Australian Broker Call

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

Allkem's December-quarter result outpaced Morgan Stanley's forecasts, thanks to strong sales from Olaroz, an easing of the freight crunch and a lower than expected new life of mine royalty from the Argentinian government.

The strong sales result was, however, struck on a lower than forecast average price, which fell -19% shy of Morgan Stanley's estimate.

Olaroz stage 2 has been delayed to the second half of 2022 and capital expenditure rose, courtesy covid.

Equal-weight rating retained. Price target rises to $10.40 from $9.80. Industry view is Attractive.

Target price is $10.40 Current Price is $10.81 Difference: minus $0.41 (current price is over target).
If AKE meets the Morgan Stanley target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $12.57, suggesting upside of 13.4% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY22:

Forecast for FY23:

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 Upgrade to Add from Hold (1) -

In allowing for tight supply for lithium throughout 2022 (futures are in contango) and new spot price highs, Morgans lifts its rating for Allkem to Add from Hold and sets a $13.25 target price.

The broker points out there was a a 68% quarter-on-quarter increase in revenue at Olaroz in the December quarter, and a 7% 2021 beat of production guidance at Mt Cattlin, with large increases in realised prices at both projects.

The company is Morgans preferred lithium exposure.

Target price is $13.25 Current Price is $10.81 Difference: $2.44
If AKE meets the Morgans target it will return approximately 23% (excluding dividends, fees and charges).

Current consensus price target is $12.57, suggesting upside of 13.4% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.8

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

Macquarie rates AZJ as No Rating (-1) -

Macquarie assesses soft 2Q results for Aurizon Holdings with poor weather and track work impacting upon coal volumes. Third quarter volumes are also considered to be under pressure from covid, tight labour and the cyclone season. 

Meanwhile, grain in WA is having a record season, which provides a strong base for the new contract, points out the broker.

Macquarie is unable to provide a rating or target at present.

Current Price is $3.65. Target price not assessed.

Current consensus price target is $3.59, suggesting downside of -1.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: -0.2

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

Credit Suisse rates BHP as Neutral (3) -

BHP Group's December-quarter results outpaced consensus by roughly 4%, although copper and metallurgical coal underperformed by -10% and -6% notes Credit Suisse.

Management guided to lower West Australian iron-ore costs, lower copper production and weakness in metallurgical coal due to higher costs, weather and maintenance issues. 

Credit Suisse conjectures that BHP could be considering a large-scale acquisition given the company's strong balance sheet and the lack of impact to be gained from small targets, although a big transaction may require Chinese competition clearance triggering divestments.

The broker is also cautious of big M&A given high multiples in future facing industries and the industry's poor track record with large deals.

Likely targets including Glencore, Freeport McMoran and Vale, the broker noting any split-off of Glencore's fossil fuel division could leave the green assets available. Otherwise, Credit Suisse suspects pure plays such as Antofagasta and First Quantum may appeal.

Target price rises to $43 from $41 to reflect the strong December quarter. Neutral rating retained given recent share price strength.

Target price is $43.00 Current Price is $46.56 Difference: minus $3.56 (current price is over target).
If BHP meets the Credit Suisse target it will return approximately minus 8% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $44.90, suggesting downside of -6.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

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

Market Sentiment: 0.5

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

Macquarie rates BHP as Outperform (1) -

Macquarie assesses a mixed 2Q result for BHP Group with iron ore production coming in above expectations countered by weak output of both copper and coking coal.

Management also cut guidance for metallurgical coal. The broker lowers EPS forecasts by -2% for both FY22 and FY23 and reduces its target price to $51 from $52, while retaining an Outperform rating.

Target price is $51.00 Current Price is $46.56 Difference: $4.44
If BHP meets the Macquarie target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $44.90, suggesting downside of -6.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

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

Market Sentiment: 0.5

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

Morgan Stanley rates BHP as No Rating (-1) -

BHP Group's December-quarter update was mixed, a strong iron-ore result outpacing consensus by 2% and Morgan Stanley by 4%.

Copper production outpaced Morgan Stanley by 2% but fell -10% short of consensus forecasts.

Management forecast copper production would fall to the low end of FY22 guidance. 

Morgan Stanley is unable to provide a rating or target price on BHP Group. Industry view: In-Line.

Current Price is $46.56. Target price not assessed.

Current consensus price target is $44.90, suggesting downside of -6.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

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

Market Sentiment: 0.5

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

Morgans rates BHP as Add (1) -

Following 2Q results, Morgans retains BHP Group as its key sector preference and estimates an interim ordinary dividend of US1.26cps. Strong results for Western Australian iron ore were considered countered by softer group copper production.

Looking forward, the broker expects meaningful acquisitions to fill the void left by divestments in petroleum and coal assets. The target rises to $48.60 from $45.70, while the Add rating is maintained.

Target price is $48.60 Current Price is $46.56 Difference: $2.04
If BHP meets the Morgans target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $44.90, suggesting downside of -6.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

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

Market Sentiment: 0.5

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

Ord Minnett rates BHP as No Rating (-1) -

Ord Minnett has reduced its FY22 underlying earnings forecast for BHP Group by -9% following a mixed December quarter marked by a depreciation in iron ore, lower met coal earnings and lower copper output. 

Iron ore shipments of 73m tonnes were a positive, but copper and met coal production came in under estimates by -10% and -14% respectively given weather impacts on operations. 

The broker is under rating restriction for BHP Group so offers no target price or rating.

Current Price is $46.56. Target price not assessed.

Current consensus price target is $44.90, suggesting downside of -6.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

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

Market Sentiment: 0.5

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

UBS rates BHP as Neutral (3) -

At a glance, BHP Group delivered a mixed December quarter, iron-ore and Escondida posting a solid performance while metallurgical coal disappointed as weather and covid hit production. Copper production was also weak.

UBS estimates FY22 earnings could fall -5% pending commodities prices.

The company announced a $2 to $2.5bn capital build in the half, signalling a potentially lower dividend payout, says UBS. 

Neutral rating and $37 target price retained.

Target price is $37.00 Current Price is $46.56 Difference: minus $9.56 (current price is over target).
If BHP meets the UBS target it will return approximately minus 21% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $44.90, suggesting downside of -6.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

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

Market Sentiment: 0.5

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

Morgan Stanley rates BLD as Upgrade to Equal-weight from Underweight (3) -

Morgan Stanley upgrades Boral to Equal Weight from Underweight as part of a review of Industrials. Target price is steady at $6.10. Industry view: In-Line.

Target price is $6.10 Current Price is $5.77 Difference: $0.33
If BLD meets the Morgan Stanley target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $6.58, suggesting upside of 14.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.0

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

Ord Minnett rates BPT as Buy (1) -

Energy analysts at JP Morgan believe higher hurdles for financing growth projects in traditional oil and gas industries has created a platform for higher energy prices.

Late last year those analysts raised their long-term price forecast for Brent to US$80/bbl.

Ord Minnett, a bit slow off the mark in early 2022, has now incorporated this change into its own modeling for oil and gas stocks under coverage on the ASX.

Beach Energy retains its Buy rating. Price target remains equally unchanged at $1.85.

Target price is $1.85 Current Price is $1.48 Difference: $0.37
If BPT meets the Ord Minnett target it will return approximately 25% (excluding dividends, fees and charges).

Current consensus price target is $1.65, suggesting upside of 11.2% (ex-dividends)

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.7

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

Morgans rates CIP as Hold (3) -

Morgans updates its financial model for Centuria Industrial REIT after recent revaluations and acquisitions, resulting in an increased target price ($4.09 from $3.87).

Revaluations as at 31 December resulted in the portfolio increasing in value by 9.6% on a like-for-like basis. The Hold rating is maintained. The 1H22 result is due on February 1.

Target price is $4.09 Current Price is $3.83 Difference: $0.26
If CIP meets the Morgans target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $3.98, suggesting upside of 4.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.4

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

Macquarie rates CMM as Neutral (3) -

Macquarie assesses a strong 2Q for Capricorn Metals with Karlawinda’s production beating the broker's expectations by 6%. All in sustaining costs (AISC) were also a 17% beat.

The analyst increases the FY22 EPS forecast by 18% (minimal increases in subsequent years), which raises the target price to $3.50 from $3.40. The Neutral rating is unchanged.

The broker feels the company is well placed to meet its 110-120koz production guidance for FY22.

Target price is $3.50 Current Price is $3.36 Difference: $0.14
If CMM meets the Macquarie target it will return approximately 4% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.0

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

Ord Minnett rates COE as Downgrade to Hold from Accumulate (3) -

Energy analysts at JP Morgan believe higher hurdles for financing growth projects in traditional oil and gas industries has created a platform for higher energy prices.

Late last year those analysts raised their long-term price forecast for Brent to US$80/bbl.

Ord Minnett, a bit slow off the mark in early 2022, has now incorporated this change into its own modeling for oil and gas stocks under coverage on the ASX.

Cooper Energy has been downgraded to Hold from Accumulate. Price target loses -1c to 32c.

Target price is $0.32 Current Price is $0.30 Difference: $0.02
If COE meets the Ord Minnett target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $0.28, suggesting downside of -11.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.0

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

Ord Minnett rates CVN as Upgrade to Buy from Accumulate (1) -

Energy analysts at JP Morgan believe higher hurdles for financing growth projects in traditional oil and gas industries has created a platform for higher energy prices.

Late last year those analysts raised their long-term price forecast for Brent to US$80/bbl.

Ord Minnett, a bit slow off the mark in early 2022, has now incorporated this change into its own modeling for oil and gas stocks under coverage on the ASX.

Carnarvon Petroleum has been upgraded to Buy from Accumulate. Price target moves to 47c from 38c.

Target price is $0.47 Current Price is $0.35 Difference: $0.12
If CVN meets the Ord Minnett target it will return approximately 34% (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

Citi rates DRR as Neutral (3) -

Citi has issued a notable 33% increase to Deterra Royalties' earnings forecast for FY22 given strong volumes from Mining Area C in the December half and near-term iron ore prices. 

Production volumes from Mining Area C were up 21% on the previous comparable period, and Citi expects high production will drive an acceleration of one-off capacity payments of $32m in the June half and $16m in the same period of FY23. 

The Neutral rating and target price of $4.15 are retained.

Target price is $4.15 Current Price is $4.45 Difference: minus $0.3 (current price is over target).
If DRR meets the Citi target it will return approximately minus 7% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.46, suggesting downside of -2.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.6

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

Morgans rates DXC as Add (1) -

Dexus Convenience Retail REIT has upgraded FY22 funds from operations (FFO) guidance to 23.1cpu from 22.9cpu. After incorporating recent Queensland acquisitions, as well as revaluations as at December 2021, Morgans raises its target to $4.11 from $4.05.

Target price is $4.11 Current Price is $3.49 Difference: $0.62
If DXC meets the Morgans target it will return approximately 18% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.8

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

Morgans rates DXI as Upgrade to Add from Hold (1) -

Dexus Industria REIT announced revaluations as at December 2021 with the portfolio increasing by 8.4% on a like-for-like basis. Morgans lifts its rating to Add from Hold and raises its target price to $3.63 from $3.56.

The analyst forecasts a total shareholder return in excess of 10% over the next 12 months, and expects the next trading update with the 1H22 result on February 9.

Target price is $3.63 Current Price is $3.23 Difference: $0.4
If DXI meets the Morgans target it will return approximately 12% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.5

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

UBS rates GNC as Downgrade to Neutral from Buy (3) -

UBS raises GrainCorp's EPS estimates 9% and 4% for FY22 and FY23, after the company's recent harvest updates, believing operating conditions remain very favourable.

The broker considers the company cheap at a 5x multiple, although it expects FY22 will most likely represent peak-cycle earnings, and believes any share-price rise from here would most likely come from consensus upgrades in FY23 forecasts pending Abares' FY23 crop estimate in June.

Target price rises 6% to $8 to reflect earnings revisions, but UBS downgrades to Neutral from Buy given recent share-price moves.

Target price is $8.00 Current Price is $7.83 Difference: $0.17
If GNC meets the UBS target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $7.68, suggesting upside of 0.3% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.5

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

Morgans rates HPI as Add (1) -

Hotel Property Investments has recently announced December revaluations, the establishment of a new capex program and various acquisitions/divestments, leading Morgans to increase its target price to $3.70 from $3.56.

The analyst expects the next trading update with the 1H22 result on 17 February.

Target price is $3.70 Current Price is $3.56 Difference: $0.14
If HPI meets the Morgans target it will return approximately 4% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.8

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

Citi rates HUB as No Rating (-1) -

Following another strong quarter from Hub24, Citi suggests full year flow forecasts may be conservative.

Second quarter flows of $3.6bn were 20% ahead of the broker's estimate, and Citi notes record underlying flows could imply full year underlying flows of more than $13bn, compared to consensus forecasts of $12.9bn in total flows for the year. 

The solid results reaffirm Citi's view that the near-term outlook for specialist platforms continues to be strong. 

Due to research restrictions Citi has not provided a rating or target price.

Current Price is $27.42. Target price not assessed.

Current consensus price target is $34.31, suggesting upside of 20.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 1.0

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

Credit Suisse rates HUB as Outperform (1) -

Hub24 has delivered December-quarter flows of $3.6bn, outpacing consensus and Credit Suisse's estimates by roughly $840m and $850m. Funds under administration clipped the broker by 3%. 

Credit Suisse says the "exceptionally strong quarter" shows Hub24 is capitalising on its broader relationships (18% of advisers use Hub24, compared with 3% five years ago), investment in distribution, the structural growth in demand for advice and a best-in-class product.

EPS forecasts fall -7% in FY22, rise 2% in FY23 and another 3% in FY24 

Outperform rating retained, the broker believing the fund manager can continue to increase market share to up to 15% compared with 5% now. Target price steady at $36.50.

Target price is $36.50 Current Price is $27.42 Difference: $9.08
If HUB meets the Credit Suisse target it will return approximately 33% (excluding dividends, fees and charges).

Current consensus price target is $34.31, suggesting upside of 20.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 1.0

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

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

Macquarie upgrades its rating for Hub24 to Outperform from Neutral after net inflows for the 2Q were ahead of estimates.

The broker expects flow momentum will likely continue, and the company is well placed to benefit from a flattening of the yield curve (positive leverage to higher rates).

The target price rises to $32.40 from $30.60 after forecast earnings (EBITDA) upgrades and the roll forward of the valuation model.

Target price is $32.40 Current Price is $27.42 Difference: $4.98
If HUB meets the Macquarie target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $34.31, suggesting upside of 20.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 1.0

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

Morgans rates HUB as Add (1) -

Morgans points out 2QFY22 flow momentum continues for Hub24 and believes market share can continue to increase significantly. Over the next three years it's thought scale benefits can deliver a step-change in earnings with long-term growth thereafter.

Second quarter funds under administration (FUA) increased 118.4% on the previous corresponding period, with net inflows of $3.6bn the primary driver, explains the analyst. Add rating. Target price rises to $34.35 from $34.20.

Target price is $34.35 Current Price is $27.42 Difference: $6.93
If HUB meets the Morgans target it will return approximately 25% (excluding dividends, fees and charges).

Current consensus price target is $34.31, suggesting upside of 20.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 1.0

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

Ord Minnett rates HUB as Upgrade to Buy from Accumulate (1) -

Hub24's market update proved a positive surprise, including new business from the IOOF Holdings ((IFL)) private label product, comment analysts at Ord Minnett.

They note the company continues to combine strong organic growth with increased market share. In light of the recent sell-off, they have decided it's time to upgrade to Buy from Accumulate.

Target price moves $1 higher to $34. The broker's positive view is supported by a generally positive view on the outlook for independent wealth platforms in Australia.

Target price is $34.00 Current Price is $27.42 Difference: $6.58
If HUB meets the Ord Minnett target it will return approximately 24% (excluding dividends, fees and charges).

Current consensus price target is $34.31, suggesting upside of 20.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 1.0

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

Citi rates HVN as Buy (1) -

Given a positive market update issued by JB HI-Fi ((JBH)), Citi has upgraded Harvey Norman Holdings' forecasts as it looks likely to benefit from strong trading in high margin categories including small appliances, cooking appliances, furniture and bedding. 

Citi further notes ongoing strength in housing and elevated household savings is likely to support a continued strong retail cycle. Given a strong balance sheet, the broker suggests Harvey Norman may look to undertake capital management and lower debt.

Earnings forecasts increase 9% and 2% in FY22 and FY23 respectively. 

The Buy rating and target price of $6.00 are retained.

Target price is $6.00 Current Price is $5.20 Difference: $0.8
If HVN meets the Citi target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $6.08, suggesting upside of 20.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.8

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

Citi rates JHG as Neutral (3) -

Although Citi expects Janus Henderson Group's fourth quarter results to be a continuation of recent quarterly trends that saw the company beat consensus expectations, the broker notes market data has pointed to dragging retail flows in the period. 

The broker noted US small-mid-cap and mid-cap growth strategies performance was particularly poor in November, but did record some recovery in December. Earnings per share forecasts increase 3% for the fourth quarter and full year, and 2% for FY23.

The Neutral rating is retained and the target price increases to $62.90 from $60.30 given changes to the USD exchange rate forecast.

Target price is $62.90 Current Price is $54.80 Difference: $8.1
If JHG meets the Citi target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $60.23, suggesting upside of 13.2% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: 0.3

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

Macquarie rates LYC as Outperform (1) -

Second quarter rare earth oxides production and sales volumes for Lynas Rare Earths were 17% and 4% higher than Macquarie's estimates, and neodymium and praseodymium production was an 8% beat.

The broker makes only minor changes to forecasts and lifts its target price to $12.40 from $12.20. The Outperform rating is unchanged.

Target price is $12.40 Current Price is $10.97 Difference: $1.43
If LYC meets the Macquarie target it will return approximately 13% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.0

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

Citi rates MP1 as Buy (1) -

Megaport's second quarter update was a mixed bag according to Citi, with weaker-than-anticipated port and Megaport Virtual Edge additions alongside record December quarter customer additions. 

Customer adds included 60 Megaport Cloud Router customers, who typically offer higher spend. The broker notes strong customer adds should offer upside benefit over time as customers take up services. 

The Buy rating and target price of $21.30 are retained.

Target price is $21.30 Current Price is $15.32 Difference: $5.98
If MP1 meets the Citi target it will return approximately 39% (excluding dividends, fees and charges).

Current consensus price target is $19.01, suggesting upside of 22.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.6

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

Macquarie rates MP1 as Outperform (1) -

Macquarie believes switching to channel sales impacted upon Megaport's margin improvement in the 2Q results, while revenue growth was in-line with forecasts. It's anticipated operating leverage in FY22 will be offset by the sales strategy, before an upward FY23 inflection.

The analyst lowers FY22-24 profit estimates and reduces its target price to $20 from $24. Earnings are now forecast to turn positive in FY24 (previously FY23). Outperform.

Target price is $20.00 Current Price is $15.32 Difference: $4.68
If MP1 meets the Macquarie target it will return approximately 31% (excluding dividends, fees and charges).

Current consensus price target is $19.01, suggesting upside of 22.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.6

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

Morgans rates MP1 as Hold (3) -

While Megaport's 2Q result met Morgans revenue expectations, the broker has increased its expense forecasts marginally and lowers its target price to $16.49 from $17.71. An acceleration in 3Q and 4Q sales is anticipated due to current heavy investment. Hold rated.

In summary, the analyst feels all KPI’s are pointed in the right direction, and it was a strong all round quarter from the company.

Target price is $16.49 Current Price is $15.32 Difference: $1.17
If MP1 meets the Morgans target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $19.01, suggesting upside of 22.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.6

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

Ord Minnett rates MP1 as Upgrade to Hold from Sell (3) -

Megaport's second quarter update was largely in line with Ord Minnett's expectations. Looking ahead, the broker expects Megaport to benefit from top-line growth in the second half following first half investment and indirect sales channel growth.

The company reported 123 customer adds and 439 port adds over the second quarter, and Ord Minnett expects utilisation ramp up in the third and fourth quarters to drive monthly recurring revenue growth.

The rating is upgraded to Hold from Sell and the target price increases to $15.50 from $15.00.

Target price is $15.50 Current Price is $15.32 Difference: $0.18
If MP1 meets the Ord Minnett target it will return approximately 1% (excluding dividends, fees and charges).

Current consensus price target is $19.01, suggesting upside of 22.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.6

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

UBS rates MP1 as Buy (1) -

Megaport's December-quarter trading update largely met UBS's forecasts, despite revenue easing -2%.

The broker expects the indirect sales strategy should gain momentum in the March or June quarter after the launch of VantegHub and the TD SYNNEX partnership.

On the downside, the slower SD-WAN ramp-up may have spooked the market but the broker holds the faith.

UBS tinkers with earnings estimates. Buy rating retained. Target price eases to $21.75 from $22. 

Target price is $21.75 Current Price is $15.32 Difference: $6.43
If MP1 meets the UBS target it will return approximately 42% (excluding dividends, fees and charges).

Current consensus price target is $19.01, suggesting upside of 22.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.6

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

Ord Minnett rates ORG as Hold (3) -

Energy analysts at JP Morgan believe higher hurdles for financing growth projects in traditional oil and gas industries has created a platform for higher energy prices.

Late last year those analysts raised their long-term price forecast for Brent to US$80/bbl.

Ord Minnett, a bit slow off the mark in early 2022, has now incorporated this change into its own modeling for oil and gas stocks under coverage on the ASX.

Hold rating retained for Origin Energy, while the price target has gained 10c to $6.

Target price is $6.00 Current Price is $5.78 Difference: $0.22
If ORG meets the Ord Minnett target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $5.96, suggesting upside of 0.7% (ex-dividends)

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.7

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

Citi rates QBE as Buy (1) -

Citi expects QBE Insurance Group's FY22 guidance is conservative among continuing favourable operating conditions, and notes strong financial year results should offer upside risk to the share price. 

On a less positive note, Citi expects the company will exceed catastrophe costs allowance given significant weather event incidents in the second half. Taking this into consideration alongside market expectations, Citi increases earnings per share forecasts 1% for FY21.

The Buy rating is retained and the target price increases to $14.55 from $14.10.

Target price is $14.55 Current Price is $12.08 Difference: $2.47
If QBE meets the Citi target it will return approximately 20% (excluding dividends, fees and charges).

Current consensus price target is $14.84, suggesting upside of 22.8% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: 0.9

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

Credit Suisse rates RMD as Outperform (1) -

Credit Suisse raises ResMed's FY22 EPS estimates 1%, and FY23 EPS estimates 20% heading into the December-quarter results next week.

The broker expects a strong quarterly performance will be coupled with conservative, covid-driven guidance, expecting the omicron outbreak will place further pressure on supply chains than expected in the March quarter.

Credit Suisse does not expect chip supply to accelerate until mid 2022, but sits 7% above consensus estimates in FY23, expecting ResMed will also benefit from a continued sidelining of Philips after the recall.

Outperform rating and $43 target price retained.

Target price is $43.00 Current Price is $33.16 Difference: $9.84
If RMD meets the Credit Suisse target it will return approximately 30% (excluding dividends, fees and charges).

Current consensus price target is $39.05, suggesting upside of 17.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

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

Market Sentiment: 0.5

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

Citi rates SFR as Buy (1) -

Reflecting fourth quarter metal prices and selling costs of the MATSA mining project, Citi issues updates to its forecasts for Sandfire Resources. 

Underlying earnings are modestly upgraded for FY22, but downgraded -4-8% for FY23 and beyond.

The Buy rating and target price of $7.40 are retained. 

Target price is $7.40 Current Price is $7.19 Difference: $0.21
If SFR meets the Citi target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $7.03, suggesting downside of -4.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.7

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

Ord Minnett rates STO as Buy (1) -

Energy analysts at JP Morgan believe higher hurdles for financing growth projects in traditional oil and gas industries has created a platform for higher energy prices.

Late last year those analysts raised their long-term price forecast for Brent to US$80/bbl.

Ord Minnett, a bit slow off the mark in early 2022, has now incorporated this change into its own modeling for oil and gas stocks under coverage on the ASX.

Santos' price target has improved to $9.20 from $8.80. Buy rating retained.

Target price is $9.20 Current Price is $7.20 Difference: $2
If STO meets the Ord Minnett target it will return approximately 28% (excluding dividends, fees and charges).

Current consensus price target is $8.69, suggesting upside of 19.2% (ex-dividends)

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: 0.7

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

Ord Minnett rates SXY as Hold (3) -

Energy analysts at JP Morgan believe higher hurdles for financing growth projects in traditional oil and gas industries has created a platform for higher energy prices.

Late last year those analysts raised their long-term price forecast for Brent to US$80/bbl.

Ord Minnett, a bit slow off the mark in early 2022, has now incorporated this change into its own modeling for oil and gas stocks under coverage on the ASX.

Hold rating and $4.60 price target for Senex Energy have remained untouched.

Target price is $4.60 Current Price is $4.61 Difference: minus $0.01 (current price is over target).
If SXY meets the Ord Minnett target it will return approximately minus 0% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.42, suggesting downside of -3.7% (ex-dividends)

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.0

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

Macquarie rates UNI as Outperform (1) -

The combined effects of lockdowns, omicron disruptions and no JobKeeper upon Universal Store Holdings resulted in a fall in 1H earnings (EBIT) compared to the previous corresponding period, explains Macquarie.

The broker now factors into forecasts a continuation of omicron impacts and reduces its target price to $9.40 from $9.60, while retaining its Outperform rating.

The analyst points to a reopening play for shareholders once omicron effects reduce and notes the long-term store rollout of over 100 stores was reconfirmed by management.

Target price is $9.40 Current Price is $6.85 Difference: $2.55
If UNI meets the Macquarie target it will return approximately 37% (excluding dividends, fees and charges).

Current consensus price target is $8.77, suggesting upside of 28.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 1.0

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

UBS rates UNI as Buy (1) -

Universal Store Holdings' top-line December first-half trading update outpaced UBS by 5% but fell -1% shy of consensus as store-closures hit sales. Underlying earnings outpaced UBS by 13% but fell -18% shy of consensus. 

Online sales rose to19.3% of total sales, up from 11.9% year on year.

Margins were mixed across the distribution channels, and the company emerged with a higher cash balance thanks to solid capital management while debt was fairly steady.

UBS suggests the company is well positioned to benefit when customers return to shopping centres post omicron.

Buy rating and $8 target price retained.

Target price is $8.00 Current Price is $6.85 Difference: $1.15
If UNI meets the UBS target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $8.77, suggesting upside of 28.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 1.0

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

Morgans rates VHT as Add (1) -

Morgans believes there is value (unrecognised by the market) in Volpara Health Technologies' data set (51m images) that could be worth up to $100m. The broker adopts a changed valuation method and raises its target price to $1.94 from $1.87. Add retained.

Via a recent newsletter, the analyst notes management declared the 3Q22 has been strong and will beat the previous best 3Q in terms of new annual recurring revenue (ARR).

Target price is $1.94 Current Price is $0.91 Difference: $1.03
If VHT meets the Morgans target it will return approximately 113% (excluding dividends, fees and charges).

The company's fiscal year ends in March.

Forecast for FY22:

Forecast for FY23:

This company reports in NZD. 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 WPL as No Rating (-1) -

Energy analysts at JP Morgan believe higher hurdles for financing growth projects in traditional oil and gas industries has created a platform for higher energy prices.

Late last year those analysts raised their long-term price forecast for Brent to US$80/bbl.

Ord Minnett, a bit slow off the mark in early 2022, has now incorporated this change into its own modeling for oil and gas stocks under coverage on the ASX.

The broker is currently unable to provide a rating or target for Woodside Petroleum (research restriction).

Current Price is $25.42. Target price not assessed.

Current consensus price target is $26.63, suggesting upside of 3.1% (ex-dividends)

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: 0.6

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

Macquarie rates WTC as Neutral (3) -

In commentary anticipating interim results on February 23, Macquarie feels the outlook for WiseTech Global remains unchanged though cargo volumes, impacted by omicron supply chain disruptions, may pose headwinds. The latter is not considered a major near-term driver.

The broker lifts its target price to $54 from $46 after adjustments to Cargowise One’s valuation and fully pricing-in Cargowise Neo web portal. The Neutral rating is unchanged.

Target price is $54.00 Current Price is $52.00 Difference: $2
If WTC meets the Macquarie target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $41.13, suggesting downside of -20.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.3

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