Australian Broker Call

Citi rates A2M as Sell (5) -

Citi cuts FY21-FY23 profit (NPAT) estimates by -11% to -57% accounting for management's revised guidance. The new target price is $5.85 from $7.15, due to earnings changes and lower market multiples. The Sell rating is maintained.

The analyst sees the -$80-$90m inventory write down as sensible. The removal of excess stock should help restore product scarcity, which was one of the key ingredients for the company’s historical success, explains Citi.

The broker sees downside risk to medium-to-long term margins given the company appears likely to increase its focus on the China offline channel. It's considered investment will need to increase to attempt to compete against larger domestic and foreign players.

Target price is $5.85 Current Price is $6.10 Difference: minus $0.25 (current price is over target).
If A2M meets the Citi target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $6.32, suggesting upside of 9.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: -0.3

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

Credit Suisse rates A2M as Underperform (5) -

Credit Suisse downgrades revenue forecast by -9-18% for a2 Milk over the forecast period.

In Credit Suisse's view, the main issues acknowledged by management were the impact on market growth by a decline in China's birth rate, consumers shifting toward domestic China brands, and the possibility that the retail daigou channel may not return to previous levels.

The broker thinks these trends will impede the strength of the sales recovery. 

Underperform rating with the target dropping to $5 from $7.15.

Target price is $5.00 Current Price is $6.10 Difference: minus $1.1 (current price is over target).
If A2M meets the Credit Suisse target it will return approximately minus 18% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $6.32, suggesting upside of 9.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: -0.3

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

Macquarie rates A2M as Downgrade to Underperform from Neutral (5) -

a2 Milk has reduced its FY21 guidance for the fourth time and expects revenue of $1.20-1.25bn for the financial year versus $1.40bn previously, -28-31% lower than last year. Macquarie expects the fourth quarter will be hit by insufficient improvement in pricing, sales and inventory.

Further, Macquarie notes excess inventory levels continue across daigou and cross-border e-commerce (CBEC) with a2 Milk now seeing issues with the China label. Also, a shift towards Chinese products continues with competition also increasing.

The broker believes the outlook remains uncertain and downgrades to Underperform from Neutral with the target falling to $5.60 from $9.75.

Target price is $5.60 Current Price is $6.10 Difference: minus $0.5 (current price is over target).
If A2M meets the Macquarie target it will return approximately minus 8% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $6.32, suggesting upside of 9.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: -0.3

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

Morgan Stanley rates A2M as Equal-weight (3) -

a2 Milk has downgraded its FY21 earnings guidance by circa -60%. Morgan Stanley highlights sales in April have been well below plan and the company's inventory review revealed higher than expected inventory and aging issues.

The China label business is also slowing down, notes Morgan Stanley, with revenue growing by only 5% in the third quarter. The broker notes since the August result, FY21 earnings guidance is down circa -77%, and a new CEO has not helped investor confidence.

The broker highlights while the board is currently reviewing potential buybacks to help provide some valuation support, the slowdown in China label products remains a concern.

 Equal-weight with the target reduced to $7.10 from $11. Industry view is Cautious.

Target price is $7.10 Current Price is $6.10 Difference: $1
If A2M meets the Morgan Stanley target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $6.32, suggesting upside of 9.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: -0.3

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

Morgans rates A2M as Add (1) -

Management has made another reduction to FY21 revenue guidance. This reflects the impact of lower than expected 4Q21 sales and further actions to rebalance the channel in May/June, explains Morgans.

A materially lower-than-expected margin guidance reflects the combination of the lower sales, as well as a stock provision of NZ$80-90m, details the analyst.

Morgans notes that a reversal of stock provisions alone would underpin significant earnings growth. The Hold rating is maintained. The target price is decreased to $6.65 from $8.34.

Target price is $6.65 Current Price is $6.10 Difference: $0.55
If A2M meets the Morgans target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $6.32, suggesting upside of 9.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: -0.3

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

UBS rates A2M as Buy (1) -

UBS assesses around 80% of management's profit warning relates to appropriate corrective action to tighten channel inventory and freshen product available in store and online.

The broker believes this should restore both the company's and channel inventory to healthy levels by 1QFY22. It's considered this will avoid brand damage and provide a platform for a solid English-label infant formula (IF) sales recovery between FY22 and FY24.

The Buy rating is maintained. The target is reduced to NZ$13.50 from NZ$15.50. UBS scenario analysis points to a share price range of $5.50-$17.00, with downside including no China IF recovery.

Current Price is $6.10. Target price not assessed.

Current consensus price target is $6.32, suggesting upside of 9.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: -0.3

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

UBS rates APE as Buy (1) -

UBS incorporates expectations of a continuation of buoyant conditions from the first half FY21 to until the end of 2021. This results from  the strongest April new car sales data on record, combined with ongoing supply issues driven by global semiconductor chip shortages.

The Buy rating and $16.45 target price are maintained, despite an increase of 15% in the FY21 EPS forecast. UBS leaves forecasts for FY22 and beyond unchanged.   

Target price is $16.45 Current Price is $14.75 Difference: $1.7
If APE meets the UBS target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $16.34, suggesting upside of 14.3% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.8

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

UBS rates ASG as Buy (1) -

Industry data and feedback suggests to UBS vehicle demand remains robust and supply tightness continues to support elevated pricing levels. UBS increases EPS forecasts for FY21-23 by 8%, 23% and 9%, respectively, and the target rises to $2.85 from $2.10. Buy rated.

The broker estimates year-to-date volumes are up 7% versus pre-covid levels. When combined with reduced discounting and the flow through benefits on holding cost/floorplan interest, it's considered to create strong operating conditions.

Target price is $2.85 Current Price is $2.40 Difference: $0.45
If ASG meets the UBS target it will return approximately 19% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

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

Citi rates BLD as Buy (1) -

Citi believes the nil premium offered in the Seven Group Holdings' ((SVW)) takeover proposal to acquire Boral at $6.50 will unlikely gain the support of Boral’s Board. It's considered another competing bid is also unlikely.

The bid is seen by the broker as an unconventional way to increase Seven Group's stake in Boral, with Seven Group ‘satisfied’ with an ending total interest of around 30% of Boral, from 23.18% currently. The Buy rating and $5.80 target are unchanged.

Target price is $5.80 Current Price is $6.50 Difference: minus $0.7 (current price is over target).
If BLD meets the Citi target it will return approximately minus 11% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $5.51, suggesting downside of -17.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

Morgan Stanley rates BLD as Overweight (1) -

Seven Group Holdings ((SGH)) announced an off-market takeover bid for Boral at $6.50 per share. The offer is expected to open on May 25 and run for one month.

With the bid in line with the current share price, Morgan Stanley expects limited take-up but also expects that it will put a floor under the share price at the bid level. The broker believes the stock should trade ahead of the bid in the near term.

Overweight rating reiterated with a target of $6.30. Industry view is in-line.

Target price is $6.30 Current Price is $6.50 Difference: minus $0.2 (current price is over target).
If BLD meets the Morgan Stanley target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $5.51, suggesting downside of -17.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

Ord Minnett rates BLD as Lighten (4) -

Seven Group ((SVW)) has made a nil-premium off-market takeover bid for Boral. Management noted it would be satisfied with a 30% stake, which would imply to Ord Minnett an increase in ownership of 6.8%. The Lighten rating and $5.50 target price are retained.

It appears to the broker that Seven Group could be targeting a third seat through the addition of a ninth Boral director. It's estimated a 30% stake in Boral could rise to 33% after the completion of Boral’s buyback program.

Seven Group’s 23.18% interest in Boral is “greater than 20%” and the creep provision (“no more than 3% every 6 months”) has been utilised to-date. Thus, the analyst notes the company has had to make the move of launching a takeover to increase the holding.

Separately, Ord Minnett performs an analysis on use of proceeds from a potential sale of both North American business units. A takeover of Adbri ((ABC)) would be an highly accretive use of funds, along with several other positives, concludes the broker.

Target price is $5.00 Current Price is $6.50 Difference: minus $1.5 (current price is over target).
If BLD meets the Ord Minnett target it will return approximately minus 23% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $5.51, suggesting downside of -17.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

Macquarie rates CWN as Neutral (3) -

Crown Resorts has received a merger proposal from Star Entertainment Group ((SGR)) along with a revised proposal from Blackstone.

Macquarie calculates the merger proposal from Star Entertainment implies a Crown Resorts valuation of around $14.50 per share considering $175m in synergies.

Even then there could be material upside from a sale and leaseback of the portfolio and better earnings across the portfolio, suggests the broker. To offer some context, Blackstone’s revised offer stands at $12.35 per share cash.

Macquarie thinks the Crown Resorts board will engage with Star Entertainment, considering the value creation.

Neutral rating with the target rising to $12.90 from $10.90.

Target price is $12.90 Current Price is $13.00 Difference: minus $0.1 (current price is over target).
If CWN meets the Macquarie target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $11.72, suggesting downside of -9.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

Ord Minnett rates CWN as Hold (3) -

The Star Entertainment Group ((SGR)) has entered the bidding for Crown Resorts, with a scrip bid (with a limited cash option). The bidder claims this is worth more than $14 a share, some 13.4% above Blackstone’s cash offer of $12.35 a share, explains Ord Minnett.

The broker anticipates ‘best-and-final’ bids and a Blackstone and Star combination to finalise a deal to take over Crown Resorts. It's expected an offer price starting at $14 would be required. The Hold rating and $11 target are retained.

Target price is $11.00 Current Price is $13.00 Difference: minus $2 (current price is over target).
If CWN meets the Ord Minnett target it will return approximately minus 15% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $11.72, suggesting downside of -9.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

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

As more waste volume gets diverted from landfills to recycling and energy recovery facilities, Morgan Stanley finds investors are concerned about a net negative operating income impact.

The broker estimates Cleanaway Waste Management's landfill volume reduction could be circa -5% per annum. In the broker's view, the company's existing reprocessing project pipeline can fully offset this landfill earnings erosion without any need to expand market share.

Equal-Weight rating. Target rises to $2.78 from $2.50. Industry view: Cautious. 

Target price is $2.78 Current Price is $2.85 Difference: minus $0.07 (current price is over target).
If CWY meets the Morgan Stanley target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.59, suggesting downside of -7.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

Morgan Stanley rates DXS as Overweight (1) -

A potentially bottoming Sydney office market is a key reason for Morgan Stanley's bullish view on Dexus. Vacancies are expected to peak at around 12% and the net effective rent could start increasing in the first half of FY22.

Some other points in the company's favour include the company's current valuation, which Morgan Stanley thinks is too low.

Also, Dexus's funds management investors are true partners rather than profit providers, highlights the broker, with acquisitions traditionally done jointly. 

Thus, while Dexus's platform may not be as lucrative as its peers', the broker thinks fund flows are likely to be as sticky and continuous.

Overweight rating with a target of $11.70. Industry View: In-line.

Target price is $11.70 Current Price is $10.25 Difference: $1.45
If DXS meets the Morgan Stanley target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $10.13, suggesting downside of -2.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.5

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

Morgans rates HRL as Add (1) -

Analytica (one of two major businesses within HRL Holdings) delivered record third quarter revenues driven by honey and environmental testing service lines. Also, HAZMAT (the other main business) also performed well across A&NZ, explains Morgans.

The broker highlights a recovery in environmental testing activity, which should support an ongoing improvement in margins as volumes continue to grow over FY22/23.

With a solid medium-term growth outlook and M&A potential, the Add rating is maintained. The target price of $0.16 is unchanged.

Target price is $0.16 Current Price is $0.12 Difference: $0.04
If HRL meets the Morgans target it will return approximately 33% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

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

Citi rates ILU as Neutral (3) -

Citi notes recent sentiment about TiO2 feedstocks, the zircon market and rare earths has improved. The broker raises realised price assumptions for zircon (on reduced discounting) and also for Eneabba stage 2 monazite concentrate (on an uplift in rare earths pricing).

This lifts the target price to $8.60 from $7.50 and the Neutral rating is retained.

Target price is $8.60 Current Price is $8.88 Difference: minus $0.28 (current price is over target).
If ILU meets the Citi target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $7.08, suggesting downside of -19.2% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.0

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

Citi rates IPL as Neutral (3) -

Citi increases FY21 and FY22 earnings (EBIT) forecasts by 19% and 12%, following strong fertiliser upgrades partially offset by Waggaman plant disruptions. It's expected the latest disruption will negatively impact FY21 earnings by -$33m-$42m.

The Neutral rating and $2.70 target are unchanged.

Target price is $2.70 Current Price is $2.45 Difference: $0.25
If IPL meets the Citi target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $3.00, suggesting upside of 24.9% (ex-dividends)

The company's fiscal year ends in September.

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

Credit Suisse rates IPL as Neutral (3) -

As more problems continue to plague Incitec Pivot's Waggaman ammonia plant (WALA), Credit Suisse believes the plant's restart would not occur before late May. 

The company has guided to a negative operating income impact of -$33-$42m. The broker notes reliability issues at WALA seem to stem from the initial plant design and may need a capex of -US$20m to be rectified. 

Incitec Pivot will report its result on May 17.

Neutral rating with a target of $2.83. 

Target price is $2.83 Current Price is $2.45 Difference: $0.38
If IPL meets the Credit Suisse target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $3.00, suggesting upside of 24.9% (ex-dividends)

The company's fiscal year ends in September.

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

Macquarie rates IPL as Outperform (1) -

The Waggaman ammonia plant restarted in mid-April for two weeks and then ran into difficulties (yet again). The plant was shutdown in May while Incitec Pivot is doing all it can to bring the plant back to full operation.

With repairs expected to take two to three weeks, the additional impact to FY21 operating income is expected to be between -$33-$42m, highlights Macquarie.

The broker has reduced its FY21-22 earnings forecasts by -6.4% and -1%.

Outperform retained. Target is reduced to $2.96 from $3.08.

Target price is $2.96 Current Price is $2.45 Difference: $0.51
If IPL meets the Macquarie target it will return approximately 21% (excluding dividends, fees and charges).

Current consensus price target is $3.00, suggesting upside of 24.9% (ex-dividends)

The company's fiscal year ends in September.

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

Ord Minnett rates IPL as Buy (1) -

Further technical issues at the Waggaman ammonia plant are expected to negatively impact earnings (EBIT) by -$33–42m. Ord Minnett believes the share price over-reacted, given the fall represented $420m of market capitalisation versus a circa $700m asset value.

The broker lowers FY21 earnings estimates by -$39m, but there are no changes in FY22. The target price is reduced to $3 from $3.10 and the Buy rating is maintained.

Target price is $3.00 Current Price is $2.45 Difference: $0.55
If IPL meets the Ord Minnett target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $3.00, suggesting upside of 24.9% (ex-dividends)

The company's fiscal year ends in September.

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 IPL as Buy (1) -

After another Waggaman ammonia plant (WALA) failure resulting in down-time, UBS feels manufacturing reliability is the key issue for the stock. It's thought investor confidence can only improve once WALA can produce at nameplate capacity for an extended period.

Buy rating retained. Target is lowered to $3 from $3.05.

Target price is $3.00 Current Price is $2.45 Difference: $0.55
If IPL meets the UBS target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $3.00, suggesting upside of 24.9% (ex-dividends)

The company's fiscal year ends in September.

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

Ord Minnett rates MGR as Hold (3) -

After reviewing the recent property-trust quarterly reporting season, Ord Minnett notes another strong quarter of sales and accelerating price growth for Residential should ensure margins remain elevated over the next few years.

The buyer profile is shifting from first-home buyers to renewed investor demand, which provides better capacity to launch apartment product. The broker sees Mirvac Group is better exposed than peers to this product shift. The Hold rating and $2.60 price are retained.

Target price is $2.60 Current Price is $2.81 Difference: minus $0.21 (current price is over target).
If MGR 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 $2.67, suggesting downside of -6.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.5

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

Citi rates NST as Buy (1) -

Citi assesses the resource/reserve upgrade extends the life of Kalgoorlie Consolidated Gold Mines (KCGM) and displaces lower-grade stockpile feed.

The target price increases to $13.50 from $13.40. The Buy rating is unchanged. The broker notes it is a Buy should the gold price go up though that is not the overall forecast. Thus, Citi prefers defensive names such as Newcrest Mining ((NCM)) and Evolution Mining ((EVN)).

Target price is $13.50 Current Price is $11.34 Difference: $2.16
If NST meets the Citi target it will return approximately 19% (excluding dividends, fees and charges).

Current consensus price target is $12.88, suggesting upside of 17.2% (ex-dividends)

The company's fiscal year ends in June.

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

Macquarie rates NWS as Outperform (1) -

News Corp's third-quarter result shows operating income at US$298m, a 26% beat versus Macquarie's expectation due to better-than-expected revenue and costs.

Dow Jones's operating income was up 61%, a 20% margin and the broker notes the group is heading towards its previously forecast circa 26% margin in the medium term.

Macquarie increases its earnings forecasts for FY21-23 by 16-31%.

Outperform retained, target rises to $46.30 from $44.

Target price is $46.30 Current Price is $32.31 Difference: $13.99
If NWS meets the Macquarie target it will return approximately 43% (excluding dividends, fees and charges).

Current consensus price target is $38.33, suggesting upside of 20.0% (ex-dividends)

The company's fiscal year ends in June.

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

Citi rates PDL as Neutral (3) -

Citi sees the acquisition of Thompson, Siegel & Walmsley (TSW) as a positive transformational deal at a reasonable price. However, the broker cautions the business is skewed to institutional sourced funds under management (FUM), with high client concentration.

The analyst increases EPS estimates by around 12% and 9% for FY22 and FY23, mainly reflecting the TSW acquisition and the $190m equity raising and new US$ denominated debt of $200m.

Target price is $7.70 Current Price is $7.34 Difference: $0.36
If PDL meets the Citi target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $8.35, suggesting upside of 13.0% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.5

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

Credit Suisse rates PDL as Neutral (3) -

Pendal Group's first-half profit after tax at $83m was 8% over last year and 5% above Credit Suisse's forecast. The result was led by a cost beat with expenses skewed towards the second half rather than a more even split over FY21, observes the broker.

The broker deems the result operationally clean with fee margins expanding slightly and rebounding performance fees. 

Credit Suisse also estimates the Thompson, Siegel & Walmsley (TSW) acquisition announced by Pendal Group will be circa 15% accretive in FY22 and has increased its earnings forecast by 13-15% for FY22-23.

Neutral rating with the target rising to $7.90 from $7.50.

Target price is $7.90 Current Price is $7.34 Difference: $0.56
If PDL meets the Credit Suisse target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $8.35, suggesting upside of 13.0% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.5

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

Macquarie rates PDL as No Rating (-1) -

Pendal Group announced the first half numbers and the acquisition of Thompson, Siegel & Walmsley (TSW).

Profit after tax at $82.6m was broadly in-line with Macquarie's expectation. The broker's earnings upgrades were driven by better fee margins and lower non-employee expenses.

The group will also acquire  Thompson, Siegel & Walmsley for US$320m, a transaction expected to be double-digit earnings accretive in the first full year post-completion.

Macquarie is research restricted and cannot provide a target and rating.

Current Price is $7.34. Target price not assessed.

Current consensus price target is $8.35, suggesting upside of 13.0% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.5

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

Morgan Stanley rates PDL as Overweight (1) -

Pendal Group's first-half earnings beat Morgan Stanley's estimates by almost 20% driven by lower expenses. Fee margins were in line while costs were lower on comps. The dividend was -11% below the broker's forecast.

Pendal Group is buying Thompson, Siegel & Walmsley (TSW). Morgan Stanley notes the deal will add US$23.6bn in funds under management and will be double-digit earnings accretive.

Overweight rating is unchanged with a target price of $8.50. Industry view: In-line.

Target price is $8.50 Current Price is $7.34 Difference: $1.16
If PDL meets the Morgan Stanley target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $8.35, suggesting upside of 13.0% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.5

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

Morgans rates PDL as Add (1) -

First half underlying profit (NPAT) beat Morgans’ forecasts by 2%. Investment performance across the UK/EU is considered to have rebounded meaningfully, which should support flows and performance fees.

Management announced the acquisition of a US-based manager for around $413m, partly funded by a placement of $190m and debt. The company expects this to be ‘double digit’ EPS accretive.

Morgans sees potential for meaningful earnings and multiple upside if management executes on the growth plan. The Add rating is maintained and the target is increased to $8.94 from $8.10.

Target price is $8.94 Current Price is $7.34 Difference: $1.6
If PDL meets the Morgans target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $8.35, suggesting upside of 13.0% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.5

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

Ord Minnett rates PDL as Accumulate (2) -

The first-half FY21 underlying net profit was slightly below Ord Minnett’s forecast though a 10%-franked interim dividend of 17 cents was ahead of an expected 14 cents. However, it's felt the acquisition of Thompson, Siegel & Walmsley (TSW) overshadowed the results.

The business has US$23.6bn of funds under management (FUM) and the acquisition is anticipated to be “double digit EPS accretive” on an annualised basis. The broker notes other positives include increasing scale and diversification by asset class and strategy. 

The Accumulate rating is maintained and the target price is increased to $8.70 from $8.50.

Target price is $8.70 Current Price is $7.34 Difference: $1.36
If PDL meets the Ord Minnett target it will return approximately 19% (excluding dividends, fees and charges).

Current consensus price target is $8.35, suggesting upside of 13.0% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.5

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

Macquarie rates PMV as Outperform (1) -

UK High Street like for like April online sales grew by 28% as stores reopened. Macquarie notes all retail venues recorded monthly highs during the week of re-opening. Malls footfall was up 399.6%, whereas footfall of the high street rose by 345.9%.

The lifestyle and fashion categories saw double digit like for like sales increases versus April and positive comps versus last year instore.

While recommending exposure to the diversified global retailer that is poised to benefit from reopening and organic growth, Macquarie retains its  Outperform rating and a $31 target.

Target price is $31.00 Current Price is $25.90 Difference: $5.1
If PMV meets the Macquarie target it will return approximately 20% (excluding dividends, fees and charges).

Current consensus price target is $26.26, suggesting upside of 3.0% (ex-dividends)

The company's fiscal year ends in July.

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

Macquarie rates REA as Outperform (1) -

REA Group's third-quarter listings were up 8% led by improvement in February and March. April was up 98% over last year. Macquarie believes the pace of growth will moderate going into May and June.

The group continues its strategy of helping agents in the residential ‘for sale’ lifecycle more broadly, notes the broker. The group reaffirmed its comments around increasing agent leads/market share before monetisation. 

Macquarie's medium-term investment thesis remains unchanged for superior mix shift/depth growth relative to competitors.

Outperform rating retained with the target rising to $179.10 from $171.7. 

Target price is $179.10 Current Price is $160.44 Difference: $18.66
If REA meets the Macquarie target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $157.75, suggesting upside of 2.3% (ex-dividends)

The company's fiscal year ends in June.

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 SCG as Hold (3) -

After reviewing the recent property-trust quarterly reporting season, Ord Minnett notes retail-sector metrics improved modestly though the rate of improvement has slowed. Also, office physical occupancy continues to recover and leasing demand is improving off a low base.

Scentre Group's portfolio appears to be outperforming that of Vicinity Centres ((VCX)), which is weighed down by CBD and Victorian exposure, explains the broker. Ord Minnett maintains its Hold recommendation with a target price of $3.

Target price is $3.00 Current Price is $2.72 Difference: $0.28
If SCG meets the Ord Minnett target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $2.84, suggesting upside of 4.9% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: -0.4

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

Macquarie rates SGR as Outperform (1) -

Star Entertainment Group has proposed a merger with Crown Resorts ((CWN)). Macquarie notes the proposal makes for a serious offer, given the value creation and the merged company could be worth more than $7 per share considering its FY23 valuation scenario.

Further, the broker highlights the merger could unlock $150-200m in synergies given they are both Australian-based casino operators. The enlarged business could generate more than $1.5bn in operating income during FY23.

Outperform rating remains with a target price of $4.65.

Target price is $4.65 Current Price is $4.21 Difference: $0.44
If SGR meets the Macquarie target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $4.27, suggesting upside of 2.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.6

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

Ord Minnett rates SGR as Accumulate (2) -

The Star Entertainment Group has entered the bidding for Crown Resorts ((CWN)), with a scrip bid (with a limited cash option). The company claims this is worth more than $14 a share, some 13.4% above Blackstone’s cash offer of $12.35 a share, explains Ord Minnett.

The broker anticipates ‘best-and-final’ bids and a Blackstone and Star combination to finalise a deal to take over Crown Resorts. It's expected an offer price starting at $14 would be required. The Accumulate rating and $4.50 target are retained.

Target price is $4.50 Current Price is $4.21 Difference: $0.29
If SGR meets the Ord Minnett target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $4.27, suggesting upside of 2.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.6

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

Ord Minnett rates SSR as Buy (1) -

The March-quarter production report showed production and all-in sustaining costs (AISC) coming in better than Ord Minnett had expected. It's estimated the company is comfortably on-track to hit the upper end of production and lower end of cash cost guidance for the year.

The Buy recommendation is maintained and the target price rises to $27 from $26.

Target price is $27.00 Current Price is $22.00 Difference: $5
If SSR meets the Ord Minnett target it will return approximately 23% (excluding dividends, fees and charges).

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 SVW as Accumulate (2) -

Seven Group has made a nil-premium off-market takeover bid for Boral ((BLD)). Management noted it would be satisfied with a 30% stake, which implies to Ord Minnett an increase in ownership of 6.8%.

It appears to the broker that Seven Group could be targeting a third seat through the addition of a ninth Boral director. It's estimated a 30% stake in Boral could rise to 33% after the completion of Boral’s buyback program.

Seven Group’s 23.18% interest in Boral is “greater than 20%” and the creep provision (“no more than 3% every 6 months”) has been utilised to-date. Thus, the analyst notes the company has had to make the move of launching a takeover to increase the holding.

Target price is $26.50 Current Price is $21.15 Difference: $5.35
If SVW meets the Ord Minnett target it will return approximately 25% (excluding dividends, fees and charges).

Current consensus price target is $27.14, suggesting upside of 33.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.9

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

Morgans rates TYR as Add (1) -

In a move that makes strategic sense to Morgans, Tyro Payments will acquire 100% of Medipass Solutions, a digital health payments business, for $22.5m.

Medipass provides a link between healthcare funders, providers and the end patient.  It will add scale to the Health vertical and allow a more holistic payment offering to health merchants and end users.

The Add rating is maintained and the target price is increased to $4.29 from $4.25. Morgans likes the overall growth story, with medium-term potential for further market share gains and structural payment tailwinds.

Target price is $4.29 Current Price is $3.63 Difference: $0.66
If TYR meets the Morgans target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $3.89, suggesting upside of 5.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.5

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

Ord Minnett rates TYR as Buy (1) -

Ord Minnett assesses the Medipass Solutions acquisition should allow Tyro Payments to tap into new markets for health fund claims and allow for cross-selling opportunities. This is expected to strengthen the company's offering in the health vertical.

Management expects minimal overlap with its existing 9,300 merchants.

Separately, after a trading update, the analyst estimates the company is on track to deliver Ord Minnett's forecast $25.5bn total transaction volume (TTV) for FY21. The Buy rating and $4.50 target are retained.

Target price is $4.50 Current Price is $3.63 Difference: $0.87
If TYR meets the Ord Minnett target it will return approximately 24% (excluding dividends, fees and charges).

Current consensus price target is $3.89, suggesting upside of 5.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.5

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

UBS rates UMG as Buy (1) -

UBS views United Malt Group as a covid-19 recovery trade, supported by recent industry insights which suggest improving US beer market conditions since the company’s profit downgrade in February.

In anticipation of first half results due on Wed 19 May, the broker restates longer term forecasts as a measuring stick. On a pre-AASB16 basis, the analyst forecasts FY21 earnings (EBITDA) will be $122m and $163m for FY22. The Buy rating and $5 price target are unchanged.

Target price is $5.00 Current Price is $4.65 Difference: $0.35
If UMG meets the UBS target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $4.41, suggesting downside of -3.7% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.8

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

Ord Minnett rates VCX as Hold (3) -

After reviewing the recent property-trust quarterly reporting season, Ord Minnett notes retail-sector metrics improved modestly though the rate of improvement has slowed. Also, office physical occupancy continues to recover and leasing demand is improving off a low base.

The portfolio of Scentre Group ((SCP)) appears to be outperforming that of Vicinity Centres, which is weighed down by CBD and Victorian exposure, explains the broker. Ord Minnett maintains its Hold recommendation with a target price of $1.80.

Target price is $1.80 Current Price is $1.55 Difference: $0.25
If VCX meets the Ord Minnett target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $1.64, suggesting upside of 7.0% (ex-dividends)

The company's fiscal year ends in June.

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

Credit Suisse rates WOW as Neutral (3) -

Credit Suisse notes there were not a lot of surprises in Woolworths' Endeavour Drinks Group demerger documents. The potential return of $1.6-2bn in surplus cash post demerger looks to be in line with investor expectations.

A dividend payout ratio of 70-75% for Endeavour Drinks Group is in line with Woolworths' historical payout, adds the broker. Post demerger, Credit Suisse highlights the retailer will be debt-free and is proposing capital management of $1.6-2bn.

Neutral rating with a target of $38.05.

Target price is $38.05 Current Price is $40.50 Difference: minus $2.45 (current price is over target).
If WOW meets the Credit Suisse target it will return approximately minus 6% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $42.54, suggesting upside of 3.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.6

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

Macquarie rates WOW as Outperform (1) -

Woolworths has confirmed Endeavour Group's demerger but will maintain an ongoing partnership. The retailer will hold a 14.6% interest in Endeavour Group with shares scheduled to start trading on the ASX on June 24.

Post demerger, Macquarie notes Woolworths will have a positive net cash position of $75m while circa $1.4bn-$1.5bn of net debt will sit with the standalone Endeavour Group business.

Along with an improved balance sheet, Woolworths will be exploring capital management options and may return up to $1.6bn-$2.0bn to shareholders, suggests Macquarie.

The broker retains its Outperform rating and a $44.50 target.

Target price is $44.50 Current Price is $40.50 Difference: $4
If WOW meets the Macquarie target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $42.54, suggesting upside of 3.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.6

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

Morgan Stanley rates WOW as Overweight (1) -

Woolworths released the Endeavour Demerger Scheme Booklet, outlining plans for capital management.

Woolworths flagged $1.6-2bn in potential capital return and assuming the high end of the capital return range, Morgan Stanley estimates FY22 net debt/EBITDA for Woolworths ex-Endeavour to be 2.8x, below the 3x level the company currently maintains.

On this basis, the broker expects capital management to be at the top end of the range. The broker's earnings estimates for Woolworths remain unchanged. 

Overweight retained. Target is $44. Industry view is Attractive.

Target price is $44.00 Current Price is $40.50 Difference: $3.5
If WOW meets the Morgan Stanley target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $42.54, suggesting upside of 3.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.6

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