Australian Broker Call

Morgan Stanley rates 360 as Overweight (1) -

Following yesterday's 3Q result for Life360, Morgan Stanley highlights its base case is for the business to surpass 100m active users in 2025. It's felt management will continue to build out the user experience and continue to monetise.

Yesterday's Broker Call: Morgan Stanley highlights Life360's 3Q2024 result showed revenue in line with expectations and EBITDA slightly lower than consensus but meeting the analyst's estimate.

Monthly average users and paying circle growth were higher than expected, with management raising EBITDA guidance.

Morgan Stanley noted some concern over transparency on advertising and hardware delays, with management reducing 2024 revenue guidance.

The Overweight rating and $25 target price remain. Industry view: In-Line.

Target price is $25.00 Current Price is $22.73 Difference: $2.27
If 360 meets the Morgan Stanley target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $24.96, suggesting upside of 9.6% (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: 0.8

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

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

APA Group is upgraded to Buy from Accumulate by Ord Minnett with target price retained at $8.60 due to more constructive view as a result of dissipating regulatory risks.

The broker notes the Australian Energy Regulator's recent decision not to regulate APA's South-West Queensland pipeline has lessened re-regulation concerns.

Despite the end of APA’s Wallumbilla–Gladstone pipeline contract with Shell in 2035, Ord Minnett sees a decade of low-risk revenue.

Distribution yields are projected at over 8% from FY25 to FY30, supported by inflation-protected earnings.

The broker finds the prospective yield is very attractive for investors.

Target price is $8.60 Current Price is $6.81 Difference: $1.79
If APA meets the Ord Minnett target it will return approximately 26% (excluding dividends, fees and charges).

Current consensus price target is $7.91, suggesting upside of 12.7% (ex-dividends)

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.2

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

Bell Potter rates CAT as Buy (1) -

Catapult International reported 1H25 results with revenue advancing 16% to US$57.8m, exceeding Bell Potter's forecast by 2% due to stronger revenue from Tactics & Coaching.

EBITDA increased 100%, surpassing the analyst's estimate by 14%, driven by better revenue generation and lower operating expenses.

Both free cash flow and annual contract values grew strongly and exceeded forecasts, with the balance sheet moving to a net cash position.

The broker raises EBITDA forecasts by 6% and 2% for FY25/ FY26, respectively, and notes the potential for Catapult International to be added to the S&P/ASX 300 in the next rebalance in December, though March appears more likely.

Buy rating remains unchanged. Target price rises to $3.30 from $2.88 due to a lower cost of capital assumption.

Target price is $3.30 Current Price is $2.87 Difference: $0.43
If CAT meets the Bell Potter target it will return approximately 15% (excluding dividends, fees and charges).

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: 1.0

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

Macquarie rates COL as Outperform (1) -

The focus at Coles Group's investor day was on investing in future efficiencies via the supply chain, with benefits to be realised over the medium term, notes Macquarie.

Efficiencies should arise now that the group has completed customer fulfilment centres (CFCs) in Melbourne and Sydney.

Management also reiterated its focus on its physical footprint, with a space growth target of more than 1.5% per year, highlights the broker.

The $19.50 target and Outperform rating are maintained.

Target price is $19.50 Current Price is $17.65 Difference: $1.85
If COL meets the Macquarie target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $19.54, suggesting upside of 9.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.6

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

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

Takeaways for Morgan Stanley from Coles Group's investor day include the full year of benefits from automated distribution centres (ADCs) will be realised in FY26, and management initiatives are underway to support the gross margin.

Management highlighted ADCs have half the footprint, double the capacity, and two-thirds of the operating cost of a manual distribution centre.

No change to target at $18.30, Equal-weight retained. Industry view: In-Line.

Target price is $18.30 Current Price is $17.65 Difference: $0.65
If COL meets the Morgan Stanley target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $19.54, suggesting upside of 9.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.6

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

Ord Minnett rates COS as Buy (1) -

Ord Minnett notes a positive business update and board renewal announcement from Cosol.

The company anticipates 1H revenue growth of 17-25% year-on-year, driven by new client wins and project expansions, including partnerships with Genesis Energy and Coca-Cola Europacific Partners.

The broker notes Cosol is progressing with its "OneCOSOL" transformation, which includes board restructuring to enhance strategic leadership.

Ord Minnett believes Cosol's outlook remains optimistic, expecting momentum from 4Q24 to continue into FY25 across all segments.

Buy rating and $1.20 target price maintained.

Target price is $1.20 Current Price is $0.96 Difference: $0.24
If COS meets the Ord Minnett target it will return approximately 25% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.5

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

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

While not expected to alleviate investor concerns about Computershare's exposure to rising interest rates, suggests Morgan Stanley, management has reaffirmed FY25 guidance for EPS of 126cps.

This guidance compares to forecasts by the broker and consensus for 125.5cps and 126.5cps, respectively.

Given rising market interest rates in recent weeks, the analyst is surprised management has lowered its FY25 yield outlook to 2.52% from 2.62%. Equal-weight. Target $27.70.  Industry view is In-Line.

Target price is $27.70 Current Price is $29.58 Difference: minus $1.88 (current price is over target).
If CPU meets the Morgan Stanley target it will return approximately minus 6% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $29.40, suggesting downside of -3.1% (ex-dividends)

The company's fiscal year ends in June.

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: 0.8

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

Morgans rates CVL as Add (1) -

Morgans notes Civmec announced its FY25 outlook along with a major OEM contract valued at $90m–$100m for a new shipbuilder, scheduled for a 2028 handover.

The broker observes the outlook has been tempered by delays in the timing of key project awards, coming in below expectations due to reduced activity levels in 2H25.

Morgans believes Civmec has not lost the contracts; rather, the awarding of new business has been delayed. FY25 earnings were expected to be impacted by the roll-off of major projects.

The analyst lowers FY25 EBITDA forecasts by -15%, with a catch-up in earnings anticipated in FY26.

Add rating is retained. Target price decreases to $1.40 from $1.45.

Target price is $1.40 Current Price is $1.32 Difference: $0.08
If CVL meets the Morgans target it will return approximately 6% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 1.0

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

Bell Potter rates DEG as Speculative Buy (1) -

Bell Potter notes the updated mineral resource for De Grey Mining's Hemi Gold Project, showing an increase of 900koz to 310mt at 1.4g/t Au for 13.6Moz contained.

The analyst highlights this update reflects a 7% lift in contained ounces, with sustained resource growth of around 1Moz per annum.

At September quarter end, the company had $828m in cash on hand with no debt, including $24m invested in project developments and "long-lead time" acquisitions. Interest income of $10m offset these outlays.

Bell Potter believes the company remains a takeover target, with Gold Road Resources' ((GOR)) 17% shareholding potentially available, as the analyst does not view Gold Road as an active investor.

Speculative Buy rating remains unchanged. Target price increases to $2.15 from $1.82.

Target price is $2.15 Current Price is $1.34 Difference: $0.81
If DEG meets the Bell Potter target it will return approximately 60% (excluding dividends, fees and charges).

Current consensus price target is $1.91, suggesting upside of 36.6% (ex-dividends)

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 1.0

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

Citi rates FLT as Buy (1) -

After updating forecasts for yesterday's trading update, Citi lowers its target for Flight Centre Travel to $20.35 from $24.35. The Buy rating is maintained.

Yesterday's Broker Call summary: In an initial assessment of today's' AGM trading update by Flight Centre Travel, Citi notes an in-line outcome.

The mid-point of FY25 profit PBT guidance of between $365-405m aligns with forecasts by consensus and the broker.

While 15% international ticket growth in the four months to October and 3% growth in corporate volumes appear stronger than underlying markets, the analyst notes converting strong volumes to super override accruals is less straight-forward with airfare deflation.

Super override is a term used in the airline industry to describe additional commissions or bonuses paid to travel agencies or corporate clients when they exceed certain sales targets. 

Target price is $20.35 Current Price is $17.39 Difference: $2.96
If FLT meets the Citi target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $22.81, suggesting upside of 31.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 1.0

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

Macquarie rates FLT as Outperform (1) -

After updating forecasts following yesterday's 1Q trading update by Flight Centre Travel, Macquarie lowers its target to $22.34 from $23.34 and maintains an Outperform rating.

Yesterday's Broker Call summary: Macquarie believes Flight Centre Travel's 1Q25 trading update was "generally" disappointing, with deflation in airfares creating a significant headwind.

The analyst notes the company has faced cyclical challenges. July was satisfactory, but August and September were soft. Total transaction values at $6bn showed a slight increase, with Australian international volumes up 15%, offset by airfare deflation and business closures.

Revenue margins advanced 20bps to 11.4%, suggesting 1Q25 revenue of $590m, according to the analyst. Cost margins rose slightly, but management expects improvements.

Management's mid-point for FY25 guidance came in below both the broker's and consensus estimates, with a larger-than-normal 2H skew in earnings expected.

Macquarie believes airfare deflation will slow in 2Q25 as comps become easier.

Target price is $22.34 Current Price is $17.39 Difference: $4.95
If FLT meets the Macquarie target it will return approximately 28% (excluding dividends, fees and charges).

Current consensus price target is $22.81, suggesting upside of 31.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 1.0

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

Bell Potter rates GNC as Hold (3) -

GrainCorp reported FY24 results in line with prior guidance at $78.8m, exceeding Bell Potter's forecast.

Revenue declined by -21%, with a -53% fall in EBITDA due to a weaker-than-expected result from processing, offset by a better outcome from agribusiness, as noted by the analyst. Net profit declined by -71%.

Management provided no fiscal guidance but indicated the harvest has started earlier than in past seasons, with year-to-date receivals of 5.8mt. Robust offshore crop production is creating margin pressures for exports, and a lower canola crush is expected in FY25.

Bell Potter reduces earnings forecasts by -12% for FY25 and -6% for FY26.

Target price drops to $9.25 from $9.80. Hold rating remains unchanged.

Target price is $9.25 Current Price is $8.59 Difference: $0.66
If GNC meets the Bell Potter target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $9.63, suggesting upside of 18.7% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.6

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

Macquarie rates GNC as Outperform (1) -

Following yesterday's FY24 results for GrainCorp, Macquarie makes lower margin assumptions for the Agribiz segment and reduces the target to $9.85 from $10.07. The Outperform rating is kept.

Yesterday's Broker Call summary: GrainCorp reported FY24 results with net profit of $77m versus Macquarie's forecast of $66m, and EBITDA of $268m versus the broker's estimate of $259m.

At first glance, the analyst notes agribusiness performed slightly better, with softer grain volumes from FY23 and lower margins.

Nutrition and processing, previously under energy, were in line with expectations, with a 33% rise in EBITDA on record crush volumes, offset by lower margins.

Management continues to explore crush expansion with an ongoing feasibility study and is working with Ampol ((ALD)). A FEED phase-in is targeted for FY28.

Macquarie believes the company's balance sheet is a strength, with $337m in net cash, supporting an annualised $500m buyback and a 48c FY24 dividend per share.

Target price is $9.85 Current Price is $8.59 Difference: $1.26
If GNC meets the Macquarie target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $9.63, suggesting upside of 18.7% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.6

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

Ord Minnett rates GNC as Buy (1) -

Ord Minnett observes GrainCorp's FY24 results were "solid", with adjusted EBITDA of $267.8m, marginally ahead of expectations.

The broker notes the outlook for the agribusiness segment remains strong due to a favourable winter crop forecast, while the nutrition & energy segment faces pressure from lower crush margins, impacted by a poor Victorian canola crop.

Ord Minnett believes the company's assets are undervalued. There is ongoing capital management potential, though modest adjustments to forward forecasts are made due to margin pressures.

The analyst lowers earnings forecasts by -9% in FY25 and -6% in FY26. Buy rating unchanged. Target price falls to $9.80 from $10.05.

Target price is $9.80 Current Price is $8.59 Difference: $1.21
If GNC meets the Ord Minnett target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $9.63, suggesting upside of 18.7% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.6

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

Morgan Stanley rates GPT as Overweight (1) -

Morgan Stanley’s analysts disagree with the view that GPT Group’s strategy to offload assets to third-party capital is potentially earnings dilutive.

The broker suggests this approach could be around 3% earnings accretive, even if management divests assets at a discount to book.

On Morgan Stanley’s estimates, even if properties are transferred off balance sheet at a -14% discount to book (at a 6.2% yield), it would still yield an earnings-neutral outcome.

Further upside could be captured through development profits if management establishes third-party vehicles with project exposures, explains the broker.

Target $6.15. Overweight. Industry View: In-Line.

Target price is $6.15 Current Price is $4.64 Difference: $1.51
If GPT meets the Morgan Stanley target it will return approximately 33% (excluding dividends, fees and charges).

Current consensus price target is $5.27, suggesting upside of 14.1% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.9

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

Ord Minnett rates IFL as Hold (3) -

Insignia Financial's Investor Day introduced its "Vision 2030" strategy, focusing on cost savings, efficiency, and growth opportunities with a target of -$150m in net cost savings by FY30.

Ord Minnett observes the strategy includes platform consolidation and productivity improvements to drive positive operating leverage and double-digit earnings growth over the medium term.

Despite the promising long-term goals, Ord Minnett notes the near-term impact is limited, with no dividend expected for 1H25.

The Hold rating is maintained. Target price rises to $3.25 from $3.20.

Target price is $3.25 Current Price is $3.14 Difference: $0.11
If IFL meets the Ord Minnett target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $3.05, suggesting downside of -7.7% (ex-dividends)

The company's fiscal year ends in June.

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

Morgan Stanley rates IPH as Overweight (1) -

Morgan Stanley sees some downside risk to the FY25 consensus earnings forecast after reviewing the 1Q trading update by IPH.

Management noted a moderate increase in revenue and earnings compared to the broker's forecast for growth of 4% and 5%, respectively. Litigation revenue in Canada is expected to be lower in H1 due to fewer cases settled.

While the A&NZ region continues to strengthen, Asia is yet to return to growth, though green shoots are emerging, suggest the analysts.

Target $7.75. Overweight. Industry view: In-Line.

Target price is $7.75 Current Price is $5.20 Difference: $2.55
If IPH meets the Morgan Stanley target it will return approximately 49% (excluding dividends, fees and charges).

Current consensus price target is $7.25, suggesting upside of 43.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 1.0

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

Morgans rates IPH as Add (1) -

Morgans believes the AGM trading update from IPH was broadly in line with expectations, with negative forex changes impacting like-for-like revenue and EBITDA for 1Q25.

Management highlighted revenue and EBITDA improvements in A&NZ and Canada, with a slight decline in Asia. Australian filings are down -4.8% for the first four months, compared to a -3.1% decline for the market.

Canadian litigation is expected to be lower in 2H25 due to case settlements in 1Q25.

Morgans lowers EPS estimates by -3% for FY25-FY27, with currency as a "swing" factor.

Add rating remains unchanged. Target price decreases to $6.80 from $7.55.

Target price is $6.80 Current Price is $5.20 Difference: $1.6
If IPH meets the Morgans target it will return approximately 31% (excluding dividends, fees and charges).

Current consensus price target is $7.25, suggesting upside of 43.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 1.0

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

Morgans rates LNW as Add (1) -

Morgans notes Light & Wonder's 3Q2024 earnings came in below consensus expectations. Revenue advanced 12% year-on-year, meeting the analyst's forecast but falling short of consensus by -2.3%.

The broker highlights land-based games outperformed, driven by gaming machine sales, with international sales up 72% year-on-year to 6,900 units. Morgans also points to strong performance from Shenlong Unleashed, which exceeded expectations.

iGaming and SciPlay performed well below expectations, though both segments are expected to improve in 4Q2024 with the US holiday season. Liquidity stood at US$1.1bn at the quarter's end, with US$350m in cash.

Management reconfirmed US$1.4bn EBITDA guidance for FY25 and a net profit after tax of US$565m–US$635m, 2% above consensus at the midpoint, with no updates on Dragon Train.

The target price of $180 and Add rating are maintained. Earnings forecasts for FY25 rise by 2%.

Target price is $180.00 Current Price is $146.91 Difference: $33.09
If LNW meets the Morgans target it will return approximately 23% (excluding dividends, fees and charges).

Current consensus price target is $178.60, suggesting upside of 21.7% (ex-dividends)

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 LNW as Upgrade to Buy from Accumulate (1) -

Ord Minnett upgrades Light & Wonder to Buy from Accumulate with target price raised to $187 from $155.

The broker notes the company’s September-quarter earnings were slightly below expectations due to weaker gaming division performance, but revenue from the Dragon Train game series has largely been replaced.

Ord Minnett anticipates 22% EPS growth in 2025, driven by strong operating leverage, continued growth in gaming installations, and double-digit expansion in iGaming.

Post-results, the broker lowers earnings forecast by -2% in 2024 but increases estimates for 2025/2026 by 9% and 8%, respectively.

Target price is $187.00 Current Price is $146.91 Difference: $40.09
If LNW meets the Ord Minnett target it will return approximately 27% (excluding dividends, fees and charges).

Current consensus price target is $178.60, suggesting upside of 21.7% (ex-dividends)

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

Bell Potter rates NUF as Hold (3) -

Nufarm reported a softer-than-expected FY24 result, Bell Potter notes, with weaker-than-anticipated revenue and EBITDA due to soft performance from Seeds and North America, offset by stronger results from APAC and Europe.

Management highlighted "solid" demand in crop protection markets with competitive pricing; Omega-3 revenues are expected to double in FY25 as inventories decline, and crop protection revenues are anticipated to return to long-term levels in FY26.

Seed technologies are targeted at $600m-$700m, an ongoing goal from Nufarm.

Hold rating remains unchanged. Target price increases to $4.25 from $4.05. The broker's earnings forecasts are largely unchanged.

Target price is $4.25 Current Price is $3.88 Difference: $0.37
If NUF meets the Bell Potter target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $4.71, suggesting upside of 17.1% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.1

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

Citi rates NUF as Sell (5) -

Updating yesterday's research note following FY24 results, Citi decides to raise its target for Nufarm to $3.75 from $3.65 and retains a Sell rating.

The broker forecasts leverage in 1H FY25 to reach 4.1 times from 2.0 times in 2H FY24, which means another half of no distribution.

Yesterday's Broker Call Report: Today's release of Nufarm's FY24 revenue and underlying earnings (EBITDA) exceeded Citi's expectations, primarily due to a volume increase in the Crop Protection business. However, the positive impact of higher volumes was offset by pressure from pricing.

In an initial review, the broker also notes margins for Seed Technologies were materially below both the previous period and the expected 20.4%.

The analyst believes pricing will continue to be a headwind in the near term for both Nufarm and the broader industry.

While management reiterated the FY26 revenue goal, the outcome remains closely tied to a recovery in long-term average pricing in Crop Protection, explains Citi.

Target price is $3.75 Current Price is $3.88 Difference: minus $0.13 (current price is over target).
If NUF meets the Citi target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.71, suggesting upside of 17.1% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.1

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

Macquarie rates NUF as Neutral (3) -

Better-than-expected net debt reduction was a highlight within Nufarm's FY24 result for Macquarie, and the performance of the Agchem division appears to be bottoming out, though Seeds disappointed.

Growth in Seeds earnings was negatively impacted by weak fish oil prices and high investment costs, explains the analyst.

The FY24 underlying loss of -$6m came in below forecasts by the broker and consensus for a profit of $3m and $7m, respectively.

The target rises to $4.22 from $4.00 based on the broker's lower net debt forecast. The Neutral rating is unchanged.

Target price is $4.22 Current Price is $3.88 Difference: $0.34
If NUF meets the Macquarie target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $4.71, suggesting upside of 17.1% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.1

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

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

Morgans upgrades Nufarm to Add from Hold, raising the target price to $4.53 from $4.23, as the analyst believes the company appears to be through the worst of a challenging period.

The broker describes FY24 results as "weak," with net profit falling -103%, in line with management's downgraded guidance.

The company was impacted by high inventory levels and destocking in the crop protection industry, with margins under pressure as higher-priced inventory was sold.

Management provided no guidance, but Morgans  believes the outlook for crop protection has improved. Nufarm is focusing on cost reduction and improved working capital, including annualised savings of -$50m.

Morgans lowers earnings forecasts by -3%, with higher depreciation/amortisation charges offset by lower net interest costs.

Target price is $4.53 Current Price is $3.88 Difference: $0.65
If NUF meets the Morgans target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $4.71, suggesting upside of 17.1% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.1

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

Citi rates ORI as Neutral (3) -

Citi retains its $19 target and Neutral rating for Orica after fully updating for yesterday's FY24 result.

Yesterday's Broker Call summary: Orica's FY24 results revealed EBIT in line with forecasts by Citi and consensus, while revenue missed the broker’s forecast by -7%, and the EBITDA margin beat by 1%. Profit of $409.4m met consensus expectations.

Management expects earnings to increase in FY25 compared to FY24.

The broker’s initial reaction is positive, viewing the results as "solid" and the FY25 outlook as aligning with growth expectations. A final unfranked dividend of 28c for FY24, representing a 59% payout ratio, is 1c above the analyst's forecast.

Target price is $19.00 Current Price is $17.58 Difference: $1.42
If ORI meets the Citi target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $20.71, suggesting upside of 13.8% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.8

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

Morgan Stanley rates ORI as Overweight (1) -

Morgan Stanley raises its target for Orica by $1.00 to $22.50 following solid execution evident within FY24 results, particularly on pricing and margin optimisation. The Overweight rating is retained. Industry view: In-Line.

The broker anticipates double-digit earnings growth across FY25-27, potentially further supported by capital management initiatives.

In summary, earnings (EBIT) were in line with the broker's forecast, with the APAC and EMEA regions as key contributors, broadly offsetting lower results from North America and Specialty Mining Chemicals.

Target price is $22.50 Current Price is $17.58 Difference: $4.92
If ORI meets the Morgan Stanley target it will return approximately 28% (excluding dividends, fees and charges).

Current consensus price target is $20.71, suggesting upside of 13.8% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.8

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

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

Morgans upgrades Orica to Add from Hold, raising the target price to $19.72 from $18.85 due to lower net debt levels and higher earnings forecasts for FY25/FY26.

Following acquisitions, Morgans notes Orica is now the world's largest explosives company and the largest producer of sodium cyanide. The analyst believes the company will achieve solid earnings over the next few years due to strong demand and recontracting benefits.

The company's FY24 earnings slightly exceeded expectations, with higher-margin businesses, digital solutions, and specialty mining chemicals boosting the EBIT margin to 10.5%. Morgans describes the earnings result as strong.

Cash flow conversion increased to 90%, and gearing came in lower than the target.

Target price is $19.72 Current Price is $17.58 Difference: $2.14
If ORI meets the Morgans target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $20.71, suggesting upside of 13.8% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.8

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

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

Ord Minnett upgrades Orica to Buy from Hold with a target price increase to $22 from $20, following strong FY24 earnings, FY24 results met consensus expectations, driven by its blasting solutions segment.

The company saw robust performance in the Asia-Pacific region and improved cash flow, leading to a better-than-forecast debt position, the analyst notes.

Management expects further EBIT growth in FY25. The broker forecasts 24% growth in EBIT for FY25 on FY24, supported by an enhanced product mix, higher prices, and contributions from recent acquisitions, including Terra Insights. 

The company’s low leverage may support potential capital returns, such as a buyback, with an updated capital policy expected in March, although the analyst does not expect a buyback at this stage.

Ord Minnett lifts its EPS forecast by 2% for FY26.

Target price is $22.00 Current Price is $17.58 Difference: $4.42
If ORI meets the Ord Minnett target it will return approximately 25% (excluding dividends, fees and charges).

Current consensus price target is $20.71, suggesting upside of 13.8% (ex-dividends)

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.8

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

Morgan Stanley rates S32 as Equal-weight (3) -

Morgan Stanley anticipates an update on the exploration drilling campaign at the nearby Catabela Northeast prospect during the upcoming site visit to South32's 45%-owned Sierra Gorda mine in northern Chile.

For Sierra Gorda, the broker and consensus expect the final investment decision to proceed, aiming to increase throughput by approximately 20% to around 58mtpa (100% basis) by adding a fourth grinding line.

Equal-weight rating maintained. Target price set at $3.20. Industry view: Attractive.

Target price is $3.20 Current Price is $3.49 Difference: minus $0.29 (current price is over target).
If S32 meets the Morgan Stanley target it will return approximately minus 8% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.84, suggesting upside of 8.5% (ex-dividends)

The company's fiscal year ends in June.

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: 0.8

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

Morgan Stanley rates SLC as Overweight (1) -

Following Superloop's AGM and trading update, Morgan Stanley highlights consumer net additions are tracking ahead of expectations, and Business/Wholesale momentum continues.

Regarding Wholesale, the Origin Energy ((ORG)) contract migration has successfully completed, notes the broker.

Management reiterated underlying earnings (EBITDA) guidance of between $83-88m.

Target $2.10. Overweight. Industry view: In-line.

Target price is $2.10 Current Price is $1.91 Difference: $0.19
If SLC meets the Morgan Stanley target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $2.07, suggesting upside of 1.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 1.0

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

Ord Minnett rates STG as Downgrade to Hold from Speculative Buy (3) -

Ord Minnett downgrades Straker to Hold from Speculative Buy, with a target price cut to $0.38 from $0.89, following management's reduction in revenue guidance of -12% for FY25.

The analyst observes the decline is driven by the non-renewal of two low-margin European Union contracts.

Straker expects stable gross margins and positive adjusted EBITDA but Ord Minnett continues to see risk in its legacy Language Services revenue with the FY24 decline of -24% in the business revenue as likely to remain into FY25.

The company is pivoting to higher-margin AI products, but Ord Minnett awaits further demand evidence before reassessing the operating outlook.

Target price is $0.38 Current Price is $0.39 Difference: minus $0.01 (current price is over target).
If STG meets the Ord Minnett target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).

The company's fiscal year ends in March.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.0

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

Citi rates XRO as Buy (1) -

For Citi's initial response to Xero's H1 results see yesterday's Report.

Upon second consideration, the broker zooms in on slowing subscriber growth, in A&NZ in particular. Though growth in ARPU remains "solid".

Subscriber growth is better in the UK, and even in the US where Xero now has, in Citi's words, an improving product-market-fit.

The broker draws confidence from management's focus on the 'Rule of 40' and thus sees potential for upside surprises.

Citi reiterates its Buy rating, while adding 7% to its price target, now at $198.

Target price is $198.00 Current Price is $171.00 Difference: $27
If XRO meets the Citi target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $184.15, suggesting upside of 7.2% (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: 0.7

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

Macquarie rates XRO as Outperform (1) -

After updating forecasts following yesterday's 1H results by Xero, Macquarie raises its target to $191.90 from $188.50 and maintains an Outperform rating.

Yesterday's Broker Call summary: Macquarie's initial take on Xero's 1H25 results shows improved cost management, with a gross margin around 89%, opex to sales at 71.2%, and a free cash flow margin of 21%, driven by 8.9% sales growth in small businesses.

Average revenue per user was better than anticipated at NZ$43.01, up 11% year-on-year, due to strong uptake of higher-priced plans in Australia, robust payments performance, and "idle" subscription churn.

Management reiterated FY25 guidance.

Target price is $191.90 Current Price is $171.00 Difference: $20.9
If XRO meets the Macquarie target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $184.15, suggesting upside of 7.2% (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: 0.7

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

Morgan Stanley rates XRO as Overweight (1) -

Morgan Stanley raises its target for Xero to $220 from $170 following 1H25 results, highlighting 25% revenue growth (23% in constant currency) and an earnings beat of approximately 9.5% against the broker's forecast.

First-half free cash flow (FCF) nearly doubled to NZ$209m compared to the previous corresponding period.

The broker believes management's adoption of the Rule of 40 metric has driven improved results over the last 18 months and sharpened corporate strategy and capital allocation. The measure rose to 44% compared to the prior half.

Overweight rating maintained. Industry view: Attractive.

Target price is $220.00 Current Price is $171.00 Difference: $49
If XRO meets the Morgan Stanley target it will return approximately 29% (excluding dividends, fees and charges).

Current consensus price target is $184.15, suggesting upside of 7.2% (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: 0.7

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

Morgans rates XRO as Hold (3) -

Morgans is happy to stick with its Hold rating for Xero. The broker explains it rates the business model, pricing power, value add and growth opportunities highly but remains apprehensive about the likely growth trajectory in the USA.

Yesterday's financial result beat expectations but it was also impacted by the company removing some -160,000 inactive subscribers. This meant subscriber number were always going to disappoint, but ARPU has been lifted as a result.

The broker also highlights cash flow was better-than-expected and the company beat its own Rule of 40 target. The broker's price target remains unchanged at $140, well below targets set elsewhere.

Target price is $140.00 Current Price is $171.00 Difference: minus $31 (current price is over target).
If XRO meets the Morgans target it will return approximately minus 18% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $184.15, suggesting upside of 7.2% (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: 0.7

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

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

Ord Minnett downgrades Xero to Hold from Accumulate, raising the target price to $180 from $160 following strong 1H FY25 results, which exceeded expectations due to strict cost control.

The downgrade is based on valuation grounds, the analyst states due to the 14% appreciation in the share price in November.

Ord Minnett views the company's prospects as positive, estimating around 20% revenue growth out to FY27, which could allow Xero to meet the "rule of 40" for SaaS companies.

On Ord Minnett's observation, market consensus is more conservative, expecting 17% growth by FY27, declining to 14% growth by the end of the decade.

Xero may also accelerate US subscriber growth and expand into Australia’s middle market where the total addressable market could be as large as NZ$2bn.

Post-results, earnings forecasts for FY25-FY27 have been increased by 4-6%, respectively.

Target price is $180.00 Current Price is $171.00 Difference: $9
If XRO meets the Ord Minnett target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $184.15, suggesting upside of 7.2% (ex-dividends)

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: 0.7

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