Australian Broker Call

Citi rates AKE as Buy (1) -

Allkem has delivered strong December-quarter production figures, which have aligned with record lithium prices.

UBS expects the company will benefit from record spot prices, as production falls shy of demand.

The company reports US$426.5m in cash ($120m being held for completion of projects and expansion of debt facilities). December-quarter cash flow was strong.

Buy rating retained. Target price rises to $13.40 from $12.

Target price is $13.40 Current Price is $11.61 Difference: $1.79
If AKE meets the Citi target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $12.29, suggesting upside of 13.7% (ex-dividends)

The company's fiscal year ends in December.

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

Credit Suisse rates AKE as Outperform (1) -

Credit Suisse has issued another spodumene price increase through to 2023, noting Allkem suggests further upside risk to the broker's forecasts given high spot pricing.

With a cheaper priced contract set to complete in the June quarter, the broker expects Allkem prices to accelerate towards record spot prices in the December half. Elsewhere, covid impacts have pushed the Sal de Vida startup back six months to the first half of 2023.

The Outperform rating is retained and the target price increases to $13.70 from $13.20.

Target price is $13.70 Current Price is $11.61 Difference: $2.09
If AKE meets the Credit Suisse target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $12.29, suggesting upside of 13.7% (ex-dividends)

The company's fiscal year ends in December.

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

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

The team at Orocobre, now known as Allkem, surprised Morgan Stanley by negotiating a better-than-expected royalty outcome with the government of Argentina.

The quarterly production update itself contained various misses starting with realised pricing guidance for the June half below the broker's forecast; US$20,000/t versus US$22,395/t.

Production at Olaroz also missed the forecast while capex guidance has increased for Stage 2.

Equal-weight rating retained. Price target $9.80. Industry view is Attractive.

Target price is $9.80 Current Price is $11.61 Difference: minus $1.81 (current price is over target).
If AKE meets the Morgan Stanley target it will return approximately minus 16% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $12.29, suggesting upside of 13.7% (ex-dividends)

The company's fiscal year ends in December.

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

Ord Minnett rates AKE as Downgrade to Accumulate from Buy (2) -

Ord Minnett finds Allkem released a strong quarterly production report with costs at both Olaroz and Mt Cattlin falling quarter-on-quarter.

Among the negatives, more capex will be spend on Olaroz Stage 2 and Sal de Vida has been delayed by a further six months.

Favourable conditions for lithium have triggered a further rise in the broker's price target for the stock; to $12.50 from $12. The recommendation is downgraded to Accumulate from Buy, on consideration of valuation.

Target price is $12.50 Current Price is $11.61 Difference: $0.89
If AKE meets the Ord Minnett target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $12.29, suggesting upside of 13.7% (ex-dividends)

The company's fiscal year ends in December.

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

Credit Suisse rates ALD as Neutral (3) -

Credit Suisse notes a strong refinery result for Ampol in the December quarter with a material improvement in the Lytton Refiner Margin to US$11.24 per barrel from US$6.76 per barrel in the previous quarter, as well as a slight production forecast beat.

Elsewhere, data suggests travel recovery has been slower than expected but retail margins better than expected, a trend which looks to be continuing into early January. Forecasts are upgraded around 3% for FY21 and 1% for FY22 and FY23.

The Neutral rating is retained and the target price increases to $30.03 from $29.53.

Target price is $30.03 Current Price is $31.27 Difference: minus $1.24 (current price is over target).
If ALD meets the Credit Suisse target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $33.34, suggesting upside of 7.1% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.7

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

Morgan Stanley rates ALD as Overweight (1) -

Ampol's Q4 update on its Lytton Refinery performance has now pushed the average refiner margin thus far above Morgan Stanley's forecast; US$9/bbl for 2H21 versus US$8/bbl.

The broker hasn't penciled it in, but seriously considers the average could well rise to US$10/bbl in 2022, which would imply 15% upside to its current EPS forecast.

Overweight rating retained. Price target $35. Industry view Attractive.

Target price is $35.00 Current Price is $31.27 Difference: $3.73
If ALD meets the Morgan Stanley target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $33.34, suggesting upside of 7.1% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.7

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

UBS rates ALD as Buy (1) -

At a glance, Ampol has delivered a strong fourth quarter trading update thanks to a strong finish from Lytton, outpacing both UBS and consensus forecasts.

UBS says Lytton improved utilisation, positioning it to scoop up strong regional gasoline and diesel margins as demand accelerated.

The broker expects improving consumer sentiment toward travel, despite omicron, augurs well for the company, and expects Australian fuel demand should return to 2019 levels in 2024, suggesting scope for upside surprises.

EPS forecasts rise 1% to 4% across FY21 to FY23 to reflect rising refining margins.

Buy rating retained. Target price rises 2% to $35.

Target price is $35.00 Current Price is $31.27 Difference: $3.73
If ALD meets the UBS target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $33.34, suggesting upside of 7.1% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.7

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

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

Morgan Stanley has done the numbers and it turns out futures volumes for the ASX remain well below the peak witnessed in March 2020. Today's averages are equally below the broker's forecast.

The ASX is yet to benefit from the prospect of higher rates, concludes the broker.

Equal-weight rating retained. Price target $75.90. Industry view In-Line.

Target price is $75.90 Current Price is $91.65 Difference: minus $15.75 (current price is over target).
If ASX meets the Morgan Stanley target it will return approximately minus 17% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $80.70, suggesting downside of -10.1% (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

Credit Suisse rates BKL as Outperform (1) -

In a preview of Blackmores first half results, Credit Suisse notes Australia & New Zealand revenues are expected to be down on the previous corresponding period, but the broker expects further progression towards a targeted $250-300m in sales growth by FY24 (ambitious indeed).

Credit Suisse also anticipates weak cash flow given the company has indicated increased inventory investment in preparation for growth in Asia, with the broker anticipating over 20% revenue growth from China in the first half and International up 10-15%. 

The Outperform rating and target price of $100 are retained.

Target price is $100.00 Current Price is $83.12 Difference: $16.88
If BKL meets the Credit Suisse target it will return approximately 20% (excluding dividends, fees and charges).

Current consensus price target is $89.40, suggesting upside of 8.5% (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 CAR as Downgrade to Lighten from Hold (4) -

Ord Minnett is of the view this month's correction in share prices has opened up an excellent opportunity to enter the highest-quality classified names on the ASX.

Alas, the broker sees too much uncertainty on the longer-term horizon for Carsales with the traditional model potentially coming under threat from car dealers (agency model) and new competitors (digital retailers).

Carsales has been downgraded to Lighten from Hold. Price target $20.60 from $22 previously.

Target price is $20.60 Current Price is $22.92 Difference: minus $2.32 (current price is over target).
If CAR meets the Ord Minnett target it will return approximately minus 10% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $24.61, suggesting upside of 10.3% (ex-dividends)

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 DHG as Hold (3) -

Ord Minnett is of the view this month's correction in share prices has opened up an excellent opportunity to enter the highest-quality classified names on the ASX.

For Domain Holdings, the rating remains Hold, while the price target increases to $5.05 from $4.80.

Target price is $5.05 Current Price is $5.12 Difference: minus $0.07 (current price is over target).
If DHG meets the Ord Minnett target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $5.53, suggesting upside of 9.3% (ex-dividends)

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.4

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

Morgans rates DTL as Add (1) -

While Morgans estimates a 10% upgrade to first half profit (PBT) guidance by Data#3, the broker only upgrades forecasts by around 3% to allow for ongoing chip and supply chain challenges. This is considered conservative as recent history suggests a stronger second half.

The analyst lifts the target price to $6.46 from $6.28 and notes impressive organic growth of 30% year-on-year. The Add rating is maintained. More detail is expected upon the release of 1H results on February 17.

Target price is $6.46 Current Price is $6.65 Difference: minus $0.19 (current price is over target).
If DTL meets the Morgans target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).

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

Morgans rates GQG as Add (1) -

Morgans undertakes a mark-to-market exercise for its forecasts for stocks under coverage in the Financial Services sector.

There are only minor changes to forecasts for GQG Partners, which is the broker's preferred sector pick due to earnings quality, growth potential and a compelling valuation versus current flows momentum.

The Add rating and $2.40 target price are unchanged.

Target price is $2.40 Current Price is $1.80 Difference: $0.6
If GQG meets the Morgans target it will return approximately 33% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

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

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

Above-trend household goods demand has continued in the second quarter based on industry trading updates, and Credit Suisse has increased Harvey Norman Holdings' first half forecasts accordingly. 

The broker now expects the Australian region to achieve -6% year-on-year comparable store sales, up from -9%. Company updates suggested comparable store sales were down -11% year-on-year to late November but the broker expects sales growth acceleration. 

Given a lagging share price compared to peers and potential earnings upgrades Credit Suisse upgrades its rating on Harvey Norman Holdings. The rating is upgraded to Outperform from Neutral and the target price increases to $5.62 from $5.61.

Target price is $5.62 Current Price is $5.05 Difference: $0.57
If HVN meets the Credit Suisse target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $6.08, suggesting upside of 16.8% (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

Ord Minnett rates IAG as Buy (1) -

Insurance Australia Group is scheduled to release interim financials on February 11th. Ord Minnett has raised its price to $5.45 from $5.35 ahead of the event, while retaining its Buy recommendation.

Looking further out, the broker reminds investors management at the insurer has an aspirational target of 1m new customers over five years, which translates to growth of 2.2% per annum.

The insurer has also said it would conduct a capital return this year if business interruption rulings remained favourable. Ord Minnett seems confident that market sentiment towards the insurer will improve.

Short-term estimates have been slightly reduced.

Target price is $5.45 Current Price is $4.44 Difference: $1.01
If IAG meets the Ord Minnett target it will return approximately 23% (excluding dividends, fees and charges).

Current consensus price target is $5.05, suggesting upside of 13.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.4

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

Citi rates JBH as Neutral (3) -

JB Hi-Fi's December first-half trading update outpaced consensus and Citi, Good Guys proving the standout performer in a strong field.

Citi believes the second-half outlook will hinge on omicron's progression, expecting weaker second half trading updates when the first-half results land; but expects the market will look through the peak covid period and demand should bounce in the June quarter. 

The broker also spies room for an off-market buyback of at least $330m to unlock the company's franking credits balance.

Citi upgrades earnings 10.5% in FY22, 3.5% in FY23 and 0% in FY24.

Neutral rating retained. Target price steady at $54.

Target price is $54.00 Current Price is $49.84 Difference: $4.16
If JBH meets the Citi target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $54.88, suggesting upside of 12.0% (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

Credit Suisse rates JBH as Outperform (1) -

Credit Suisse notes an assumed normalisation for JB Hi-Fi continues to be pushed back following strong sales recovery in the second half, driving upgrades to FY23 forecasts.

The omicron variant also offers upside risk to household goods spending and an FY23 earnings upgrade may be on the cards.

It was noted that industry stock positions were tight which could have impacted on results in the first half. Credit Suisse expects supply pressure to continue into the second half. 

The Outperform rating is retained and the target price increases to $58.80 from $55.86.

Target price is $58.80 Current Price is $49.84 Difference: $8.96
If JBH meets the Credit Suisse target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $54.88, suggesting upside of 12.0% (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

Morgans rates JBH as Add (1) -

JB Hi-Fi yesterday revealed preannounced first half earnings (EBIT) that were 17% above Morgans forecast and 16% above consensus. 

The broker considers the result was positive in terms of sales and margin and according to management reflected heightened demand for consumer electronics and home appliance products.

Morgans lifts its FY22 sales and earnings forecasts by 4.2% and 10.3%, respectively. The target rises to $57 from $54. Add rating.

Target price is $57.00 Current Price is $49.84 Difference: $7.16
If JBH meets the Morgans target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $54.88, suggesting upside of 12.0% (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 JBH as Buy (1) -

Ord Minnett points out The Good Guys drove the positive surprise for JB Hi-Fi, relative to the broker's forecasts, likely through operating leverage and gross margin expansion.

The stock remains Ord Minnett's preferred exposure within retail due to the demand tailwinds from housing and work from home, online profitability and limited supply chain risks. The target price rises to $56 from $54 and the Buy rating is maintained.

Target price is $56.00 Current Price is $49.84 Difference: $6.16
If JBH meets the Ord Minnett target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $54.88, suggesting upside of 12.0% (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

UBS rates JBH as Neutral (3) -

At a glance, JB Hi-Fi's December first-half result outpaced consensus and UBS by a strong clip, thanks to strong demand for consumer electronics and home appliances.

Earnings (EBITDA) were 10% above consensus and 25% above UBS estimates.

The broker highlights reopening tailwinds, broader momentum and a 13.7% uptick in online growth; and an increase in EBIT margins given tight product supply.

EPS forecasts rise 22% in FY22, 5% in FY23, and 2% in FY24. 

Neutral rating retained. Target rises to $51 from $50.

Target price is $51.00 Current Price is $49.84 Difference: $1.16
If JBH meets the UBS target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $54.88, suggesting upside of 12.0% (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

Morgan Stanley rates LLC as Underweight (5) -

Shareholders in Lendlease have had a challenging time of late, and Morgan Stanley still thinks it's too early to get overly optimistic about the company's future.

It seems general consensus remains confident about management's FY24 return targets being achieved, but the broker is not so sure, instead zooming in on the many risks that are lurking on the horizon.

The upcoming interim result could well be "optically weak", posits the broker. Morgan Stanley prefers to remain cautious at this stage.

Underweight rating and target of $11.40 are both retained. Industry view is In-Line.

Target price is $11.40 Current Price is $10.63 Difference: $0.77
If LLC meets the Morgan Stanley target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $12.69, suggesting upside of 20.8% (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

Morgans rates MFG as Hold (3) -

Morgans undertakes a mark-to-market exercise for its forecasts for stocks under coverage in the Financial Services sector.

While Magellan Financial Group's valuation looks attractive to the broker, a Hold rating is maintained pending more confidence around the funds under management and fee base metrics. The target price is $24.73.

Target price is $24.73 Current Price is $19.98 Difference: $4.75
If MFG meets the Morgans target it will return approximately 24% (excluding dividends, fees and charges).

Current consensus price target is $25.04, suggesting upside of 26.5% (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

UBS rates NTO as Buy (1) -

UBS notes that Nitro Software has lost more than -$300m in market capitalisation since its Connective acquisition as concerns bloom over PDF/e-sign sales heading into 2022 (competitor Docusign is down -44% after posting a disappointing third quarter, and Adobe's growth also slowed) and partly due to the rotation out of tech stocks.

But the broker remains a believer, particularly in the e-sign market which should sharply strengthen the company's moat, and that Nitro should be less impacted than competitors given its focus on new customers and regions.

UBS notes that Connective has revenue of US$7m in an immature market estimated at US$2.5bn and is growing swiftly.

Buy rating retained. Target price falls to $3.80 from $4.70 to reflect the broader tech de-rating.

Target price is $3.80 Current Price is $2.17 Difference: $1.63
If NTO meets the UBS target it will return approximately 75% (excluding dividends, fees and charges).

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: 1.0

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

Morgans rates PDL as Add (1) -

Morgans undertakes a mark-to-market exercise for its forecasts for stocks under coverage in the Financial Services sector.

The broker lowers FY23 and FY24 forecasts for Pendal Group on lower funds under management expectations and reduces its target price to $6.85 from $7.80. The Add rating is maintained as the stock is considered oversold.

Target price is $6.85 Current Price is $5.36 Difference: $1.49
If PDL meets the Morgans target it will return approximately 28% (excluding dividends, fees and charges).

Current consensus price target is $7.78, suggesting upside of 43.2% (ex-dividends)

The company's fiscal year ends in September.

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

Morgans rates PNI as Hold (3) -

Morgans undertakes a mark-to-market exercise for its forecasts for stocks under coverage in the Financial Services sector.

The broker sees value starting to re-emerge for Pinnacle Investment Management and maintains its Hold rating. There's considered potential near-term upside from acquisitions. The target price slips to $15.80 from $17.20.

Target price is $15.80 Current Price is $13.11 Difference: $2.69
If PNI meets the Morgans target it will return approximately 21% (excluding dividends, fees and charges).

Current consensus price target is $16.40, suggesting upside of 30.2% (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 RBL as Downgrade to Equal-weight from Overweight (3) -

It's by no means an exaggeration to state Morgan Stanley has been a fervent supporter of the investment thesis for Redbubble. Yesterday's profit warning by the company has now triggered a downgrade to Equal-weight from Overweight.

Higher competition and rising costs are hampering the company and the broker sees both issues persisting for longer. Visibility is now replaced with a more clouded outlook, the analysts acknowledge.

A strong balance sheet is seen as somewhat of a protection to the downside, as far as the share price goes. Price target tumbles to $2.65 from $6.50. Ouch! Industry view: In-Line.

Estimates have now reversed back into negative territory for the years ahead (meaning: losses, not profits on the horizon).

Target price is $2.65 Current Price is $2.32 Difference: $0.33
If RBL meets the Morgan Stanley target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $3.23, suggesting upside of 48.2% (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

Morgans rates RBL as Add (1) -

Redbubble's revised FY22 guidance was well below Morgans and consensus estimates due to larger-than-anticipated costs.

After slashing earnings (EBITDA) estimates, the broker lowers its target price to $3.59 from $4.84 though retains its Add rating after recent share price declines.

Management attributed gross margin slippage to higher shipping costs and a change in product mix toward apparel away from masks.

Target price is $3.59 Current Price is $2.32 Difference: $1.27
If RBL meets the Morgans target it will return approximately 55% (excluding dividends, fees and charges).

Current consensus price target is $3.23, suggesting upside of 48.2% (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

UBS rates RBL as Neutral (3) -

Redbubble's December first-half trading update slightly outpaced UBS forecasts at the top line but disappointed at the earnings level, falling -7% shy due to weaker margins.

Stronger competition bred stronger promotional spend - hence the margin hit.

The company downgrades near-term guidance but retains medium-term expectations.

Neutral rating retained. Target price steady at $3.45.

Target price is $3.45 Current Price is $2.32 Difference: $1.13
If RBL meets the UBS target it will return approximately 49% (excluding dividends, fees and charges).

Current consensus price target is $3.23, suggesting upside of 48.2% (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 REA as Upgrade to Buy from Hold (1) -

Ord Minnett is of the view this month's correction in share prices has opened up an excellent opportunity to enter the highest-quality classified names on the ASX.

Hence, the broker upgrades REA Group to Buy from Hold with a fresh price target of $165, up from $145 previously.

Target price is $165.00 Current Price is $154.44 Difference: $10.56
If REA meets the Ord Minnett target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $174.17, suggesting upside of 13.5% (ex-dividends)

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.4

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

Citi rates RIO as Buy (1) -

Rio Tinto's December-quarter production figures broadly met the broker, iron ore marginally lower than UBS forecast.

Management has guided to a strong year for all commodities but covid-inspired costs continue to bite and mining approvals are slowing.

After shuffling through commodity price and shipment adjustments, the broker retains a Buy rating and $115 target price.

Target price is $115.00 Current Price is $109.65 Difference: $5.35
If RIO meets the Citi target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $107.57, suggesting downside of -2.1% (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

Credit Suisse rates RIO as Outperform (1) -

A marginally soft performance in the December quarter closed out the lowest volume year for Rio Tinto since 2015 according to Credit Suisse, with iron ore shipments totaling 319.7m tonnes.

Rio Tinto is now guiding to 2022 iron ore shipment of 320-335m tonnes, but Credit Suisse remains conservative with a 320m tonne forecast given the risk of the upcoming WA hard border opening to increase labour issues.

Profit after tax forecasts decrease -0.9% and -2.4% in 2021 and 2022 respectively, accounting for softer copper and aluminium production. 

The Outperform rating is retained and the target price increases to $110.00 from $109.65.

Target price is $110.00 Current Price is $109.65 Difference: $0.35
If RIO meets the Credit Suisse target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $107.57, suggesting downside of -2.1% (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) -

Morgan Stanley found Rio Tinto's Q4 production performance was in-line with EBITDA actually slightly ahead because of iron ore quotational pricing.

Guidance for 2022 implies revenues might be impacted but not by more than is already anticipated, argues the broker. Copper is the stand-out in a negative sense (production-wise).

Overweight rating. Target price $109. Industry view: Attractive.

Target price is $109.00 Current Price is $109.65 Difference: minus $0.65 (current price is over target).
If RIO meets the Morgan Stanley target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $107.57, suggesting downside of -2.1% (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

Morgans rates RIO as Hold (3) -

While maintaining a Hold rating, Morgans is highly cautious in the near-term after a disappointing operational result from Rio Tinto. Again, Pilbara iron ore was considered to underperform and 2022 guidance was lower than consensus estimates in most segments.

The analyst laments the lack of consistent reinvestment in the iron ore business which puts the company behind schedule for critical mine replacements. Also, increased sales of low-grade ore were used to achieve 2021 guidance, assesses the broker.

The target price falls to $102 from $104 and the Hold rating is unchanged.

Target price is $102.00 Current Price is $109.65 Difference: minus $7.65 (current price is over target).
If RIO meets the Morgans target it will return approximately minus 7% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $107.57, suggesting downside of -2.1% (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

Ord Minnett rates RIO as Hold (3) -

Rio Tinto's December quarter production report was mostly in-line, comments Ord Minnett, but copper provided some disappointment and management is anticipating difficulties across a number of projects in the year ahead.

The broker remains of the view that iron ore prices will be weaker over coming months, having surprised on the upside thus far. Supply from Brazil is expected to pick-up while Chinese restocking is coming to an end is the argument.

Ord Minnett is working off an average iron ore price of US$92/t for 2022 (forecast by JP Morgan). Target price $102. Hold.

Target price is $102.00 Current Price is $109.65 Difference: minus $7.65 (current price is over target).
If RIO 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 $107.57, suggesting downside of -2.1% (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) -

At a glance, Rio Tinto's fourth-quarter update fell shy of UBS' estimates, as did guidance - Pilbara shipments, aluminium and mined copper all missing consensus forecasts.

Delays at Gudai-Darri, Kitimat and Jadar added to the malaise, although the company reports progress at Simandou and Oyu Tolgoi.

High iron-ore prices continue to benefit the producer but UBS says 2022 iron-ore guidance disappointed, shipments, and grades both deteriorating, as did aluminium. The picture for copper was better, UBS expecting the metal will partly offset declines in iron ore and aluminium.

EPS forecasts fall -2% and -3% for FY21 and FY22.

Sell rating retained, UBS believing the iron-ore price risk is to the downside. Target price steady at $80.

Target price is $80.00 Current Price is $109.65 Difference: minus $29.65 (current price is over target).
If RIO meets the UBS target it will return approximately minus 27% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $107.57, suggesting downside of -2.1% (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

Ord Minnett rates SEK as Upgrade to Accumulate from Hold (2) -

Ord Minnett is of the view this month's correction in share prices has opened up an excellent opportunity to enter the highest-quality classified names on the ASX.

Hence, Seek is upgraded to Accumulate from Hold, while the price target climbs to $34 from $31.

Target price is $34.00 Current Price is $29.87 Difference: $4.13
If SEK meets the Ord Minnett target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $35.65, suggesting upside of 17.7% (ex-dividends)

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

Morgan Stanley rates TPW as Overweight (1) -

Morgan Stanley has been supportive of Temple & Webster for quite a while and this time the broker has singled out the company as one of its conviction calls ahead of the February reporting season.

In the broker's own words, this is the preferred online migration story.

Part of the attraction is a share price that has lost more than -25% in six months, with the positive thesis underpinned by category tailwinds, a dominant market position, attractive model, margin upside and leadership track record.

Overweight rating. Target price of $16.25. Industry view: In-Line.

Target price is $16.25 Current Price is $9.13 Difference: $7.12
If TPW meets the Morgan Stanley target it will return approximately 78% (excluding dividends, fees and charges).

Current consensus price target is $14.11, suggesting upside of 71.2% (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