Australian Broker Call

Macquarie rates BIN as Neutral (3) -

Macquarie assesses the market conditions remain tough and the stock is trading well above historical valuation ranges.

The broker anticipates Bingo Industries will continue to preserve capital and not pay dividends until FY22, with the company reporting FY20 results on August 25.

Neutral retained. Target unchanged at $1.80.

Target price is $1.80 Current Price is $2.04 Difference: minus $0.24 (current price is over target).
If BIN meets the Macquarie target it will return approximately minus 12% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.44, suggesting upside of 21.9% (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

Ord Minnett rates BSL as Accumulate (2) -

Ord Minnett notes US steel capacity utilisation has flat-lined this week after steady growth since May-lows.

BlueScope Steel has adopted a cautious tone on the outlook. The broker considers FY21 as the earnings trough with the company’s cash reserves sufficient to help it deal with a difficult earnings period.

Ord Minnet maintains its Accumulate rating with a target price of $15.

Target price is $15.00 Current Price is $11.93 Difference: $3.07
If BSL meets the Ord Minnett target it will return approximately 26% (excluding dividends, fees and charges).

Current consensus price target is $12.53, suggesting upside of 2.6% (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

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

While infant formula sales grew 20% in the June quarter there was a -19% slowdown relative to the prior quarter. This was not unexpected and Citi continues to believe Bubs Australia has a promising future.

Nevertheless, the rating is downgraded to Neutral/High Risk from Buy/High Risk as the value/sales ratio does not adequately reflect the risk that the slowdown could persist into the first quarter of FY21 and delay profitability.

Citi reduces FY20 net sales estimates to $58m and cuts estimates for FY21 and FY22 by -7% and -10%, respectively. Target is reduced to $1.00 from $1.10.

Target price is $1.00 Current Price is $0.98 Difference: $0.02
If BUB meets the Citi target it will return approximately 2% (excluding dividends, fees and charges).

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 CTD as Upgrade to Buy from Accumulate (1) -

Despite plenty of headwinds, Ord Minnett thinks there is nothing wrong with Corporate Travel Management’s business model. This is partly because the broker expects a number of competitors are unlikely to survive or at least be seriously wounded from the crisis.

The company has an estimated 33-100 months of liquidity due to its $200m undrawn debt facility. The broker expects positive catalysts in the next 12 months. 

Ord Minnett upgrades its rating to Buy from Accumulate with the target price increasing to $12.97 from $10.59.

Target price is $12.97 Current Price is $8.95 Difference: $4.02
If CTD meets the Ord Minnett target it will return approximately 45% (excluding dividends, fees and charges).

Current consensus price target is $14.60, suggesting upside of 64.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.5

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

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

Cleanaway Waste Management is due to release FY20 results on August 26.

Morgans makes some minor adjustments to forecasts and downgrades the recommendation to a Hold from Add largely due to recent share price strength.

The target price is increased to $2.14 from $2.12.

Target price is $2.14 Current Price is $2.20 Difference: minus $0.06 (current price is over target).
If CWY meets the Morgans target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.33, suggesting upside of 5.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.5

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

Morgans rates EHL as Add (1) -

Emeco Holdings met forecasts from Morgans. However, FY21 guidance for coal was weak, which reflected the standing down of around 5% of the company's eastern fleet.

The broker suggests the company is trading in line with weaker coal prices and the analyst believes the current situation is suitable to contrarian investors capable of digesting sector dynamics. These can improve sharply as steel-making capacity recovers ex-China, states the analyst.

The broker maintains its Add rating with the target reduced to $1.66 from $1.80.

Target price is $1.66 Current Price is $0.99 Difference: $0.67
If EHL meets the Morgans target it will return approximately 68% (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

Ord Minnett rates GXY as Hold (3) -

Ord Minnett points out lithium prices continue to hit cyclical lows. This is led by China where electric vehicle sales were down -37% year on year in June.

2025 electric vehicle targets and related demand boost on the entire lithium raw material supply chain are not reflected in orders yet, highlights the broker.

The broker notes Galaxy Resources has done a good job in terms of cost savings at Mt Cattlin and thinks the company is well placed to ride this out.

Ord Minnet maintains its Hold rating with a target price of $0.9.

Target price is $0.90 Current Price is $1.10 Difference: minus $0.2 (current price is over target).
If GXY 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 $0.84, suggesting downside of -25.0% (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: -0.3

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

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

Healius expects underlying net profit in FY20 of $54-56m. Citi awaits the results on August 21 for clarification, finding it impossible to reconcile margins to its forecasts.

The company is guiding to higher FY21 earnings (EBIT) with pathology expected to grow significantly as coronavirus testing remains elevated.

Still, in terms of day hospitals comparisons are considered impossible without revenue disclosure and Citi downgrades to Neutral from Buy, lowering the target to $3.35 and $3.55.

Target price is $3.35 Current Price is $3.25 Difference: $0.1
If HLS meets the Citi target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $3.30, suggesting upside of 2.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.5

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

Credit Suisse rates HLS as Outperform (1) -

Healius anticipates earnings (EBIT) of $102-104m in FY20. Currently, testing for coronavirus is offsetting any weakness in the base pathology business and the imaging/day hospital businesses.

Credit Suisse expects testing rates to remain robust and support earnings into FY22.

The broker believes, with the right investment in cost strategies, the margin differential to Sonic Healthcare ((SHL)) can be narrowed over the medium term. Outperform maintained. Target increases to $3.35 from $3.25.

Target price is $3.35 Current Price is $3.25 Difference: $0.1
If HLS meets the Credit Suisse target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $3.30, suggesting upside of 2.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.5

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

Macquarie rates HLS as Outperform (1) -

The trading update was ahead of Macquarie's expectations and Healius is likely to be favourably exposed to improved activity levels in FY21.

Macquarie believes the divestment of the medical centres provides a simplified structure and flexibility for growth.

The balance sheet is better than expected and Healius remains Macquarie's preferred pathology exposure. Outperform rating retained. Target is raised to $3.55 from $3.40.

Target price is $3.55 Current Price is $3.25 Difference: $0.3
If HLS meets the Macquarie target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $3.30, suggesting upside of 2.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.5

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

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

The rising second wave cases have led to a dramatic expansion in testing and as a leading supplier, Healius is set to benefit, comments Ord Minnett.

Management expects pathology operating earnings to grow materially in FY21 from the increased demand for testing. The broker has lifted its FY21 estimates and updated its forecasts to match with the company’s revised guidance. 

The imaging division performed worse than expected, dropping into losses in the June half. Ord Minnett is currently research restricted on Healius.

Current Price is $3.25. Target price not assessed.

Current consensus price target is $3.30, suggesting upside of 2.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.5

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

UBS rates HLS as No Rating (-1) -

Healius pre-announced its FY20 unaudited operating income and net profit. With pre-AASB-16 earnings provided along with the exclusion of discontinued GP/dental operations, UBS finds it difficult to interpret the results.

Still, operating income from pathology was in-line while that from imaging declined by -56%. The company has guided to strong pathology operating income in FY21 led by covid-19 PCR testing and recovery in routine work.

Imaging operating income is expected to exceed pre-covid-19 levels in FY21. Overall, the broker considers the group operating income growth looks feasible.

After the separation of its primary care division, Healius’s business is considered to be more simplified.

UBS is under research restriction on Healius.

Current Price is $3.25. Target price not assessed.

Current consensus price target is $3.30, suggesting upside of 2.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.5

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

Morgans rates ITG as Add (1) -

Intega Group has provided FY20 earnings guidance of $30m-$31m, slightly below the $32.4m forecast by Morgans.

The broker believes it is a good outcome given the current environment. The analyst expects lower growth in FY21 due to expected delays in large projects but has growth bouncing back in FY22.

Despite management noting a strong backlog of work, Morgans believes there is a risk some of this project work will be deferred.

The company stated that it was not materially impacted by covid-19 and it received no material government assistance.
 
The broker lowers earnings estimates for FY21 and FY22 by -12% and -14%, respectively. Add rating maintained. Target is decreased to $0.49 from $0.57.

Target price is $0.49 Current Price is $0.32 Difference: $0.17
If ITG meets the Morgans target it will return approximately 53% (excluding dividends, fees and charges).

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 KAR as Outperform (1) -

Karoon Energy has successfully renegotiated the Bauna deal with Petrobras. This results in a -40% reduction in acquisition costs.

Macquarie does not expect shareholders will receive a special dividend or capital return, given the completion of the deal. Cash will be needed for expenditure on the asset to boost production rates.

Macquarie retains an Outperform rating and raises the target to $1.25 from $0.90.

Target price is $1.25 Current Price is $0.74 Difference: $0.51
If KAR meets the Macquarie target it will return approximately 69% (excluding dividends, fees and charges).

Current consensus price target is $1.20, suggesting upside of 61.7% (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 KAR as Overweight (1) -

Karoon Energy has revised its terms for the acquisition of Bauna with the Brazilian oil company Petrobras. Bauna is located in Brazil’s Santos Basin.

The company will now be paying US$665m in two instalments. The first instalment of US$380m includes a deposit of US$49.9m which has already been paid.

The second instalment of US$285m will be paid in 18 months. This portion will not be paid until 2026, reports Morgan Stanley. The broker notes the company can fund the deal from its current cash position of nearly $500m.

Morgan Stanley reaffirms its Overweight rating with a target price of $0.84. Industry view: Cautious.

Target price is $0.84 Current Price is $0.74 Difference: $0.1
If KAR meets the Morgan Stanley target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $1.20, suggesting upside of 61.7% (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

Morgans rates M7T as Add (1) -

Mach7 Technologies has posted a 4QFY20 cashflow report.

Morgans believes the highlights were free cashflow generation of $3.6m, new sales orders of $9.2m and reconfirmed guidance of positive earnings for FY20 (The broker expects earnings of $2.2m).

The company indicated that $40m of tenders have been lodged and decisions are expected over the next six to twelve months. 

The Client Outlook acquisition was completed on July 14 and post the acquisition the cash reserves were $19m.

Morgans maintains an Add rating. The target price is $1.43.

Target price is $1.43 Current Price is $0.99 Difference: $0.44
If M7T meets the Morgans target it will return approximately 44% (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

Ord Minnett rates MFG as Hold (3) -

Ord Minnett considers the FY21 flow outlook for Magellan Financial to be strong.

The broker retains its Hold rating with the target price increasing to $60.44 from $48.60.

Target price is $60.44 Current Price is $59.61 Difference: $0.83
If MFG meets the Ord Minnett target it will return approximately 1% (excluding dividends, fees and charges).

Current consensus price target is $56.68, suggesting downside of -5.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: -0.3

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

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

Nufarm is trading at a discount to global peers driven by a deterioration in sentiment around its European division. UBS feels this division may be at an earnings trough with cyclical factors beginning to reverse.

The stock has already priced in the broker’s downside earnings scenario, notes the broker. European operating income margin is expected to be restored to 23% by FY22.

UBS upgrades its rating to Buy from Neutral with a target price of $5.19.

Target price is $5.19 Current Price is $3.97 Difference: $1.22
If NUF meets the UBS target it will return approximately 31% (excluding dividends, fees and charges).

Current consensus price target is $5.31, suggesting upside of 23.7% (ex-dividends)

The company's fiscal year ends in July.

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 PAC as Buy (1) -

Among the fund managers, Ord Minnett considers Pacific Current Group to be low risk and cheap.

While the pandemic may have affected the distribution efforts for closed-end funds, the broker sees this as just a delay and not a lost opportunity.

Ord Minnett retains its Buy rating with a target price of $7.47.

Target price is $7.47 Current Price is $5.51 Difference: $1.96
If PAC meets the Ord Minnett target it will return approximately 36% (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

Ord Minnett rates PNI as Buy (1) -

Many of Pinnacle Investment Management Group's affiliates did well, comments the broker, by generating notable alpha in the second half. 

The broker’s updated FY21 earnings forecast is ahead of the consensus range. Among the fund managers, Ord Minnett thinks Pinnacle Investments provides growth at a reasonable price.

Ord Minnett maintains its Buy rating with the target price increasing to $6.29 from $6.

Target price is $6.29 Current Price is $4.40 Difference: $1.89
If PNI meets the Ord Minnett target it will return approximately 43% (excluding dividends, fees and charges).

Current consensus price target is $5.22, suggesting upside of 7.0% (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 PPT as Neutral (3) -

Citi reduces estimates for FY20 by -10%, and raises FY21 and FY22 by 1% and 8%, respectively.

This reflects the significant accretion from the acquisition of Barrow Hanley and the fact FY20 underlying net profit is well below prior forecasts.

While there is some excitement around the transaction and the accretion available, Citi believes the medium-term execution will be difficult and full accretion will not be available until FY22.

The broker retains a Neutral rating and raises the target to $33.60 from $32.00.

Target price is $33.60 Current Price is $33.61 Difference: minus $0.01 (current price is over target).
If PPT meets the Citi target it will return approximately minus 0% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $36.13, suggesting upside of 12.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.1

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

Credit Suisse rates PPT as Neutral (3) -

Perpetual has acquired 75% of Barrow Hanley for $465m along with a $265m equity raising. Credit Suisse factors in little growth in the Barrow Hanley business although there is upside if the distribution capability in the US can be refined and expanded into Europe/Asia.

The broker forecasts a -50% cut in the final distribution and expects a new pay-out policy of 50-60% of underlying net profit in FY21. Neutral maintained. Target is raised to $36.50 from $32.00.

Target price is $36.50 Current Price is $33.61 Difference: $2.89
If PPT meets the Credit Suisse target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $36.13, suggesting upside of 12.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.1

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

Macquarie rates PPT as Neutral (3) -

Perpetual will acquire a 75% interest in the US-based asset manager Barrow Hanley. While the deal is materially accretive, Macquarie envisages downside risk to the current forward PE multiple will offset a large proportion of earnings upgrades.

Perpetual envisages FY20 underlying profit of $93.5m, below Macquarie's estimates. The broker believes there is more value elsewhere in the sector and retains a Neutral rating. Target is raised to $33.50 from $33.00.

Target price is $33.50 Current Price is $33.61 Difference: minus $0.11 (current price is over target).
If PPT meets the Macquarie target it will return approximately minus 0% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $36.13, suggesting upside of 12.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.1

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

Morgan Stanley rates PPT as Overweight (1) -

Perpetual is acquiring 75% of the US-based asset manager Barrow Hanley from BrightSphere Investment Group.

Morgan Stanley considers this to be a complementary acquisition with low overlap with existing products. It will give Perpetual a larger footprint in the US, UK and Hong Kong.

The broker also reports Perpetual will be raising $265m in new equity and $284m in new debt. 

For FY20, the company has pre-reported net profit that is circa -5% below consensus. From FY21, the company will be changing its dividend policy and the broker expects lower payout.

Morgan Stanley retains its Overweight rating with a target price of $45. Industry view: In-line.

Target price is $45.00 Current Price is $33.61 Difference: $11.39
If PPT meets the Morgan Stanley target it will return approximately 34% (excluding dividends, fees and charges).

Current consensus price target is $36.13, suggesting upside of 12.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.1

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

Morgans rates PPT as Hold (3) -

Perpetual has announced the acquisition of 75% of Barrow Hanley, a Texas based fund manager with US$44bn of FUM, for -$465m.

Barrow Hanley is a global investment manager with a 40 year track record in value investing.

Morgans believes the acquisition is transformational, tripling Perpetual's FUM to $94bn from $29bn and diversifying the company's business mix by product/geography and accelerating its US presence, while also providing a UK and Hong Kong presence.

The broker is comfortable with the acquisition price but observes some risks including skewing more to the value style at a time it remains out of favour.

Nonetheless, Morgans believes this is a key turning point in the execution of Perpetual's global growth strategy.

Rating increased to Add from Hold. Target is increased to $37.90 from $34.22.

Target price is $37.90 Current Price is $33.61 Difference: $4.29
If PPT meets the Morgans target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $36.13, suggesting upside of 12.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.1

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

Ord Minnett rates PPT as Hold (3) -

Perpetual provided its preliminary FY20 result with net profit a little less than Ord Minnett’s expectations.

The company will be acquiring 75% of the US-based asset manager Barrow Hanley. The transaction is more than 20% earnings accretive, states the broker. It is also expected to re-establish the importance of the Investment business within the group.

Ord Minnet retains its Hold rating with the target price increasing to $37.5 from $33.

Target price is $37.50 Current Price is $33.61 Difference: $3.89
If PPT meets the Ord Minnett target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $36.13, suggesting upside of 12.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.1

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

Ord Minnett rates PTM as Hold (3) -

Among the fund managers, Ord Minnett notes Platinum’s outlook for FY21 flows appears weak. 

Ord Minnett retains its Hold rating with the target price increasing to $3.63 from $3.17.

Target price is $3.63 Current Price is $3.75 Difference: minus $0.12 (current price is over target).
If PTM 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 $3.20, suggesting downside of -14.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: -0.8

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

Morgan Stanley rates RHC as Underweight (5) -

Morgan Stanley notes Australia, with the exception of Victoria, saw elective surgery rates recovering to 75% of pre-covid-19 levels by June end.

Despite headwinds from Victoria, the broker estimates the average utilization of Ramsay Health Care hospitals will be about 88% over the December half.

Industry pressures remain and the broker feels affordability issues for private health insurance will likely be heightened due to the sharp rise in unemployment.

The company will be announcing its FY20 results on August 27^th.

Due to systemic uncertainty, Morgan Stanley remains Underweight on the stock with the target price increasing to $56 from $55. Industry view: In-line.

Target price is $56.00 Current Price is $62.66 Difference: minus $6.66 (current price is over target).
If RHC meets the Morgan Stanley target it will return approximately minus 11% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $67.66, suggesting upside of 8.9% (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 RIO as Outperform (1) -

Macquarie expects buoyant iron ore prices will underpin upgrade momentum when the first half results are reported on July 29.

The broker expects operating earnings (EBITDA) of US$9.5bn and underlying net profit of US$4.5bn.

The broker envisages scope for an additional US$1 special dividend, given low levels of gearing and strong free cash flow.

Outperform rating maintained and the target edges up to $111 from $110.

Target price is $111.00 Current Price is $102.89 Difference: $8.11
If RIO meets the Macquarie target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $101.93, suggesting downside of -2.1% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

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

Market Sentiment: 0.2

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

Ord Minnett rates RIO as Accumulate (2) -

Rio Tinto kicks off the mining results season on July 29^th with Ord Minnett forecasting operating income of US$9.3bn and distribution of US$1.53 per share.

The miner’s second-quarter performance was strong, led by iron ore. The market is expecting news on the Juukan Gorge issue and which divisions/projects will be incurring more capital expenditure, states the broker.

Ord Minnett maintains its Accumulate rating with a target price of $115.

Target price is $115.00 Current Price is $102.89 Difference: $12.11
If RIO meets the Ord Minnett target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $101.93, suggesting downside of -2.1% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

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

Market Sentiment: 0.2

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

UBS rates RIO as Neutral (3) -

Rio Tinto will be releasing its 2020 interim financial results on July 29.

UBS expects earnings to decline -6% year on year driven by declining commodity prices. The biggest decline is likely to be from the copper and diamonds products group which is expected to post a loss for the half.

An interim dividend of US$1.42 per share is expected, in-line with the previous pay-out ratios. The miner announced capital expenditure for 2020 to be circa -US$6bn, driven by a weaker US dollar and less than expected impact from covid-19.

There are risks to the timeline and budget due to covid-19 driven restrictions on mobility, notes the broker.

UBS retains its Neutral rating with a target price of $102.

Target price is $102.00 Current Price is $102.89 Difference: minus $0.89 (current price is over target).
If RIO meets the UBS target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $101.93, suggesting downside of -2.1% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

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

Market Sentiment: 0.2

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

Macquarie rates S32 as Underperform (5) -

Macquarie notes silver prices have risen over 50% since early May. South32 has material exposure to silver at Cannington which is expected to produce 11m ounces per annum for the next 10 years.

However, coal and manganese prices are expected to drag earnings lower, which offsets the upside from silver.

South32 will release FY20 results on August 20. Macquarie maintains an Underperform rating and $1.80 target.

Target price is $1.80 Current Price is $2.23 Difference: minus $0.43 (current price is over target).
If S32 meets the Macquarie target it will return approximately minus 19% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.52, suggesting upside of 13.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

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

Market Sentiment: 0.6

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

Ord Minnett rates SBM as Buy (1) -

St Barbara has agreed to purchase the remaining 40% of the Touquoy mine at Moose River for C$60m. This is in-line with Ord Minnett’s estimate and brings the total consideration for Atlantic to C$782m.

The broker forecasts Atlantic production to grow to about 240kozpa by FY24. It believes there is considerable value for St Barbara to realise at higher gold prices (risen in CAD terms since July 2019).

Ord Minnet reaffirms its Buy rating with a target price of $4.40.

Target price is $4.40 Current Price is $3.83 Difference: $0.57
If SBM meets the Ord Minnett target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $3.58, suggesting downside of -5.5% (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 WES as Lighten (4) -

The resilient and growing Bunnings is considered by Ord Minnett as the largest and highest-quality business within Wesfarmers. The broker expects more upside to sales growth, expected to be driven by company-specific drivers.

While dividend and surplus capital for the group are considered attractive, the broker comments the group has lacked valuation support for some time now.

FY20 earnings estimates increased for both FY20-21 due to higher expected sales and operating income in Bunnings, Catch Group and Kmart.

Ord Minnet maintains its lighten rating with the target price increasing to $41 from $37.

Target price is $41.00 Current Price is $46.86 Difference: minus $5.86 (current price is over target).
If WES meets the Ord Minnett target it will return approximately minus 13% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $39.54, suggesting downside of -15.1% (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