Australian Broker Call

Macquarie rates AGL as Underperform (5) -

In its preliminary response to AGL Energy's first half result, Macquarie highlights earnings are progressively de-rating with lower electricity and large-scale renewable energy target (LRET) prices.

The analyst highlights this outcome also impacts balance sheet flexibility and places greater pressure on the dividend as management choose to re-invest.

Consumer was in-line and Wholesale -10% weaker, driven by lower electricity, explains the broker.

The company reported a loss of -$2,287m due to write-downs, while underlying  profit (NPAT) was below the broker's expectations. Earnings (EBIT) of $536m were down -23% and below Macquarie's  forecast for $601m.

The un-franked dividend of 41 cents was also well shy of the broker's forecast for 47 cents.

The Underperform rating is retained with a $10.86 target at this stage.

Target price is $10.86 Current Price is $11.16 Difference: minus $0.3 (current price is over target).
If AGL meets the Macquarie target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $10.87, suggesting downside of -3.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: -0.5

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

Ord Minnett rates AGL as Accumulate (2) -

In an early response to today’s 1H21 announcement by AGL, Ord Minnett notes that the interim result predictably reflected weak market conditions, with underlying NPAT ($317m) down -27% from the prior corresponding period and -17% below its estimate ($380m).

Management reiterated full year NPAT guidance of A$500-$580 million (versus the broker’s A$504m), which Ord Minnett notes implies only A$183-$223 million in the June 2021 half. 

Management also provided operating earnings (EBITDA) guidance of A$1,585-$1,845 million (versus the broker’s A$1,672 million) which implies A$659-$919m in the remaining half versus A$926m reported.

With electricity portfolio margins predictably declining, the broker notes that the impact of weaker wholesale prices will remain a primary focus for management.

The interim dividend of 41cps was at a 100% payout.

Accumulate rating and price target of $14 remain unchanged.

Target price is $14.00 Current Price is $11.16 Difference: $2.84
If AGL meets the Ord Minnett target it will return approximately 25% (excluding dividends, fees and charges).

Current consensus price target is $10.87, suggesting downside of -3.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: -0.5

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

Macquarie rates AMP as Underperform (5) -

In a preliminary review of AMP's FY20 result, Macquarie believes all else will be overshadowed by management's statement "“AMP has been advised by Ares that it does not intend to proceed with its offer to acquire the whole business."

At an operational level, the company have not declared a FY20 dividend and their -$300m cost out program is unchanged.

Underperform retained after Macquarie sees ongoing downside earnings risk across all of the company’s divisions over the medium term. Target is $1.30 at this stage.

Target price is $1.30 Current Price is $1.54 Difference: minus $0.24 (current price is over target).
If AMP meets the Macquarie target it will return approximately minus 16% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $1.61, suggesting upside of 16.4% (ex-dividends)

The company's fiscal year ends in December.

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

Ord Minnett rates AMP as Hold (3) -

AMP’s headline normalised FY20 result (NPAT $295m) was in line with Ord Minnett’s numbers ($297m).

In its initial response to the announcement, the broker expects the market's focus on the results to be threefold.

Firstly, the broker suggests the decision by ARES to not continue with due diligence on the group means AMP must execute its strategy for cost-out and restructure itself.

The brokers also cites margin pressures in Australian Wealth Management (down -8% over the FY20 year due to net outflows), which have a material impact on controllable costs within the divisions.

Capital/Remediation/Reset also remains a primary focus, and Ord Minnett notes that with the business continuing to face challenges, the board seems to be cautious, only committing to capital management after the portfolio review is complete.

AMP did not declare a dividend. Hold rating is retained with the target price also remaining unchanged at $1.75.

Target price is $1.75 Current Price is $1.54 Difference: $0.21
If AMP meets the Ord Minnett target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $1.61, suggesting upside of 16.4% (ex-dividends)

The company's fiscal year ends in December.

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 AQZ as Outperform (1) -

Alliance Aviation Services' interim result shows rapidly improving unit economics, excellent cash conversion and increasingly simpler accounts, assesses Credit Suisse. 

Operating income of $46m was up 34% versus last year with Alliance Aviation showing higher profitability per plane.

The company's latest update also puts to rest cash flow concerns and uncertainty around the future home of $200m of deployed aircraft capital, notes a very pleased Credit Suisse.

The Outperform rating is unchanged and the target increases to $5.40 from $5.10.

Target price is $5.40 Current Price is $4.36 Difference: $1.04
If AQZ meets the Credit Suisse target it will return approximately 24% (excluding dividends, fees and charges).

Current consensus price target is $5.22, suggesting upside of 19.1% (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

Morgans rates AQZ as Add (1) -

Alliance Aviation Services delivered a record interim result, which was in-line with Morgan's forecast, with strong operating cashflow a standout.

Management highlighted the outlook for the balance of FY21 remains positive and further growth is expected in FY22 and beyond, supported by the recent Qantas Airways ((QAN)) wet lease agreement.

Morgans lifts underlying profit (NPBT) estimates for FY21 and FY22 by 10% and 8%, respectively, while the target is increased to $5.25 from $5. The Add rating is unchanged.

Target price is $5.25 Current Price is $4.36 Difference: $0.89
If AQZ meets the Morgans target it will return approximately 20% (excluding dividends, fees and charges).

Current consensus price target is $5.22, suggesting upside of 19.1% (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

Morgan Stanley rates BLD as Overweight (1) -

Morgan Stanley's meeting with Boral threw more light on the latter's $300m transformation program that includes identifying a number of operating income projects and revenue-generating initiatives.

Despite positive headlines on stimulus and infrastructure spending, Morgan Stanley notes the underlying market conditions remain difficult due to lags between leading indicators and materials demand. The broker fears this near-term weakness will offset most of the transformation benefit in the second half.

The US Building Products sale process has commenced and the broker believes conditions for the business are positive led by a wave of US housing growth and strong pricing dynamics.

Overweight rating with a target of $6.10. Industry view is in-line.

Target price is $6.10 Current Price is $5.06 Difference: $1.04
If BLD meets the Morgan Stanley target it will return approximately 21% (excluding dividends, fees and charges).

Current consensus price target is $5.47, suggesting upside of 7.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.6

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

Citi rates CBA as Neutral (3) -

First half results were ahead of expectations, largely driven by better revenue and capital accumulation. Citi notes higher costs took the shine from lower bad debts.

Given the growth challenges in the industry, the "normalising" balance sheet is likely to be the driver of earnings and dividend growth, in the broker's view.

Citi deems "regulatory comfort" as the main determinant of capital management and defers the forecast start of buybacks until the second half of FY22. Neutral rating and $82.50 target retained.

Target price is $82.50 Current Price is $86.12 Difference: minus $3.62 (current price is over target).
If CBA meets the Citi target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $80.21, suggesting downside of -7.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: -0.4

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

Credit Suisse rates CBA as Neutral (3) -

Commonwealth Bank reported cash earnings of $3,886m, down -11% versus last year but above Credit Suisse's estimate of $3,513m.

The broker finds the bank's first-half result to be one of the most conservative in recent times set against an operating back-drop that is far better than 6-9 months ago.

Despite management's cautious stance, the broker is optimistic and believes it is only a matter of time before material releases and capital management bolster earnings.

Looking at the current valuation, Credit Suisse decides to maintain its Neutral rating and increase its target price to $85 from $82.

Target price is $85.00 Current Price is $86.12 Difference: minus $1.12 (current price is over target).
If CBA meets the Credit Suisse target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $80.21, suggesting downside of -7.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: -0.4

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

Morgan Stanley rates CBA as Underweight (5) -

Morgan Stanley notes stronger housing and business loan growth were the highlights of Commonwealth Bank's first half. Also, a combination of standard variable rate repricing, lower funding costs and a better funding mix offset the impact of lower rates and front book competition.

The broker expects the margin to fall by circa -7bps in FY21 and just circa -3bps in FY22 with revenue up circa 1% and circa 2.5%.

Expenses were up more than 2% in the first half (year on year) and the broker reckons flat costs in the medium term is its best-case scenario.

The Underweight rating is unchanged with the target price lifting to $79 from $78.50. Industry view: In-line.

Target price is $79.00 Current Price is $86.12 Difference: minus $7.12 (current price is over target).
If CBA meets the Morgan Stanley target it will return approximately minus 8% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $80.21, suggesting downside of -7.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: -0.4

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

Morgans rates CBA as Reduce (5) -

Commonwealth Bank has reported cash profit (NPAT) of $3,975m, 3.9% better than Morgan's expectation. An interim dividend of $1.50 per share fully franked was declared.

The broker highlights good momentum in home lending, and the domestic business lending (excluding institutional lending) growth of 4% over the first half was better than expected. There was also considered to be strong Markets income in the December quarter. 

The analyst expects the low interest rate environment and the mortgage pricing impact to remain substantial net interest margin (NIM) headwinds in the second half. However, there are considered enough offsetting tailwinds to keep the NIM remaining broadly stable.

The target price is increased to $68 from $64 and the Reduce rating is maintained.

Target price is $68.00 Current Price is $86.12 Difference: minus $18.12 (current price is over target).
If CBA 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 $80.21, suggesting downside of -7.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: -0.4

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

Ord Minnett rates CBA as Hold (3) -

The first-half result from Commonwealth Bank came in very close to Ord Minnett’s estimates across revenue, costs and loan losses and the interim dividend matched expectations.

The real surprise for the broker was the much stronger capital position, with a pro forma common equity tier-one (CET1) ratio of circa 13% being 50 basis points ahead of expectation. The company expects no deterioration in capital ratios from credit risk migration. 

While net interest margins (NIM) remain difficult to predict near term, the bank's NIM was slightly better than Ord Minnett expected, down -4 basis points half-on-half, excluding markets.

Though disappointed on costs, the analyst is reticent to criticise the focus on long-term investment which has increased the broker's  expense forecasts.

Hold maintained and target increases to $79 from $78.60.

Target price is $79.00 Current Price is $86.12 Difference: minus $7.12 (current price is over target).
If CBA meets the Ord Minnett target it will return approximately minus 8% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $80.21, suggesting downside of -7.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: -0.4

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

UBS rates CBA as Neutral (3) -

First half results were ahead of expectations. The highlight for UBS was the strength of the balance sheet with the capital build-up maintaining a high degree of conservatism.

Drilling down, the broker notes the sharp bounce in revenue in the second quarter which appears to be broad-based and suggests this highlights the underlying leverage the banks have to be economic recovery.

While UBS warns it is impossible to escape the drag of near-zero interest rates, the revenue environment is better than previously envisaged. Neutral maintained. Target rises to $90 from $80.

Target price is $90.00 Current Price is $86.12 Difference: $3.88
If CBA meets the UBS target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $80.21, suggesting downside of -7.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: -0.4

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

Credit Suisse rates CIM as Downgrade to Neutral from Outperform (3) -

Rating is downgraded to Neutral from Outperform. Target is reduced to $21.90 from $34.

Credit Suisse is disappointed by CIMIC Group's weak full-year result noting the subdued result was further compounded by various one-offs and suboptimal cash flows that will likely dampen sentiment in the near term.

While the company's investment thesis includes a capital-light structure and an improving balance sheet, Credit Suisse believes this will take time to reflect in the stock's multiples.

Post a lukewarm 2021 guidance, the broker cuts its 2021-22 earnings forecasts by -36-42%.

Target price is $21.90 Current Price is $21.56 Difference: $0.34
If CIM meets the Credit Suisse target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $23.91, suggesting upside of 14.9% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.3

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

Macquarie rates CIM as Neutral (3) -

Macquarie has returned from restriction to note a "weak and messy" result from Cimic, well below the broker and consensus. The sale of Thiess has helped shore up the balance sheet, but needed to be drawn upon to cover weak cash flow and Middle East losses.

Cash flow was hurt by the lack of new awards and the cost to complete existing work, the broker notes, coupled with covid impact. With infrastructure spending a government priority, and the vaccine rollout pending, new contract opportunities should emerge.

But it will be FY22 before any benefits flow. The broker resumes coverage with a Neutral rating and $21.75 target.

Target price is $21.75 Current Price is $21.56 Difference: $0.19
If CIM meets the Macquarie target it will return approximately 1% (excluding dividends, fees and charges).

Current consensus price target is $23.91, suggesting upside of 14.9% (ex-dividends)

The company's fiscal year ends in December.

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 CIM as Buy (1) -

The 2020 revenue for CIMIC Group was in line with Ord Minnett's expectations, although operating earnings (EBITDA) and net profit missed estimates by -6% and -11%, respectively.

Overall the result disappointed the broker on earnings, guidance and cash, although a lack of project wins in 2020 due to covid-19 is considered at the heart of the outcome.

The analyst highlights a bright spot, with the company returning to a 60–65% payout ratio for the second half, declaring a 20% franked 60 cent dividend.

Buy rating and target falls to $29 from $32.

Target price is $29.00 Current Price is $21.56 Difference: $7.44
If CIM meets the Ord Minnett target it will return approximately 35% (excluding dividends, fees and charges).

Current consensus price target is $23.91, suggesting upside of 14.9% (ex-dividends)

The company's fiscal year ends in December.

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 CIM as Neutral (3) -

2020 net profit was below UBS estimates. The miss was largely because of higher impacts from the pandemic on the awarding of new projects as well as construction activity.

Operating cash flow conversion was also weak, affected by the unwinding of Leighton Asia projects and a reduction in debtor factoring.

The company has returned to issuing guidance with net profit guidance for 2021 of $400-430m. UBS remains attracted to Cimic's dominant position in Australian infrastructure construction but execution is considered a key risk.

Neutral maintained. Target is reduced to $23.00 from $27.50.

Target price is $23.00 Current Price is $21.56 Difference: $1.44
If CIM meets the UBS target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $23.91, suggesting upside of 14.9% (ex-dividends)

The company's fiscal year ends in December.

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

Morgan Stanley rates CNI as Overweight (1) -

Centuria Capital Group reported a half-year profit of $34m, slightly ahead of Morgan Stanley's $33.3m estimate driven by performance fees.

The company has upgraded its FY21 distribution guidance to 10c from 9c with management acknowledging its previous guidance had been conservative.

The group has outlined a $1.6bn development pipeline with most assets to be developed within the next 3-5 years and with earnings expected from development fees.

The group's assets under management increased to $10.2bn in the first half from $8.8bn in FY20 but the increment came mostly from acquisitions with net asset value increase virtually non-existent. This leads Morgan Stanley to suggest Centuria's assets may have limited upside. 

Overweight with the target rising to $2.80 from $2.75. Industry view is in-line.

Target price is $2.80 Current Price is $2.46 Difference: $0.34
If CNI meets the Morgan Stanley target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $2.76, suggesting upside of 11.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.5

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

Ord Minnett rates CNI as Accumulate (2) -

Centuria Capital Group reported first half FY21 operating EPS of 6.2cps, well ahead of Ord Minnett’s forecast due to higher realised performance fees. Assets under management (AUM) increased to $10.2bn, up 16%.

FY21 operating earnings guidance for FY21 was reiterated at 11.5–12.5cps, while DPS guidance was upgraded from 9cps to 10cps.

The broker expects AUM growth to remain strong driven by growth in the industrial and healthcare sectors, which should underpin strong recurring earnings and distribution growth.

Accumulate and target rises to $3 from $2.90.

Target price is $3.00 Current Price is $2.46 Difference: $0.54
If CNI meets the Ord Minnett target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $2.76, suggesting upside of 11.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.5

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

UBS rates CNI as Neutral (3) -

First half results were ahead of UBS estimates mainly because of higher performance fees. Distribution guidance for FY21 has increased to $0.10.

The broker notes the company is closing out two unlisted retail investor fund raisings and further incremental raisings are expected in health care and industrial.

Further upside could come from large transactions that require institutional capital and participation in competitive processes, which would be well received by the market. UBS retains a Neutral rating and raises the target to $2.49 from $2.43.

Target price is $2.49 Current Price is $2.46 Difference: $0.03
If CNI meets the UBS target it will return approximately 1% (excluding dividends, fees and charges).

Current consensus price target is $2.76, suggesting upside of 11.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.5

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

Morgan Stanley rates COH as Overweight (1) -

Cochlear will release its first-half results on February 19. Morgan Stanley expects revenue to rise 16% to $650m with net profit expected to be $103m. For FY21, the broker expects a 51% rise in net profit to $233m.

Aided by covid, the broker sees an underpenetrated and growing market opportunity helped by a dominant market position and a growing installed base.

Overweight retained with the target falling to $214 from $227. Industry view: In-line.

Target price is $214.00 Current Price is $206.84 Difference: $7.16
If COH meets the Morgan Stanley target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $204.19, suggesting downside of -0.6% (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 CPU as Sell (5) -

Citi assesses Computershare is on track to attain its improved FY21 management earnings guidance.

In the first half there was a small lost at the EBIT level for US and UK mortgage services although the company expects a pick up in fulfilments will improve US returns and has also raised its UK cost savings target.

Still, Citi believes there is a lot priced into the share price and retains a Sell rating. Target is raised to $13.20 from $12.00.

Target price is $13.20 Current Price is $14.55 Difference: minus $1.35 (current price is over target).
If CPU meets the Citi target it will return approximately minus 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $14.54, suggesting upside of 1.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: 0.1

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

Credit Suisse rates CPU as Neutral (3) -

Computershare’s net profit was down -25% versus last year at US$118m although ended up 2% ahead of Credit Suisse's estimated US$115m. This revenue beat was offset by a cost miss leading to an in-line operating income. 

Credit Suisse considers Computershare is doing a great job in managing the considerable headwinds and while an earnings recovery is expected in FY22, the broker believes it will be largely led by cost outs, considered lower quality than a revenue-led recovery.

Neutral rating with a target price of $13.90.

Target price is $13.90 Current Price is $14.55 Difference: minus $0.65 (current price is over target).
If CPU 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 $14.54, suggesting upside of 1.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: 0.1

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

Macquarie rates CPU as Outperform (1) -

Computershare's result beat consensus on higher margin income, a recovery in corporate actions and strong bankruptcy revenue growth, the broker notes. Full year guidance has been upgraded, as has cost-out guidance to FY23.

The broker retains Outperform based on long-term growth in US Mortgage Servicing being ahead of expectations which, at this point, remains intact. Target rises to $16.45 from $15.95.

Target price is $16.45 Current Price is $14.55 Difference: $1.9
If CPU meets the Macquarie target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $14.54, suggesting upside of 1.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: 0.1

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

Morgan Stanley rates CPU as Overweight (1) -

Despite mortgage foreclosure fees being delayed into FY22, Computershare has upgraded its guidance to -8% from -11%. Morgan Stanley believes this highlights the company's resilience in revenues and rapid recovery in corporate actions.

The broker thinks US mortgage servicing can recover to 24% revenue growth in FY22 with catch up in foreclosure fees from FY21. Corporate actions should see further improvement into FY22E as well. 

Morgan Stanley upgrades its FY21 management earnings forecast by circa 3.5% led by better revenues, especially in corporate activity. 

Overweight rating with the target falling to $16.30 from $16.50. Industry view is In-Line.

Target price is $16.30 Current Price is $14.55 Difference: $1.75
If CPU meets the Morgan Stanley target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $14.54, suggesting upside of 1.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: 0.1

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

Morgans rates CPU as Add (1) -

Morgans assesses an in-line first half result for Computershare as being acceptable in a difficult environment, with the major positive a stronger Issuer Services result.

Management upgraded FY21 guidance though the broker considers it requires achievement of cost-out, supplemented by organic growth and some seasonality benefits.

Morgans raises the price target to $16.20 from $15.13 after upgrading FY21 and FY22 EPS estimates by 2% and 4%, respectively, mainly on the higher Issuer Services result. The Add rating is unchanged.

Target price is $16.20 Current Price is $14.55 Difference: $1.65
If CPU meets the Morgans target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $14.54, suggesting upside of 1.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: 0.1

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

Ord Minnett rates CPU as Lighten (4) -

Computershare reported management EPS of US$21.8cps in the first half, in-line with Ord Minnett’s forecast. The company guided for a sharp improvement in the second half, to US30cps, implying to the broker very strong earnings growth.

This guidance was attributed to issuer services, share plans and US mortgage servicing. The analyst notes the latter two showed weak
trends in the period, implying a very sharp turnaround.

The broker believes the cost-savings initiative is progressing, although overall expenses in the group are still rising.

Ord Minnett maintains its Lighten recommendation with a target price of $10.75.

Target price is $10.75 Current Price is $14.55 Difference: minus $3.8 (current price is over target).
If CPU meets the Ord Minnett target it will return approximately minus 26% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $14.54, suggesting upside of 1.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: 0.1

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

UBS rates CPU as Neutral (3) -

First half results were broadly in line with UBS estimates. Some of the cyclical benefits will roll and a further step down in margin income is expected in FY22.

UBS finds there is little management can do about the difficult operating environment and therefore a focus on cost remains critical.

The stock is not expensive but the broker assesses growth in earnings per share is negative over the short term. Neutral retained with a target price of $15.

Target price is $15.00 Current Price is $14.55 Difference: $0.45
If CPU meets the UBS target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $14.54, suggesting upside of 1.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: 0.1

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

Credit Suisse rates CWN as Neutral (3) -

Credit Suisse downgrades rating on Crown Resorts to Neutral from Outperform on the basis of share price appreciation.

A study of the Bergin Report leads Credit Suisse to think Crown Resorts' valuation will not be impacted much despite not getting the go-ahead for the NSW restricted gaming licence.

The report recommends the regulator should conduct an audit of Crown without which Crown will have to delay opening the gaming floors. This prompts the broker to reduce its FY22 net profit by -$35m.

The report also recommends suitability tests for holders of casinos at 10% ownership. Here the broker highlights Creso Pharma ((CPH)) currently holds 36.8% in Crown Resorts and may have to sell down its stake. 

Neutral rating with a 10.35 target retained.

Target price is $10.35 Current Price is $9.81 Difference: $0.54
If CWN meets the Credit Suisse target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $9.64, suggesting downside of -4.1% (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

Macquarie rates DOW as Outperform (1) -

In a preliminary review of Downer EDI's first half, Macquarie sees a relatively clean result with no major one-offs. The dividend has been reinstated at 9 cents, above the broker's expectation for 5 cents.

The profit (NPAT) represents 44 % of the broker's full year forecast and compares to the usual 42/58 split.

The analyst highlights $526m of asset sales to date including Open Cut West, Blasting Services, underground and Laundries, with greater than half of this to be received in the second half.

The analyst believes the strong cash result and asset sales pave the way for potential capital management initiatives and acquisitions going forward.

The Outperform rating and $5.82 target are retained at this stage.

Target price is $5.82 Current Price is $5.34 Difference: $0.48
If DOW meets the Macquarie target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $5.46, suggesting upside of 0.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.8

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

Ord Minnett rates DOW as Hold (3) -

In its preliminary response to Downer EDI’s interim result, Ord Minnett notes that while revenue missed its expectations, company’s headline operating earnings (EBITDA) of $221m was ahead of its forecasts.

Despite headline operating earnings beating its expectations, due primarily to recoveries in their “non-core" divisions, Ord Minnett regards Downer EDI’s core performance a cause for concern.

Looking at operating earnings swings on a HoH basis, core earnings went backwards (-3%) while non-core earnings rose 5-fold from $8.1 million to $40.9 million.

Equally concerning to Ord Minnett is the fact that every core division went backwards on the pcp.

Downer EDI declared a 9cps dividend.

Ord Minnett maintains both its Hold rating and target price of $5.00.

Target price is $5.00 Current Price is $5.34 Difference: minus $0.34 (current price is over target).
If DOW meets the Ord Minnett target it will return approximately minus 6% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $5.46, suggesting upside of 0.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.8

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

UBS rates EBO as Buy (1) -

UBS revises Australian pharmacy distribution revenue growth assumptions from FY23 to reflect the longer term benefits of a more stable volume growth environment.

This translates to upgrades of 5% for earnings per share over the short term and 10% from FY27.

Despite the recent share price performance, the broker considers the current trading multiple undemanding and retains a Buy rating. Target is raised to NZ$32.70 from NZ$28.30.

Current Price is $28.00. Target price not assessed.

Current consensus price target is $24.97, suggesting downside of -9.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.8

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

Morgans rates EVN as Hold (3) -

In a review of the gold sector Morgans notes average share prices in stocks under coverage have fallen -35% on average since 2020 peaks, in a range of -20% to -50%. 

The broker still expects gold  price support via money printing and increased inflation targets globally.

The broker explains Evolution Mining had a strong quarter and remains well placed to achieve guidance at the lower end of costs. It's  anticipated there will be a material increase to the group ore reserves during this quarter with a reserve update at Red Lake.

Progress is going well at the Cowal underground and Red Lake growth projects, which underpin the company’s next stage of growth, predicts the analyst.

The Hold rating and $4.85 target are unchanged.

Target price is $4.85 Current Price is $4.70 Difference: $0.15
If EVN meets the Morgans target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $4.84, suggesting upside of 2.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.1

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

Macquarie rates GUD as Outperform (1) -

GUD Holdings will acquire Australian Clutch Services for an enterprise value of $32m, implying a "fair" 5.6x PE multiple. The broker estimates 5% earnings accretion in FY22, and sees the deal as strategic and consistent with GUD's growth strategy.

Outperform retained, target rises to $13.50 from $13.00.

Target price is $13.50 Current Price is $12.78 Difference: $0.72
If GUD meets the Macquarie target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $13.08, suggesting upside of 1.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.6

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

Ord Minnett rates GUD as Hold (3) -

Due largely to higher revenue in its Automotive division, GUD Holdings 1H21 divisional revenue of A$251.5m was up 10.7% (pcp), while underlying operating earnings (EBIT Post AASB16 of A$52.3m) was also up (17.6%) on the half year prior. 

In its initial response to GUD Holdings interim result, Ord Minnett observed encouraging signs in operating trends in the first half, which continued through January.

Assuming no H2 fiscal cliff or significant mobility restrictions, the broker forecasts FY21 underlying operating earnings to be in the range of $95-100m (including contributions from G4CVA and Australia Clutch Services)”.

Given the strong 1H21 result of A$52.3m, an additional A$2m of operating earnings from the Australia Clutch Services (which is newly acquired for A$32m) in 2H2, and an expected FX tailwind (albeit tempered by current hedging), Ord Minnett regards the company’s guidance (FY21 operating earnings of A$95-100m) as a little underwhelming vs current market expectations (consensus $96m).

The interim dividend at A25.0cps, was in-line with the pcp and ahead of the broker’s 23.0cps forecast.

Hold recommendation is maintained with a $12.00 target price.

Target price is $12.00 Current Price is $12.78 Difference: minus $0.78 (current price is over target).
If GUD meets the Ord Minnett target it will return approximately minus 6% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $13.08, suggesting upside of 1.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.6

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

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

Citi assesses momentum is building in the business and underlying margins although on current estimates there is only modest value appeal. Still, enough to upgrade to Buy from Neutral.

The broker anticipates the margin target of 15-17% will be achieved by FY23. Target is raised to $5.90 from $5.00.

Citi expects a significant increase in hazards allowance in FY22 while in the short term there is likely to be a modest adverse impact from lower investment returns and higher costs.

Target price is $5.90 Current Price is $5.29 Difference: $0.61
If IAG meets the Citi target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $5.66, suggesting upside of 6.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

Macquarie rates IAG as Neutral (3) -

Insurance Australia Group's result was strong, the broker suggests, under the circumstances. Structural industry concerns remain but the business has built significant buffers. The provision against business interruption claims was not changed.

The insurer has retained FY21 dividend payout guidance of 60-80% but has provided no earnings guidance. The broker believes management commentary was overly cautious and has lifted its FY21 earnings forecast by 21%.

Neutral retained, target rises to $5.30 from $5.10.

Target price is $5.30 Current Price is $5.29 Difference: $0.01
If IAG meets the Macquarie target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $5.66, suggesting upside of 6.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

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

For Insurance Australia Group to achieve its 15-17% insurance margin targets, Morgan Stanley believes the group needs a sustained premium rate momentum that should last at least 12 months and to lower its expense ratios via digitization.

Just like for Suncorp Group ((SUN)), Morgan Stanley believes the group may first have to increase its cost base to execute its transformation strategy before reaping the benefits, expected in FY23.

Industry view: In-line. The price target is increased to $5.10 from $5 and the Equal-Weight rating is unchanged.

Target price is $5.10 Current Price is $5.29 Difference: minus $0.19 (current price is over target).
If IAG 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 $5.66, suggesting upside of 6.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

Morgans rates IAG as Hold (3) -

Insurance Australia Group's first half NPAT loss of -$460m came in slightly below Morgans expectations, while the dividend of 7cps compared to an expectations of no dividend.

Overall, the reported result was impacted by a -$1.2bn provision loss (pre-tax) being booked due to Business Interruption (BI) claims, as announced in November.

Management has disclosed new mid-term profitability targets of a 12%-13% return on equity (ROE) and a reported insurance margin (IM) of 15%-17% as part of its refreshed strategy.

Morgans lifts FY21 and FY22 cash NPAT by 1% and 5%, respectively, on higher IM expectations, and the price target is increased to $5.68 from $5.29. The Hold rating is unchanged.

Target price is $5.68 Current Price is $5.29 Difference: $0.39
If IAG meets the Morgans target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $5.66, suggesting upside of 6.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

Ord Minnett rates IAG as Hold (3) -

Ord Minnett assesses Insurance Australia Group first half result as credible, despite reporting a net loss of -$460m, which was adversely affected by covid-19 along with business interruption and several other provisions.

The group showed a strong reported first half result that also showed flat underlying margins at 14.2% excluding covid-19, despite
reinsurance and yield pressures, explains the broker.

An unfranked interim dividend of 7 cents was declared, well below the analyst's 12 cent forecast.

 The broker maintains the Hold rating and target of $5.37.

Target price is $5.37 Current Price is $5.29 Difference: $0.08
If IAG meets the Ord Minnett target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $5.66, suggesting upside of 6.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

UBS rates IAG as Buy (1) -

UBS found the first half result "cleaner" following the earnings downgrades throughout 2020. The broker is comforted by underlying margins of 14.2% which indicate no further slippage from the medium-term targets 15-17%.

Business interruption risks will continue to weigh on the share price although the broker believes the company is well-positioned. Buy rating retained. Target is raised to $6.00 from $5.80.

Target price is $6.00 Current Price is $5.29 Difference: $0.71
If IAG meets the UBS target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $5.66, suggesting upside of 6.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

Credit Suisse rates JHX as Neutral (3) -

James Hardie Industries' third-quarter result shows net profit is 16% above consensus with guidance for FY21 increased by 11% to US$440-450m. The company declared a special dividend of 70c, a move that Credit Suisse believes underscores its strong position.

Operating income margins in all segments were above the broker's forecast led by an increase in LEAN savings. Looking at the company's savings trend, the broker expects James Hardie may exceed its target of FY20-22 cumulative savings by US$40m. 

Neutral rating with the target rising to $40 from $39.

Target price is $40.00 Current Price is $41.22 Difference: minus $1.22 (current price is over target).
If JHX meets the Credit Suisse target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $43.60, suggesting upside of 7.0% (ex-dividends)

The company's fiscal year ends in March.

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 LEP as Neutral (3) -

ALE Property's first half earnings were 14% above the prior first half and 12% ahead of the broker. However the beat was a result of lower interest expense due to the deferral of interest rate hedges, which makes it of lower quality.

Having rarely made changes to its portfolio the past, the REIT has announced a detailed review. The broker suspects this could be due to the underperformance of some pubs in the rent review process.

This might provide for upside, the broker suggests, but there could be a divestment/deployment lag, or there could be a buyback. Neutral retained, target falls to $4.51 from $4.58 on hedging delay.

Target price is $4.51 Current Price is $4.77 Difference: minus $0.26 (current price is over target).
If LEP meets the Macquarie target it will return approximately minus 5% (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) -

ALE Property Group reported a first-half FY21 distributable profit of $17.9m, up 14.7% on the same period last year and in-line with Ord Minnett’s forecast.

The outcome was supported by $0.35m of back-paid rent following the receipt of rent determinations in the half, explains the broker. An interim distribution of 10.75cps was declared, up by 2.9%.

Management guided to an FY21 distribution of 21.50cps, up 2.9%, and expects distributions to grow by at least CPI under its updated distribution policy.

The Group received independent valuations indicating that the portfolio was around -33% under-rented at October 2020. This should result in a material uplift in rents at the uncapped market rent review in 2028, and in-turn reduce the payout ratio, according to the broker.

The Lighten rating and $4.20 target are retained.

Target price is $4.20 Current Price is $4.77 Difference: minus $0.57 (current price is over target).
If LEP meets the Ord Minnett target it will return approximately minus 12% (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

Macquarie rates MFG as Outperform (1) -

In a preliminary response, Macquarie considers Magellan Financial Group's first half result in-line on revenue and the dividend, with a beat on expenses.

FY21 Funds Management expense guidance is now expected by the broker to come in at the lower end of the $110-115m range. Partially offsetting this will be the share of equity accounted investments (mainly Barrenjoey), still considered in their early stages.

Macquarie suggests the recent de-rating provides an attractive entry point, assuming the recent moderation in performance metrics doesn’t persist for a prolonged period of time.

The Outperform rating and $53 target are maintained.

Target price is $53.00 Current Price is $51.11 Difference: $1.89
If MFG meets the Macquarie target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $55.32, suggesting upside of 12.8% (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

Macquarie rates MIN as Outperform (1) -

Mineral Resources' earnings and dividend both beat the broker. Lower spudomene costs and higher margins in Mining Services were the drivers, underpinned by the ever buoyant iron ore price.

The broker has incorporated cost and margin trends into earnings forecast increases. Outperform retained, target rises to $47.50 from $45.80.

Target price is $47.50 Current Price is $36.80 Difference: $10.7
If MIN meets the Macquarie target it will return approximately 29% (excluding dividends, fees and charges).

Current consensus price target is $40.08, suggesting upside of 8.9% (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

Morgan Stanley rates MIN as Underweight (5) -

Mineral Resources' first-half operating income was up 15% at $31m versus Morgan Stanley's estimate driven by the Yilgarn hub and external contracts crushing more during the period. The company's external contract retention rate was 67% in the half.

A dividend of 100c was ahead of Morgan Stanley's 74c and equates to an underlying payout ratio of 36%.

Mineral Resources has lowered its iron ore shipment guidance range for operations at Koolyanobbing and Iron Valley and is now in-line with the broker's forecast of 20mt.

Underweight rating with a target of $32. Industry view: Attractive.

Target price is $32.00 Current Price is $36.80 Difference: minus $4.8 (current price is over target).
If MIN meets the Morgan Stanley target it will return approximately minus 13% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $40.08, suggesting upside of 8.9% (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 MIN as Hold (3) -

Mineral Resources reported  first-half FY21 underlying net profit of $430m, up 233% on the same period last year. An interim dividend of $1 was declared, ahead of Ord Minnett's expectations.

Net debt was in-line with the broker's expectations after higher capex offset lower cash tax paid. FY21 capex guidance was increased by 50%.

The broker highlights lithium leverage along with the iron ore projects remain key value drivers. 

Hold rating retained with the target falling to $36.80 from $38.20.

Target price is $36.80 Current Price is $36.80 Difference: $0
If MIN meets the Ord Minnett target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $40.08, suggesting upside of 8.9% (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 MIN as Buy (1) -

Mineral Resources reported a first half result that was ahead of UBS estimates. Even stripping out the contribution from higher iron ore prices, there was a 20% sequential lift in operating earnings.

UBS suggests this demonstrates the volume growth being achieved in commodities and mining services. Despite this, free cash flow was light amid a tax payment against the Wodgina sale proceeds.

The broker retains a Buy rating and reduces the target to $44.00 from $44.60.

Target price is $44.00 Current Price is $36.80 Difference: $7.2
If MIN meets the UBS target it will return approximately 20% (excluding dividends, fees and charges).

Current consensus price target is $40.08, suggesting upside of 8.9% (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 MP1 as Hold (3) -

Morgans makes immaterial forecast changes for Megaport as key metrics were disclosed prior to the first half result. The broker notes foreign exchange continues to weigh by slowing revenue on translation and causing an around -$17m loss.

Key points for the analyst included, Megaport Virtual Edge progress and closing the gap to earnings (EBITDA) breakeven. With North America (NAM) now EBITDA positive, all three regions are EBITDA positive at a segmental level and before centralised costs.

Hold and $13.27 target are unchanged. 

Target price is $13.27 Current Price is $14.20 Difference: minus $0.93 (current price is over target).
If MP1 meets the Morgans target it will return approximately minus 7% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $14.56, suggesting upside of 3.6% (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 MP1 as Hold (3) -

Megaport reported a first-half FY21 net loss of -$38m, well below Ord Minnett’s forecast of a loss of -$20.4m, although this included a -$17m currency loss due to the appreciation of the Australian dollar.

Management reiterated its commitment to achieve run-rate operating earnings (EBITDA) break-even by the end of FY21, highlights the broker.

The analyst believes strong growth in the company's business and the pending launch of new products and services are largely factored in at current share price levels.

Ord Minnett retains a Hold rating with the target increasing to $13.50 from $12.80.

Target price is $13.50 Current Price is $14.20 Difference: minus $0.7 (current price is over target).
If MP1 meets the Ord Minnett target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $14.56, suggesting upside of 3.6% (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 MP1 as Buy (1) -

UBS found some positive surprises in the first half result, including better momentum from the signing up of new SD-WAN partnerships and additional discussions on partnerships.

The outlook is better now some disruptions caused by the pandemic to IT projects have dissipated.

All regions were positive on operating earnings in the second quarter and the company has reasserted expectations for positive group operating earnings exiting June 2021. UBS maintains a Buy rating and raises the target to $16.90 from $15.45.

Target price is $16.90 Current Price is $14.20 Difference: $2.7
If MP1 meets the UBS target it will return approximately 19% (excluding dividends, fees and charges).

Current consensus price target is $14.56, suggesting upside of 3.6% (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 NCM as Hold (3) -

In a review of the gold sector Morgans notes average share prices in stocks under coverage have fallen -35% on average since 2020 peaks, in a range of -20% to -50%. 

The broker still expects gold  price support via money printing and increased inflation targets globally.

The broker explains Newcrest Mining is benefiting from higher copper and silver prices even as the gold price has softened, with circa 20% of revenue from copper, and this proportion forecast to rise.

The Hold rating and $27.87 target are maintained.

Target price is $27.87 Current Price is $25.20 Difference: $2.67
If NCM meets the Morgans target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $31.64, suggesting upside of 20.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: 0.6

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

Credit Suisse rates NST as Outperform (1) -

Northern Star's operating income at $474m was ahead of Credit Suisse's forecast of $461m and with record earnings achieved on gold sales. The miner declared a 9.5c, in-line with its policy.

Of course, the highlight of the first half was the merger between Northern Star-Saracen Mineral Holdings ((SAR)), adds the broker.

A solid result that, Morgan Stanley believes, also offers an opportunity to improve with the best days yet to come from operations at Pogo, KCGM, Yandal and merger synergies.

The broker's investment thesis on the stock is based on the miner's superior production and earnings growth versus peers along with higher gold price leverage.

Outperform retained with a target price of $14.75.

Target price is $14.75 Current Price is $12.09 Difference: $2.66
If NST meets the Credit Suisse target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $13.77, suggesting upside of 12.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

Macquarie rates NST as No Rating (-1) -

Northern Star's earnings result beat the broker by 17%. A 19.5c (ff) dividend was declared for which new, post-merger shares will be eligible, atop merger partner Saracen Minerals' ((SAR)) 3.8c special.

As the broker is advising on the merger it is restricted from making a recommendation.

Current Price is $12.09. Target price not assessed.

Current consensus price target is $13.77, suggesting upside of 12.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

Morgan Stanley rates NST as Underweight (5) -

Net profit was 9% ahead of Morgan Stanley's estimate. The operating cash flow was better than expected but put in line due to -$35m worth of principal lease payment.

Northern Star Resources states it is on track to achieve the FY21 production guidance. 

Underweight rating. Target is $11.60. Industry view: Attractive.

Target price is $11.60 Current Price is $12.09 Difference: minus $0.49 (current price is over target).
If NST 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 $13.77, suggesting upside of 12.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

Ord Minnett rates NST as Upgrade to Buy from Hold (1) -

Northern Star’s result was in line with Ord Minnet's forecast and the broker can see over 10% free cash flow (FCF) yields from FY23.

With $123m net debt and no material capex on the horizon, cash flow and returns will remain an important part of the analyst's investment case.

The company has reconfirmed the 6% revenue-based dividend policy.

Ord Minnett highlights significant leverage to the gold price with only 13% of the three year forward production hedged in the broker's model.

Upgrade to Buy from a Hold rating with the price target rising to $14.40 from $14.3.

Target price is $14.40 Current Price is $12.09 Difference: $2.31
If NST meets the Ord Minnett target it will return approximately 19% (excluding dividends, fees and charges).

Current consensus price target is $13.77, suggesting upside of 12.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

UBS rates NST as Neutral (3) -

First half results were in line with expectations, although UBS notes the dividend was slightly higher than anticipated. Nevertheless, the results over the short term are not reflective of the earnings power of the new entity.

UBS points out earnings from the Saracen assets will only accrue from implementation date on February 12. Transaction costs will also affect the FY21 results.

News flow is expected to be positive over the next 12 months and the broker assesses Northern Star offers the strongest production growth outlook amongst the gold miners. Neutral maintained. Target is $14.20.

Target price is $14.20 Current Price is $12.09 Difference: $2.11
If NST meets the UBS target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $13.77, suggesting upside of 12.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

UBS rates NWS as Buy (1) -

News Corp's second quarter was materially ahead of UBS estimates. Revenue grew 5.5% in reported operating earnings grew by 40%.

UBS believes the results stem from strong execution across several businesses, including Dow Jones, Move, and the restructuring of News Media.

The broker retains a Buy rating and raises the target to $33.20 from $29.00.

Target price is $32.20 Current Price is $28.91 Difference: $3.29
If NWS meets the UBS target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $33.60, suggesting upside of 15.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: 0.5

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

Macquarie rates OSH as Underperform (5) -

Papua LNG partners Oil Search, Total and ExxonMobil have finally signed an agreement with the PNG government. This is an
important milestone for the project, the broker notes, given recent unpredictability from the PNG government regarding fiscal terms on new projects.

The broker expects negotiations between Papua LNG and the PNG LNG JV still need to occur regarding infrastructure access and sharing at Port Moresby. With Oil Search's result release pending the broker retains Underperform. Target rises to $3.85 from $3.75.

Target price is $3.85 Current Price is $4.15 Difference: minus $0.3 (current price is over target).
If OSH meets the Macquarie target it will return approximately minus 7% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.12, suggesting downside of -0.7% (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

Ord Minnett rates PPS as Buy (1) -

Praemium's first half result was in-line with Ord Minnett's expectations, with a solid initial contribution from Powerwrap and an International division edging to profitability.

The analyst highlights UK tax losses of -$61m should add to cash flow performance once profit is achieved. Also, half of the quoted $6m
synergies relating to the Powerwrap integration have been achieved (annualised), in-line with Ord Minnett's expectations.

The broker feels the International business is the largest swing factor with the potential for meaningful and tax free cash flows within two years.

Buy rating is retained as Ord Minnett highlights a discount to two listed peers remains substantial. Target is increased to $1 from $0.90.

Target price is $1.00 Current Price is $0.84 Difference: $0.16
If PPS meets the Ord Minnett target it will return approximately 19% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for 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

Morgans rates RED as Add (1) -

In a review of the gold sector Morgans notes average share prices in stocks under coverage have fallen -35% on average since 2020 peaks, in a range of -20% to -50%. 

The broker still expects gold  price support via money printing and increased inflation targets globally.

While Red 5 continue to miss with production from Darlot, Morgans sees most value coming from the King of the Hills project where the company is already progressing development.

The Add rating and $0.41 target are retained.

Target price is $0.41 Current Price is $0.23 Difference: $0.18
If RED meets the Morgans target it will return approximately 78% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 1.0

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

Morgans rates RMS as Add (1) -

In a review of the gold sector Morgans notes average share prices in stocks under coverage have fallen -35% on average since 2020 peaks, in a range of -20% to -50%. 

The broker still expects gold  price support via money printing and increased inflation targets globally.

Ramelius Resources is Morgans preferred stock and despite a sharp pull back, there is considered upside to valuation.

Production exceeded guidance for the second quarter and the analyst sees a pathway to life extension at Edna May, while at Mt Magnet the Eridanus underground deposit continues to grow. 

Add rating and $2.44 target retained.

Target price is $2.44 Current Price is $1.44 Difference: $1
If RMS meets the Morgans target it will return approximately 69% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 1.0

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

Morgans rates RRL as Add (1) -

In a review of the gold sector Morgans notes average share prices in stocks under coverage have fallen -35% on average since 2020 peaks, in a range of -20% to -50%. 

The broker still expects gold  price support via money printing and increased inflation targets globally.

Morgans sees multiple catalysts for Regis Resources in the medium term including a significantly increased WA land holding and a large exploration budget for FY21. Additionally, there’s an expectation of permitting news for the world class McPhillamys project in 2021.

Add rating and $4.40 target are maintained.

Target price is $4.40 Current Price is $3.56 Difference: $0.84
If RRL meets the Morgans target it will return approximately 24% (excluding dividends, fees and charges).

Current consensus price target is $4.65, suggesting upside of 31.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.7

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

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

Saracen Mineral Holdings' net profit was 18% ahead of Morgan Stanley with operating cash flow 15% above the broker's estimate. Merger implementation with Northern Star Resources ((NST)) will occur on 12 Feb 2021.

A merger special dividend of 3.8c was paid as part of the completion of merger. No ordinary dividend was paid which is in-line with the broker's expectations.

Equal-weight rating with a target of $5.30. Industry view: Attractive.

Target price is $5.30 Current Price is $4.69 Difference: $0.61
If SAR meets the Morgan Stanley target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $5.53

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 SUN as Downgrade to Hold from Accumulate (3) -

Suncorp Group reported a first half FY21 net profit of $490m, below Ord Minnett’s $518m forecast, while the headline result was
boosted by the bank achieving a high net interest margin (NIM) and low bad debt charges.

A fully franked interim dividend of 26 cents was declared, versus the broker's 22 cent forecast.

The analyst makes a significant reduction to forecasts due to weak underlying trends, a period of reinvestment in the business and a strong share price performance relative to other general insurance stocks.

The rating is downgraded to Hold from Accumulate and the target price falls to $12 from $12.83.

Target price is $12.00 Current Price is $10.57 Difference: $1.43
If SUN meets the Ord Minnett target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $11.62, suggesting upside of 10.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

Ord Minnett rates TAH as Lighten (4) -

Instead of a sale, Ord Minnett has a preference for the company announcing a demerger of the Wagering division at the first-half FY21 results due on 17 February.

The broker believes this would extract the most value for both the lotteries and wagering divisions, while avoiding change of control provisions or stakeholder appeals.

The analyst cuts FY22 and FY23 earnings (EBITDA) forecasts by -4.8 and -5.6%, respectively, on further estimated wagering market share losses.

Ord Minnett retains its Lighten recommendation and increases the target price to $4 from $3.10.

Target price is $4.00 Current Price is $4.57 Difference: minus $0.57 (current price is over target).
If TAH meets the Ord Minnett target it will return approximately minus 12% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.16, suggesting downside of -7.7% (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

Macquarie rates TCL as Outperform (1) -

In a preliminary review of Transurban Group's result, Macquarie reinforces it was always going to be a soft half due to covid-19. The result is not considered a strong measure, with the impact of covid-19 on Citylink and lockdowns for the greater Washington area. 

Roads indicate they are benefiting from the early recovery and should get a further boost as domestic aviation starts to increase, explains the broker. Price growth is considered to remain favourable with 60% of revenue at over 4% per annum.

The company highlighted the potential for around $2bn of capital releases over the next three years to fund growth opportunities.

The Outperform rating and $15.06 target are maintained.

Target price is $15.06 Current Price is $13.36 Difference: $1.7
If TCL meets the Macquarie target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $14.47, suggesting upside of 9.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.1

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

Ord Minnett rates TCL as Buy (1) -

Upon first glance, Transurban’s 1H21 Underlying Free Cash Flow (FCF) of $467m (excl. capital releases) -released today- was ahead of Ord Minnett’s $410m estimate, while proportional operating earnings (EBITDA) was 2% above what the broker was expecting.

With traffic growth continuing to improve across Transurban Group’s assets, Ord Minnett expects the company’s earnings to stabilise at around 20% above pre-COVID-19 levels in FY22 and around 40% higher in FY23.

The broker expects development completions (WestConnex and NorthConnex) to be positive for cash flows, and drive strong growth.

Ord Minnett notes that the list of potential acquisitions continues to swell, with Transurban considering "the largest pipeline of opportunities ever seen".

The broker estimates potential acquisitions comprising a) 49% of WestConnex ($3-5bn at share, $6-10bn at 49%), b) Western Harbour Tunnel ($1-2.5bn at share, $2-5bn at 100%), and c) Maryland Express Lanes Project (US$4.5-5.5bn at 50% share).

Transurban is yielding circa 4.5% on FY22, and Ord Minnett forecasts a strong 8% DPS CAGR out to FY28.

The Buy rating remains unchanged as does the target price of $16.50.

Target price is $16.50 Current Price is $13.36 Difference: $3.14
If TCL meets the Ord Minnett target it will return approximately 24% (excluding dividends, fees and charges).

Current consensus price target is $14.47, suggesting upside of 9.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.1

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

Macquarie rates URW as Neutral (3) -

After a preliminary review of Unibail-Rodamco-Westfield's results, Macquarie calculates it was broadly in-line with the broker's expectations.

While no FY21 guidance was provided, the company does not expect a recovery in earnings (EBITDA) until FY22, given current mall closures across its operations and potential delays in vaccination programs.

The company announced it will not pay a dividend for FY20-22 in order to aid the deleveraging process.

Neutral and $5.05 target retained.

Target price is $5.05 Current Price is $4.84 Difference: $0.21
If URW meets the Macquarie target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $4.78, suggesting upside of 3.1% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

This company reports in EUR. 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

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

After the Shopping Centres Australia Property Group ((SCP))'s result, Ord Minnett determines like-for-like sales growth rates remain strong. On a read-through basis, Woolworths is expected to have outperformed Coles ((COL)) again in the second quarter

While turnover rent was a positive for SCA Property, it is a potential headwind for supermarkets, notes the broker. Conversely, Big W like-for-like sales growth momentum is considered to remain very strong.

Ord Minnett is currently restricted and cannot provide a rating or target at present.

Current Price is $41.53. Target price not assessed.

Current consensus price target is $42.80, suggesting upside of 4.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.7

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