Australian Broker Call

Citi rates 29M as Initiation of coverage with Buy (1) -

Citi initiates coverage of 29Metals with a Buy rating and $3.20 target price.

The broker says the miner is emerging as the third amigo in the ASX copper space, the third largest copper producer by metal sourced from its Golden Grove mine in WA and Capricorn Copper in Queensland.

Cit forecasts earnings (EBIDTA) margins of roughly 40% and above-sector average free-cash-flow yields of 14%.

The broker notes that, as a higher cost producer, 29Metals has more leverage to copper prices on the way up - and vice versa.

Citi believes the July IPO to be well timed and spies further drilling and exploration potential.

Target price is $3.20 Current Price is $2.78 Difference: $0.42
If 29M meets the Citi target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $3.21, suggesting upside of 17.7% (ex-dividends)

The company's fiscal year ends in December.

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 29M as Outperform (1) -

Macquarie leaves its Outperform rating and $3.60 target price unchanged after 29Metals provided an operations update for both Capricorn Copper and Golden Grove. For the former, the company plans to transition to owner-operator of the process plant in February 2022.

An improved operating performance from Golden Grove in 2022 should eventuate after the receipt of all approvals for the paste plant, believes the analyst.

Target price is $3.60 Current Price is $2.78 Difference: $0.82
If 29M meets the Macquarie target it will return approximately 29% (excluding dividends, fees and charges).

Current consensus price target is $3.21, suggesting upside of 17.7% (ex-dividends)

The company's fiscal year ends in December.

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 AKE as Buy (1) -

Ord Minnett retains the view that the lithium market will remain in perpetual deficit and expects compound annual demand growth of 24%
through to 2030. In light of this, and strong recent prices, the broker is surprised lithium equities haven’t performed more strongly.

The broker maintains its Buy rating for Allkem and lifts its target price to $12 from $10.40.

Target price is $12.00 Current Price is $9.26 Difference: $2.74
If AKE meets the Ord Minnett target it will return approximately 30% (excluding dividends, fees and charges).

Current consensus price target is $10.67, suggesting upside of 16.9% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.6

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

Macquarie rates ANZ as Outperform (1) -

Macquarie lowers FY22 EPS forecasts for the major banks by around -2-4%, with a smaller impact on FY23-24, largely driven by mortgage margins changes. This comes after substantial switching by customers from variable to fixed rates, explains the analyst.

The broker points out a lack of repricing and significant competitive pressures in fixed-rate also contributed to a margin squeeze.

ANZ Bank is expected to benefit from an underweight position in mortgages and should deliver better revenue growth in FY22, estimates Macquarie. The $30 target price and Outperform rating are maintained.

Target price is $30.00 Current Price is $27.48 Difference: $2.52
If ANZ meets the Macquarie target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $29.46, suggesting upside of 6.8% (ex-dividends)

The company's fiscal year ends in September.

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

Citi rates APX as Buy (1) -

Citi does not expect the EU's draft proposal for digital labour platforms to have a material impact on Appen's margins, given only 10% of listings have been in the EU and given Appen's pay rates sometimes outpace minimum wages.

The broker also expects regulation aids large players such as Appen with the funds to invest in regulatory systems and processes.

Buy rating and $17.10 target price retained.

Target price is $17.10 Current Price is $10.25 Difference: $6.85
If APX meets the Citi target it will return approximately 67% (excluding dividends, fees and charges).

Current consensus price target is $12.78, suggesting upside of 30.5% (ex-dividends)

The company's fiscal year ends in December.

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 AWC as Upgrade to Accumulate from Hold (2) -

Ord Minnett upgrades its rating for Alumina to Accumulate from Hold after a recent share price fall due to weakening alumina prices. The broker feels the recent increase in cash costs may have ended and a fall in the Australian dollar offers some relief.

The analyst also feels it would be a timely entry point for Alumina shares as the spot alumina price has some near term support. Moreover,  there's considered longer term structural drivers for the alumina and aluminium industries. The $2.10 target price is unchanged.

Target price is $2.10 Current Price is $1.81 Difference: $0.29
If AWC meets the Ord Minnett target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $2.11, suggesting upside of 12.8% (ex-dividends)

The company's fiscal year ends in December.

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: 0.5

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

Macquarie rates BHP as Outperform (1) -

Macquarie notes last week's Central Economic Work Conference (CEWC) in China reconfirmed a key policy pivot from tightening to pro-growth, which boosted market sentiment.

The broker remains positive on stocks with iron-ore exposure, with BHP Group as the preferred large-cap exposure. The Outperform rating and $52 target price are retained.

Target price is $52.00 Current Price is $41.28 Difference: $10.72
If BHP meets the Macquarie target it will return approximately 26% (excluding dividends, fees and charges).

Current consensus price target is $43.55, suggesting upside of 6.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

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

Macquarie rates CBA as Underperform (5) -

Macquarie lowers FY22 EPS forecasts for the major banks by around -2-4%, with a smaller impact on FY23-24, largely driven by mortgage margins changes. This comes after substantial switching by customers from variable to fixed rates, explains the analyst.

The broker points out a lack of repricing and significant competitive pressures in fixed-rate also contributed to a margin squeeze.

Separately, the broker increases the expense forecasts for Commonwealth Bank of Australia after a 1Q22 trading update. 
relative to the implied cost outlook from 1Q22 trading update. The Underperform rating and $86 target price are maintained.

Target price is $86.00 Current Price is $97.54 Difference: minus $11.54 (current price is over target).
If CBA meets the Macquarie target it will return approximately minus 12% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $87.25, suggesting downside of -9.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: -0.8

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

Macquarie rates CIA as Outperform (1) -

Macquarie notes last week's Central Economic Work Conference (CEWC) in China reconfirmed a key policy pivot from tightening to pro-growth, which boosted market sentiment.

The broker remains positive on stocks with iron-ore exposure generally and Champion Iron is seen as a key mid-cap pick offering unique leverage to both the iron-ore price and capex cycle. The Outperform rating and $7.40 target price are maintained.

Target price is $7.40 Current Price is $5.02 Difference: $2.38
If CIA meets the Macquarie target it will return approximately 47% (excluding dividends, fees and charges).

The company's fiscal year ends in March.

Forecast for FY22:

Forecast for FY23:

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

Market Sentiment: 1.0

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

Macquarie rates CNU as Neutral (3) -

The NZ Commerce Commission will release its final decisions on Chorus' price-quality path as at 1 January 2022 on December 16th.
Macquarie feels investor focus will be upon on the regulated asset base and maximum allowable revenue.

The broker considers it unlikely there will be any material variance between the final determination and the draft. The target price rises to NZ$7.22 from NZ$6.91. The Neutral rating is unchanged.

Current Price is $6.74. Target price not assessed.

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

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

Market Sentiment: 0.0

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

Morgans rates COF as Hold (3) -

Centuria Office REIT has upgraded FY22 guidance on the back of recent leasing activity, with FY22 funds from operations (FFO) now expected to be 18.3cpu, from 18cpu. Dividend guidance is unchanged.

Also, net tangible assets have climbed by 5 cents to $2.49 after December revaluations. The broker retains its Hold rating and raises its target price to $2.50 from $2.48.

Target price is $2.50 Current Price is $2.35 Difference: $0.15
If COF meets the Morgans target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $2.48, suggesting upside of 5.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.0

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

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

CSL will purchase Vifor Pharma at a 65% premium to the company's trading price and Citi estimates the purchase will be roughly 9% accretive to CSL's net profit after tax prior to amortisation given CSL's higher trading multiple.

Vifor's products focus on iron deficiency, renal and cardio-renal therapies.

Citi upgrades to Buy from Neutral and increases the target price to $340 from $325.

Target price is $340.00 Current Price is $298.31 Difference: $41.69
If CSL meets the Citi target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $318.73, suggesting upside of 7.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

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

Macquarie rates CSL as Outperform (1) -

Macquarie considers the rationale for the acquisition of Vifor Pharma is to utilise CSL's global presence, R&D capabilities and scale to grow Vifor’s renal franchise. FY23 earnings (EPS) accretion of 5% is estimated.

The broker thinks the transaction will supplement an assumed earnings recovery in FY23 and provide medium-longer term growth. The Outperform rating and $338 target price re unchanged.

The acquisition will be funded via an institutional placement of US$4.5bn, debt facilities (US$6bn) and existing cash/undrawn facilities (US$2bn).

Target price is $338.00 Current Price is $298.31 Difference: $39.69
If CSL meets the Macquarie target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $318.73, suggesting upside of 7.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

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

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

CSL has tendered an approximate $17.2bn offer for the acquisition of Vifor Pharma. Morgan Stanley notes the offer is for the acquisition of all publicly held Vifor Pharma shares at a per share price of US$179.25 and is marked for a mid-January commencement. 

The company is guiding to the acquisition providing a low- to mid-teens after tax profit benefit in FY23, the expected first full year of ownership. The broker notes the transaction further diversifies CSL's portfolio, somewhat diluting future disruption risk. 

The Equal-Weight rating and target price of $280.000 are retained. Industry view: In-Line.

Target price is $280.00 Current Price is $298.31 Difference: minus $18.31 (current price is over target).
If CSL meets the Morgan Stanley target it will return approximately minus 6% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $318.73, suggesting upside of 7.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

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

Ord Minnett rates CSL as Hold (3) -

Following CSL's all-cash offer to acquire Swiss pharmaceutical developer Vifor Pharma for US$12.3bn, Ord Minnett sees an attractive new source of growth. The target price rises to $315 from $285 and the Hold rating is maintained.

While the analyst cautions the transaction may signal moderating growth for the plasma franchise, there's still faith in management's ability to maximise growth opportunities. Vifor franchises specialise in nephrology, dialysis and iron deficiency.

Management guided to a low to mid-teens net profit boost from the deal.

Target price is $315.00 Current Price is $298.31 Difference: $16.69
If CSL meets the Ord Minnett target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $318.73, suggesting upside of 7.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

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

Macquarie rates DRR as Outperform (1) -

Macquarie notes last week's Central Economic Work Conference (CEWC) in China reconfirmed a key policy pivot from tightening to pro-growth, which boosted market sentiment.

The broker remains positive on stocks with iron-ore exposure generally. The Outperform rating and $5.20 target price are maintained for Deterra Royalties.

Target price is $5.20 Current Price is $4.22 Difference: $0.98
If DRR meets the Macquarie target it will return approximately 23% (excluding dividends, fees and charges).

Current consensus price target is $4.61, suggesting upside of 10.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.8

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

Macquarie rates FMG as Outperform (1) -

Macquarie notes last week's Central Economic Work Conference (CEWC) in China reconfirmed a key policy pivot from tightening to pro-growth, which boosted market sentiment.

The broker remains positive on stocks with iron-ore exposure. The Outperform rating and $21 target price for Fortescue Metals Group are retained.

Target price is $21.00 Current Price is $18.70 Difference: $2.3
If FMG meets the Macquarie target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $16.49, suggesting downside of -11.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

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

Credit Suisse rates GOZ as Neutral (3) -

Growthpoint Properties has upgraded funds from operations ((FFO) guidance to account for strong leasing and lower funding costs.

Credit Suisse says the upgrade excludes upside from its recent Bowes St, Canberra, acquisition; debt costs have fallen post refinancing; and December 2021 revaluations should increase net tangible asset backing by about 33c a share to $4.50 (although its peers are in a similar position).

All up, the broker spies 83c earnings upside annually.. 

Target price rises to $4.36 from $4.22. Neutral rating retained.

Target price is $4.36 Current Price is $4.27 Difference: $0.09
If GOZ meets the Credit Suisse target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $4.34, suggesting upside of 1.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.0

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

Macquarie rates GOZ as Neutral (3) -

Growthpont Properties has upgraded guidance for FY22 funds from operations (FFO) by around 3% due to acquisitions and debt refinancing, explains Macquarie.

Management also announced preliminary December draft revaluations, in-line with the broker's expectation. The target price rises to $4.25 from $3.99. It's felt the company is fairly valued and a Neutral rating is maintained.

Target price is $4.25 Current Price is $4.27 Difference: minus $0.02 (current price is over target).
If GOZ meets the Macquarie target it will return approximately minus 0% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.34, suggesting upside of 1.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.0

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

Ord Minnett rates GOZ as Hold (3) -

Growthpoint Properties has upgraded FY22 funds from operations (FFO) guidance by 2.7% and announced revaluations of 7.5% in the second half. This lifts net tangible assets (NTA) by 33cpu to $4.50 and the total portfolio value to $5bn.

Ord Minnett, in turn, raises its target price to $4.40 from $4 and maintains its Hold rating. The broker also notes FY22 DPS guidance was raised to 20.8cps from 20.6cps.

Target price is $4.40 Current Price is $4.27 Difference: $0.13
If GOZ meets the Ord Minnett target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $4.34, suggesting upside of 1.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.0

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

Morgans rates JIN as Add (1) -

Stronger-than-expected jackpot activity and a potentially larger new player base for Jumbo Interactive prompts Morgans to lift FY22-24 profit forecasts by 6.6%, 5.1% and 4.4%, respectively. The target price increases to $20.20 from $17.10. Add rating unchanged.

In an International update, management noted regulatory approval for the Stride acquisition will be received in 4Q 2022 (formerly 2021).

Overall, the broker likes the strong cash generation from the core lottery business and the long-term growth potential of the SaaS and Managed Services business.

Target price is $20.20 Current Price is $18.58 Difference: $1.62
If JIN meets the Morgans target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $18.40, suggesting downside of -2.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.7

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

Ord Minnett rates KLS as Buy (1) -

Ord Minnett lowers Kelsian Group's earnings estimates for FY22-24 by -4%, -12% and -19%, respectively, and lowers its target price to $8.43 from $10.71. This is due to border closures and removal of a portion of assumed contract wins (Melbourne), explains the analyst.

These negative impacts were partially offset by the West London Bus joint venture (which removed some losses), and a lower assumed effective tax rate from FY23 onwards, notes the broker. The Buy rating is maintained.

Target price is $8.43 Current Price is $6.80 Difference: $1.63
If KLS meets the Ord Minnett target it will return approximately 24% (excluding dividends, fees and charges).

Current consensus price target is $8.36, suggesting upside of 24.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.7

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

Macquarie rates MGX as Outperform (1) -

Macquarie notes last week's Central Economic Work Conference (CEWC) in China reconfirmed a key policy pivot from tightening to pro-growth, which boosted market sentiment.

The broker remains positive on stocks with iron-ore exposure generally. The Outperform rating and $0.80 target price are maintained for Mount Gibson Iron.

Target price is $0.80 Current Price is $0.39 Difference: $0.41
If MGX meets the Macquarie target it will return approximately 105% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 1.0

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

Macquarie rates MIN as Outperform (1) -

Macquarie notes last week's Central Economic Work Conference (CEWC) in China reconfirmed a key policy pivot from tightening to pro-growth, which boosted market sentiment.

The broker remains positive on stocks with iron-ore exposure generally and Mineral Resources is seen as a key mid-cap pick offering unique leverage to both the iron-ore price and capex cycle. The Outperform rating and $72 target price are maintained.

Target price is $72.00 Current Price is $49.41 Difference: $22.59
If MIN meets the Macquarie target it will return approximately 46% (excluding dividends, fees and charges).

Current consensus price target is $53.43, suggesting upside of 9.0% (ex-dividends)

The company's fiscal year ends in June.

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 MIN as Hold (3) -

Ord Minnett retains the view that the lithium market will remain in perpetual deficit and expects compound annual demand growth of 24%
through to 2030. In light of this, and strong recent prices, the broker is surprised lithium equities haven’t performed more strongly.

The broker maintains its Hold rating for Mineral Resources. While leverage to lithium has increased with the pullback in iron ore, the company is considered the most expensive on most metrics across Ord Minnett's coverage of the sector. The target rises to $46 from $40.

Target price is $46.00 Current Price is $49.41 Difference: minus $3.41 (current price is over target).
If MIN 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 $53.43, suggesting upside of 9.0% (ex-dividends)

The company's fiscal year ends in June.

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

Macquarie rates NAB as Outperform (1) -

Macquarie lowers FY22 EPS forecasts for the major banks by around -2-4%, with a smaller impact on FY23-24, largely driven by mortgage margins changes. This comes after substantial switching by customers from variable to fixed rates, explains the analyst.

The broker points out a lack of repricing and significant competitive pressures in fixed-rate also contributed to a margin squeeze.

National Australia Bank is expected to benefit from an underweight position in mortgages and should deliver better revenue growth in FY22, estimates Macquarie. The $30.50 target price and Outperform rating are maintained.

Target price is $30.50 Current Price is $28.46 Difference: $2.04
If NAB meets the Macquarie target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $29.47, suggesting upside of 3.2% (ex-dividends)

The company's fiscal year ends in September.

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

Macquarie rates NCM as Outperform (1) -

Newcrest Mining's Cadia mine has received NSW government approval to increase its processing capacity to 35Mtpa from 32Mtpa, as expected by Macquarie.

The analyst reiterates the company's solid leverage to both gold and copper prices, with a 10% move driving circa 30% and 10% changes to FY22/FY23 earnings forecasts. The Outperform rating and $34 target price are retained.

Target price is $34.00 Current Price is $23.25 Difference: $10.75
If NCM meets the Macquarie target it will return approximately 46% (excluding dividends, fees and charges).

Current consensus price target is $29.31, suggesting upside of 28.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

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

Market Sentiment: 0.9

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 notes Nearmap's commentary that Australian and New Zealand business continues to perform well indicates the company will report growth on the $69.1m regional annual contract value reported as end of June. 

On further commentary of the North American annual contract value exceeding Australia and New Zealand, the broker expects a strong first half result of an approximate $15m uplift to total group contract value of over $143-144m.

The Overweight rating and target price of $3.20 are retained. Industry view: In-Line. 

Target price is $3.20 Current Price is $1.54 Difference: $1.66
If NEA meets the Morgan Stanley target it will return approximately 108% (excluding dividends, fees and charges).

Current consensus price target is $2.53, suggesting upside of 65.6% (ex-dividends)

The company's fiscal year ends in June.

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 PLS as Buy (1) -

Ord Minnett retains the view that the lithium market will remain in perpetual deficit and expects compound annual demand growth of 24%
through to 2030. In light of this, and strong recent prices, the broker is surprised lithium equities haven’t performed more strongly.

The broker maintains its Buy rating for Pilbara Minerals and increases its target price to $2.90 from $2.30. The company has the greatest leverage to spodumene of lithium stocks covered by Ord Minnett and trades the cheapest based on earnings multiples.

Target price is $2.90 Current Price is $2.75 Difference: $0.15
If PLS meets the Ord Minnett target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $2.56, suggesting downside of -5.1% (ex-dividends)

The company's fiscal year ends in June.

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 RHC as Underweight (5) -

The $1.4bn acquisition of Elysium Healthcare sees Ramsay Health Care diversify into high growth mental health care. Morgan Stanley notes while the company guides to a mid-single digit earnings per share benefit from FY23, the broker expects 4% accretion that year. 

Despite the acquisition adding value, the broker is concerned about the company's ability to sustain margins post pandemic given expected continued elevated costs and lower indexation paid by insurers. 

The Underweight rating is retained and the target price increases to $65.00 from $60.00. Industry view: In-Line.

Target price is $65.00 Current Price is $69.57 Difference: minus $4.57 (current price is over target).
If RHC meets the Morgan Stanley target it will return approximately minus 7% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $71.52, suggesting upside of 4.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.1

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

Morgans rates RHC as Hold (3) -

After listening to investor day presentations by Ramsay Health Care on the intended creation a digitally enabled, leading healthcare ecosystem, Morgans notes this will require a material step-up in capex. 

The new ecosystem will dictate the medium/longer term outlook, while the short term is in the hands of covid, believes the analyst. The Hold rating and $65.10 target price are unchanged.

Target price is $65.10 Current Price is $69.57 Difference: minus $4.47 (current price is over target).
If RHC meets the Morgans target it will return approximately minus 6% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $71.52, suggesting upside of 4.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.1

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

Ord Minnett rates RHC as Accumulate (2) -

Ord Minnett assesses Ramsay Health Care's purchase of British mental health operator Elysium Healthcare for $1.4bn will boost earnings and the growth trajectory of the group’s expanded UK operations.

However, a negative earnings impact from a new wave of covid and staff shortages lessens the positive estimated earnings impact from the acquisition, explains the analyst. The target price moves to $75 from $74 and the Accumulate rating is unchanged.

Target price is $75.00 Current Price is $69.57 Difference: $5.43
If RHC meets the Ord Minnett target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $71.52, suggesting upside of 4.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.1

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

Macquarie rates RIO as Outperform (1) -

Macquarie notes last week's Central Economic Work Conference (CEWC) in China reconfirmed a key policy pivot from tightening to pro-growth, which boosted market sentiment.

The broker remains positive on stocks with iron-ore exposure. The Outperform rating and $133 target price for Rio Tinto are retained.

Target price is $133.00 Current Price is $98.10 Difference: $34.9
If RIO meets the Macquarie target it will return approximately 36% (excluding dividends, fees and charges).

Current consensus price target is $107.21, suggesting upside of 9.0% (ex-dividends)

The company's fiscal year ends in December.

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

Morgan Stanley rates RIO as Overweight (1) -

Rio Tinto, alongside the majority owned Turquoise Hill Resources ((TQR)), has made a joint proposal to write off the US$2.3bn debt owed by the Government of Mongolia, with the intention to allow the progression of the underground development project as noted by Morgan Stanley.

While negotiations are ongoing the broker notes this would remove a key hurdle for the Turquoise Hill project. 

The Overweight rating and target price of $110.50 are retained. Industry view: Attractive.

Target price is $110.50 Current Price is $98.10 Difference: $12.4
If RIO meets the Morgan Stanley target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $107.21, suggesting upside of 9.0% (ex-dividends)

The company's fiscal year ends in December.

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

UBS rates RIO as Sell (5) -

Turquoise Hill ((TRQ)) and majority shareholder Rio Tinto have offered to write off a loan to the Mongolian government of US2.3bn which "aims to reset the relationship and allow all parties to move forward together" with regard Oyu Tolgoi.

While it is encouraging that the project will move forward, UBS suggests, its a significant value loss for both parties. It would be worse if the project was again put on hold, nonetheless. Oyu Tolgoi (copper) is Rio's key growth project.

Sell retained. Target rises to $80 from $79 as the broker has simultaneously increased its commodity price forecasts.

Target price is $80.00 Current Price is $98.10 Difference: minus $18.1 (current price is over target).
If RIO meets the UBS target it will return approximately minus 18% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $107.21, suggesting upside of 9.0% (ex-dividends)

The company's fiscal year ends in December.

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

Macquarie rates SGP as Downgrade to Underperform from Neutral (5) -

Macquarie believes downside risks are forming for residential developers as house price growth will continue to moderate. The broker downgrades its rating for Stockland to Underperform from Neutral and reduces its target price to $4.21 from $4.84.

This view stems from an increased likelihood of a cash rate hike in calendar year 2022, APRA increasing serviceability buffers and an overall decline in housing affordability, explains the analyst.

Also, Macquarie downgrades FY23 settlement volumes for Stockland and notes uncertainty related to overall strategy changes.

Target price is $4.21 Current Price is $4.44 Difference: minus $0.23 (current price is over target).
If SGP meets the Macquarie target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.78, suggesting upside of 11.8% (ex-dividends)

The company's fiscal year ends in June.

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

Macquarie rates SSM as Neutral (3) -

After a period of research restriction on Service Stream, Macquarie resumes with a Neutral rating and $0.88 target price, following the acquisition of Lendlease ((LLC)) Services.

The acquisition provides diversification and contributes to the analyst's increased FY22-24 EPS forecasts, which rise by 19%, 42% and 63%, respectively.

The broker cautions the standalone Service Stream business is yet to deliver with respect to ongoing NBN work.

Target price is $0.88 Current Price is $0.84 Difference: $0.04
If SSM meets the Macquarie target it will return approximately 5% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.5

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

Citi rates STO as Neutral (3) -

Citi resumes coverage of Santos with a Neutral rating (under review) and a $7.01 target price (also under review). This compares with its last rating of Neutral in July, with a $7.45 target price.

Citi says make-or-break shale results are expected in FY22 and says the Oil Search merger favoured Santos, Oil Search boasting a higher base leverage to oil prices than Santos.

Citi says its FY22 net profit after tax forecasts outpace consensus by roughly 12% given the broker's relatively bullish sort-ter price deck, but that FY23 forecasts than fall to -12% below consensus given the broker's relatively bearish long-term oil price assumption.

Target price is $7.45 Current Price is $6.53 Difference: $0.92
If STO meets the Citi target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $8.58, suggesting upside of 32.9% (ex-dividends)

The company's fiscal year ends in December.

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: 0.7

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

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

After a period of research restriction on Santos, Macquarie upgrades its rating to Outperform from Neutral after the completion of the  acquisition of Oil Search. The target price is set at $8.

The company is now the broker's preferred ASX energy exposure into 2022, exhibiting superior free cash flow and growth. The analyst expects sell-downs at PNG LNG, Dorado oil, Alaska oil and Narrabri CSG to monetise and manage risk.

Target price is $8.00 Current Price is $6.53 Difference: $1.47
If STO meets the Macquarie target it will return approximately 23% (excluding dividends, fees and charges).

Current consensus price target is $8.58, suggesting upside of 32.9% (ex-dividends)

The company's fiscal year ends in December.

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: 0.7

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

Citi rates UMG as Buy (1) -

Citi expects United Malt Group may be an acquisition target.

InVivo Group plans to double malting capacity over five years and is on the acquisition path, targeting Australia and the United States, and other regions.

The broker believe United Malt is a logical target given its location and quality assets, and its purchase would make InVivo the largest commercial maltster.

Buy rating and $4.90 target price retained.

Target price is $4.90 Current Price is $4.39 Difference: $0.51
If UMG meets the Citi target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $4.83, suggesting upside of 9.4% (ex-dividends)

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.8

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

Macquarie rates WBC as Neutral (3) -

Macquarie lowers FY22 EPS forecasts for the major banks by around -2-4%, with a smaller impact on FY23-24, largely driven by mortgage margins changes. This comes after substantial switching by customers from variable to fixed rates, explains the analyst.

The broker points out a lack of repricing and significant competitive pressures in fixed-rate also contributed to a margin squeeze. Westpac Bank is assessed to be the most affected. The $25.50 target price and Neutral rating are maintained.

Target price is $25.50 Current Price is $20.93 Difference: $4.57
If WBC meets the Macquarie target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $26.33, suggesting upside of 25.4% (ex-dividends)

The company's fiscal year ends in September.

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

Citi rates WOW as Neutral (3) -

Woolworths Group's trading update disappointed the broker, the company reporting sharply lower earnings (EBIT) guidance for Big W and Australian Food.

The company attributed the decline to bad weather, a return to pre-covid shopping habits, the impact of store closures on Big W, and lower tobacco sales.

While attractive as a defensive play during covid, the broker says operating leverage continues to disappoint given the high costs of health-regulation compliance.

While Citi expects these pressures will ease and food inflation will eventually kick in, it prefers Coles ((COL)) over Woolworths and cuts the target price to $39 from $39.50. Neutral rating retained.

Target price is $39.00 Current Price is $37.45 Difference: $1.55
If WOW meets the Citi target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $37.14, suggesting downside of -0.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: -0.2

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

Credit Suisse rates WOW as Underperform (5) -

Woolworths FY22 trading update disappointed Credit Suisse, due to missed performance improvements and cost disruptions.

The broker expects a moderation in food inflation and e-commerce costs will drag on Woolworths Group and downgrades FY22 forecasts for both halves.

Given the magnitude of the downgrades, the broker shifts its valuation to FY23, allowing a tiny increase in the target price to $31.92 from $31.84, thanks to forecast margin improvements.

Underperform rating retained.

Target price is $31.84 Current Price is $37.45 Difference: minus $5.61 (current price is over target).
If WOW meets the Credit Suisse target it will return approximately minus 15% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $37.14, suggesting downside of -0.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: -0.2

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

Macquarie rates WOW as Neutral (3) -

A first half trading update by Woolworths revealed covid costs and supply chain disruptions were weighing upon on the Australian Food performance. Meanwhile, Big W trading is considered to have improved as restrictions have eased.

The analyst estimates 1H22 guidance implies earnings (EBIT) are down around -4% on the previous corresponding period. The broker lowers its FY22-24 EPS forecasts by -14%, -7.3% and -5.5%, respectively, and lowers its target price to $40 from $41.50.

The Neutral rating is maintained and Macquarie expects efficiency to improve over Q3 after a return to a more sustainable operating environment.

Target price is $40.00 Current Price is $37.45 Difference: $2.55
If WOW meets the Macquarie target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $37.14, suggesting downside of -0.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: -0.2

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

Morgans rates WOW as Hold (3) -

Morgans assesses Woolworths Group's trading update was disappointing after significantly higher covid costs far outweighed slightly-better than-expected Australian Food sales growth in the 1H22. The target price slips to $36.65 from $37.85 and the Hold rating is unchanged.

The analyst keeps FY23 and FY24 earnings forecasts broadly unchanged after assuming a reversion to more normal trading conditions. The long-term fundamentals of the business are considered to remain sound.

Target price is $36.65 Current Price is $37.45 Difference: minus $0.8 (current price is over target).
If WOW meets the Morgans target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $37.14, suggesting downside of -0.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: -0.2

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

Ord Minnett rates WOW as Accumulate (2) -

Ord Minnett reduces its FY22-24 EPS forecasts for Woolworths by -14.9%, -5.1% and -3.6%, respectively, following a trading update that revealed cost growth of 7.8% in 1H22, leading to a margin decline of -75bps.

Management attributed the rise in costs to a combination of online mix, digital investment, indirect covid costs and tobacco excise. The analyst expects costs will moderate in FY23. The target price falls to $41 from $43 and the Accumulate rating is unchanged.

Target price is $41.00 Current Price is $37.45 Difference: $3.55
If WOW meets the Ord Minnett target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $37.14, suggesting downside of -0.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: -0.2

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

UBS rates WOW as Sell (5) -

Woolworths has revealed at a trading update that costs associated with covid -- direct and indirect store costs, and distribution centre disruption costs have significantly hit supermarket earnings, while lockdowns impacted on Big W.

This on top of investment in e-commerce. The majority of these costs will pass, UBS notes, but food costs will extend into the second half and e-commerce investment is ongoing.

Food inflation will provide support but only if it can be passed on, while online sales are lower margin and increasing to replace in-store shopping. The stall in population growth is a "silent" headwind as well, UBS notes. Sell retained, target falls to $35 from $37.

Target price is $35.00 Current Price is $37.45 Difference: minus $2.45 (current price is over target).
If WOW meets the UBS target it will return approximately minus 7% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $37.14, suggesting downside of -0.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: -0.2

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