Australian Broker Call

Citi rates ALL as Buy (1) -

Cit reviews some results from land-based competitors and concludes Aristocrat Leisure is investing through short-term disruption, while competitors reduce investment to preserve liquidity.

The analyst focuses on the UK listed IGT and the US based SciGames, as both recently issued 2Q20 results. Both are cutting back heavily on capex and R&D in order to preserve liquidity as they swing to losses, states the broker.

Meanwhile, casino revenues have proven resilient which is also supportive of the medium-term outlook for the company, says the analyst.

The Buy rating and $30.10 price target remain unchanged.

Target price is $30.10 Current Price is $26.96 Difference: $3.14
If ALL meets the Citi target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $29.57, suggesting upside of 8.0% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.9

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

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

Ord Minnett downgrades Aristocrat Leisure to Accumulate from Buy based on valuation. Target is $28.50.

Target price is $28.50 Current Price is $26.96 Difference: $1.54
If ALL meets the Ord Minnett target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $29.57, suggesting upside of 8.0% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.9

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

Ord Minnett rates AMI as Accumulate (2) -

Ord Minnett reviews the reserves outlook noting a production shift towards base metals. Upcoming FY21 guidance for the mine plan and metal output should remain broadly unchanged.

While risks continue surrounding the Peak development and grade variability Ord Minnett still likes the stock as it trades at a discount to fundamentals and has no debt and no hedge book.

Accumulate maintained. Target is raised to $0.60 from $0.55.

Target price is $0.60 Current Price is $0.60 Difference: $0
If AMI meets the Ord Minnett target it will return approximately 0% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.8

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

Citi rates ANZ as Buy (1) -

Banking analysts at Citi note banks may struggle during the August reporting season to paint a true picture of performance. This is due to declining economic activity and lending demand, loan loss recognition deferrals and the prospect of ongoing lockdowns.

The broker states investors will be focused on how loan loss provisioning levels have evolved since May, due to Victoria’s stage 4 lockdown.

Citi anticipates that forward-looking statements on revenue and cost of funds may be positive as a lack of lending, but strong deposit growth has seen a fall in domestic deposit costs. The broker forecasts higher-than-consensus Net Interest Margins (NIM) as banks will likely use the build-up of excess deposits to repay wholesale debt as it comes due.

ANZ Bank reports a 3Q20 Pillar 3 update on Wednesday, August 19. (Pillar 3 is an APRA requirement to disclose the main features of instruments included in the bank's regulatory capital).

Citi forecasts 3Q20 cash earnings of around $1.25bn and no dividend, as the bank has deferred the decision on its interim dividend.

No change to rating or price target.

Target price is $24.75 Current Price is $17.46 Difference: $7.29
If ANZ meets the Citi target it will return approximately 42% (excluding dividends, fees and charges).

Current consensus price target is $21.61, suggesting upside of 22.5% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.7

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

UBS rates ANZ as Buy (1) -

The first half saw ANZ Bank announce less than expected credit impairment charges of -$1,674m including a -$1,031m covid-19 overlay. UBS assumes bad debt charges of -$1,058m in the second half, continuing to -$2,288m in the first half of FY21.

The bank will likely provide an update on the status of its loan deferral customers which stood at 105,000 in home loan deferrals and 42,000 in business deferrals in the first half.

UBS doesn't expect any dividend distribution this year.

UBS maintains its Buy rating with a target price of $21.

Target price is $21.00 Current Price is $17.46 Difference: $3.54
If ANZ meets the UBS target it will return approximately 20% (excluding dividends, fees and charges).

Current consensus price target is $21.61, suggesting upside of 22.5% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.7

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

Credit Suisse rates AQZ as Outperform (1) -

Credit Suisse observes Alliance Aviation enters FY21 with a fully utilised fleet and no indication that the trends from the fourth quarter are moderating. FIFO markets are strong and end commodity exposures favourable.

The result reveals pre-tax profit of $40.7m, consistent with guidance. Credit Suisse reduces dividend estimates in outer years to reflect a sensible approach to capital management in light of the recent raising. Outperform retained. Target rises to $4.05 from $3.75.

Target price is $4.05 Current Price is $3.57 Difference: $0.48
If AQZ meets the Credit Suisse target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $3.80, suggesting upside of 5.6% (ex-dividends)

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

Credit Suisse rates AWC as Outperform (1) -

Credit Suisse lifts earnings estimates because of strength across the base metals complex in China. The lead stimulus has caused the broker to revise forecasts higher, reflecting consumption growth of 1-3% in aluminium in China in 2020.

Outperform rating and $2 target maintained. The broker finds enough indicators to expect Alumina Ltd can perform well over the next 12 months.

Target price is $2.00 Current Price is $1.57 Difference: $0.43
If AWC meets the Credit Suisse target it will return approximately 27% (excluding dividends, fees and charges).

Current consensus price target is $1.87, suggesting upside of 14.5% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

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

Citi rates BEN as Neutral (3) -

Banking analysts at Citi note banks may struggle during the August reporting season to paint a true picture of performance. This is due to declining economic activity and lending demand, loan loss recognition deferrals and the prospect of ongoing lockdowns.

The broker states investors will be focused on how loan loss provisioning levels have evolved since May, due to Victoria’s stage 4 lockdown.

Citi anticipates that forward-looking statements on revenue and cost of funds may be positive as a lack of lending, but strong deposit growth has seen a fall in domestic deposit costs. The broker forecasts higher-than-consensus Net Interest Margins (NIM) as banks will likely use the build-up of excess deposits to repay wholesale debt as it comes due.

Bendigo and Adelaide Bank reports FY20 results on Monday, August 17.

Citi expects strong lending growth to be offset by weak NIM's in 2H20 and the key points to focus upon are the NIM outlook, cost growth and 4Q loan loss provisioning.

The broker forecasts no 2H20 dividend due to the material 1H20 dividend.

No change to rating or price target.

Target price is $7.25 Current Price is $6.64 Difference: $0.61
If BEN meets the Citi target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $7.60, suggesting upside of 13.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: -0.2

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

UBS rates BWP as Neutral (3) -

BWP Trust's FY20 results were majorly in-line with the broker's estimates. It delivered a 1% growth in its FY20 net profit even with the uncertainty caused by covid-19.

Rent receipts were high at 98.8% from March to June while abatements were less than 0.3% of the portfolio net profit interest (NPI).

UBS highlights the REIT remains well supported by Bunnings as its key anchor tenant. With high levels of lease expiries in the next three years, the broker considers the REIT expensive at current levels. 

UBS reiterates its Neutral rating with the target price rising to $3.80 from $3.37.

Target price is $3.80 Current Price is $3.95 Difference: minus $0.15 (current price is over target).
If BWP meets the UBS target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.60, suggesting downside of -9.9% (ex-dividends)

The company's fiscal year ends in June.

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 CBA as Neutral (3) -

Banking analysts at Citi note banks may struggle during the August reporting season to paint a true picture of performance. This is due to declining economic activity and lending demand, loan loss recognition deferrals and the prospect of ongoing lockdowns.

The broker states investors will be focused on how loan loss provisioning levels have evolved since May, due to Victoria’s stage 4 lockdown.

Citi anticipates that forward-looking statements on revenue and cost of funds may be positive as a lack of lending, but strong deposit growth has seen a fall in domestic deposit costs. The broker forecasts higher-than-consensus Net Interest Margins (NIM) as banks will likely use the build-up of excess deposits to repay wholesale debt as it comes due.

The Commonwealth Bank of Australia FY20 result is due on Wednesday, August 12. 

Citi expects the bank to record an improved 4Q result with the key items to look out for being weaker than expected NIM's 4Q loan provisioning and a recovering capital position.

The broker forecasts a 50 cent dividend in 2H20.

No change to rating or price target.

Target price is $71.00 Current Price is $71.70 Difference: minus $0.7 (current price is over target).
If CBA meets the Citi target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $66.51, suggesting downside of -7.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: -0.3

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

UBS rates CBA as Neutral (3) -

UBS expects net interest margin to fall -3bps in the second half to 2.07% but admits there are upside risks to its forecast due to favorable funding costs and strong growth in at-call deposits.

The average interest-earning asset growth is expected to be 3% in the second half. Commonwealth Bank has maintained its market share during this period and the broker expects this to continue.

Increased staffing in customer support and reduced annual leaves announced in the third quarter will impact costs in the fourth quarter and into FY21, expects UBS.

Credit impairment charges are expected to rise to -$1.9bn due to covid-19 related provisions. With the government stimulus measures and loan deferrals coming to an end, the broker thinks the bank could see an uptick in impairment charges.

The broker assumes a $0.95 per share dividend but notes this is to be at the higher end of consensus. 

UBS retains its Neutral rating with a target price of $65

Target price is $65.00 Current Price is $71.70 Difference: minus $6.7 (current price is over target).
If CBA meets the UBS target it will return approximately minus 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $66.51, suggesting downside of -7.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: -0.3

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

Macquarie rates CCX as Outperform (1) -

The company has raised around $90m to support the balance sheet by eliminating debt and to position it for growth. The unaudited result for FY20 is broadly in line with Macquarie's forecasts.

While recent developments in Melbourne and a rise in the spread of the coronavirus may represent some downside to estimates, Macquarie is comforted by the recent extension of JobKeeper.

Outperform retained. Target is raised to $4.21 from $3.57.

Target price is $4.21 Current Price is $3.37 Difference: $0.84
If CCX meets the Macquarie target it will return approximately 25% (excluding dividends, fees and charges).

Current consensus price target is $3.84, suggesting upside of 13.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.7

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

Credit Suisse rates CIP as Neutral (3) -

FY20 results were within revised guidance and in line with Credit Suisse estimates. Guidance for FY21 is for free funds from operations of 17.4c and a distribution of 17.0c.

While this is below Credit Suisse estimates, it is considered mainly a function of to the dilutive impact of the -$340.8m equity raising and the related -$447.1m in acquisitions. The broker increases the target to $3.17 from $2.66 and retains a Neutral rating.

Target price is $3.17 Current Price is $3.31 Difference: minus $0.14 (current price is over target).
If CIP meets the Credit Suisse target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.23, suggesting upside of 1.3% (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 CIP as Buy (1) -

FY20 results were in line with guidance. Ord Minnett notes the portfolio has been repositioned over the past 12 months. The average lease term has risen to 10.2 years from 4.3 years and total assets have increased to $2bn.

The company has acquired the Telstra data centre in Melbourne on a year sale and leaseback agreement for $417m.

Centuria Industrial is also in due diligence to acquire three additional industrial assets for $45m.

Ord Minnett retains a Buy rating and raises the target to $3.60 from $3.10.

Target price is $3.60 Current Price is $3.31 Difference: $0.29
If CIP meets the Ord Minnett target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $3.23, suggesting upside of 1.3% (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

UBS rates CIP as Neutral (3) -

Centuria Industrial REIT acquired 3 assets worth $447m. UBS considers the transaction as being circa -7% dilutive to earnings.

The acquisition provides an entry to the data centre market, notes the broker, while highlighting it also increases the portfolio weighted average lease expiry (WALE) to 10.2 years.

The REIT's FY20 funds from operations (FFO) per share was at the bottom end of the revised guidance range, but the broker thinks it showed resilience given the pandemic.

UBS reaffirms its Neutral rating with the target price decreasing to $3.23 from $3.36.

Target price is $3.23 Current Price is $3.31 Difference: minus $0.08 (current price is over target).
If CIP 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 $3.23, suggesting upside of 1.3% (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

Morgans rates COF as Add (1) -

Morgans describes the FY20 result as 'solid' with portfolio metrics stable, for Centuria Office REIT, especially given current operating conditions.

Rent collection over April to June averaged 92%. The trust provided dividend guidance of 16.5 cents, which equates to a yield of over 8%, highlights the broker.

No Funds from Operations (FFO) guidance was provided due to the ongoing uncertainty around covid-19 and impact to business operating conditions.

Morgans acknowledges prevailing uncertainties but notes the stock continues to offer an attractive Total Shareholder Return (TSR).

The Add rating is maintained. The target price is decreased to $2.29 from $2.33.

Target price is $2.29 Current Price is $1.95 Difference: $0.34
If COF meets the Morgans target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $2.32, suggesting upside of 18.8% (ex-dividends)

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

UBS rates COF as Buy (1) -

Centuria Office REIT's FY20 result was about 3% ahead of UBS's forecast driven by a better than expected covid-19 outcome. The REIT's rent collection rate was 92% from April to June. 

No FY21 guidance was provided but the dividend guidance should alleviate investors' concern, comments UBS.

The broker thinks the REIT will likely see lesser asset value declines than others. However, investors will focus on its gearing levels which are in the mid-30% range.

Centuria plans to retain some capital to fund maintenance capex and will do so by reducing the payout ratio to 85-90%. The broker highlights for every -10% reduction in the payout ratio, gearing will reduce by -0.5%.

UBS retains its Buy with a target price of $2.50.

Target price is $2.50 Current Price is $1.95 Difference: $0.55
If COF meets the UBS target it will return approximately 28% (excluding dividends, fees and charges).

Current consensus price target is $2.32, suggesting upside of 18.8% (ex-dividends)

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

UBS rates CSL as Buy (1) -

UBS takes a look at the financial performance of CSL's competitors. Grifols and Takeda enjoyed strong revenue growth for their plasma businesses in the June quarter. Both consider the outlook on plasma collection to be challenging.

A range of potential mitigations across the group will help underpin earnings growth, believes the broker. These include normalising albumin sales in China and a strong flu vaccine demand among others.

The broker has trimmed its collection forecasts, expecting a decline of -25% for March-September 2020 and -5% between October and March 2021. Earnings forecasts have been notched down by circa -2% for FY21.

UBS maintains its Buy rating with the target price reducing to $320 from $331.

Target price is $320.00 Current Price is $278.15 Difference: $41.85
If CSL meets the UBS target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $306.03, suggesting upside of 10.2% (ex-dividends)

The company's fiscal year ends in May.

Forecast for FY20:

Forecast for FY21:

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

Market Sentiment: 0.4

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

Morgans rates CTP as Hold (3) -

Central Petroleum posted its 4Q20 result, with cash receipts and production costs in-line with Morgans forecasts, while General & Administrative and finance costs were below its forecasts.

Operating cash flow of $4m impressed the broker.

Work on the Range coal seam gas project remains suspended and follow up drilling of the Dukas prospect has been scheduled for 1H22.

Morgans sees attractive upside in Central Petroleum. However, the company is being weighed down by excessive debt. The analyst would revisit the investment thesis if the debt is refinanced, Range is progressed and a farm-in partner secured for its extensive Amadeus acreage package.

The Hold rating is maintained. The target price is increased to $0.089 from $0.072.

Target price is $0.09 Current Price is $0.09 Difference: minus $0.001 (current price is over target).
If CTP meets the Morgans target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.0

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

Credit Suisse rates IGO as Underperform (5) -

Credit Suisse implements a more favourable base metals deck. Infrastructure-led stimulus has accelerated commodity demand in China.

The broker revises forecasts to reflect consumption growth of 1-3% for copper and aluminium in 2020 while retaining demand reductions for the rest of the world of -10-12%.

Underperform rating retained. Target rises to $4.05 from $4.00.

Target price is $4.05 Current Price is $4.80 Difference: minus $0.75 (current price is over target).
If IGO meets the Credit Suisse target it will return approximately minus 16% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.77, suggesting downside of -4.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.0

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

Morgans rates KLL as Add (1) -

Following the $61m equity raising completed in June, Kalium Lakes is confident it is fully financed to SOP production, according to Morgans.

The broker notes prior capital overruns were driven by a variety of factors, but the outcome should be a more robust operating facility comfortably able to meet initial forecast production figures, 

At 30 June, the company reported 52% construction completion at Beyondie.

Morgans describes a "near death" experience for the company at the beginning of the year, but states that the company has resumed and accelerated construction activities at Beyondie.

The Speculative Buy rating is maintained. The target price is reduced to $0.232 from $0.863.

Target price is $0.23 Current Price is $0.14 Difference: $0.092
If KLL meets the Morgans target it will return approximately 66% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 1.0

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

Macquarie rates LEP as Neutral (3) -

Rental collection has been strong but FY20 distributable earnings were below Macquarie's estimates because of higher corporate costs. No FY21 guidance was provided.

The broker assesses short-term catalysts include the rent review process whereby 36 assets have now received the full 10% increase in rents.

The remaining 43 are subject to independent determination and an outcome is expected in the first quarter.

Debt refinancing is also a catalyst and while timing is uncertain the broker expects this will occur in FY22 at 3%. Neutral rating retained. Target is reduced -2% to $4.69.

Target price is $4.69 Current Price is $4.71 Difference: minus $0.02 (current price is over target).
If LEP meets the Macquarie target it will return approximately minus 0% (excluding dividends, fees and charges - negative figures indicate an expected loss).

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 LEP as Lighten (4) -

Profit in FY20 was up 7.5% and well above Ord Minnett's forecasts. Rent determinations on 43 properties remain outstanding with the result expected by the end of September.

Ord Minnett notes the high-quality portfolio with stable growth but anticipates a flat distribution profile through to FY22. Lighten rating retained. Target is $4.40.

Target price is $4.40 Current Price is $4.71 Difference: minus $0.31 (current price is over target).
If LEP meets the Ord Minnett target it will return approximately minus 7% (excluding dividends, fees and charges - negative figures indicate an expected loss).

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 NAB as Buy (1) -

Banking analysts at Citi note banks may struggle during the August reporting season to paint a true picture of performance. This is due to declining economic activity and lending demand, loan loss recognition deferrals and the prospect of ongoing lockdowns.

The broker states investors will be focused on how loan loss provisioning levels have evolved since May, due to Victoria’s stage 4 lockdown.

Citi anticipates that forward-looking statements on revenue and cost of funds may be positive as a lack of lending, but strong deposit growth has seen a fall in domestic deposit costs. The broker forecasts higher-than-consensus Net Interest Margins (NIM) as banks will likely use the build-up of excess deposits to repay wholesale debt as it comes due.

The National Australia Bank reports 3Q20 results on Friday, August 14.

Citi forecasts 3Q20 cash earnings of $1.26bn and a reduced dividend.

No change to rating or price target.

Target price is $23.50 Current Price is $16.91 Difference: $6.59
If NAB meets the Citi target it will return approximately 39% (excluding dividends, fees and charges).

Current consensus price target is $20.26, suggesting upside of 18.9% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.5

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

UBS rates NAB as Buy (1) -

Given National Australia Bank's relatively low first-half charge compared to peers (-$1,161m), UBS expects -$1,464m as charges for the second half.

Till the first half, the bank had approved 75,000 home loan deferrals worth $26.5bn and 34,000 business deferrals worth $17.4bn. 

UBS maintains its Buy rating with a target price of $20.50.

Target price is $20.50 Current Price is $16.91 Difference: $3.59
If NAB meets the UBS target it will return approximately 21% (excluding dividends, fees and charges).

Current consensus price target is $20.26, suggesting upside of 18.9% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.5

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

Credit Suisse rates OZL as Underperform (5) -

Credit Suisse implements a more favourable base metals deck. Infrastructure-led stimulus has accelerated commodity demand in China.

The broker revises forecasts to reflect consumption growth of 1-3% for copper and aluminium in 2020 while retaining demand reductions for the rest of the world of -10-12%.

Underperform rating retained. Target rises to $10.17 from $9.00.

Target price is $10.70 Current Price is $14.00 Difference: minus $3.3 (current price is over target).
If OZL meets the Credit Suisse target it will return approximately minus 24% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $12.71, suggesting downside of -10.2% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.5

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

Ord Minnett rates QAN as Resume coverage with Hold (3) -

Ord Minnett observes Qantas has done a good job in reducing costs and commitments. However, industry headwinds are extreme and the timing of passenger recovery is uncertain.

The broker estimates around 80% of the next five years in earnings will come from the domestic business and loyalty program and domestic travel won't recover to 2019 levels until FY23 and international until FY25.

Ord Minnett resumes coverage with a Hold rating and $3.50 target. The $1.4bn capital raising should allow Qantas to fund its restructure and negotiate a period of cash burn.

The broker assumes aircraft purchases will be deferred until FY23 and no distribution will be paid until then.

Target price is $3.50 Current Price is $3.24 Difference: $0.26
If QAN meets the Ord Minnett target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $4.23, suggesting upside of 27.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.5

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

UBS rates QAN as Buy (1) -

Bain Capital released strategy details for Virgin Australia. Virgin Australia intends to offer customers a broad offering which includes regional routes, lounges, loyalty, corporate and leisure but on a reduced scale, reports UBS.

The broker considers this to be positive for Qantas Airways. It is similar to the service offering from Virgin over the past 5 years where Qantas was able to take about 90% of the domestic profit pool.

In terms of revenue, the broker highlights Qantas has a 25% unit revenue advantage over Virgin.

UBS retains its Buy rating with a target price of $4.60

Target price is $4.60 Current Price is $3.24 Difference: $1.36
If QAN meets the UBS target it will return approximately 42% (excluding dividends, fees and charges).

Current consensus price target is $4.23, suggesting upside of 27.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.5

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

Credit Suisse rates RIO as Underperform (5) -

Credit Suisse implements a more favourable base metals deck. Infrastructure-led stimulus has accelerated commodity demand in China.

The broker revises forecasts to reflect consumption growth of 1-3% for copper and aluminium in 2020 while retaining demand reductions for the rest of the world of -10-12%.

Underperform rating retained. Target is lifted to $88 from $86.

Target price is $88.00 Current Price is $103.99 Difference: minus $15.99 (current price is over target).
If RIO meets the Credit Suisse target it will return approximately minus 15% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $102.25, suggesting downside of -3.1% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

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

Market Sentiment: 0.1

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

Morgan Stanley rates RMD as Overweight (1) -

The US Centre for Medicare & Medicaid proposes changes that will expand telehealth permanently. Morgan Stanley believes this will accelerate the adoption of remote patient monitoring technologies such as ResMed's Propeller Health.

Given current relationships and pharmacy agreements as well as demonstrated expertise in patient connectivity, the broker considers ResMed has a strong competitive position in what is likely to become a high-growth market.

Overweight. Target is $25.50. Industry view: In-Line.

Target price is $25.50 Current Price is $27.95 Difference: minus $2.45 (current price is over target).
If RMD 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 $24.73, suggesting downside of -4.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

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

Market Sentiment: 0.0

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

UBS rates SAR as Neutral (3) -

Saracen Mineral Holdings provided FY21 guidance for its Carosue Dam mine and Thunderbox operations. The growth capex guidance for the year at $330m is much larger than the circa $125m UBS expected.

However, the broker points out this guidance includes a stripping campaign on new open pits and underground development which is ahead of the broker's expectations.

Excluding the Superpit, production is expected to grow to circa 450kozpa by FY23, ahead of the broker's expected 410kozpa.

The broker considers Saracen to be a growth company that offers organic group production growth of 6% between FY20-24. 

UBS maintains its Neutral rating with the target price decreasing to $6.50 from $6.90.

Target price is $6.50 Current Price is $6.02 Difference: $0.48
If SAR meets the UBS target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $5.59, suggesting downside of -6.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: -0.4

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

Macquarie rates TCL as Outperform (1) -

Macquarie lowers Citylink traffic expectations to reflect the second wave of coronavirus and stage 4 restrictions in Victoria. At this stage, the broker is also envisaging some slowdown in the mobility indices in Sydney.

While the short term is affected by the pandemic, diversification provides some benefit, the broker assesses.

Transurban, in FY21 and FY22, will gain from the contribution of WestConnex and NorthConnex as these roads ramp up. Outperform retained. Target is $14.66.

Target price is $14.66 Current Price is $13.81 Difference: $0.85
If TCL meets the Macquarie target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $13.73, suggesting downside of -0.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: -0.1

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

Morgans rates VUK as Downgrade to Reduce from Hold (5) -

Virgin Money UK provided a 3Q20 trading update last week, which failed to excite Morgans.

Credit loss provisions increased by -GBP42m over the quarter, which was unsurprising to the broker, given the grim macroeconomic backdrop in the UK. The analyst forecasts a further -GBP285m provision top-up for the mortgage book over the next 12 months.

Morgans downgrades the rating for the company to Reduce largely due to lower Net Interest Margin (NIM) forecasts, after third quarter NIM disappointed. 

Morgans downgrades underlying EPS forecasts by -11%, -14% and -9% for FY20, FY21 and FY22, respectively. The rating is downgraded to Reduce from Hold. The target price is decreased to $1.30 from $1.44.

Target price is $1.30 Current Price is $1.65 Difference: minus $0.35 (current price is over target).
If VUK meets the Morgans target it will return approximately minus 21% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $1.70, suggesting upside of 3.7% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY20:

Forecast for FY21:

This company reports in GBP. 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

Citi rates WBC as Buy (1) -

Banking analysts at Citi note banks may struggle during the August reporting season to paint a true picture of performance. This is due to declining economic activity and lending demand, loan loss recognition deferrals and the prospect of ongoing lockdowns.

The broker states investors will be focused on how loan loss provisioning levels have evolved since May, due to Victoria’s stage 4 lockdown.

Citi anticipates that forward-looking statements on revenue and cost of funds may be positive as a lack of lending, but strong deposit growth has seen a fall in domestic deposit costs. The broker forecasts higher-than-consensus Net Interest Margins (NIM) as banks will likely use the build-up of excess deposits to repay wholesale debt as it comes due.

Westpac provides a 3Q20 update on Tuesday, August 18.

Citi forecasts 3Q20 cash earnings of around $1.7bn and no dividend. The bank deferred the decision on its interim dividend, indicating that it would continue to review dividend options ‘over the course of this year’.

No change to rating or price target.

Target price is $23.50 Current Price is $16.63 Difference: $6.87
If WBC meets the Citi target it will return approximately 41% (excluding dividends, fees and charges).

Current consensus price target is $20.23, suggesting upside of 20.7% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.6

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

UBS rates WBC as Buy (1) -

After announcing credit impairment charges of -$2,238m in the first half, UBS expects Westpac will have a considerably lower charge of -$1,204m in the second half.

The broker expects the bank to provide an update on the status of its loan deferral customers for the second half. The bank had approved loan deferrals for 105,000 home loan accounts and 31,000 business loan accounts till the first half.

The broker does not expect the bank to pay dividends, considering it a prudent choice in these trying times. A Q3 trading update will be announced on August 18.

UBS retains its Buy rating with a target price of $20.50.

Target price is $20.50 Current Price is $16.63 Difference: $3.87
If WBC meets the UBS target it will return approximately 23% (excluding dividends, fees and charges).

Current consensus price target is $20.23, suggesting upside of 20.7% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.6

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