Australian Broker Call

Deutsche Bank rates AMC as Buy (1) -

Deutsche Bank considers management changes are a minor positive. Mike Schmitt, currently president of the rigid plastics division will step aside to support the integration of Bemis, where he previously spent 17 years. He will be replaced by Eric Roegner from mid November.

Buy rating and $16.65 target maintained.

Target price is $16.65 Current Price is $13.61 Difference: $3.04
If AMC meets the Deutsche Bank target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $15.23, suggesting upside of 11.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

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

Market Sentiment: 0.5

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

Deutsche Bank rates AZJ as Hold (3) -

Adani Australia has announced plans to shelve its standard gauge rail plans from the Carmichael project to the Abbot Point terminal in favour of a shorter narrow gauge linking to the Aurizon Newlands network.

The Carmichael project is yet to reach financial close and appears to be on the back burner, Deutsche Bank observes.

Hold rating maintained. Target is $4.10.

Target price is $4.10 Current Price is $4.12 Difference: minus $0.02 (current price is over target).
If AZJ meets the Deutsche Bank target it will return approximately minus 0% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.25, suggesting upside of 3.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.3

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

Morgan Stanley rates BLD as Overweight (1) -

Reports are circulating that a prospective owner of the Navajo generating station in Arizona has ended efforts to acquire the plant. The plant is scheduled to close at the end of 2019.

Morgan Stanley notes, from a Boral perspective, this is the most significant US coal plant slated to close, given its location and the volume of fly ash produced. While a sale could have meant additional volumes above those announced in August, the broker remains positive on the fly ash business, given Boral's strategies for increasing volumes.

Overweight rating. Target is $8.00 and Industry view is Cautious.

Target price is $8.00 Current Price is $6.87 Difference: $1.13
If BLD meets the Morgan Stanley target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $7.55, suggesting upside of 9.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.4

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

Morgan Stanley rates CGF as Underweight (5) -

Morgan Stanley suspects multiples could suffer if the MyRetirement implementation is delayed. The federal government plans to implement legislation requiring trustees to offer products that provide income for life no matter how long they live.

New pension eligibility tests for lifetime annuities have been introduced, opening the market up for deferred lifetime annuities. Morgan Stanley observes, given a near-monopoly position, Challenger is a major beneficiary of the proposals and political uncertainty overhangs the outlook.

Underweight rating. Target is $10.50. Industry view: In-line.

Target price is $10.50 Current Price is $11.00 Difference: minus $0.5 (current price is over target).
If CGF meets the Morgan Stanley target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $11.64, suggesting upside of 5.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.0

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

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

Morgan Stanley expects a seamless transition under new management. The focus is on growing share in the North American business. Key strategies are in place and the company has reiterated its primary demand growth target of 6%.

The broker does not consider the stock expensive at current levels but would like evidence of further success on its strategies before adopting a more positive stance. Equal-weight. Industry view is Cautious. Target price is $23.

Target price is $23.00 Current Price is $20.74 Difference: $2.26
If JHX meets the Morgan Stanley target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $24.46, suggesting upside of 17.9% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY19:

Forecast for FY20:

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

UBS rates JHX as Buy (1) -

At the tour of the Plant City facility management has emphasised its core strategy and target of 20-25% in margins for North America, supported by the new CEO, Jack Truong.

UBS is impressed with the potential of the facility, which plays to expectations that lower unit costs can expand margins or drive greater reinvestment. While the internal initiatives are positive, the broker suggests this is not a pivot away from growth.

Buy rating and $26.20 target maintained.

Target price is $26.20 Current Price is $20.74 Difference: $5.46
If JHX meets the UBS target it will return approximately 26% (excluding dividends, fees and charges).

Current consensus price target is $24.46, suggesting upside of 17.9% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY19:

Forecast for FY20:

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

Macquarie rates PMV as Outperform (1) -

The company's global expansion plans reflect increasing confidence in the medium/long-term outlook, Macquarie suggests. The broker believes the company is investing ahead of the curve, which is temporarily weighing on margins and growth.

In this context the valuation is undemanding and the broker maintains a Outperform rating. Target is raised to $20.90 from $16.90.

Target price is $20.90 Current Price is $18.10 Difference: $2.8
If PMV meets the Macquarie target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $18.89, suggesting upside of 4.4% (ex-dividends)

The company's fiscal year ends in July.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.0

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

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

FY18 results were in line with expectations while sales appear to have accelerated in the first five weeks of FY19. Morgan Stanley also notes mature brands improved their momentum. The company's strategy is shifting to a more scalable, capital-light strategy via online, concessions and wholesale business.

Because of the longevity of the global growth opportunity for Smiggle Morgan Stanley lifts target multiples. The broker requires further clarity on the unit economics of the revised European/wholesale plans before becoming more positive.

Equal-weight rating,  In-Line industry view retained. Target is raised to $19.00 from $13.20.

Target price is $19.00 Current Price is $18.10 Difference: $0.9
If PMV meets the Morgan Stanley target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $18.89, suggesting upside of 4.4% (ex-dividends)

The company's fiscal year ends in July.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.0

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

UBS rates RIO as Buy (1) -

Rio Tinto will return US$3.2bn from the sale of its coal assets, lifting total return since 2017 to US$15bn. The company has confirmed that the timing and form of shareholder returns in respect of proceeds from further disposals will be announced with the 2018 results.

This includes a sale of the Dunkerque smelter, which is expected to be completed shortly. UBS envisages potential for a further US$7-8bn from disposals in 2019, potentially including Grasberg, the Canadian iron ore business and Pacific Aluminium.

Buy rating maintained. Target is reduced to $90.

Target price is $90.00 Current Price is $79.46 Difference: $10.54
If RIO meets the UBS target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $86.60, suggesting upside of 9.0% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY18:

Forecast for FY19:

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

Deutsche Bank rates RMD as Buy (1) -

The company has identified, through Brightree data analytics, a number of improvements for durable medical equipment suppliers which have led to increased profitability.

Deutsche Bank expects these benefits will ultimately lead to higher and more stable sales for ResMed. Buy rating and US$124 target.

Current Price is $15.60. Target price not assessed.

Current consensus price target is $14.50, suggesting downside of -7.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

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

Citi rates WHC as Upgrade to Buy from Neutral (1) -

Citi has upgraded to Buy from Neutral with a revised price target of $5.90 from $5.40.

The analysts explain the move as being in response to negative sentiment towards base metals while physical strength in bulks has remained intact. Thus  earnings upgrades combined with lower share prices have driven a recommendation upgrade.

Target price is $5.90 Current Price is $5.36 Difference: $0.54
If WHC meets the Citi target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $5.59, suggesting upside of 4.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.6

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

Citi rates WSA as Upgrade to Buy from Neutral (1) -

Today's upgrade to Buy from Neutral occurs in response to a weaker share price, explain analysts at Citi.

Target price is $3.20 Current Price is $2.73 Difference: $0.47
If WSA meets the Citi target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $3.29, suggesting upside of 20.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.6

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