Australian Broker Call

Bell Potter rates AEL as Buy (1) -

Post last week's update from Amplitude Energy, Bell Potter notes  Australia faces heightened fuel supply risk due to heavy reliance on imports and exposure to Middle East crude, with diesel prices up 88% in March 2026, according to the Australian Institute of Petroleum.

The country imports over 80% of fuel, largely from Asian refiners dependent on Middle East oil, leaving supply vulnerable to the Strait of Hormuz disruption, while the National Cabinet is set to discuss contingency measures.

Chevron has also curtailed production at its Gorgon and Wheatstone LNG projects in Western Australia due to Cyclone Narelle, adding to pressure as over 20% of global LNG supply is already offline.

Amplitude Energy remains Buy rated with a target of $2.70.

Target price is $2.70 Current Price is $1.72 Difference: $0.98
If AEL meets the Bell Potter target it will return approximately 57% (excluding dividends, fees and charges).

Current consensus price target is $2.93, suggesting upside of 70.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.5

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

Macquarie rates ALD as Outperform (1) -

Macquarie highlights the government measures to support refiners --given the limited storage of refined transport fuel-- such as the enhanced fuel security services payment, now at $0.10 per litre, which reflects the increased cost environment and materially improves downside protection while reducing earnings volatility.

It will come at a cost to the government, but the broker now forecasts a greater incidence of payments in future years. Macquarie expects further improvements in 2027 to ensure both refineries remain in the system.

Further support includes relaxing of fuel quality standards such as the diesel flashpoint lowered to 60.5°C. In the year to date the Singapore weighted average margin of US$19.60/bbl is well above long-term averages.

The broker retains an Outperform rating for Ampol and increases its target to $40 from $36.

Target price is $40.00 Current Price is $34.00 Difference: $6
If ALD meets the Macquarie target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $35.50, suggesting upside of 5.6% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 1.0

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

Citi rates ARB as Neutral (3) -

Citi views ARB Corp as a high-quality market leader in 4x4 accessories, though the recent de-rating in the PE multiple reflects concerns around increasing fragmentation across total Australian cars in usage (car park).

The company is seen as potentially underinvesting in engineering and fitment capacity, with a greater focus on dividends potentially limiting growth and constraining a re-rating.

The broker also flags near-term cyclical headwinds from higher fuel prices and reduced availability.

Target $22.05. Neutral.

Target price is $22.05 Current Price is $20.44 Difference: $1.61
If ARB meets the Citi target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $28.06, suggesting upside of 34.1% (ex-dividends)

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.8

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

Macquarie rates BXB as Neutral (3) -

In assessing the US market, Macquarie points out volatility remains high and for the third year running the context looks disappointing. A large amount of caution exists across the US economy.

The broker has shifted an expected second half recovery into 2027 and, while a clear catalyst will be a resolution of the Iran war, suggests the inflationary impulse could linger and influence macro decisions.

Macquarie's US dollar-based adjustments to earnings estimates for Brambles have been limited to the minor softening of US market volumes and changes to FX rates. Neutral retained. Targets is lowered to $23.35 from $24.70.

Target price is $23.35 Current Price is $22.46 Difference: $0.89
If BXB meets the Macquarie target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $26.57, suggesting upside of 17.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

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

Market Sentiment: 0.6

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

Ord Minnett rates COL as Accumulate (2) -

Ord Minnett concludes from a review of supermarket giants that the outlook is stronger than what the broader market is expecting.

The broker calculates like-for-like sales growth should pick up pace into FY27 rather than slow down, expecting an easing of the impact of illegal tobacco sales and a boost from inflation driven by the surge in oil prices.

Excluding the impact of industrial action and tobacco, Ord Minnett now forecasts Coles Group like-for-like sales growth of 4.1% in FY27, retaining an Accumulate rating and $22.50 target. A CAGR growth rate of 6.9% is expected for Coles over the forecast horizon.

Target price is $22.50 Current Price is $22.19 Difference: $0.31
If COL meets the Ord Minnett target it will return approximately 1% (excluding dividends, fees and charges).

Current consensus price target is $23.21, suggesting upside of 5.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.9

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

UBS rates GMG as Buy (1) -

UBS' global economics team outlines three Middle East conflict scenarios, a rapid resolution, a two month Strait of Hormuz disruption with oil at US$130/bbl, and an extended shock with oil at US$150/bbl.

Inflation is expected to rise sharply across all scenarios, with increases potentially exceeding current expectations, including fertiliser prices up 48% y/y and global food prices up 12% y/y.

The first scenario appears unlikely, with UBS Australia shifting to scenario two and now expecting two more RBA hikes to a 4.6% peak by August, versus 4.35% previously, and real GDP easing to 1.9% in 2026.

A-REITs are trading on a 3.7% FY26 yield, a -20.5% discount to NAV and a 60% premium to NTA.

Excluding Goodman Group, Charter Hall ((CHC)) and Centuria Capital Group ((CNI)), A-REITs trade at a -5.4% and -9.5% discount to NTA.

Goodman Group is Buy rated with a $33.92 target.

Target price is $33.92 Current Price is $25.08 Difference: $8.84
If GMG meets the UBS target it will return approximately 35% (excluding dividends, fees and charges).

Current consensus price target is $34.55, suggesting upside of 34.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.9

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

Macquarie rates GWA as Neutral (3) -

In assessing the US market, Macquarie points out volatility remains high and for the third year running the context looks disappointing. A large amount of caution exists across the US economy.

The broker has shifted an expected second half recovery into 2027 and, while a clear catalyst will be a resolution of the Iran war, suggests the inflationary impulse could linger and influence macro decisions.

GWA Group has a Neutral rating while Macquarie makes downgrades to earnings estimates, driven by soft volume expectations amid potential for freight-related price adjustments. Target is lowered to $2.15 from $2.65.

Target price is $2.15 Current Price is $2.12 Difference: $0.03
If GWA meets the Macquarie target it will return approximately 1% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.0

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

UBS rates IGO as Buy (1) -

UBS argues the current energy crisis could accelerate EV adoption beyond prior expectations, drawing parallels with the 1973 oil shock which drove lasting changes in policy, consumer behaviour and automotive strategy.

Higher oil prices are seen improving EV total cost of ownership versus ICE vehicles, supporting demand, particularly in regions exposed to energy shocks and benefiting lower-cost Chinese EV exports. US tariffs remain a constraint.

EV demand is still forecast to grow around 9% in 2026, with early-year sales modest despite rising consumer interest, while battery storage demand remains strong and lithium inventories in China stay tight. Even partial substitution underscores the scale of potential structural demand uplift.

UBS  favours lithium equities with longer-term leverage to EV adoption, preferring Liontown ((LTR)), Mineral Resources ((MIN)) and IGO Ltd ((IGO)). Rio Tinto ((RIO)) is nominated as a diversifed play.

IGO Ltd is Buy rated with an $8.55 target.

Target price is $8.55 Current Price is $8.09 Difference: $0.46
If IGO meets the UBS target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $8.96, suggesting upside of 14.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.3

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

Macquarie rates JHX as Outperform (1) -

In assessing the US market, Macquarie points out volatility remains high and for the third year running the context looks disappointing. A large amount of caution exists across the US economy.

The broker has shifted an expected second half recovery into 2027 and, while a clear catalyst will be a resolution of the Iran war, suggests the inflationary impulse could linger and influence macro decisions.

Macquarie believes there could be opportunities in James Hardie Industries, with growth in the short term increasingly supported by self-help initiatives and the Azek integration.

Valuation appears "relatively attractive" as the stock is trading on a prospective EV/EBIT of 12.8x compared with an historical average of 15.9x. Outperform retained. Target is reduced to $41.10 from $43.60.

Target price is $41.10 Current Price is $26.13 Difference: $14.97
If JHX meets the Macquarie target it will return approximately 57% (excluding dividends, fees and charges).

Current consensus price target is $41.16, suggesting upside of 58.1% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY26:

Forecast for FY27:

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

Ord Minnett rates MAH as Initiation of coverage with Hold (3) -

Ord Minnett is expanding its coverage of mining services, engineering and construction contractors and initiates coverage of MacMahon Holdings with a Hold rating and $0.75 target.

The broker observes the business performance has been "getting better" although it faces higher risks relative to others in the sector from its greater exposure to oil prices and supply constraints.

The contractor has continued to pivot towards underground mining and civil engineering versus surface mining work, which is more capital intensive. Surface mining now accounted for just 51% of revenue in the first half of FY26 compared with 90% back in FY18.

Target price is $0.75 Current Price is $0.71 Difference: $0.04
If MAH meets the Ord Minnett target it will return approximately 6% (excluding dividends, fees and charges).

Market Sentiment: 0.5

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

Ord Minnett rates MND as Reinstate Coverage with Accumulate (2) -

Ord Minnett is expanding its coverage of mining services, engineering and construction contractors and reinstating Monadelphous Group with an Accumulate rating and $30.55 target.

Overall, Monadelphous is the preferred choice in the segment given high-quality earnings and a track record. It has the least exposure to fuel price or supply volatility.

The company has a long history of lower volatility in cash flow and earnings amid growing exposure to maintenance and industrial services, which accounted for well over half of group revenue in the first half of FY26.

Target price is $30.55 Current Price is $27.61 Difference: $2.94
If MND meets the Ord Minnett target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $34.60, suggesting upside of 27.1% (ex-dividends)

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.4

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

Morgans rates NGI as Buy (1) -

Navigator Global Investments’ acquisition of Toronto-based AI-focused growth equity firm Georgian is strategically sound, according to Morgans.

The transaction is also earnings accretive, observes the analyst, adding exposure to the fast-growing AI-focused private markets segment.

The deal aligns with management's acquisition criteria, offering access to scalable assets under management (AUM), attractive cash yields and long-term growth through Georgian’s established platform.

The broker makes modest EPS forecast upgrades of 1-3% across FY26-FY28, though valuation has been tempered by lower peer multiples. Target falls to $2.98 from $3.35.

Commentary attributes recent share price weakness to private credit concerns linked to Blue Owl, rather than fundamentals, with market volatility seen as supportive for alternative asset managers. Morgans retains a Buy rating.

Target price is $2.98 Current Price is $2.07 Difference: $0.91
If NGI meets the Morgans target it will return approximately 44% (excluding dividends, fees and charges).

Current consensus price target is $3.23, suggesting upside of 52.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

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

Ord Minnett rates NGI as Buy (1) -

Navigator Global Investments has acquired a 4.5% strategic minority and preferred economic interest in Georgian, an AI-focused technology investor with US$5.9bn in assets under management.

The company's -US$100m investment is spread over three years with the deal structured to enhance returns while enabling the transaction to be funded from cash flow.

The broker notes there is still opportunity for Navigator Global to continue with further acquisitions, while the latest investment provides shareholders with unique exposure to the AI theme through a specialised and growing private market franchise.

Target is reduced to $3.30 from $3.55 and a Buy rating is maintained.

Target price is $3.30 Current Price is $2.07 Difference: $1.23
If NGI meets the Ord Minnett target it will return approximately 59% (excluding dividends, fees and charges).

Current consensus price target is $3.23, suggesting upside of 52.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

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

UBS rates NGI as Buy (1) -

UBS highlights Navigator Global Investments' first transaction for FY26, the acquisition of a 4.5% equity stake and preferred economic interest (PEI) for -US$100m in Georgian, a Canada-based AI private equity investor.

The consideration is -US$5m upfront and -US$95m deferred over three years, inferring a valuation of US$2.2bn.

Georgian is viewed as diversifying Navigator's portfolio with the addition of AI-driven B2B technology funds, which are aiming to disrupt SaaS companies.

Management expects the acquisition to achieve a cash yield between the 10%-15% target range, but the internal rate of return could be considerably higher.

With the shares down -28% since the February results, UBS sees value at current levels. A Buy rating is retained with a lower target of $3.45 from $3.80. EPS forecasts are lifted slightly by 1.2% in FY26 and 3% in FY27.

Target price is $3.45 Current Price is $2.07 Difference: $1.38
If NGI meets the UBS target it will return approximately 67% (excluding dividends, fees and charges).

Current consensus price target is $3.23, suggesting upside of 52.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

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

UBS rates NST as Upgrade to Buy from Sell (1) -

UBS upgrades Northern Star Resources to Buy from Sell with a lower target of $24.70 from $28, pointing to the share price decline of some -40% over the last month as excessive following a disappointing operational update.

The analyst's production outlook is highlighted as "conservative", sitting some -13% below consensus for FY27-FY31, with rationalisation of the portfolio incorporating the sale of lower margin, shorter life assets as a pathway to further re-rating upside.

Market consensus is viewed as still too optimistic in the short term. UBS models 1.65Moz at an AISC of around $3,080/oz and -$2.4bn in capex, versus consensus at circa 2.35Moz at $3,000/oz and -$3.0bn capex.

EPS forecasts are lowered by -24% for FY26 and -26% for FY27/FY28.

Target price is $24.70 Current Price is $19.51 Difference: $5.19
If NST meets the UBS target it will return approximately 27% (excluding dividends, fees and charges).

Current consensus price target is $27.65, suggesting upside of 35.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.9

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

Ord Minnett rates NWH as Initiation of coverage with Hold (3) -

Ord Minnett is expanding its coverage of mining services, engineering and construction contractors and initiates coverage of  NRW Holdings with a Hold rating and $5.80 target.

The broker forecasts an EPS compound growth rate of 17%, supported by a more diverse customer base, although the company faces near-term challenges and is more sensitive compared with peers to oil price moves.

Target price is $5.80 Current Price is $5.31 Difference: $0.49
If NWH meets the Ord Minnett target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $6.57, suggesting upside of 24.2% (ex-dividends)

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.7

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

Bell Potter rates PGC as Buy (1) -

Paragon Care’s long-term growth is underpinned by expansion in Asian medical technology and pharmacy distribution, suggests Bell Potter.

The integration of Chemist Warehouse Group’s wholesale distribution business is nearing completion, with ongoing cost-out initiatives and the new Brisbane distribution centre expected to deliver meaningful savings.

The broker flags inflationary pressures, particularly rising diesel and distribution costs, as a key risk, with limited ability to pass these on to price-sensitive pharmacy customers.

Progress on the Infinity Group recovery provides potential upside, though timing remains uncertain. Infinity is a group of pharmacies and related entities that went into administration/receivership.

Bell Potter retains a Buy rating and raises its target to 30c from 29c.

Target price is $0.30 Current Price is $0.19 Difference: $0.11
If PGC meets the Bell Potter target it will return approximately 58% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 1.0

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

Morgan Stanley rates PXA as Overweight (1) -

Morgan Stanley reviews the first half results (released in February) and outlook from Pexa Group finding this supportive of its investment thesis.

The Australian platform is a core driver of earnings and value and the broker expects this will continue generating infrastructure-like top-line growth as well as higher margin/returns.

The exit of digital solutions is welcomed as this was a failed strategy of previous management and the UK remains the "X factor" for investors, the broker adds.

Overweight retained. Target is $17.50. Industry View: Attractive.

Target price is $17.50 Current Price is $15.36 Difference: $2.14
If PXA meets the Morgan Stanley target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $17.90, suggesting upside of 17.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.9

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

Citi rates QAN as Buy (1) -

In a flash update, Citi notes the RBA has announced the decision to remove the majority of credit and debit card surcharges, which will come into effect in October and will permit lowering caps on interchange fees (-16bps for debit/-30bps for credit).

The RBA decision will also necessitate increased fee transparency by card networks/payment service providers.

The analyst highlights possible impacts on Qantas Airways' loyalty business are unknown at this stage, with some evidence showing that consumer credit interchange fees have funded frequent flyer and other reward programs.

Merchants are expected to recover costs through higher prices and Qantas Loyalty to offset any flow-on impact of lower cost recovery further up the chain, Citi explains.

Buy rating. Target of $12.10.

Target price is $12.10 Current Price is $8.28 Difference: $3.82
If QAN meets the Citi target it will return approximately 46% (excluding dividends, fees and charges).

Current consensus price target is $12.12, suggesting upside of 44.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 1.0

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

Macquarie rates REH as Neutral (3) -

In assessing the US market, Macquarie points out volatility remains high and for the third year running the context looks disappointing. A large amount of caution exists across the US economy.

The broker has shifted an expected second half recovery into 2027 and, while a clear catalyst will be a resolution of the Iran war, suggests the inflationary impulse could linger and influence macro decisions.

Macquarie notes the competitive intensity in the broader US market presents risks in both directions for Reece. Neutral retained. Target is reduced to $14.90 from $17.00.

Target price is $14.90 Current Price is $13.81 Difference: $1.09
If REH meets the Macquarie target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $16.67, suggesting upside of 25.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.3

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

Citi rates RHC as Neutral (3) -

While the analyst at Citi sees rising investor interest in Ramsay Health Care, driven by the potential separation of Ramsay Sante, the stock is considered fairly valued at current levels.

Increased digital investment in the Australian business may weigh on near-term earnings, the broker suggests, with benefits expected longer term.

Citi lowers its UK revenue growth forecasts following weaker read-through from peers, while also incorporating higher costs and the pending National Capital Private Hospital acquisition.

The target falls to $39.00 from $41.40. Neutral rating maintained.

Target price is $39.00 Current Price is $39.85 Difference: minus $0.85 (current price is over target).
If RHC meets the Citi target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $39.97, suggesting upside of 2.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: -0.2

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

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

Is Rio Tinto planning to monetise its infrastructure assets? This is the question Morgan Stanley is pondering as it would be consistent with the previously articulated strategy to divest non-core assets and/or crystallise value.

Rival BHP Group ((BHP)) made a comparable transaction last year by selling a 49% stake in its WA iron ore inland power system for US$2bn, the broker notes.

Media reports suggest Rio Tinto's Pilbara power portfolio is one potential option. A similar transaction to BHP's could allow Rio Tinto to recycle capital without compromising the integrity or competitive advantage of its Pilbara iron ore franchise, Morgan Stanley suggests.

Equal weight rating. Target is $146. Industry view is Attractive.

Target price is $146.00 Current Price is $160.78 Difference: minus $14.78 (current price is over target).
If RIO meets the Morgan Stanley target it will return approximately minus 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $155.50, suggesting downside of -3.7% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY26:

Forecast for FY27:

This company reports in USD. 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 RWC as Outperform (1) -

In assessing the US market, Macquarie points out volatility remains high and for the third year running the context looks disappointing. A large amount of caution exists across the US economy.

The broker has shifted an expected second half recovery into 2027 and, while a clear catalyst will be a resolution of the Iran war, suggests the inflationary impulse could linger and influence macro decisions.

The investment thesis for Reliance Worldwide is supported by valuation, Macquarie asserts. The business is leveraged to any market recovery as it is allied with strong channel partners that are gaining share.

The $120m buyback is also a positive.Outperform retained. Target is reduced to $4.50 from $4.75.

Target price is $4.50 Current Price is $2.99 Difference: $1.51
If RWC meets the Macquarie target it will return approximately 51% (excluding dividends, fees and charges).

Current consensus price target is $4.02, suggesting upside of 31.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

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

Market Sentiment: 0.2

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

Citi rates S32 as Upgrade to Buy from Neutral (1) -

Citi raises its target for South32 to $5.40 from $5.00 and upgrades to Buy from Neutral.

The company's focus is expected to shift toward executing growth options and extending mine life under incoming CEO Matt Daley, with potential to double copper-equivalent volumes over the next decade.

The analysts anticipate limited volume growth in alumina and manganese will be offset by upside risk from potential price spikes.

The stock is viewed as attractively priced, trading on around 4.3x June-27 EV/EBITDA.

Target price is $5.40 Current Price is $4.41 Difference: $0.99
If S32 meets the Citi target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $5.17, suggesting upside of 21.0% (ex-dividends)

Forecast for FY26:

Forecast for FY27:

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

Market Sentiment: 0.8

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

UBS rates S32 as Buy (1) -

Iranian drone and missile attacks have damaged aluminium smelters in the Middle East, with a -3.2mtpa outage resulting in an additional supply constraint on top of the closure of the Strait of Hormuz, disrupting supply.

Alcoa ((AAI)) has the most leverage to the aluminium price, with South32 the most preferred base metals play due to valuation and exposure to copper, which is considered "attractive".

The analyst emphasises the Middle East conflict underpins higher aluminium, thermal coal, iron ore (and energy and shipping costs), with Mineral Resources ((MIN)), South32, BHP Group ((BHP)), Alcoa, Whitehaven Coal ((WHC)) and Fortescue ((FMG)) seemingly better on spot fair value and free cash flow yield.

South32 is Buy rated with a $5.20 target and spot value around $6.40.

Target price is $5.20 Current Price is $4.41 Difference: $0.79
If S32 meets the UBS target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $5.17, suggesting upside of 21.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

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

Market Sentiment: 0.8

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

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

In assessing the US market, Macquarie points out volatility remains high and for the third year running the context looks disappointing. A large amount of caution exists across the US economy.

The broker has shifted an expected second half recovery into 2027 and, while a clear catalyst will be a resolution of the Iran war, suggests the inflationary impulse could linger and influence macro decisions.

Macquarie upgrades SGH Ltd to Outperform from Neutral, assessing the stock has materially de-rated to an "attractive" 13x prospective EV/EBIT that is in line with the five-year average.

Demand could weaken yet the broker suspects the business is well able to manage. There remains the likelihood the attempt to acquire BlueScope Steel ((BSL)) will continue.

Target is reduced to $50.40 from $53.05.

Target price is $50.40 Current Price is $40.68 Difference: $9.72
If SGH meets the Macquarie target it will return approximately 24% (excluding dividends, fees and charges).

Current consensus price target is $52.13, suggesting upside of 28.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 1.0

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

Macquarie rates VEA as Outperform (1) -

Macquarie highlights the government measures to support refiners --given the limited storage of refined transport fuel-- such as the enhanced fuel security services payment, now at $0.10 per litre, which reflects the increased cost environment and materially improves downside protection while reducing earnings volatility.

It will come at a cost to the government, but the broker now forecasts a greater incidence of payments in future years. Macquarie expects further improvements in 2027 to ensure both refineries remain in the system.

Further support includes relaxing of fuel quality standards such as the diesel flashpoint lowered to 60.5°C. In the year to date, the Singapore weighted average margin of US$19.60/bbl is well above long-term averages.

The broker retains an Outperform rating for Viva Energy, assessing it has the greatest upside potential of the two refiners given its high sensitivity to refining margins, and raises its target to $3.50 from $2.70.

Target price is $3.50 Current Price is $2.53 Difference: $0.97
If VEA meets the Macquarie target it will return approximately 38% (excluding dividends, fees and charges).

Current consensus price target is $2.81, suggesting upside of 9.7% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.8

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

Ord Minnett rates WOW as Accumulate (2) -

Ord Minnett concludes from a review of supermarket giants that the outlook is stronger than what the broader market is expecting.

The broker calculates like-for-like sales growth should pick up pace into FY27 rather than slow down, expecting an easing of the impact of illegal tobacco sales and a boost from inflation driven by the surge in oil prices.

Excluding the impact of industrial action and tobacco, Ord Minnett now forecasts Woolworths Group like-for-like sales growth of 4.3% in FY27, retaining an Accumulate rating and $39 target. A CAGR growth rate of 12.6% is expected for Woolworths over the forecast horizon.

Target price is $39.00 Current Price is $36.68 Difference: $2.32
If WOW meets the Ord Minnett target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $36.26, suggesting downside of -0.1% (ex-dividends)

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.2

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

Citi rates ZIP as Buy (1) -

Citi questions whether Zip Co's over 40% growth is sustainable, given rising bad debts in its US “Pay in 8” product and broader macro risks. The analysts lower their target to $2.60 from $4.30 and retain a Buy rating.

Commentary anticipates bad debts will increase in the near term, particularly in Q3, before improving in Q4, with the company still expected to meet earnings guidance for FY26.

The broker ponts out higher revenue yields and lower funding costs should offset elevated losses, supporting margins.

It's noted slowing app download growth suggests a shift toward existing customers, while higher oil prices pose a risk to consumer spending and credit quality.

Target price is $2.60 Current Price is $1.49 Difference: $1.115
If ZIP meets the Citi target it will return approximately 75% (excluding dividends, fees and charges).

Current consensus price target is $3.59, suggesting upside of 131.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 1.0

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