Australian Broker Call

Morgans rates AGL as Downgrade to Hold from Add (3) -

Morgans observes the share price has slowly gained during May. Electricity futures prices have shown some early signs of improvement although they are still much cheaper than six months ago.

The broker expects underlying weakness in FY21 earnings with a one-off offset from the pending insurance claim covering the Loy Yang outage in 2019.

The broker considers the yield on FY20 forecasts is reasonable but there is only limited upside from here. Rating is downgraded to Hold from Add and the target is steady at $17.15.

Target price is $17.15 Current Price is $16.76 Difference: $0.39
If AGL meets the Morgans target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $17.38, suggesting upside of 3.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: -0.4

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

Credit Suisse rates ALX as Neutral (3) -

Atlas Arteria has announced a $495m equity raising to pay down the EUR350m MIBL debt facility. The facility has a covenant that is becoming restrictive because of weak traffic conditions on APRR.

The broker notes early signs of a return of traffic in France but Dulles Greenway remains challenged.

The broker raises proportional operating earnings by 8.8% for 2021 based on a faster recovery in traffic on the toll road in France.

Neutral rating maintained. Target rises to $6.90 from $6.00.

Target price is $6.90 Current Price is $6.66 Difference: $0.24
If ALX meets the Credit Suisse target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $6.71, suggesting upside of 0.8% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.3

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

Macquarie rates ALX as No Rating (-1) -

Atlas Arteria has updated on traffic and revealed an intention to repay holding company debt. APRR is rebounding while Dulles Greenway remains in lock-up and is yet to stage a recovery.

The deferred final dividend payment in the first half has been cancelled and redirected to part of the debt repayment.

Macquarie cannot advise of a rating or target at present.

Current Price is $6.66. Target price not assessed.

Current consensus price target is $6.71, suggesting upside of 0.8% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.3

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

UBS rates ALX as Neutral (3) -

The company has announced a $420m placement to be used for repayment of the corporate debt facility, which UBS assesses removes some risk and simplifies the holding structure for the 31% stake in APRR.

The broker increases the assumed recovery in traffic on the motorway and also lowers the cost of equity assumptions. Updated disclosure and traffic trade shows a significant recovery through May.

Despite the first half being profitable, no dividend is assumed for this period. Neutral maintained. Target is raised to $6.35 from $5.55.

Target price is $6.35 Current Price is $6.66 Difference: minus $0.31 (current price is over target).
If ALX meets the UBS target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $6.71, suggesting upside of 0.8% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.3

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

Ord Minnett rates AST as Upgrade to Hold from Lighten (3) -

As Ausnet Services is trading in line with Ord Minnett's $1.75 target the rating is upgraded to Hold from Lighten.

The business is one of the broker's preferred regulated utility companies on the basis of its strong dividend cover. Strong growth is also anticipated in the contracted asset base.

Target price is $1.75 Current Price is $1.76 Difference: minus $0.01 (current price is over target).
If AST meets the Ord Minnett target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $1.79, suggesting upside of 1.9% (ex-dividends)

The company's fiscal year ends in March.

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

Morgan Stanley rates BAP as Overweight (1) -

With the economy reopening and an increasing return to business as usual, Morgan Stanley notes demand for batteries and inventories restocking has gone up along with an improvement in access to mechanics due to work from home.

These factors will positively impact Bapcor as will the company's cost discipline. Earnings estimates increased for FY21-22.

The broker retains its Overweight rating with target price increased to $7.20 from $6. Industry view: In-line

Target price is $7.20 Current Price is $5.78 Difference: $1.42
If BAP meets the Morgan Stanley target it will return approximately 25% (excluding dividends, fees and charges).

Current consensus price target is $6.16, suggesting upside of 6.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 1.0

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

Citi rates BEN as Buy (1) -

Citi lowers FY20 cash earnings forecast by -14% to reflect the higher up-front provisions. The bank has announced increased collective provisioning, providing $148m for potential impacts from the pandemic.

Third quarter asset quality trends appear benign, the broker observes. The bank expects a -10% decline in house prices through 2021 before a gradual recovery in 2022. Citi retains a Buy rating and $7.25 target.

Target price is $7.25 Current Price is $6.16 Difference: $1.09
If BEN meets the Citi target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $6.54, suggesting upside of 6.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.0

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

Credit Suisse rates BEN as Upgrade to Neutral from Underperform (3) -

The bank has announced extra provisioning of $148.3m to allow for the future impact from the pandemic. Credit Suisse suspects the market will be surprised by the size of the provisioning, which is larger than regional peers.

However, the broker envisages less downside risk now, downgrading estimates by -16-28% across the forecast horizon. Target is reduced to $7 from $9 and the rating is upgraded to Neutral from Underperform.

Target price is $7.00 Current Price is $6.16 Difference: $0.84
If BEN meets the Credit Suisse target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $6.54, suggesting upside of 6.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.0

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

Macquarie rates BEN as Neutral (3) -

The bank has disclosed a second-half impairment charge in relation to the pandemic in advance of the full year result.

This is around $148m but, nevertheless, the second half capital position remains above Macquarie's capital target of 9.25%.

The broker envisages limited relative upside from current levels, despite the higher skew to mortgages and agribusiness providing the bank with less impact from pandemic-related risk.

Macquarie retains a Neutral rating and raises the target to $6.50 from $6.00.

Target price is $6.50 Current Price is $6.16 Difference: $0.34
If BEN meets the Macquarie target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $6.54, suggesting upside of 6.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.0

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

Morgan Stanley rates BEN as Underweight (5) -

Bendigo and Adelaide Bank raised a covid-19 provision of -$148.3m which is more than Morgan Stanley’s estimated -$80m. Cash earnings are expected to take a hit by circa -10%.

While credit risk-weighted assets (RWA) is circa 106bp, proforma CET1 is lower at circa 9.3%. Slower recovery expected.

The broker maintains its Underweight rating with the target price reduced to $6 from $6.8. Industry View: In-line.

Target price is $6.00 Current Price is $6.16 Difference: minus $0.16 (current price is over target).
If BEN meets the Morgan Stanley target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $6.54, suggesting upside of 6.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.0

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

Ord Minnett rates BEN as Hold (3) -

Bendigo and Adelaide Bank will undertake a $148.3m provision to allow for the impact of the pandemic. Ord Minnett reduces second half estimates by -7% to reflect the higher-than-expected provision top up.

The broker considers this a pulling forward of future provisions and FY21 forecasts are lifted 5%. Underlying asset quality trends appear relatively benign, the broker notes. Hold rating and $6 target maintained.

Target price is $6.00 Current Price is $6.16 Difference: minus $0.16 (current price is over target).
If BEN meets the Ord Minnett target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $6.54, suggesting upside of 6.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.0

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

UBS rates BEN as Neutral (3) -

The regional lender has announced it will strengthen provisions, comprising a collective provisioning charge of -$127.7m and a transfer of -$20.6m to the general reserve for credit losses from retained earnings.

Provisions are higher than UBS expected and the estimates for credit impairments are pulled forward. This leads to a -12% downgrade to FY20 estimates and 16% upgrade to FY21. Neutral and $6.50 target retained.

Target price is $6.50 Current Price is $6.16 Difference: $0.34
If BEN meets the UBS target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $6.54, suggesting upside of 6.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.0

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

Citi rates CGC as Neutral (3) -

Citi considers the trends remain encouraging for Costa Group with better pricing in almost all areas excluding tomatoes. The broker reiterates a Buy rating.

The company had noted good early-season sales for blueberries in Morocco and recent press reports have noted the bad weather in Spain and pandemic disruptions in picking and transport have led to higher prices. All positive for Costa Group.

Citi believes improved conditions in FY20 provide the foundation for double-digit earnings growth in FY21 as well. Target is $3.40.

Target price is $3.40 Current Price is $3.22 Difference: $0.18
If CGC meets the Citi target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $3.20, suggesting downside of -0.7% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.2

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

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

At present, Credit Suisse believes the share price is reflecting the FY19 earnings base, which will take some time to achieve. Nevertheless, the broker assesses a capital raising will not be required.

As conditions improve in the northern hemisphere and restrictions reduce, Credit Suisse would become more confident as the opportunity remains robust. Rating is downgraded to Neutral from Outperform. Target is $12.

Target price is $12.00 Current Price is $12.00 Difference: $0
If CTD meets the Credit Suisse target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $14.20, suggesting upside of 18.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.4

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

Macquarie rates EHL as Outperform (1) -

Macquarie believes Emeco is executing well in challenging conditions. However, there are risks around FY21 as lower coal prices could further affect production, particularly for marginal operations.

The company has guided to operating earnings (EBITDA) in FY20 of $244-247m. This implies the second half is up 5-7% half on half. The broker retains an Outperform rating and $1.50 target.

Target price is $1.50 Current Price is $1.09 Difference: $0.41
If EHL meets the Macquarie target it will return approximately 38% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 1.0

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

Morgans rates GDF as Add (1) -

Garda Diversified Property plans to pay a fourth quarter distribution of 1.8c. The company has also indicated the revenue impact from the pandemic has to date been minimal.

Morgans considers it likely there will be increased earnings uncertainty and tougher leasing markets in the near term, as well as a lag while the industrial project rolls out.

In the longer term, the broker remains comfortable with the stock and retains an Add rating. Target is $1.07. The main leasing risk relates to Botanicca 9 and the broker assumes a six-month contribution to FY21 in forecasts.

Target price is $1.07 Current Price is $0.97 Difference: $0.1
If GDF meets the Morgans target it will return approximately 10% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 1.0

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

Macquarie rates MCR as Outperform (1) -

Macquarie retains an Outperform rating and $0.85 target. Mincor Resources has secured contracts for underground mining at Cassini for five years and Long/Durkin North for at least three years.

This represents a key milestone, in the broker's view. Exploration success at Cassini could deliver upside to the base case.

Target price is $0.85 Current Price is $0.72 Difference: $0.13
If MCR meets the Macquarie target it will return approximately 18% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 1.0

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

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

The trading update revealed May has returned to more normal trading while April was materially affected by the lockdowns. Rental relief tied to turnover is expected to be minimal in May, from which Morgans assesses "decent" sales are likely.

The broker believes Motorcycle Holdings has done a commendable job in reducing costs and managing cash flow. The material cost reductions provide leverage to a recovery in demand.

Rating is upgraded to Add from Hold and the target raised to $1.86 from $1.24.

Target price is $1.86 Current Price is $1.61 Difference: $0.25
If MTO meets the Morgans target it will return approximately 16% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 1.0

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

Citi rates NEA as Buy (1) -

Citi highlights the resilience of the business, noting churn is lower than previously expected. Still FY21 growth is likely to be constrained by weak macroeconomic conditions.

The cash burn is higher than expected but the broker notes the balance sheet remains reasonable. Citi removes the High Risk designation from its Buy rating and raises the target to $2.60 from $1.90.

Target price is $2.60 Current Price is $2.29 Difference: $0.31
If NEA meets the Citi target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $2.13, suggesting downside of -6.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 1.0

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

Morgan Stanley rates NEA as Overweight (1) -

 Nearmap narrowed actual cash value (ACV) guidance to $103-107m from $102-110m. Morgan Stanley expects FY20 free cash flow at $32-35m.

The broker points towards lowering of churn, implying circa -$2m for the second half with -$7m for the first. Importantly, the broker does not expect a repeat of the first half major churn events.

The broker is overweight on the stock with a target price of $2.Industry view: In-line.

Target price is $2.00 Current Price is $2.29 Difference: minus $0.29 (current price is over target).
If NEA 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 $2.13, suggesting downside of -6.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 1.0

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

Credit Suisse rates NEC as Outperform (1) -

Nine Entertainment has confirmed a revised contract with the NRL covering the remainder of the existing rights deal out to FY22.

Under the new arrangement, there will no longer be a Saturday night game on view in 2020, but this is expected to have limited revenue impact in the current environment. Savings in 2020 amount to $66m.

Credit Suisse updates estimates to allow for a greater reduction in costs in the current year and minor cost increases in FY21/22. Outperform maintained. Target is $2.

Target price is $2.00 Current Price is $1.48 Difference: $0.52
If NEC meets the Credit Suisse target it will return approximately 35% (excluding dividends, fees and charges).

Current consensus price target is $1.87, suggesting upside of 26.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 1.0

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

Macquarie rates NEC as Outperform (1) -

Nine Entertainment has revised terms with the NRL, ahead of the season recommencing. The deal still expires after the 2022 season. Savings of $27.5m per annum are expected in both FY21 and FY22.

Macquarie assesses the medium-term benefits represent just one component of a broader cost reduction program. The business is well-positioned as advertising markets recover, the broker adds.

Outperform rating maintained. Target rises to $1.65 from $1.60.

Target price is $1.65 Current Price is $1.48 Difference: $0.17
If NEC meets the Macquarie target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $1.87, suggesting upside of 26.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 1.0

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

UBS rates NEC as Buy (1) -

Nine Entertainment has revised its agreement with the NRL for the 2020, 2021 and 2022 seasons. In addition, Foxtel has extended its partnership to the end of 2027.

Given there is only one more month in the financial year, the impact for FY20 will be minor, UBS assesses.

The broker has already factored in the NRL costs returning at a higher rate in FY21. At a total TV costs level, forecasts also factor in cost reduction guidance of at least $150m over three years.

Buy rating and $1.70 target maintained.

Target price is $1.70 Current Price is $1.48 Difference: $0.22
If NEC meets the UBS target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $1.87, suggesting upside of 26.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 1.0

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

Citi rates NHC as Neutral (3) -

Saleable coal production in the third quarter was down -22% on the prior corresponding quarter but up 12% for the year to date.

The High Court will hear the Oakey application for leave to appeal the orders of the Queensland Court of Appeal on June 5, 2020. The company expects a decision shortly after the hearing.

Citi retains a Neutral rating and $1.60 target.

Target price is $1.60 Current Price is $1.36 Difference: $0.24
If NHC meets the Citi target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $1.55, suggesting upside of 14.0% (ex-dividends)

The company's fiscal year ends in July.

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 NHC as Downgrade to Neutral from Outperform (3) -

Higher sales volumes were able to largely offset the impact of the weather and the ramp down of Acland in the latest quarter. Credit Suisse assesses the investment case is tough although acknowledges conditions and the market can change quickly.

Still, until some risk dissipates or there is a recovery in the coal price, the broker believes it likely New Hope will remain under pressure.

Bengalla is a quality asset but Credit Suisse finds it hard to devise a compelling case for jumping into the stock. Rating is downgraded to Neutral from Outperform. Target is reduced to $1.50 from $2.00.

Target price is $1.50 Current Price is $1.36 Difference: $0.14
If NHC meets the Credit Suisse target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $1.55, suggesting upside of 14.0% (ex-dividends)

The company's fiscal year ends in July.

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

Macquarie rates NHC as Underperform (5) -

Coal sales were higher than forecast in the third quarter while production was lower. New Acland stage 3 is in limbo and Macquarie is yet to include it in forecasts. Stage 2 is currently ramping down.

Thermal coal price weakness persists and, in a spot price scenario, Macquarie notes significant downside risk to earnings. Underperform rating and $1.30 target maintained.

Target price is $1.30 Current Price is $1.36 Difference: minus $0.06 (current price is over target).
If NHC 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 $1.55, suggesting upside of 14.0% (ex-dividends)

The company's fiscal year ends in July.

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

Morgan Stanley rates NTO as Overweight (1) -

The eSigning service is offered as stand-alone by Nitro Software, with more functionality and new integrations in the pipeline. The company is trying to capture the recent increase in eSigning demand which will also lead to embeddedness.

Morgan Stanley believes this to be positive in the long term, leading to deeper penetration and cross-sell opportunities.

The broker maintains its Overweight rating with a target price of $1.80. Industry view: In-line.

Target price is $1.80 Current Price is $1.60 Difference: $0.2
If NTO meets the Morgan Stanley target it will return approximately 12% (excluding dividends, fees and charges).

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: 1.0

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

UBS rates RHC as Neutral (3) -

UBS considers the short-term outlook for Ramsay Health Care is complicated and based on the duration of government viability agreements and the speed at which elective surgery volumes return to normal.

Nevertheless, the broker expects demand will recover reasonably quickly. A degree of stability is also anticipated in private health insurance participation. Neutral rating maintained. Target is raised to $71.20 from $63.20.

Target price is $71.20 Current Price is $70.05 Difference: $1.15
If RHC meets the UBS target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $65.77, suggesting downside of -6.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.2

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

Macquarie rates STO as Outperform (1) -

Santos has completed its US$1.5bn acquisition of the northern Australia/Timor-Leste assets. Macquarie notes some improvement in the settlement terms.

The stock provides exposure to the ongoing recovery in oil prices and the broker is more confident in the Barossa/Darwin LNG proceeding to construction compared with the Western Australian projects.

Outperform rating maintained. Target is $5.95.

Target price is $5.95 Current Price is $5.37 Difference: $0.58
If STO meets the Macquarie target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $5.50, suggesting upside of 2.5% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

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

Market Sentiment: 0.6

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

Morgan Stanley rates STO as Overweight (1) -

Santos completed the acquisition of ConocoPhillips's North Australian and Timor-Leste assets (Darwin LNG and Barossa projects). The slump in oil helped the energy player get better terms than before.

The company paid -US$655m versus the guided amount of -US$800m, better than Morgan Stanley expected. A number of sell-down deals by Santos were announced, but these are conditional on the final investment decision (FID) on Barossa.

The broker retains its Overweight rating with a target price of $5. Industry view: Cautious.

Target price is $5.00 Current Price is $5.37 Difference: minus $0.37 (current price is over target).
If STO meets the Morgan Stanley target it will return approximately minus 7% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $5.50, suggesting upside of 2.5% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

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

Market Sentiment: 0.6

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

Macquarie rates TLS as Outperform (1) -

Incorporating the impact of the pandemic has meant downgrades to short-term forecasts. However, Macquarie expects cash generation should be solid over the next few years and support the dividend and valuation.

Telstra has flagged the loss of high-margin international roaming for FY20/21 and reduced professional services work in NAS.

There are some positives, the broker notes, including increased demand for some services, while bad debts may not be as severe as feared because of government support. Outperform rating maintained. Target is reduced to $3.90 from $4.10.

Target price is $3.90 Current Price is $3.24 Difference: $0.66
If TLS meets the Macquarie target it will return approximately 20% (excluding dividends, fees and charges).

Current consensus price target is $3.81, suggesting upside of 17.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.6

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

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

Credit Suisse eventually expects upside to the FY19 earnings base, primarily driven by the B2B division. However, with this division exposed to onerous travel restrictions in the northern hemisphere, the broker tempers expectations and will look to get upbeat again once intra-regional leisure travel improves.

Meanwhile, the B2C division, which is two thirds domestic travel, is looking increasingly attractive with the opening up of Australia, and potentially New Zealand. Rating is downgraded to Neutral from Outperform. Target is $4.50.

Target price is $4.50 Current Price is $4.16 Difference: $0.34
If WEB meets the Credit Suisse target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $3.76, suggesting downside of -9.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.4

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

Ord Minnett rates WTC as Hold (3) -

WiseTech Global has renegotiated some of its earn-out arrangements, noting its business continues to track in line with expectations.

Still, Ord Minnett struggles with the outlook for FY21 and does not consider the current update provides any more confidence.

Payments to around 17 vendors have been reduced by -$69.5m and cash payments have been swapped for equity at a 9% premium to the last price.

Ord Minnett retains a Hold rating and raises the target to $19.00 from $16.70.

Target price is $19.00 Current Price is $20.19 Difference: minus $1.19 (current price is over target).
If WTC 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 $22.00, suggesting upside of 9.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.3

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