Australian Broker Call

Ord Minnett rates 29M as Hold (3) -

Ord Minnett slashes its target for 29Metals to $1.35 from $1.95 following a soft 3Q result impacted by bad weather at Capricorn and issue with tailings at Golden Grove.

The broker is concerned by the ability to recommence production at Capricorn and associated costs, as well as the ramp-up profile at Golden Grove for the Xantho Extended orebody.

Target price is $1.35 Current Price is $1.14 Difference: $0.21
If 29M meets the Ord Minnett target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $1.26, suggesting upside of 16.9% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.0

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

Citi rates AKE as Buy (1) -

After a conference call, Citi notes Allkem and Livent are feeling positive about their merge on a rationale of scale and vertical integration. Allkem is overweight upstream (mining) and Livent is overweight downstream (processing).

The merger enables Allkem to expedite lithium to market. Livent is the only producer using Direct Lithium Extraction commercially plus it has greater capacity on hydroxide in the US, the broker points out.

Buy and $14.50 target retained.

Target price is $14.50 Current Price is $14.94 Difference: minus $0.44 (current price is over target).
If AKE 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 $16.37, suggesting upside of 8.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

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 No Rating (-1) -

Allkem investors will continue to hold 56% of the new entity after its merger with US-based Livent, and while shares will be listed on the NYSE, shares will still be listed locally via the issue of CDI's to shareholders.

Morgan Stanley highlights cost synergies from the adjacency of assets in Argentina and Canada. Future project development 
should also be de-risked, as Livent is already using DLE technology, which Allkem required for future expansions.

The broker is under research restriction, thus no price target or rating are offered. Industry View: Attractive.

Current Price is $14.94. Target price not assessed.

Current consensus price target is $16.37, suggesting upside of 8.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.8

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

Morgans rates AKE as Downgrade to Hold from Add (3) -

A share price rally for Allkem after the announced merger with US-based Livent prompts Morgans to downgrade its rating to Hold from Add on valuation. Due to softer recent spodumene pricing the target price falls to $14.40 from $14.70.

The main appeal of the merger for the analyst are the synergies on offer as both companies have brine operations in Argentina (where Livent uses more advanced brine processing techniques) and spodumene operations in Quebec. 

Prior to a more detailed analysis, the broker assesses value in the transaction for Allkem shareholders.

Target price is $14.40 Current Price is $14.94 Difference: minus $0.54 (current price is over target).
If AKE meets the Morgans target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $16.37, suggesting upside of 8.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.8

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

UBS rates AKE as No Rating (-1) -

UBS is satisfied with the progress on stage 2 after visiting the Allkem Olaroz lithium brine project in Argentina. The company is entering a critical point in project delivery and ramp up and the broker looks for the near-term catalysts to de-risk growth and drive value.

Meanwhile, a friendly merger has been announced with US-listed Livent. UBS is currently restricted and cannot provide a rating or target.

Current Price is $14.94. Target price not assessed.

Current consensus price target is $16.37, suggesting upside of 8.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.8

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

UBS rates ALL as Buy (1) -

Aristocrat Leisure will report its first half result on May 18 and UBS takes note of peers which have reported March quarter results. The broker believes the company will have been a net winner of share in recent quarters, based on industry data and feedback.

Going forward the broker considers Aristocrat Leisure provides a compelling proposition that is less linked to global macro fortunes compared with other discretionary exposures.

Free cash flow generation should provide increased flexibility for growth investment and/or further capital returns. Buy rating retained. Target rises to $44.20 from $41.60.

Target price is $44.20 Current Price is $38.53 Difference: $5.67
If ALL meets the UBS target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $43.17, suggesting upside of 11.5% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.9

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

Morgans rates CBA as Hold (3) -

Following CommBank's 3Q results, Morgans retains its Hold rating due to a forecast of only low single digit total shareholder returns for the next 12 months.

Net interest income (NII) declined by -2% compared to the 1H quarterly average. The broker downgrades its NII forecasts by -1-2% to reflect loan growth that was higher than previously assumed for the 3Q, but lowers net interest margin (NIM) estimates.

Additional retained capital contributes to the broker's forecast increase in surplus capital for future potential buybacks, though forecast dividends are lowered on the assumption of a lower payout ratio.

The Hold rating is unchanged and the target falls to $96.08 from $97.85.

Target price is $96.08 Current Price is $98.35 Difference: minus $2.27 (current price is over target).
If CBA meets the Morgans target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $89.68, suggesting downside of -9.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: -0.5

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

Citi rates COL as Buy (1) -

Coles hosted a site tour of its new Automated Distribution Centre (ADC) in Queensland.

Citi notes Witron is the leader in automation with an excellent track record offshore and we should expect better on-shelf availability, more flexible range management and lower stock losses as the two ADCs go into operation. No changes to project costs were announced.

The site tour reinforces the broker's view that Coles is moving in the right direction and the ADCs have the potential to provide a cost advantage over competitors.

Buy and $20.20 target retained.

Target price is $20.20 Current Price is $18.10 Difference: $2.1
If COL meets the Citi target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $17.63, suggesting downside of -3.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.2

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

Macquarie rates COL as Outperform (1) -

Macquarie has visited the new Witron automated distribution centre in Redbank, Queensland, noting availability will improve for customers by halving the number of items "out of stock".

A second automated centre is scheduled to open in the third quarter of 2024 in Kemps Creek, NSW. Coles Group aims to double capacity and slash costs with the new centres and has reiterated guidance for capital expenditure of -$1.04bn.

The broker notes both facilities are tracking in line with the initial timelines. Outperform. Target is steady at $20.

Target price is $20.00 Current Price is $18.10 Difference: $1.9
If COL meets the Macquarie target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $17.63, suggesting downside of -3.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.2

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

UBS rates COL as Neutral (3) -

UBS was one of those that attended the tour of the new automated distribution centre at Redbank, Queensland. This is the first of two that Coles Group is opening in partnership with Witron, a leader in supply-chain technology.

UBS revises estimates down by -2.7% for FY24 and -6.2% for FY25 because of ongoing costs, a longer ramp up and lower return on capital (ROC) compared with its previous estimates.

The broker points out the ROC target was unquantified as were cost savings, against its expectations of something more specific.The company has only indicated automated centres will provide double the capacity, half the footprint and two thirds of prior operating costs.

Neutral maintained. Target is reduced to $17.75 from $18.50.

Target price is $17.75 Current Price is $18.10 Difference: minus $0.35 (current price is over target).
If COL meets the UBS target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $17.63, suggesting downside of -3.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.2

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

Macquarie rates CXO as Outperform (1) -

Core Lithium has secured mining approval for the BP33 underground mine and commenced loading the first spodumene shipment from Finnis.

Macquarie considers this a major de-risking event with development of the mine now able to begin. BP33 accounts for 40% of the company's total contained lithium reserves and is the sole source of ore in FY28-33 in the broker's development scenario.

The Outperform rating is unchanged. Target is raised to $1.30 from $1.20.

Target price is $1.30 Current Price is $1.11 Difference: $0.19
If CXO meets the Macquarie target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $1.02, suggesting downside of -13.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.0

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

Macquarie rates GLN as Outperform (1) -

Macquarie recently toured the Hombre Muerto West project in Argentina and notes, being adjacent to other brine lithium projects, this could improve the carbonisation productivity for existing operators.

The broker narrows its forecast losses for FY23 by 4% and FY24-25 by 8%. Outperform rating retained. Target rises to $1.80 from $1.70.

Target price is $1.80 Current Price is $1.25 Difference: $0.545
If GLN meets the Macquarie target it will return approximately 43% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 1.0

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

Citi rates GMG as Buy (1) -

Along with its March quarter update, Goodman Group upgraded FY23 earnings guidance to 15% growth from 13.5%.

Citi suggests the update highlighted ongoing tailwinds for industrial assets with strong market rent growth improving the future rental upside on Goodman’s book.

Record low vacancy has driven ongoing development demand resulting in a strong development workbook, highlighting near-term growth in developments from less time taken to develop, which will boost annual earnings, the broker notes.

Citi sees potential for Goodman to generate consistent high-single to low-double digit earnings growth over the medium term driven by rental upside and longer term development projects, which will add to management and development earnings.

Buy retained, target rises to $24.30 from $24.00.

Target price is $24.30 Current Price is $19.97 Difference: $4.33
If GMG meets the Citi target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $22.64, suggesting upside of 12.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.8

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

Macquarie rates GMG as Outperform (1) -

Macquarie assesses the short-term metrics are volatile for Goodman Group, although strong fundamentals should underpin the outlook over the longer term.

The company has upgraded FY23 guidance for growth in operating earnings per share to 15%, while Macquarie forecasts 16.7%.

Goodman Group has experienced strong demand across a broad range of customers seeking more productive and sustainable assets. Data centre users were particularly active.

The business is continuing to assess opportunities to re-stock developments with competition beginning to soften.

Outperform retained. Target rises to $23.18 from $22.61.

Target price is $23.18 Current Price is $19.97 Difference: $3.21
If GMG meets the Macquarie target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $22.64, suggesting upside of 12.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.8

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

Morgan Stanley rates GMG as Overweight (1) -

Morgan Stanley assesses sound 3Q results for Goodman Group and suspects the market will like FY23 EPS guidance growth which was upgraded to 15% from 13.5%. The broker had already forecast 15.1%, while the consensus estimate was sitting at 15.6%.

The cap rate rose by 10bps to 4.3% and management flagged there will be further cap rate expansions over the next 12 months.

The UK fund experienced a -$200m decline in total assets, which the analyst suspects is due to more significant devaluations in the UK.

The Overweight rating and target price of $24.10 are retained. Industry view: In-Line. 

Target price is $24.10 Current Price is $19.97 Difference: $4.13
If GMG meets the Morgan Stanley target it will return approximately 21% (excluding dividends, fees and charges).

Current consensus price target is $22.64, suggesting upside of 12.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.8

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

Ord Minnett rates GMG as Hold (3) -

Goodman Group's 3Q trading update and increased FY23 operating earnings growth guidance were in line with Ord Minnett's forecasts.

Growth guidance was upgraded to 15% from 13.5% due to development activity, high rental growth and occupancy rates, explains the analyst. 

Funds under management (FUM) increased to $80.7bn from the 2Q's $79.5bn, highlights the broker, supported by development completions, positive revaluations and favourable exchange rate moves.

Net property income growth is offsetting the negative impact of widening capitalisation rates for property valuations, explains Ord Minnett. The Hold rating and $18.60 target are unchanged.

Target price is $18.60 Current Price is $19.97 Difference: minus $1.37 (current price is over target).
If GMG 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 $22.64, suggesting upside of 12.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.8

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

UBS rates GMG as Buy (1) -

Goodman Group has highlighted continued demand for data centres which are now a material component (30%) of its development book. The company has lifted FY23 guidance to operating earnings growth of 15% from 13.5%.

UBS envisages an external capital solution is the next step to de-risk profits, addressing concerns about increased balance sheet exposure to these developments.

With long lead times, and at capitalisation rates that are tighter than logistics, the broker assesses the sell-down of data centre assets should underpin growth.

UBS retains a Buy rating and $23 target.

Target price is $23.00 Current Price is $19.97 Difference: $3.03
If GMG meets the UBS target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $22.64, suggesting upside of 12.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.8

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

Bell Potter rates GNC as Buy (1) -

Bell Potter was expecting 1H underlying profit of $145.3m and GrainCorp delivered $200.3m. Earnings (EBITDA) fell by -10% year-on-year due to a lower contribution from agribusiness, which was partly offset by a stronger crush result in oils, explains the analyst.

Management raised FY23 earnings (EBITDA) guidance to $500-560m from $470-530m and profit guidance to $220-260m from $180-220m.

The target rises to $9.45 from $8.00 to reflect an uplift in the broker's through-the-cycle profit (PBITDA) range to $235-265m from $195-205m. The valuation is considered undemanding. Buy.

Target price is $9.45 Current Price is $7.81 Difference: $1.64
If GNC meets the Bell Potter target it will return approximately 21% (excluding dividends, fees and charges).

Current consensus price target is $8.68, suggesting upside of 5.2% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.6

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

Macquarie rates GNC as Outperform (1) -

GrainCorp posted net profit of $200m in the first half, well ahead of Macquarie's forecast. FY23 guidance has been upgraded to net profit of $220-260m.

The broker was surprised by the extent of earnings upgrades in the context of weakening seasonal conditions and declining soft commodity prices.

EBITDA guidance has been upgraded to $500-560m from $470-530m. Around $14m of the upgrade reflects the revaluation of United Malt ((UMG)) and the remainder strong exports and good global demand.

Macquarie transfers coverage to John Purtell from David Pobucky and retains an Outperform rating. Target is reduced to $9.08 from $10.80.

Target price is $9.08 Current Price is $7.81 Difference: $1.27
If GNC meets the Macquarie target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $8.68, suggesting upside of 5.2% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.6

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

Morgans rates GNC as Hold (3) -

GrainCorp's 1H result slightly exceeded Morgans forecasts, yet the broker retains its Hold rating in the expectation of an earnings decline over FY23-25. The target rises to $8.65 from $8.60.

Management upgraded FY23 guidance due to a positive United Malt ((UMG)) revaluation, explains the analyst, with the remainder likely from Processing.

 'Through-the-cycle’ earnings (EBITDA) guidance was also raised to $310m from $240m largely reflecting structural margin improvements in the Processing and Feeds, Fats & Oils (FFO) businesses.

Target price is $8.65 Current Price is $7.81 Difference: $0.84
If GNC meets the Morgans target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $8.68, suggesting upside of 5.2% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.6

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

UBS rates GNC as Buy (1) -

GrainCorp has been boosted by a third consecutive bumper crop and strong demand across key end markets. Volumes are being driven by capacity upgrades and margins by demand for oils for food and renewable fuels. Guidance for FY23 has been upgraded 6%.

UBS increases EBITDA estimates by 10-18% over FY23-26. The broker points out the stock should be assessed on its mid-term cash flows and scope for capital returns. There is likely to be a step-down in earnings from FY24 as La Nina ends, according to UBS.

Buy rating maintained. Target rises to $9.50 from $8.65.

Target price is $9.50 Current Price is $7.81 Difference: $1.69
If GNC meets the UBS target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $8.68, suggesting upside of 5.2% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.6

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

Ord Minnett rates HUM as Hold (3) -

Ord Minnett lifts its uncertainty rating for Humm Group to Very High from High to reflect the opaque nature of earnings as the company undergoes a restructure amid a potential economic downturn.

As near-term earnings are expected to deteriorate, the broker assumes a $150m capital raise to support compliance with covenants around FY24. 

The analyst highlights net losses are rising  in Humm's Australian credit cards business.

Despite all the above, the Hold rating and 50c target are maintained, with the broker acknowledging steps are being taken by management to improve earnings.

Target price is $0.50 Current Price is $0.42 Difference: $0.08
If HUM meets the Ord Minnett target it will return approximately 19% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.0

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

Bell Potter rates JLG as Buy (1) -

Bell Potter predicts a softer demand outlook for Johns Lyng during the presence of El Nino, particulary for the business as usual (BAU) operations, where work backlogs appear to be winding down.

The analyst has observed declining incurred property claims at the mid-point of the El Nino cycle in four of the last six events.

Despite this view, the broker maintains its Buy rating on early signs of strong execution in the US, a record CAT pipeline and the company's increasing share of government and run-off work from CAT events.

The target falls to $7.70 from $8.00.

Target price is $7.70 Current Price is $6.74 Difference: $0.96
If JLG meets the Bell Potter target it will return approximately 14% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 1.0

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

Ord Minnett rates MAF as Buy (1) -

Following a trading update at MA Financial's AGM, Ord Minnett raises its EPS estimates by 1-2% over the forecast period given MA money's better-than expected performance and application pipeline. The Buy rating and $7.50 target are retained.

The update for the the four months to May 1 showed the analyst not only a strong start for MA money but also solid funds under management (FUM) growth within Asset Management.

Asset Management is considered the company's jewel in the crown, with growing fund flows and a long growth runway, observes the broker.

Target price is $7.50 Current Price is $4.90 Difference: $2.6
If MAF meets the Ord Minnett target it will return approximately 53% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 1.0

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

Bell Potter rates NEU as Buy (1) -

Neuren Pharmaceuticals' North American partner Acadia has announced the commercial launch of Daybue (for Rett Syndrome) in the US following FDA approval in March. The first commercial sale has now earnt Neuren a US$40m milestone payment.

A further US$350m will be payable to Neuren contingent on achieving a series of annual net sales thresholds. The company is also eligible to receive one third of the value of the Rare Pediatric Disease Priority Review Voucher (circa US$33m).

The target rises to $16.50 from $13.67. Buy.

Target price is $16.50 Current Price is $13.37 Difference: $3.13
If NEU meets the Bell Potter target it will return approximately 23% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 1.0

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

Shaw and Partners rates NOL as Buy (1) -

Shaw and Partners has assessed the Plan For Life 2022 data which show premium inflows over the year grew 25.6%. Overall risk inflows increased 2.5%.

NobleOak Life is expected to continue growing market share in an industry that is returning to profitability and the broker retains a Buy rating and target price of $2.85.

Target price is $2.85 Current Price is $1.65 Difference: $1.2
If NOL meets the Shaw and Partners target it will return approximately 73% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 1.0

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

Citi rates NXT as Buy (1) -

The timing of NextDC's capital raise is a bit of a surprise but does remove investor concerns on the balance sheet, Citi suggests.

The size of the Kuala Lumpur data centre is larger than expected but is de-risked in Citi's view given modular development, with initial capacity expected to be small.

The international expansion does open up a new growth avenue but also increases risk, but Citi expects Sydney/Melbourne to be the key driver over the next 3-5 years.

Pipeline commentary, especially in terms of Retail/Enterprise demand, continues to be positive, the broker notes. Buy and $14.45 target retained.

Target price is $14.45 Current Price is $11.78 Difference: $2.67
If NXT meets the Citi target it will return approximately 23% (excluding dividends, fees and charges).

Current consensus price target is $13.65, suggesting upside of 15.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.8

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

Morgans rates NXT as Add (1) -

NextDC has announced a capital raising to fund overseas data centre expansion (Kuala Lumpur and Aukland) and to accelerate the S3 fit-out. Morgans is unsurprised by the well-thought-out expansion plan which leverages the company's competitive advantage.

The 1:8 non-renounceable accelerated entitlement offer is looking to raise $618m at $10.80/share. The broker expects healthy contract wins will follow over time across enterprise and cloud.

The broker's underlying earnings (EBITDA) forecasts are unchanged, but a lower net debt reduces interest forecasts and lifts EPS forecasts. The Add rating is unchanged and the target climbs to $13.99 from $13.50.

Separately, management tightened the FY23 earnings (EBITD) guidance range and increased the capex range.

Target price is $13.99 Current Price is $11.78 Difference: $2.21
If NXT meets the Morgans target it will return approximately 19% (excluding dividends, fees and charges).

Current consensus price target is $13.65, suggesting upside of 15.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.8

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

UBS rates NXT as Buy (1) -

NextDC has announced a $618m equity raising for new data centre developments in Kuala Lumpur and Auckland together with the accelerated data hall fit-out in the third Sydney centre.

Guidance has been updated for FY23 for DC service revenue of $350-360m and capital expenditure of -$670-720m. In addition to Malaysia and New Zealand the company is also evaluating Singapore and Tokyo as potential markets.

UBS does not incorporate these developments or the capital raising into estimates as yet, pending completion of the deal. Buy rating and $14.15 target maintained.

Target price is $14.15 Current Price is $11.78 Difference: $2.37
If NXT meets the UBS target it will return approximately 20% (excluding dividends, fees and charges).

Current consensus price target is $13.65, suggesting upside of 15.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.8

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

Citi rates ORI as Neutral (3) -

Orica's result missed Citi but beat consensus and the broker has lifted its earnings forecasts and its target to $17.00 from $15.55, citing positive outlook commentary for the second half on commodity demand and improved mix to higher value services.

Given the shares are up some 14% in the last six months, Citi retains Neutral.

Target price is $17.00 Current Price is $16.61 Difference: $0.39
If ORI meets the Citi target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $17.99, suggesting upside of 7.7% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.5

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

Macquarie rates ORI as Outperform (1) -

Orica reported strong operations, with first half earnings (EBIT) of $323m ahead of Macquarie's estimates. Asia-Pacific stood out. The business was underpinned by robust end-customer demand, technology adoption and the focus on commercial discipline, the broker notes.

Macquarie welcomes the "under-promise over-deliver approach" and while not cheap believes the stock offers an attractive earnings growth outlook and relative defensiveness in the near term. Outperform maintained. Target rises to $18 from $17.

Target price is $18.00 Current Price is $16.61 Difference: $1.39
If ORI meets the Macquarie target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $17.99, suggesting upside of 7.7% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.5

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

Morgan Stanley rates ORI as Overweight (1) -

Contract re-pricing in the 1H by Orica exceeded Morgan Stanley's forecast, which resulted in a double-digit earnings beat versus forecasts by the broker and consensus.

Underlying earnings (EBIT) beat the broker's forecast by 12% on disciplined pricing and proactive recontracting, despite significant impacts from weather and supply chains.

The broker expects multiple years of earnings growth and retains its Outperform rating. It's felt the company is positioned to benefit from pricing growth in domestic ammonium nitrate markets.The target is increased to $20.30 from $18.70 

Target price is $20.30 Current Price is $16.61 Difference: $3.69
If ORI meets the Morgan Stanley target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $17.99, suggesting upside of 7.7% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.5

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

Morgans rates ORI as Hold (3) -

Orica's 1H result revealed impressive 32% earnings (EBIT) growth and was a material beat when set against Morgans forecasts. While cashflows once again disappointed, the performance of Australia Pacific and Asia (APA) was the standout positive.

The broker increases its earnings forecasts materially over the next few years on the back of the 1H result, though profit upgrades are less significant due to rising interest expenses from higher rates.

Earnings growth is expected to moderate in the 2H due to plant turnarounds, explains the analyst, and the company will also be cycling last year's price rises.

The Hold rating is unchanged, while the target rises to $17.15 from $14.55.

Target price is $17.15 Current Price is $16.61 Difference: $0.54
If ORI meets the Morgans target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $17.99, suggesting upside of 7.7% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.5

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

Ord Minnett rates ORI as Hold (3) -

While Orica's 1H profit was an -8% miss against Ord Minnett's forecast, no longer-term implications are drawn. In fact the broker raises its target by 2% to $16.50, largely due to the time value of money.

Revenue was well ahead of the analyst's forecast though operating costs rose more than commensurately, partly due to the disruption caused by industrial action at a major supplier.

Management expects a stronger 2H performance. Longer-term, Ord Minnett expects improved earnings margins from a greater uptake of technology-based productivity solutions.

The Hold rating is unchanged.

Target price is $16.50 Current Price is $16.61 Difference: minus $0.11 (current price is over target).
If ORI 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 $17.99, suggesting upside of 7.7% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.5

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

UBS rates ORI as Buy (1) -

First half results from Orica were well ahead of estimates at the EBIT line. Operating performance was underpinned by the benefits of ammonium nitrate contract re-pricing and volume growth of 5%. UBS notes this was delivered despite adverse weather.

Orica expects the strength will be sustained into the second half, supported by mining and increased technology demand, yet EBIT will be less skewed to the second half than in FY22 because of manufacturing plant turnarounds.

UBS considers guidance "reasonably conservative" and upgrades FY23 and FY24 EBIT forecasts by 7% and 5%, respectively. Buy rating retained. Target rises to $19 from $18.

Target price is $19.00 Current Price is $16.61 Difference: $2.39
If ORI meets the UBS target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $17.99, suggesting upside of 7.7% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.5

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

Shaw and Partners rates PLY as Buy (1) -

Playside Studios has commenced development of a new Indie title, consistent with a strategy to internally fund a portfolio of PC/console projects that have enhanced potential versus the current mobile-dominated catalogue.

Shaw and Partners believes investors are now getting the original IP business for free and upgrades FY25 revenue forecast by 15%.

Meanwhile, Work For Hire has exceeded expectations in FY23 and the recent Skydance International contract should support more than 35% revenue growth in FY24, the broker adds. Buy rating and $0.70 target reiterated.

Target price is $0.70 Current Price is $0.38 Difference: $0.32
If PLY meets the Shaw and Partners target it will return approximately 84% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 1.0

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

Citi rates QBE as Buy (1) -

QBE Insurance's Q1 market update, released this morning, has come with upgraded premium growth guidance for the financial year, on top of a solid investment return, Citi analysts comment upon initial assessment.

There is a 'but' though, as the insurer also flags it will have to top up its reserves. Citi points out this relates to specific adverse events, not to the underlying performance of the business, but it's disappointing nevertheless.

Buy. Target $16.20.

Target price is $16.20 Current Price is $15.16 Difference: $1.04
If QBE meets the Citi target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $16.28, suggesting upside of 11.6% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY23:

Forecast for FY24:

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

Market Sentiment: 0.7

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

Citi rates REA as Buy (1) -

REA Group's Q3, released this morning, proved weaker-than-expected. Citi analysts, upon initial glance, blame geo-mix and Financial Services.

In addition, management flags Q4 has started on a weak note. April and May listings are down by -20%-plus. Compensation comes through a lower cost base, with management reducing cost guidance by -2%-3%, the broker notes.

Citi continues to forecast a double-digit yield growth turnaround for FY24. Having participated in a conference call post today's release, the analysts stick by that forecast.

Buy. Target $141.30.

Target price is $141.30 Current Price is $138.71 Difference: $2.59
If REA meets the Citi target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $122.96, suggesting downside of -11.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.0

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

Citi rates SCG as Neutral (3) -

Scentre Group published a stable operational update for the period to 30 April, Citi notes, reiterating previous earnings guidance. Management highlighted that funds from operations will grow 3.4% to 5.9% for the year, in line with the broker's expectations.

Management also expects distributions to be at least 16.5c per security for 2023, representing at least 4.8% growth for the year.

Citi retains Neutral and a $3.10 target, noting the rising interest rate environment and cap rate implications continue to be a risk
to the sector and a focus for investors.

Target price is $3.10 Current Price is $2.83 Difference: $0.27
If SCG meets the Citi target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $3.20, suggesting upside of 13.5% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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

UBS rates SCG as Neutral (3) -

Scentre Group has reconfirmed FY23 guidance and reported sales growth for the March quarter of 14.4%. The highlights were dining, health & beauty and food & retail.

Guidance for earnings per security in FY23 is in a range of 20.75-21.25c with a distribution of at least 16.5c per security.

While UBS acknowledges strong sales, rebounding foot traffic and consistent occupancy are underpinning the business, this is balanced by an expected slowdown throughout 2023 and an ever-increasing debt balance as expenditure surprises to the upside.

The broker retains a Neutral rating and $3.20 target.

Target price is $3.20 Current Price is $2.83 Difference: $0.37
If SCG meets the UBS target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $3.20, suggesting upside of 13.5% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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

Macquarie rates SFR as Outperform (1) -

Sandfire Resources has completed the rescheduling of its US$452m Matsa debt facility. The new schedule will increase surplus cash flow over FY24-25.

Macquarie welcomes the new repayment schedule and expects Sandfire Resources will generate US$83m in free cash flow in FY24 and US$223m in FY25. Outperform rating and $7.30 target maintained.

Target price is $7.30 Current Price is $6.50 Difference: $0.8
If SFR meets the Macquarie target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $6.91, suggesting upside of 12.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

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