Australian Broker Call

UBS rates AQG as Buy (1) -

UBS believes Gediktepe adds options to the Alacer Gold story now the Copler sulphide project is under construction. The broker expects investors will be drawn to the 150,000 ozs gold equivalent production profile and it will complement Copler.

UBS adds a risk-adjusted 55c per share for Gediktepe and raises the target to $5.40 from $5.20. The broker maintains a Buy rating.

Target price is $5.40 Current Price is $3.59 Difference: $1.81
If AQG meets the UBS target it will return approximately 50% (excluding dividends, fees and charges).

Current consensus price target is $4.36, suggesting upside of 21.4% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY16:

Forecast for FY17:

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 ASB as Outperform (1) -

Austal has been awarded a US$434m contract in the US for two more expeditionary fast transport vessels, adding to a block order for an original ten. This extends the production schedule to 2022, the broker notes.

Given its solid balance sheet, Austal retains plenty of scope to bid for further US or Australian contracts, the broker notes. Outperform and $1.56 target retained.

Target price is $1.56 Current Price is $1.53 Difference: $0.035
If ASB meets the Macquarie target it will return approximately 2% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY17:

Forecast for FY18:

Market Sentiment: 0.8

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

Morgans rates EVN as Add (1) -

The company has revised its production outlook following the acquisition of a 30% economic interest in copper and silver production and 100% of the gold credits from Glencore's Ernest Henry and after the sale of Pajingo.

With revised production guidance and incorporating spot prices and exchange rates Morgans reduces the target to $2.71 from $2.82. Add rating retained.

Target price is $2.71 Current Price is $2.34 Difference: $0.37
If EVN meets the Morgans target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $2.71, suggesting upside of 16.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Forecast for FY18:

Market Sentiment: 0.7

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

Macquarie rates GMA as Outperform (1) -

Genworth's contract with the Commonwealth Bank ((CBA)) expires at year-end, representing 45% of the company's gross written premium. The broker expects a renewal decision during the Dec quarter and expects Genworth to retain the CBA contract.

Were this not to be the case there would likely be a negative market reaction but the broker would see this as a buying opportunity. Outperform and $3.98 target retained.

Target price is $3.98 Current Price is $2.92 Difference: $1.06
If GMA meets the Macquarie target it will return approximately 36% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

Forecast for FY16:

Forecast for FY17:

Market Sentiment: 0.5

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

Citi rates JHX as Neutral (3) -

Citi analysts returned from the company's annual investor visit to the US operations with the notion management is demonstrating and acknowledging the challenges of being a high growth enterprise.

No changes made to estimates or $20.80 price target. With the share price not that far off, the rating remains Neutral. Citi also reports management reiterated guidance for FY17 underlying net profits to be in the range of US$260-290m.

Target price is $20.80 Current Price is $20.82 Difference: minus $0.02 (current price is over target).
If JHX meets the Citi target it will return approximately minus 0% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $21.84, suggesting upside of 4.9% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY17:

Forecast for FY18:

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 JHX as Outperform (1) -

Credit Suisse found management's presentations detailed and suggests the cycle is still in a strong tailwind. The main identifiable risk is around new capacity and the potential ramp up in inefficiencies.

FY17 outlook is unchanged and the broker does not expect the seasonal margin slowdown as tight utilisation will warrant additional inventory build.

Credit Suisse considers the fundamentals support a rating agency review with potential to upgrade to investment grade in the next 12 months. Outperform retained. Target is $22.70.

Target price is $22.70 Current Price is $20.82 Difference: $1.88
If JHX meets the Credit Suisse target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $21.84, suggesting upside of 4.9% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY17:

Forecast for FY18:

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

Deutsche Bank rates JHX as Buy (1) -

The analysts briefing provided no change to FY17 guidance but Deutsche Bank notes, for fibre cement to achieve a 35% target share of the siding market, management now has stated an 8% primary demand growth target per annum.

Deutsche Bank calculates, on this basis, the company would achieve the target by FY25. The broker's Buy rating and $22.43 target are retained.

Target price is $22.43 Current Price is $20.82 Difference: $1.61
If JHX meets the Deutsche Bank target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $21.84, suggesting upside of 4.9% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY17:

Forecast for FY18:

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 JHX as Lighten (4) -

After the investor presentations in the US, Ord Minnett remains of the view that the company will continue to roll out brownfield capacity expansion and deliver strong volume and earnings growth.

Still, this will not come without significant investment. Lighten rating and $18.60 target retained.

Target price is $18.60 Current Price is $20.82 Difference: minus $2.22 (current price is over target).
If JHX meets the Ord Minnett target it will return approximately minus 11% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $21.84, suggesting upside of 4.9% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY17:

Forecast for FY18:

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 NHC as Downgrade to Hold from Add (3) -

Morgans revises forecasts slightly to account for higher coal prices ahead of the results. Uncertainty around Acland stage 3 is the main sticking point for investors, the broker observes.

Rating is downgraded to Hold from Add rating, given the uncertainty and the potential valuation impact should approval not be secured. Target is reduced to $1.60 from $1.68.

Target price is $1.60 Current Price is $1.57 Difference: $0.03
If NHC meets the Morgans target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $1.52, suggesting downside of -3.4% (ex-dividends)

The company's fiscal year ends in July.

Forecast for FY16:

Forecast for FY17:

Market Sentiment: -0.3

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

Morgans rates NUF as Hold (3) -

Morgans expects top line growth to be fairly flat when FY16 results are reported. The broker adjusts estimates to account for higher interest expense.

The Australian result is expected to disappoint but most other regions are expected to post solid results.  Morgans considers the stock fairly valued but also warranting corporate appeal. Hold rating retained. Target rises to $8.60 from $8.05.

Target price is $8.60 Current Price is $8.25 Difference: $0.35
If NUF meets the Morgans target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $8.01, suggesting downside of -1.1% (ex-dividends)

The company's fiscal year ends in July.

Forecast for FY16:

Forecast for FY17:

Market Sentiment: 0.1

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

Ord Minnett rates NUF as Hold (3) -

Ahead of the FY16 results, Ord Minnett suspects unfavourable weather effects are likely to be more than offset by the performance improvement program. This is expected to result in an 8.6% uplift in FY16 EBIT.

Ord Minnett retains a Hold rating and raises the target to $8.20 from $7.80.

Target price is $8.20 Current Price is $8.25 Difference: minus $0.05 (current price is over target).
If NUF 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 $8.01, suggesting downside of -1.1% (ex-dividends)

The company's fiscal year ends in July.

Forecast for FY16:

Forecast for FY17:

Market Sentiment: 0.1

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

Credit Suisse rates OGC as Underperform (5) -

The exploration update has delivered positive results, demonstrating to Credit Suisse that the underground opportunity at Haile is likely to be better than previously expected.

The broker believes exploration will potentially grow value over time but value is already attributed from production assumed from exploration success. Underperform rating is retained. Target is $4.40.

Target price is $4.40 Current Price is $4.39 Difference: $0.01
If OGC meets the Credit Suisse target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $4.15, suggesting downside of -9.8% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY16:

Forecast for FY17:

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 QAN as Overweight (1) -

Morgan Stanley observes demand was flat in July, although strong capacity management likely indicates a return to yield growth. Nevertheless, the broker believes a meaningful re-rating is probably a 12-month story.

The broker still envisages sustainable cash flow from the domestic business is undervalued. Morgan Stanley retains an Overweight rating and Attractive Industry view. Target is $4.30.

Target price is $4.30 Current Price is $3.21 Difference: $1.09
If QAN meets the Morgan Stanley target it will return approximately 34% (excluding dividends, fees and charges).

Current consensus price target is $4.53, suggesting upside of 41.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Forecast for FY18:

Market Sentiment: 1.0

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

Morgans rates RFG as Hold (3) -

FY16 results were in line with guidance, supported by acquisitions which Morgans notes accounted for 41.5% of EBITDA. The company has also acquired Hudson Pacific Corp, a food distribution and bakery manufacturing business.

While Morgans finds the stock has benefits from becoming more vertically integrated, the addition of manufacturing and distribution adds complexity. As a result the broker remains somewhat wary of the reliance on acquisitive growth.

Hold maintained. Target rises to $6.65 from $5.00.

Target price is $6.65 Current Price is $7.00 Difference: minus $0.35 (current price is over target).
If RFG meets the Morgans target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $5.75, suggesting downside of -18.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Forecast for FY18:

Market Sentiment: -0.3

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

Citi rates STO as Buy (1) -

Citi analysts believe ongoing market speculation about potentially another capital raising are likely to prove misguided. Citi analysts believe management has plenty of levers it can pull to bring down the oil price at which the company can survive to US$34/bbl.

There is also still the option of making the balance sheet bulletproof, suggest the analysts, through hedging. Citi thinks the upcoming December Strategy Day might turn into a positive catalyst with management having the opportunity to better explain what's going on and what are the plans currently in motion.

Target loses 2c to $6.13. Buy rating retained.

Target price is $6.13 Current Price is $3.48 Difference: $2.65
If STO meets the Citi target it will return approximately 76% (excluding dividends, fees and charges).

Current consensus price target is $5.17, suggesting upside of 48.5% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY16:

Forecast for FY17:

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

UBS rates STO as Upgrade to Buy from Neutral (1) -

The share price has significantly underperformed the oil price and peers since the results.

UBS attributes this to a lack of firm guidance on cost reductions, concerns around GLNG and reserves as well as disclosure by the company's largest shareholder that it has been asked by the Shanghai Stock Exchange to justify its investment.

The broker's analysis downgrades the value of GLNG on risks around reserves and notes the credit rating is in the spotlight. UBS believes Santos will fall short of the multiples needed to justify an investment grade credit rating.

The stock remains one of the most leveraged to the oil price movement and, after the recent share price decline, the broker upgrades to Buy from Neutral. Target falls to $4.50 from $4.90.

Target price is $4.50 Current Price is $3.48 Difference: $1.02
If STO meets the UBS target it will return approximately 29% (excluding dividends, fees and charges).

Current consensus price target is $5.17, suggesting upside of 48.5% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY16:

Forecast for FY17:

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

UBS rates WOW as Sell (5) -

UBS does not believe the market has a clear view on what a turnaround would look like other than to assume that if it is successful it will drive upside.

The broker considers the outlook is uncertain and market growth benign, while competition is high and margins declining. Against this background UBS is cautious and considers the market expectations are optimistic.

For this reason and because competitors are likely to react if momentum accelerates further, UBS retains a Sell rating and $19.30 target.

Target price is $19.30 Current Price is $22.52 Difference: minus $3.22 (current price is over target).
If WOW meets the UBS target it will return approximately minus 14% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $21.21, suggesting downside of -5.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Forecast for FY18:

Market Sentiment: -0.6

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