81 Difference: $1.44
If SUL meets the Morgans target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $9.26, suggesting upside of 7.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.8

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

Ord Minnett rates SUL as Accumulate (2) -

Super Retail Group announced a $203m equity raising which will be used for investing in organic growth opportunities while reporting stronger than expected sales with May year-to-date group like-for-like sales up 1.2%.

The group enjoys an attractive business mix anchored by Super Cheap Auto (SCA) which has shown resilience while Rebel is performing well amidst fragmented competitors, comments the broker.

Earnings forecast increased for FY20 by the broker while FY21-22 earnings estimates (impacted by dilution from capital raising) have been reduced. 

Ord Minnett notes a skew towards domestic travel and health and well-being and expects this to support BCF, Macpac, SCA and Rebel. The broker believes the group is well placed for a post-pandemic recovery.

Ord Minnett retains its Accumulate rating with target price increasing to $9.50 from $9.

Target price is $9.50 Current Price is $7.81 Difference: $1.69
If SUL meets the Ord Minnett target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $9.26, suggesting upside of 7.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.8

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

UBS rates SUL as Neutral (3) -

Super Retail has announced a $203m rights issue to shore up its balance sheet. UBS upgrades underlying estimates for operating earnings by 4-5% over FY20-21 to reflect the update.

The broker retains a Neutral rating and believes there are limited catalysts at present and significant uncertainty around trading post September.

In the medium term the company is considered well-placed. Target is reduced to $8.20 from $8.70.

Target price is $8.20 Current Price is $7.81 Difference: $0.39
If SUL meets the UBS target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $9.26, suggesting upside of 7.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.8

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

Citi rates SXY as Buy (1) -

Citi upgrades 2020 Brent forecasts to US$42/bbl and 2021 to US$57/bbl, with a more constructive outlook for a recovery in demand.

The broker's conviction idea is Senex Energy and a High Risk addition is made to the Buy rating.

The broker believes the company has demonstrated there is little risk in the coal seams and its balance sheet can survive very low oil prices. Target is raised to $0.40 from $0.37.

Target price is $0.40 Current Price is $0.23 Difference: $0.17
If SXY meets the Citi target it will return approximately 74% (excluding dividends, fees and charges).

Current consensus price target is $0.36, suggesting upside of 45.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.9

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

Ord Minnett rates TYR as Accumulate (2) -

The weekly trading update by Tyro Payments has the June transaction value rising by 6% (month to date). Ord Minnett notes the numbers are broadly in line with last week and believes the company is on track to deliver its FY20 transaction value estimate of $20bn.

Ord Minnett retains its Accumulate recommendation with a target price of $3.90.

Target price is $3.90 Current Price is $3.32 Difference: $0.58
If TYR meets the Ord Minnett target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $3.47, suggesting downside of -4.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.2

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

Ord Minnett rates UWL as Buy (1) -

Uniti Group has accelerated its fibre segment growth plans with the proposed acquisition of OptiComm ((OPC)) via a scheme of arrangement.

Ord Minnett expects an improvement in the group's earnings quality and financial returns in the medium term and supports Uniti's guidance of $10m in cost synergies from this deal.

The scheme of arrangement is subject to approval by OptiComm shareholders and expected to complete in September 2020. The broker expects earnings accretion of 14% in FY22.

Ord Minnett retains its Buy rating with target price increased to $2.06 from $1.68.

Target price is $2.06 Current Price is $1.54 Difference: $0.52
If UWL meets the Ord Minnett target it will return approximately 34% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 1.0

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