Australian Broker Call

Macquarie rates 29M as Upgrade to Neutral from Underperform (3) -

The Commodities Team at Macquarie has raised 2024 and 2025 copper forecasts by 7% and 9%, respectively, to US4.39/lb and US$4.34/lb.

The long-term forecast has been increased by 7% to US$4.08/lb, reflecting higher hurdle rates and higher inducement prices required to incentivise new production, explains the broker.

South32 and Sandfire Resources are Macquarie's diversified and pure-play preferences for copper, respectively, while BHP Group is marginally preferred over Rio Tinto.

The rating for 29Metals is upgraded to Neutral from Underperform and the target is increased by 92% to 50c largely due to the impact of the broker's higher copper forecasts on a leveraged balance sheet. New equity funding assumptions are also made.

Target price is $0.50 Current Price is $0.50 Difference: $0.005
If 29M meets the Macquarie target it will return approximately 1% (excluding dividends, fees and charges).

Current consensus price target is $0.50, suggesting downside of -2.0% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.3

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

Macquarie rates AIS as Upgrade to Neutral from Underperform (3) -

The Commodities Team at Macquarie has raised 2024 and 2025 copper forecasts by 7% and 9%, respectively, to US4.39/lb and US$4.34/lb.

The long-term forecast has been increased by 7% to US$4.08/lb, reflecting higher hurdle rates and higher inducement prices required to incentivise new production, explains the broker.

South32 and Sandfire Resources are Macquarie's diversified and pure-play preferences for copper, respectively, while BHP Group is marginally preferred over Rio Tinto.

The rating for Aeris Resources is upgraded to Neutral from Underperform and the target is increased by 50% to 30c largely due to the impact of the broker's higher copper forecasts on a leveraged balance sheet.

Target price is $0.30 Current Price is $0.30 Difference: $0.005
If AIS meets the Macquarie target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $0.27, suggesting downside of -2.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.3

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

Ord Minnett rates ALQ as Sell (5) -

ALS Ltd's FY24 profit was a -4% miss against Ord Minnett's forecast and management noted market conditions remain mixed, inclusive of a spending slowdown for mining exploration and drug discovery activity.

A final dividend of 19.6cps was declared and management stated FY27 targets are on track for revenue and earnings of $3.3bn and 0.6bn, respectively.

The Sell rating is maintained and the target rises to $9.10 from $8.90.

Target price is $9.10 Current Price is $13.94 Difference: minus $4.84 (current price is over target).
If ALQ meets the Ord Minnett target it will return approximately minus 35% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $13.46, suggesting downside of -4.0% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.3

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

Macquarie rates AMI as Outperform (1) -

The Commodities Team at Macquarie has raised 2024 and 2025 copper forecasts by 7% and 9%, respectively, to US4.39/lb and US$4.34/lb.

The long-term forecast has been increased by 7% to US$4.08/lb, reflecting higher hurdle rates and higher inducement prices required to incentivise new production, explains the broker.

South32 and Sandfire Resources are Macquarie's diversified and pure-play preferences for copper, respectively, while BHP Group is marginally preferred over Rio Tinto.

The target for Aurelia Metals rises to 25c from 22c and the Outperform rating is unchanged.

Target price is $0.25 Current Price is $0.19 Difference: $0.06
If AMI meets the Macquarie target it will return approximately 32% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 1.0

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

Citi rates APE as Downgrade to Sell from Neutral (5) -

Eagers Automotive reported revenue growth for the first four months of 2024 at 18.3%, ahead of Citi expectations of 12.5% year-on-year growth, with new car sales boosting the results since May 2023.

Margins, however, contracted by -100bps over this period compared to the 1H23 with excess inventory and soft demand for Atto 3 (BYD) leading to price discounting and erosion of profits.

Some improvement is expected in the 2H24 from the Seal and Sealion models, although the broker expects margins to remain "subdued" due to investment in the company's network.

The analyst revises earnings forecasts for FY24 down -16% due to continued weakening consumer demand and tougher dealership conditions, and down a further -13.3% in FY25.

Rating downgraded to Sell from Neutral. Target price revised to $9.55 from $13.85.

Target price is $9.55 Current Price is $10.44 Difference: minus $0.89 (current price is over target).
If APE 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 $12.62, suggesting upside of 19.0% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.4

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

Ord Minnett rates AUB as Buy (1) -

AUB Group has announced the acquisition of professional risk underwriting agency Pacific Indemnity for -$105m, and a probable total cost of -$140m.

Management has completed a $200m equity placement at $27.50 per new share to both fund the transaction and help support future M&A activity, notes Ord Minnett. A share purchase plan is also being contemplated for up to $25m.

The Buy rating is reiterated and the target eases to $34.04 from $34.20.

Target price is $34.04 Current Price is $30.51 Difference: $3.53
If AUB meets the Ord Minnett target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $34.72, suggesting upside of 15.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 1.0

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

Macquarie rates BEN as Underperform (5) -

A key focus of Bendigo & Adelaide Bank's investor day was progress on the digital front, which Macquarie feels is starting to reap benefits.

It's believed, however, these benefits will form part of the cost-of doing-business rather than providing genuine growth opportunities.

As investment spending remains elevated and competitive pressures persist, the broker believes returns will remain challenged.

The Underperform rating and $9.25 target are retained.

Target price is $9.25 Current Price is $10.99 Difference: minus $1.74 (current price is over target).
If BEN 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 $9.82, suggesting downside of -9.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: -0.4

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

Morgan Stanley rates BEN as Overweight (1) -

Bendigo & Adelaide Bank's investor day highlighted to Morgan Stanley progress in re-shaping the business, reducing complexity and modernising its technology. Digitisation of mortgage and deposit origination is expected to provide upside for FY25 earnings.

By way of example, the bank has moved to three from eight core banking systems. Also, more than 40% of applications have been migrated to the cloud over the past four years.

Bendigo & Adelaide Bank is Morgan Stanley's preferred smaller bank given the quality of its deposit franchise and management's focus on efficiency.

The Overweight rating and $11.10 target are maintained. Industry View: In-Line.

Target price is $11.10 Current Price is $10.99 Difference: $0.11
If BEN meets the Morgan Stanley target it will return approximately 1% (excluding dividends, fees and charges).

Current consensus price target is $9.82, suggesting downside of -9.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: -0.4

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

Macquarie rates BHP as Neutral (3) -

The Commodities Team at Macquarie has raised 2024 and 2025 copper forecasts by 7% and 9%, respectively, to US4.39/lb and US$4.34/lb.

The long-term forecast has been increased by 7% to US$4.08/lb, reflecting higher hurdle rates and higher inducement prices required to incentivise new production, explains the broker.

South32 and Sandfire Resources are Macquarie's diversified and pure-play preferences for copper, respectively, while BHP Group is marginally preferred over Rio Tinto.

The target for BHP Group rises to $43 from $42. Neutral.

Target price is $43.00 Current Price is $44.91 Difference: minus $1.91 (current price is over target).
If BHP meets the Macquarie target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $44.76, suggesting upside of 1.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

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

Market Sentiment: 0.4

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

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

BHP Group submitted an increased final offer to Anglo American's board on May 20, which has been rejected.

The revised proposal implies to Morgan Stanley a 47% premium for Anglo ordinary shares over the undisturbed Anglo share price.

Morgan Stanley is currently under research restriction for BHP Group. No rating or target are provided.

Current Price is $44.91. Target price not assessed.

Current consensus price target is $44.76, suggesting upside of 1.6% (ex-dividends)

Forecast for FY24:

Forecast for FY25:

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

Market Sentiment: 0.4

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

Ord Minnett rates BHP as Hold (3) -

Ord Minnett believes the chance of a successful deal between BHP Group and Anglo American has risen to 60% from 50% following a deadline extension and increased offer price.

The broker's 60% figure incorporates a 40% chance the deal will be done at the prevailing offer price, or a 20% likelihood it is clinched at a an around 5% higher offer price.

The broker's target falls to $39.50 from $40 and the Hold rating is maintained.

Target price is $39.50 Current Price is $44.91 Difference: minus $5.41 (current price is over target).
If BHP 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 $44.76, suggesting upside of 1.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

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

Market Sentiment: 0.4

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

UBS rates CGF as Upgrade to Buy from Neutral (1) -

As Australians transition from accumulation to de-cumulation, UBS estimates assets under management (AUM) in the retirement phase (over $1trn) are growing faster than AUM in the contribution phase.

UBS is upbeat on Challenger with its strong position as Australia's largest annuity provider and the expected growth in its addressable market, driven by closer collaboration with industry super funds.

The analyst views these collaborations as new distribution opportunities that will compensate for bottlenecks in the retail financial advice channel.

UBS has increased its FY25-26 EPS forecasts by 2% and 5% due to an additional $300m p.a. in bulky lifetime sales to industry funds, achieving over 11% return on invested capital on new growth capital.

Rating upgraded to Buy from Neutral. Target raised to $8 from $7.10.

Target price is $8.00 Current Price is $6.44 Difference: $1.56
If CGF meets the UBS target it will return approximately 24% (excluding dividends, fees and charges).

Current consensus price target is $7.40, suggesting upside of 11.6% (ex-dividends)

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.2

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

Macquarie rates CNB as Outperform (1) -

The Commodities Team at Macquarie has raised 2024 and 2025 copper forecasts by 7% and 9%, respectively, to US4.39/lb and US$4.34/lb.

The long-term forecast has been increased by 7% to US$4.08/lb, reflecting higher hurdle rates and higher inducement prices required to incentivise new production, explains the broker.

South32 and Sandfire Resources are Macquarie's diversified and pure-play preferences for copper, respectively, while BHP Group is marginally preferred over Rio Tinto.

The target for Carnaby Resources rises to $1.25 from $1.10 mainly due to decreased dilution after the broker updates assumed equity raise assumptions

Target price is $1.25 Current Price is $0.75 Difference: $0.5
If CNB meets the Macquarie target it will return approximately 67% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 1.0

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

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

Cleanaway Waste Management recently reconfirmed FY24 EBIT guidance at approximately $350m and its FY26 EBIT target of over $450m at a conference.

Morgans assesses the update positively with the announced reduction in the maintenance capex budget starting FY25 by $50m p.a., which is expected to enhance cashflows for the company, given the existing capex equivalent stands at around -$280m-$300m in FY24, according to the analyst.

Adjusting for the changes boosts the brokers discounted cashflow valuation markedly. Upgraded rating to Add from Neutral. Target price raised to $3.02 from $2.54.

Target price is $3.02 Current Price is $2.80 Difference: $0.22
If CWY meets the Morgans target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $2.88, suggesting upside of 3.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.5

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

Ord Minnett rates DSE as Buy (1) -

Ord Minnett's new target for Dropsuite is $3.38 following approval by shareholders at the recent AGM for a 10:1 consolidation of the company's issued capital.

Management believes a higher share price (same value) will be more appealing to a wider range of international investors, particularly in
North America , where the company derived 68% of FY23 revenue.

Buy.

Target price is $3.38 Current Price is $2.75 Difference: $0.63
If DSE meets the Ord Minnett target it will return approximately 23% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 1.0

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

Ord Minnett rates JHX as Hold (3) -

FY24 results for James Hardie Industries were in line with Ord Minnett's expectations, but as consumers are reducing discretionary spending on renovations, management has downgraded the outlook for FY25.

The company's earnings are supported by aging houses in North America, points out the analyst.

The broker anticipates a gradual recovery in the 2H of FY25 as consumer spending recovers in line with the expected lowering of interest rates by central banks.

Hold rating and $51 target price retained.

Target price is $51.00 Current Price is $48.24 Difference: $2.76
If JHX meets the Ord Minnett target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $55.48, suggesting upside of 16.8% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY25:

Forecast for FY26:

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

Market Sentiment: 0.6

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

Ord Minnett rates MPL as Hold (3) -

Medibank Private's give back commitment has increased to $305m from $215m for Medibank and AHM customers. Ord Minnett notes the company's aim to not benefit from the pandemic brings total customer give backs to $1.46bn.

Management has also confirmed FY24 guidance for policyholder growth of 1.2-1.5% and expects claims-per-policyholder will increase at the lower end of the 2.2-2.4% guidance range.

The Hold rating and $3.60 target are unchanged.

Target price is $3.60 Current Price is $3.66 Difference: minus $0.06 (current price is over target).
If MPL meets the Ord Minnett target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.81, suggesting upside of 5.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.2

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

Macquarie rates NEM as Outperform (1) -

The Commodities Team at Macquarie has raised 2024 and 2025 copper forecasts by 7% and 9%, respectively, to US4.39/lb and US$4.34/lb.

The long-term forecast has been increased by 7% to US$4.08/lb, reflecting higher hurdle rates and higher inducement prices required to incentivise new production, explains the broker.

South32 and Sandfire Resources are Macquarie's diversified and pure-play preferences for copper, respectively, while BHP Group is marginally preferred over Rio Tinto.

The $71 target and Outperform rating for Newmont Corp are maintained.

Regarding gold stocks with copper exposure, Macquarie notes Evolution Mining ((EVN) is the most heavily exposed with around 34% of revenue being copper-driven for FY25.

Target price is $71.00 Current Price is $63.05 Difference: $7.95
If NEM meets the Macquarie target it will return approximately 13% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

Forecast for FY24:

Forecast for FY25:

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

Bell Potter rates NUF as Hold (3) -

Nufarm reported a softer-than-expected 1H24 result with underlying net profit down -64% year-over-year (yoy) to $50.9m, below the Bell Potter estimate of $66.9m.

A  -23% fall in average selling prices led to -290bps decline in the gross margin, notes the analyst. 

Management guided to FY24 EBITDA  between $350-390m, below the consensus of $439m and Bell Potter lowers net profit estimates by -52% for FY24 and -22% for FY25.

The broker highlights earnings uncertainty for FY26 with Nufarm relying on a material recovery in average selling prices, which appears challenging given current sector trends, 

The target is trimmed to $5.10 from $6.35. Hold rating unchanged.

Target price is $5.10 Current Price is $4.73 Difference: $0.37
If NUF meets the Bell Potter target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $5.71, suggesting upside of 24.2% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.2

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

Citi rates NUF as Downgrade to Neutral from Buy (3) -

The recovery in pricing remains a key concern for Citi regarding the earnings outlook for Nufarm in the 2H24, post the company's interim result.

The broker highlights overcapacity in China and ongoing industry de-stocking as the issues in postponing the recovery in prices.

For more earnings certainty, Citi analysts are seeking clarity on price stability and increases for the active ingredients which would then flow through to Crop Protection products.

Management guided to EBITDA of $350m-$390m, but the analyst remains circumspect and trim EBITDA forecasts by -15% for FY24 and -4% for FY25.

The target is lowered to $4.80. Rating downgraded to Neutral from Buy.

Target price is $4.80 Current Price is $4.73 Difference: $0.07
If NUF meets the Citi target it will return approximately 1% (excluding dividends, fees and charges).

Current consensus price target is $5.71, suggesting upside of 24.2% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.2

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

Macquarie rates NUF as Neutral (3) -

Nufarm's 1H underlying profit of $51m fell well short of Macquarie's $72m forecast, while FY24 guidance was also a -16% miss as challenging conditions are expected to continue in the 2H.

The company is facing weak margins amid ongoing price pressure and ample supply, explains the broker, noting sector peers are expecting a challenging FY24 followed by a recovery in FY25.

Burgeoning momentum in Omega 3 is helping underpin the broker's earnings growth assumptions for the Seeds business. Management reiterated its FY26 Seeds revenue aspiration of $600-700m.

The Neutral rating is retained and the target falls to $5.10 from $5.73 on the broker's earnings changes and a valuation roll-forward.

Target price is $5.10 Current Price is $4.73 Difference: $0.37
If NUF meets the Macquarie target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $5.71, suggesting upside of 24.2% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.2

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

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

Nufarm's 1H earnings (EBITDA) missed the consensus forecast by -15% and FY24 guidance reflects a similar downgrade, notes Morgan Stanley. Plant inefficiencies from capital programs have disrupted manufacturing operations, explains the broker.

Now, management's FY26 targets are feeling increasingly aspirational, in the analyst's view.

FY24 guidance points to a decline in seed technology earnings for FY24, despite these earnings being a clear standout in the 1H, according to the broker.

The current level of leverage is not without risk, cautions the broker, though management is confident of a return to targeted levels. It's this leverage keeping Morgan Stanley at an Equal-weight rating. 

The $5.00 target is unchanged. Industry view: In-Line.

Target price is $5.00 Current Price is $4.73 Difference: $0.27
If NUF meets the Morgan Stanley target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $5.71, suggesting upside of 24.2% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.2

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

Ord Minnett rates NUF as Accumulate (2) -

Ord Minnett underestimated the crop protection headwinds evident in Nufarm's 1H results, but suggests the potential for the Seeds division is being overlooked by a market focused on near-term industry challenges.

Back in February, points out the broker, management confirmed the industry is dealing with an inventory overhang and higher cost of goods.

The analyst anticipates a recovery in crop protection from low prices and looks forward to new crop protection products from Nufarm. Accelerated seed technologies growth is also expected via developments in the omega-3 canola and bioenergy space.

The Accumulate rating and target price of $7.70 are retained.

Target price is $7.70 Current Price is $4.73 Difference: $2.97
If NUF meets the Ord Minnett target it will return approximately 63% (excluding dividends, fees and charges).

Current consensus price target is $5.71, suggesting upside of 24.2% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.2

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

UBS rates NUF as Buy (1) -

Nufarm reported 1H24 EBITDA earnings in line with UBS estimates representing a -31% fall on the previous year, although the Seeds division performed strongly.

Margins came under pressure from discounting of higher cost inventory and the broker now expects the margin pressures to remain for longer than previously anticipated.

Management guided for FY24 EBITDA between $350-390m, implying a weaker 2H24. UBS has downgraded FY24 EPS forecasts by -44% due to lower earnings and higher debt costs, and a further -4% for FY25.

Buy rating unchanged. Target price lowered to $6.90 from $7.

Target price is $6.90 Current Price is $4.73 Difference: $2.17
If NUF meets the UBS target it will return approximately 46% (excluding dividends, fees and charges).

Current consensus price target is $5.71, suggesting upside of 24.2% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.2

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

Macquarie rates RIO as Neutral (3) -

The Commodities Team at Macquarie has raised 2024 and 2025 copper forecasts by 7% and 9%, respectively, to US4.39/lb and US$4.34/lb.

The long-term forecast has been increased by 7% to US$4.08/lb, reflecting higher hurdle rates and higher inducement prices required to incentivise new production, explains the broker.

South32 and Sandfire Resources are Macquarie's diversified and pure-play preferences for copper, respectively, while BHP Group is marginally preferred over Rio Tinto.

The target for Rio Tinto rises to $123 from $121. Neutral.

Target price is $123.00 Current Price is $133.50 Difference: minus $10.5 (current price is over target).
If RIO meets the Macquarie target it will return approximately minus 8% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $128.33, suggesting downside of -3.0% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY24:

Forecast for FY25:

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

Market Sentiment: 0.0

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

Bell Potter rates RPL as Buy (1) -

Bell Potter assesses the recent strong performance updates from Regal Partners for the first four months of 2024, with 72% of Funds Under Management (FUM) at or within 5% of high-water marks, leading to potential strong performance fees.

Notably, 1Q24 FUM increased by 10% to $12.1bn, with net flows of $404m and investment performance adding $811m; better metrics than the broker's expectations.

The analyst adjusts EPS forecasts for FY24 by 21.9%, and 3.2% for FY25. Buy rating retained and the target raised to $4.02 from $3.86

Target price is $4.02 Current Price is $3.03 Difference: $0.99
If RPL meets the Bell Potter target it will return approximately 33% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 1.0

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

Macquarie rates RXM as Outperform (1) -

The Commodities Team at Macquarie has raised 2024 and 2025 copper forecasts by 7% and 9%, respectively, to US4.39/lb and US$4.34/lb.

The long-term forecast has been increased by 7% to US$4.08/lb, reflecting higher hurdle rates and higher inducement prices required to incentivise new production, explains the broker.

South32 and Sandfire Resources are Macquarie's diversified and pure-play preferences for copper, respectively, while BHP Group is marginally preferred over Rio Tinto.

The target for Rex Minerals rises to 40c from 26c primarily due to decreased dilution after the broker updates assumed equity raise assumptions. Outperform.

Target price is $0.40 Current Price is $0.26 Difference: $0.145
If RXM meets the Macquarie target it will return approximately 57% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 1.0

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

Macquarie rates S32 as Outperform (1) -

The Commodities Team at Macquarie has raised 2024 and 2025 copper forecasts by 7% and 9%, respectively, to US4.39/lb and US$4.34/lb.

The long-term forecast has been increased by 7% to US$4.08/lb, reflecting higher hurdle rates and higher inducement prices required to incentivise new production, explains the broker.

South32 and Sandfire Resources are Macquarie's diversified and pure-play preferences for copper, respectively, while BHP Group is marginally preferred over Rio Tinto.

The target for South32 rises to $4.25 from $4.20. Outperform.

Target price is $4.25 Current Price is $3.85 Difference: $0.4
If S32 meets the Macquarie target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $3.79, suggesting downside of -1.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

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

Macquarie rates SFR as Outperform (1) -

The Commodities Team at Macquarie has raised 2024 and 2025 copper forecasts by 7% and 9%, respectively, to US4.39/lb and US$4.34/lb.

The long-term forecast has been increased by 7% to US$4.08/lb, reflecting higher hurdle rates and higher inducement prices required to incentivise new production, explains the broker.

South32 and Sandfire Resources are Macquarie's diversified and pure-play preferences for copper, respectively, while BHP Group is marginally preferred over Rio Tinto.

The target for Sandfire Resources rises by 3% to $10.80. Outperform.

Target price is $10.80 Current Price is $9.17 Difference: $1.63
If SFR meets the Macquarie target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $9.02, suggesting downside of -3.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

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 SHL as Accumulate (2) -

Ord Minnett believes the long-term story for Sonic Healthcare remains intact despite lower near-term earnings, noting 2H organic revenues to-date are up by 6%, following the 6% achieved in the 1H.

Margin expansion is still expected in the longer-term on operating leverage, better integration of recent acquisitions, and improved productivity via digitising samples, along with newer AI tools to speed-up diagnoses.

Margin improvement initiatives are taking longer-than-expected, concedes the analyst, and this, along with currency headwinds, prompts a -7% reduction in the FY24 earnings (EBITDA) forecast.

The Accumulate rating and target price of $32 are retained.

Target price is $32.00 Current Price is $25.44 Difference: $6.56
If SHL meets the Ord Minnett target it will return approximately 26% (excluding dividends, fees and charges).

Current consensus price target is $29.83, suggesting upside of 20.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.6

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

Ord Minnett rates TLS as Accumulate (2) -

Ord Minnett assesses no impact on its intrinsic value of Telstra Group following an update on restructuring and trading, and highlights shares are trading at an attractive -21% discount to the broker's assessment of $4.50 as fair value. The Accumulate rating is maintained.

The broker is not surprised by a subtle shift by management to achieve FY24 guidance by focusing on cost reductions over a rejuvenation led by mobile.

Irrational competitive behaviour is not anticipated by Ord Minnett, especially given the capital deployed in rolling out 5G.

Ord Minnett highlights management maintained FY24 earnings guidance.

Target price is $4.50 Current Price is $3.46 Difference: $1.04
If TLS meets the Ord Minnett target it will return approximately 30% (excluding dividends, fees and charges).

Current consensus price target is $4.01, suggesting upside of 15.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.4

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

Ord Minnett rates TNE as Lighten (4) -

Ord Minnett sees nothing in TechnologyOne's 1H results to suggest any levers can be pulled by management to maintain historically high growth rates. Expansion beyond ERP was considered the most promising outcome within the results.

The broker retains its Lighten rating on valuation. Recent high growth rates are attributed to greater demand from governments and business in reaction to the pandemic, as well as the impact of high inflation on the company's CPI-linked contracts.

The target is increased to $14.50 from $14 due to the time value of money, explains the analyst.

Target price is $14.50 Current Price is $17.79 Difference: minus $3.29 (current price is over target).
If TNE meets the Ord Minnett target it will return approximately minus 18% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $17.11, suggesting downside of -3.9% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.3

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

Morgans rates TRS as Add (1) -

Reject Shop reported lower than expected sales growth for the 2H24 due to the timing of store openings and closures. Management has guided group EBIT to $4.0-5.5m, down -$2.3m-$3.8m against consensus forecasts, according to the Morgans analyst.

Though like-for-like sales have been resilient at 3.3% with total sales growth of 4.1%, and the company benefiting from the ongoing strategic turnaround in store rationalisation and new openings, the broker suggests.

Morgans adjust FY24 EBIT forecast down to $5m from $7.8m and FY25 EBIT down to $13m from $14m due to lower sales estimates and a -10bps decline in the gross margin.

Add rating unchanged and the target is lowered to $4.65 from $5.40.

Target price is $4.65 Current Price is $3.50 Difference: $1.15
If TRS meets the Morgans target it will return approximately 33% (excluding dividends, fees and charges).

Current consensus price target is $4.53, suggesting upside of 33.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.7

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

Ord Minnett rates TRS as Buy (1) -

Ord Minnett lowers its target for the Reject Shop to $4.20 from $5.80 after a 2H trading update revealed lower gross profit margins and a higher-cost of-doing business (CODB).

The higher CODB is due to ongoing inflationary pressures in labour costs and higher shrinkage, explains the broker.

While sales growth in consumables categories has remained strong in the 2H, as customers seek value, sales growth in higher-margin general merchandise categories has been weak, observe the analysts. It's felt the near-term outlook remains challenging.

Target price is $4.20 Current Price is $3.50 Difference: $0.7
If TRS meets the Ord Minnett target it will return approximately 20% (excluding dividends, fees and charges).

Current consensus price target is $4.53, suggesting upside of 33.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.7

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

Morgan Stanley rates WES as Downgrade to Underweight from Equal-weight (5) -

Since October 23, Morgan Stanley assesses Wesfarmers' share price outperformance has been 75%-driven by multiple expansion and 25% via earnings upgrades.

In the broker's view, shares are vulnerable to a multiple contraction based on recent valuation trends for both offshore and domestic peers, while there is only limited scope for earnings upgrades.

Morgan Stanley's target rises to $56.20 from $55.30, but the rating is downgraded to Underweight from Equal-weight. Industry view: In line.

Target price is $56.20 Current Price is $66.31 Difference: minus $10.11 (current price is over target).
If WES meets the Morgan Stanley target it will return approximately minus 15% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $59.02, suggesting downside of -7.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: -0.3

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

Macquarie rates XRO as Outperform (1) -

Macquarie raises its target for Xero by 16.9% to $180.70 following consensus-beating FY24 results and good prospects for FY25, given three additional months of A&NZ price rises and a positive mix shift.

The broker raises FY25-28 EPS forecasts by 14%, 10%, 2% and 4%, respectively, to reflect a higher average revenue per user (ARPU) and further free cash flow (FCF) expansion.

The company also has the ability to run-rate recent partnership announcements, with many, particularly in payments, attracting high EBIT margins, highlights the analyst.

The Outperform rating remains.

Target price is $180.70 Current Price is $134.84 Difference: $45.86
If XRO meets the Macquarie target it will return approximately 34% (excluding dividends, fees and charges).

Current consensus price target is $138.58, suggesting upside of 5.9% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY25:

Forecast for FY26:

This company reports in NZD. 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 XRO as Hold (3) -

Lower costs boosted the FY24 bottom line results for Xero and management achieved the aspirational 'rule of 40' years ahead of schedule, notes the analyst at Morgans.

The broker observes Xero reported revenues in line with expectations which grew 22% year-on-year (yoy), split broadly 50:50 from new subscribers and price (average revenue per user of ARPU).

At financial year end the company had NZ$1.5bn in cash and equivalents on the balance sheet post the 250% improvement in free cashflow over the year.

Morgans adjusts FY25 and FY26 EBITDA estimates by 15% and 6%, respectively. Hold rating and the target revised to $140 from $134.80.

Target price is $140.00 Current Price is $134.84 Difference: $5.16
If XRO meets the Morgans target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $138.58, suggesting upside of 5.9% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY25:

Forecast for FY26:

This company reports in NZD. 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 XRO as Sell (5) -

Ord Minnett is sticking to its Sell rating for Xero though increases the target by 9% to $85 thanks to the better-than-expected improvement for operating leverage evident in FY24 results.

The broker points out operating expenses, excluding non-recurring costs, declined to 73% of revenue from 81% in FY23, a beat against management's forecast for 75%.

The analyst notes Xero struggles to achieve positive unit economics in international markets, highlighting customer acquisition costs were -14% worse compared to FY23, and are three times higher than in A&NZ.

The company will find increasing difficulty in maintaining is Rule of 40 score, suggests the broker.

Target price is $85.00 Current Price is $134.84 Difference: minus $49.84 (current price is over target).
If XRO meets the Ord Minnett target it will return approximately minus 37% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $138.58, suggesting upside of 5.9% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY25:

Forecast for FY26:

This company reports in NZD. 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 XRO as Buy (1) -

Xero's 2H24 results beat expectations yet again, comments UBS, with better than expected free cash flow (FCF), alongside robust revenue growth.

Average revenue per user (ARPU) growth was up 8.6% year-on-year (yoy) on the back of recent price increases.

The broker revises the compound average growth rate (CAGR) for APRU to 7% for the next five years, from 6.5%, due to higher Australian prices and improved plan mixes.

Higher R&D investment will result in a contraction in the free cash flow margin to circa 17% in  FY25 from 20% in FY24 and it is then expected to expand to 27% in FY27, notes UBS.

The target is lifted to $156.00 from $141.90.

Buy rating unchanged. UBS highlights Xero is generating superior sales/free cashflow growth compared to Intuit.

Target price is $156.00 Current Price is $134.84 Difference: $21.16
If XRO meets the UBS target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $138.58, suggesting upside of 5.9% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY25:

Forecast for FY26:

This company reports in NZD. 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