Australian Broker Call

Macquarie rates AOG as Downgrade to Underperform from Neutral (5) -

The trading update from the AGM signals to Macquarie that management is backtracking from FY19 guidance, with sales rates below expectations because of a weak residential market.

Given price deflation and lower sales across the retirement sector, the broker suspects conditions will remain tough and pressure margins in FY19.

Macquarie downgrades to Underperform from Neutral and struggles to envisage operating conditions improving. Target is reduced to $1.54 from $2.74.

Target price is $1.54 Current Price is $1.63 Difference: minus $0.09 (current price is over target).
If AOG meets the Macquarie target it will return approximately minus 6% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.24, suggesting upside of 37.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.2

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

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

The company's AGM update revealed weaker sales/settlements because of a softer housing market. The company has, prudently in Morgan's view, pulled back its FY20 development deliveries to around 200 from 500 previously.

The broker downgrades forecasts by -21% and -34% for FY19 and FY20 respectively. The broker downgrades to Hold from Add, until there is further evidence sales rates are holding at current levels. Target is reduced to $2.09 from $3.37.

Target price is $2.09 Current Price is $1.63 Difference: $0.46
If AOG meets the Morgans target it will return approximately 28% (excluding dividends, fees and charges).

Current consensus price target is $2.24, suggesting upside of 37.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.2

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

Ord Minnett rates AOG as Accumulate (2) -

The company has downgraded ambitious FY19 sales targets and is unable to confirm earnings guidance, given volume uncertainty. Aveo will reduce deliveries of new stock to 420 in FY19 and 200 in FY20.

Ord Minnett's forecasts were already below guidance but are reduced by a further -8%. The broker believes it was appropriate to provide more realistic sales targets, given slowing deliveries.

The broker maintains an Accumulate rating and reduces the target to $3.10 from $3.20.

Target price is $3.10 Current Price is $1.63 Difference: $1.47
If AOG meets the Ord Minnett target it will return approximately 90% (excluding dividends, fees and charges).

Current consensus price target is $2.24, suggesting upside of 37.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.2

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

Ord Minnett rates APE as Hold (3) -

The company expects earnings from the automotive and truck retailing divisions to be higher in 2018, despite a weaker retail environment. The company is guiding to a net profit in 2018 of $126-130m, down -4-7% on 2017.

Ord Minnett believes the company is well-placed to capitalise on industry consolidation, although remains cautious on the outlook because of the macro environment. Hold rating maintained. Target is reduced to $7.40 from $8.30.

Target price is $7.40 Current Price is $7.02 Difference: $0.38
If APE meets the Ord Minnett target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $7.83, suggesting upside of 11.5% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.0

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

Credit Suisse rates AST as Neutral (3) -

First half earnings were ahead of forecasts, supported by non-recurring project revenue. Credit Suisse believes a reinstatement of the discounted distribution reinvestment plan is further reflection of the regulatory outlook and the opportunity in renewables.

The broker retains a Neutral rating, given regulatory pressure is likely to constrain cash flow/distribution growth. Target is raised to $1.60 from $1.55.

Target price is $1.60 Current Price is $1.68 Difference: minus $0.08 (current price is over target).
If AST meets the Credit Suisse target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $1.69, suggesting upside of 0.6% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.1

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

Deutsche Bank rates AST as Hold (3) -

First half results were largely as Deutsche Bank expected, with revenue down -6.8% and operating earnings down -2.4%. The company continues to focus on growing both the regulated and unregulated asset base.

A substantial portion of regulator revenue is locked in until the next re-setting in FY21. Deutsche Bank maintains a Hold rating and $1.65 target.

Target price is $1.65 Current Price is $1.68 Difference: minus $0.03 (current price is over target).
If AST meets the Deutsche Bank target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $1.69, suggesting upside of 0.6% (ex-dividends)

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.1

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

Macquarie rates AST as Downgrade to Neutral from Outperform (3) -

The interim result was stronger than Macquarie expected, reflecting a better customer contribution. Macquarie believes the stock has performed well but the potential for growth is now factored in.

While the yield provides a floor, it is considered unlikely to be a catalyst for re-rating. A more coordinated government policy that accelerates growth and renewables is likely to be the driver of a re-rating, in the broker's opinion. This is unlikely before May 2019.

Rating is downgraded to Neutral from Outperform. Target is lowered to $1.72 from $1.74.

Target price is $1.72 Current Price is $1.68 Difference: $0.04
If AST meets the Macquarie target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $1.69, suggesting upside of 0.6% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.1

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

Morgan Stanley rates AST as Upgrade to Equal-weight from Underweight (3) -

First half results were in line with Morgan Stanley's estimates. The broker believes regulatory risks are factored into the price and this raises the defensive appeal of the stock.

The broker lifts growth estimates for the contracted asset base to around $1.2bn by FY21,  20% above the current level but considered achievable based on the large pipeline of new generation projects.

Rating is upgraded to Equal-weight from Underweight. Target is raised to $1.72 from $1.71. Industry view: Cautious.

Target price is $1.72 Current Price is $1.68 Difference: $0.04
If AST meets the Morgan Stanley target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $1.69, suggesting upside of 0.6% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.1

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

Morgans rates AST as Add (1) -

First half earnings declined, but not as much as Morgans expected. Electricity transmission was stronger and gas distribution weaker, as anticipated.

The company expects further moderation in revenues in the second half while cost efficiency programs should partly offset the decline.

Morgans considers the quality of earnings solid and believes the 12-month potential return of around 8% is reasonable in the context of broader market weakness.

Add rating maintained. Target is reduced to $1.73 from $1.77.

Target price is $1.73 Current Price is $1.68 Difference: $0.05
If AST meets the Morgans target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $1.69, suggesting upside of 0.6% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.1

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

Ord Minnett rates AST as Hold (3) -

First half net profit was -11% lower but ahead of Ord Minnett's estimates. Regulated revenue continues to decline, although cost efficiencies and sustained growth in the contracted base have contributed to a better performance than would otherwise be the case.

Ord Minnett observes pressure will remain on distribution network service providers to reduce network charges despite potential increases to capital expenditure, given the federal government's commitment to lowering retail power prices.

Ord Minnett maintains an Hold rating and raises the target to $1.85 from $1.83.

Target price is $1.85 Current Price is $1.68 Difference: $0.17
If AST meets the Ord Minnett target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $1.69, suggesting upside of 0.6% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.1

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

Credit Suisse rates AUB as Reinstate Coverage with Outperform (1) -

The company has announced a pro-rata non-renounceable entitlement offer of $116.3m. Proceeds will be used to pay down debt and provide financial flexibility for future growth.

Credit Suisse reinstates coverage with an Outperform rating and $14.50 target. The broker remains supportive of management's strategy and considers the operating environment favourable.

Target price is $14.50 Current Price is $11.95 Difference: $2.55
If AUB meets the Credit Suisse target it will return approximately 21% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 1.0

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

Deutsche Bank rates BHP as Hold (3) -

BHP has not paid a special dividend for the past 10 years but Deutsche Bank recognises this may be changing and, ahead of the November 21 investor briefing, highlights its expectations. The broker emphasises capital may now be allocated to growth areas in conventional oil, copper and potash.

The broker also suspects BHP may choose, at the first possible date, to redeem the 60-year $6.5bn hybrid capital bonds issued at the lows of the cycle in late 2015. Hold rating and $36 target maintained.

Target price is $36.00 Current Price is $32.00 Difference: $4
If BHP meets the Deutsche Bank target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $37.52, suggesting upside of 17.3% (ex-dividends)

Forecast for FY19:

Forecast for FY20:

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

Market Sentiment: 0.7

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

Morgan Stanley rates BHP as Overweight (1) -

BHP intends to return US$10.4bn to shareholders through an off-market buyback and special dividend. The outcome of the buyback is expected to be announced on December 17.

Morgan Stanley assumes that US$5.2bn in shares is bought back at a tender a discount of -14% and a theoretical price of $35, and calculates the float-adjusted market cap within the S&P ASX 200 would decrease by -47 basis points to 6.8% of the index.

Overweight. Industry view:In Line.

Current Price is $32.00. Target price not assessed.

Current consensus price target is $37.52, suggesting upside of 17.3% (ex-dividends)

Forecast for FY19:

Forecast for FY20:

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

Market Sentiment: 0.7

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

Macquarie rates CYB as Resume Coverage with Outperform (1) -

Macquarie believes, with an economy beset by uncertainty, the bank offers positive momentum, supported by cost savings from the Virgin Money merger.

Macquarie resumes coverage following the removal of research restrictions with an Outperform rating and $6.30 target.

The broker incorporates the Virgin Money merger synergies and believes, with the acquisition, interest-rate sensitivity has diminished as the combined funding position has weakened.

As the investment thesis is less reliant on the outlook for interest rates the broker envisages greater probability of CYBG achieving 12-13% returns over the medium term.

Target price is $6.30 Current Price is $4.90 Difference: $1.4
If CYB meets the Macquarie target it will return approximately 29% (excluding dividends, fees and charges).

Current consensus price target is $6.48, suggesting upside of 32.3% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY18:

Forecast for FY19:

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

Market Sentiment: 0.4

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

Citi rates DLX as Neutral (3) -

Citi believes FY19 is shaping up as another solid year and considers, in the medium term, the company's offshore growth initiatives are likely re-rating catalysts.

Dulux margins held up in the face of cost headwinds, the broker observes, supported by mitigating initiatives from efficiency gains, procurement and R&D.

The broker considers the stock fairly valued and maintains a Neutral rating. Target is $7.60.

Target price is $7.60 Current Price is $7.19 Difference: $0.41
If DLX meets the Citi target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $7.14, suggesting downside of -0.7% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.4

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

Credit Suisse rates DLX as Neutral (3) -

Results were in line with Credit Suisse. Cost pressures are expected to abate in the second half of FY19 and the broker suspects guidance for the Merrifield factory to be earnings neutral remains conservative.

The broker considers Dulux a high-quality company with defensive end-market exposure and a track record of adjusting to market conditions.

However, as the stock is trading close to all-time highs a Neutral rating is maintained. Target is raised to $8.10 from $8.00.

Target price is $8.10 Current Price is $7.19 Difference: $0.91
If DLX meets the Credit Suisse target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $7.14, suggesting downside of -0.7% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.4

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

Deutsche Bank rates DLX as Sell (5) -

Deutsche Bank was slightly disappointed with the results, as it was boosted by profit on an asset sale, lower-than-forecast depreciation and net interest expense. Cash flow was also weaker than expected, down -16%.

The company has guided to higher underlying earnings in FY19 but expects this to be skewed to the second half. The broker retains a Sell rating and $5.70 target.

Target price is $5.70 Current Price is $7.19 Difference: minus $1.49 (current price is over target).
If DLX meets the Deutsche Bank target it will return approximately minus 21% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $7.14, suggesting downside of -0.7% (ex-dividends)

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.4

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

Macquarie rates DLX as Neutral (3) -

Results were in line with Macquarie's expectations. The broker likes the defensive characteristics of the stock and believes the company did well to offset cost pressures and maintain core margins.

There was a $19m increase in working capital over the year, more than expected. The broker expects a continued focus on price and cost, particularly in paints & coatings.

Neutral rating maintained. Target is reduced to $7.90 from $8.50.

Target price is $7.90 Current Price is $7.19 Difference: $0.71
If DLX meets the Macquarie target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $7.14, suggesting downside of -0.7% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.4

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

Morgans rates DLX as Hold (3) -

Results were slightly below Morgans' forecasts. The main positive was the Australasian division.

The stock is a consistent performer and there are long-term growth opportunities in overseas markets but Morgans believes the attributes are reflected in the current share price.

While maintaining a Hold rating, the broker is positive regarding the long-term and would reconsider its view on any weakness in the share price. Target is reduced to $7.67 from $7.69.

Target price is $7.67 Current Price is $7.19 Difference: $0.48
If DLX meets the Morgans target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $7.14, suggesting downside of -0.7% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.4

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

Ord Minnett rates DLX as Lighten (4) -

Net profit in FY18 was in line with Ord Minnett's forecasts. The broker believes the demand environment is becoming more challenging as new construction activity moderates.

In the face of an earnings decline in the first half and macro headwinds the broker believes the share price is at risk of a de-rating.

Ord Minnett acknowledges the solid balance sheet and the ability to pursue acquisitions but maintains a Lighten rating. Target is reduced to $6.70 from $6.90.

Target price is $6.70 Current Price is $7.19 Difference: minus $0.49 (current price is over target).
If DLX meets the Ord Minnett target it will return approximately minus 7% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $7.14, suggesting downside of -0.7% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.4

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

UBS rates DLX as Sell (5) -

In a quick first impression,UBS saw Dulux' result as solid, in line with consensus but a tad better than the broker's own forecast.

The broker does not expect much of a change to consensus forecasts but remains cautious on the outlook as growth in Australian coatings revenues has begun to slow. Sell and $6.30 target retained.

Target price is $6.30 Current Price is $7.19 Difference: minus $0.89 (current price is over target).
If DLX meets the UBS target it will return approximately minus 12% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $7.14, suggesting downside of -0.7% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.4

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

Citi rates ECX as Neutral (3) -

Headline results met guidance and Citi notes growth slowed in the second half. The primary drivers of the slowdown were Grays and CarLoans.com, which grew at only half the rate originally guided.

Citi maintains a Neutral rating and lowers the forecasts for FY19-20 by -3-4%. The broker lowers the target to the implied bid price from McMillan Shakespeare ((MMS)) of $2.55, from $2.85.

Target price is $2.55 Current Price is $2.64 Difference: minus $0.09 (current price is over target).
If ECX 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 $2.55, suggesting downside of -3.3% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.4

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

Credit Suisse rates ECX as Neutral (3) -

Results were in line with expectations post the August downgrade. Credit Suisse expects further growth in FY19 in Australian commercial business while the NZ fleet business should be stable. In contrast, momentum in Right2Drive, consumer and Grays is soft.

Corporate action remains a key driver of the stock and, because of declines in the McMillan Shakespeare ((MMS)) share price, the implied merger offer price has fallen to $2.55. Credit Suisse believes the weakness is overdone and all novated leasing players are likely to post better growth than the market might expect.

Neutral rating maintained. Target is reduced to $2.55 from $2.85.

Target price is $2.55 Current Price is $2.64 Difference: minus $0.09 (current price is over target).
If ECX meets the Credit Suisse target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.55, suggesting downside of -3.3% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.4

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

Morgan Stanley rates ECX as Overweight (1) -

Morgan Stanley found no issues in the results, which were in line with guidance. With a bid on the table, the broker suggests the downside risk is limited. Given the current upside potential to the bid price and competition, the broker maintains an Overweight rating.

The broker lowers FY19-20 estimates for net profit by -2-3%, largely because of the change in accounting policy. Morgan Stanley believes the stock is unlikely to trade around fundamentals in the short term as the opportunity for consolidation is compelling.

McMillan Shakespeare ((MMS)) has submitted an offer that is recommended by the EclipX board. Target is $3.00. Industry view is In-Line.

Target price is $3.00 Current Price is $2.64 Difference: $0.36
If ECX meets the Morgan Stanley target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $2.55, suggesting downside of -3.3% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.4

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

Morgan Stanley rates FLT as Overweight (1) -

Morgan Stanley observes the shares have de-rated considerably over the past four months as the Australian leisure performance weakened. The broker does not consider the online challenges are a structural issue.

Hence, the broker suspects the results in February will act as a catalyst for the shares. Overweight. Target is $59. Industry view: Cautious.

Target price is $59.00 Current Price is $48.19 Difference: $10.81
If FLT meets the Morgan Stanley target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $54.47, suggesting upside of 13.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.5

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

Credit Suisse rates LLC as Upgrade to Outperform from Neutral (1) -

Lend Lease has announced an additional cost overrun of around $500m on NorthConnex and some other engineering construction projects. While there is heightened risk in the shares, Credit Suisse believes they are oversold and it may be attractive to buy ahead of the AGM on November 16.

Rating is upgraded to Outperform from Neutral. Target is steady at $16.20. The broker suspects there could be significant upside from a more aggressive focus on costs across the business.

Target price is $16.20 Current Price is $13.23 Difference: $2.97
If LLC meets the Credit Suisse target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $15.75, suggesting upside of 19.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.4

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

Deutsche Bank rates MPL as Buy (1) -

Medibank Private has stated that improved momentum has continued into the first quarter and remains confident share can be grown even in a flat overall market.

Deutsche Bank believes the company needs to add around 30,000 new customers to offset the top line impact of a price cap of 2%.

The broker maintains a Buy rating and $3.40 target.

Target price is $3.40 Current Price is $2.80 Difference: $0.6
If MPL meets the Deutsche Bank target it will return approximately 21% (excluding dividends, fees and charges).

Current consensus price target is $2.95, suggesting upside of 5.4% (ex-dividends)

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.3

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

Morgans rates MPL as Hold (3) -

The commentary at the AGM has reaffirmed FY19 is tracking in line with expectations. The company still expects modest market share growth. Medibank Private will also book a $10m provision, which broadly fits with Morgans forecasts.

The broker believes the company is making progress in turning around its business but the outlook is unclear because of the risks to pricing from a potential change in government. Hold rating and $3 target maintained.

Target price is $3.00 Current Price is $2.80 Difference: $0.2
If MPL meets the Morgans target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $2.95, suggesting upside of 5.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.3

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

UBS rates MPL as Sell (5) -

Medibank Private's AGM update was a lot less upbeat than rival nib's ((NHF)), the broker notes, but with one of the more politically sensitive premium approval rounds coming up and the prospect of a change of government next year, Medibank is likely playing it conservatively, the broker suspects. The company sees Labor's proposed premium cap policy as challenging.

Medibank is on target to achieve modest market share growth in FY19 but in a flat market this doesn't much improve the picture, the broker notes. Sell and $2.60 target retained.

Target price is $2.60 Current Price is $2.80 Difference: minus $0.2 (current price is over target).
If MPL meets the UBS target it will return approximately minus 7% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.95, suggesting upside of 5.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.3

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

Morgan Stanley rates MTS as Overweight (1) -

Morgan Stanley is becoming increasingly cautious regarding sales trends for housing-linked retailers. The broker believes the results from Dulux ((DLX)) (no longer covered) points to incrementally negative trends for hardware stores.

The Metcash supplied Mitre 10 business is not immune to a softer housing cycle and Morgan Stanley lowers sales forecasts for the hardware division by -5-6%.

However, the broker lifts the company's food & grocery margin forecasts to reflect a more benign competitive environment such that the earnings outlook overall is little changed.

The broker retains an Overweight rating and reduces the target to $3.50 from $3.90. Industry view: Cautious.

Target price is $3.50 Current Price is $2.86 Difference: $0.64
If MTS meets the Morgan Stanley target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $2.93, suggesting upside of 2.3% (ex-dividends)

The company's fiscal year ends in April.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.1

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

Morgans rates NTD as Add (1) -

The company's trading update for FY19 was weaker than Morgans expected, affected by soft consumer sentiment, additional promotion and FX. Operating earnings guidance is $16-17m, which suggests to the broker a deterioration in the base business.

The company has reiterated a dividend policy of 40-60% of net profit and a dividend will be paid "in the absence of an acquisition".

The broker acknowledges the market will require evidence the company can achieve guidance before a re-rating can occur. Still, an Add rating is maintained. Target is reduced to $0.84 from $1.44.

Target price is $0.84 Current Price is $0.59 Difference: $0.25
If NTD meets the Morgans target it will return approximately 42% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 1.0

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

Credit Suisse rates PGH as Outperform (1) -

The company's trading update has reflected a more conservative profit outlook for FY19, at $245m versus prior guidance of $270-285m. Credit Suisse believe the prior guidance was aggressive and the main issues affecting profitability have not changed: higher raw material costs.

While the new guidance assumes raw material costs will not change, Credit Suisse observes resin costs are no longer threatening and some margin recovery from rising output prices could be possible. Outperform rating maintained. Target is reduced to $3.85 from $4.00.

Target price is $3.85 Current Price is $3.23 Difference: $0.62
If PGH meets the Credit Suisse target it will return approximately 19% (excluding dividends, fees and charges).

Current consensus price target is $4.02, suggesting upside of 24.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.4

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

Deutsche Bank rates PGH as Buy (1) -

Deutsche Bank believes the revised guidance for FY19 for operating earnings (EBITDA) of $245m is conservative as it no longer assumes any recovery in raw material costs.

Resin prices are beginning to decline in the US dollar business while the Australian dollar is stabilising.

Deutsche Bank maintains a Buy rating as the stock is trading at a -41% discount to valuation. Target is $5.50.

Target price is $5.50 Current Price is $3.23 Difference: $2.27
If PGH meets the Deutsche Bank target it will return approximately 70% (excluding dividends, fees and charges).

Current consensus price target is $4.02, suggesting upside of 24.5% (ex-dividends)

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.4

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

Macquarie rates PGH as Neutral (3) -

The company has indicated FY19 operating earnings are expected to be around $245m, versus prior guidance of $270-285m. This is a large change in the short space of time, Macquarie suggests, noting the departure of the CEO in September.

Resin cost headwinds are stronger than previously expected and a new issue has loomed in the form of higher costs for contract manufacturing, the largest because of the downgrade.

Macquarie remains concerned about the base business as well as the fact a new CEO is still to be appointed. Neutral maintained. Target is lowered to $3.72 from $4.65.

Target price is $3.72 Current Price is $3.23 Difference: $0.49
If PGH meets the Macquarie target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $4.02, suggesting upside of 24.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.4

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

Morgans rates PGH as Hold (3) -

The trading update disappointed Morgans, as underlying earnings estimates are downgraded to around $245m versus prior guidance of $270-285m. The broker decreases its forecasts accordingly.

Earnings are expected to recover in the second half, with the skew predicated on benefits from efficiency programs and a full six-month contribution from the TIC Retail Accessories acquisition.

Morgans maintains a Hold rating and reduces the target to $3.24 from $4.23.

Target price is $3.24 Current Price is $3.23 Difference: $0.01
If PGH meets the Morgans target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $4.02, suggesting upside of 24.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.4

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

Ord Minnett rates PGH as Hold (3) -

The company now expects operating earnings in FY19 of around $245m. Earnings will be skewed to the second half. The driver of the downgrade is greater-than-expected resin and contract manufacturing costs. Guidance assumes no recovery from pass-through mechanisms over FY19.

The broker believes the stock price is depressed and there is fundamental valuation support, but because of the poor track record of organic growth remains cautious about the outlook and earnings prospects. Hold rating maintained. Target is reduced to $3.80 from $4.50.

Target price is $3.80 Current Price is $3.23 Difference: $0.57
If PGH meets the Ord Minnett target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $4.02, suggesting upside of 24.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.4

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

UBS rates RHC as Neutral (3) -

The broker has now incorporated the Capio acquisition into its numbers, leading to a 3% earnings forecast increase from FY21 and a target price increase to $56 from $54 on valuation. The broker sees the merit in the deal but notes Australia remains Ramsay's dominant division.

In Australia concerns remain over declining rates of private healthcare insurance take-up and subsequent low growth in private hospital admissions. Neutral retained.

Target price is $56.00 Current Price is $55.33 Difference: $0.67
If RHC meets the UBS target it will return approximately 1% (excluding dividends, fees and charges).

Current consensus price target is $59.12, suggesting upside of 6.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.3

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

Morgans rates RHL as Add (1) -

Results beat Morgans' forecast, considered commendable in light of the severe east coast drought. Underlying net profit rose 10.3%, at the upper end of management's guidance.

No formal FY19 guidance was provided but management indicated October rainfall meant the year was off to a good start. Morgans forecasts FY19 net profit of $31m, up 7.5%.

The broker maintains an Add rating and raises the target to $3.60 from $3.40.

Target price is $3.60 Current Price is $3.14 Difference: $0.46
If RHL meets the Morgans target it will return approximately 15% (excluding dividends, fees and charges).

The company's fiscal year ends in September.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 1.0

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

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

The company has reaffirmed distribution guidance and the soft outlook for regulated returns. Morgan Stanley observes the brightest aspects are the longer-term connection growth and the diversity in supply load.

The broker believes the current regulatory allowances will underpin distributions to FY20. Equal-weight. Target is reduced to $2.43 from $2.44. Industry view is Cautious.

Target price is $2.43 Current Price is $2.32 Difference: $0.11
If SKI meets the Morgan Stanley target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $2.42, suggesting upside of 4.2% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: -0.1

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

Credit Suisse rates SUN as Neutral (3) -

As a result of the delay in the sale of the company's life business, to February 28 2019, Credit Suisse now includes two months of life earnings in second half forecasts. Overall, FY19 net profit estimates increase by 1.3% and earnings per share declines by -0.3%.

Credit Suisse maintains a Neutral rating and $14.70 target.

Target price is $14.70 Current Price is $13.50 Difference: $1.2
If SUN meets the Credit Suisse target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $15.26, suggesting upside of 13.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.3

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

UBS rates SWM as Upgrade to Neutral from Sell (3) -

Seven West has underperformed the market, UBS notes, since rival Nine Entertainment's ((NEC)) October update which suggested a weaker metro TV market in which Nine was gaining share. Seven West's own update confirmed such headwinds but the broker believes this could be a low watermark, given key programming lies ahead such as the cricket and My Kitchen Rules.

Guidance has been left unchanged on the assumption cost controls can offset weak TV, but UBS appears to have a lot of faith in the cricket and MKR and flags a typical election boost next year. The broker thus upgrades to Neutral from Sell while cutting its target to 80c from 85c.

Target price is $0.80 Current Price is $0.74 Difference: $0.06
If SWM meets the UBS target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $0.79, suggesting upside of 6.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.4

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

Citi rates WES as Neutral (3) -

Citi calculates a pro forma de-merged Coles valuation of $14.20 a share. Post the de-merger, the broker expects Wesfarmers to trade at $28.80 a share.

Coles is considered to be at the start of a reinvestment cycle and capital expenditure per square metre is expected to increase by 19% in FY19 and a further 12% in FY20. The increase is primarily expected from supply chain investment and refurbishments.

Meanwhile, organic growth at Wesfarmers is expected to be soft, as Bunnings faces a slowdown in the housing cycle and Kmart has reached peak margins. Neutral rating maintained. Target is reduced to $45.30 from $45.80.

Target price is $45.30 Current Price is $45.19 Difference: $0.11
If WES meets the Citi target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $47.81, suggesting upside of 5.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.1

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

Morgan Stanley rates WES as Underweight (5) -

In the wake of the Dulux ((DLX)) result, Morgan Stanley suspects the market is over estimating the resilience of Bunnings to the soft housing cycle.

While Bunnings has the strongest long-term track record of the retailers the broker covers, it has not experienced a protracted housing downturn, which is now clearly emerging in Australia.

Hence, Morgan Stanley believes the market valuation is too high in the context that like-for-like sales growth will ease and pressure operating margins which are, by global standards, high.

Underweight rating, $45 target and Cautious industry view maintained.

Target price is $45.00 Current Price is $45.19 Difference: minus $0.19 (current price is over target).
If WES meets the Morgan Stanley target it will return approximately minus 0% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $47.81, suggesting upside of 5.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.1

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

Deutsche Bank rates WOR as Upgrade to Buy from Hold (1) -

Deutsche Bank likes the exposure to the recovery in oil & gas capital expenditure. The share price could be negatively affected by concerns regarding global growth and declines in the oil price, but the company is still expected to find significant opportunities for revenue and margin expansion.

Deutsche Bank forecasts 20% growth in earnings per share between FY18-21. Rating is upgraded to Buy from Hold and the target is raised to $20.15 from $19.10.

Target price is $20.15 Current Price is $14.79 Difference: $5.36
If WOR meets the Deutsche Bank target it will return approximately 36% (excluding dividends, fees and charges).

Current consensus price target is $19.76, suggesting upside of 33.6% (ex-dividends)

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.7

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

Macquarie rates WOR as Resume Coverage with Outperform (1) -

Macquarie observes the acquisition of the Jacob's energy & resources division has now doubled the size of WorleyParsons, providing critical mass in the US market and building out the non-hydrocarbons exposure.

The broker believes consensus estimates are yet to fully factor in the accretion and the stock has de-rated post the deal, providing potential for a re-rating on the solid business outlook.

Macquarie resumes coverage with an Outperform rating and $21.25 target.

Target price is $21.25 Current Price is $14.79 Difference: $6.46
If WOR meets the Macquarie target it will return approximately 44% (excluding dividends, fees and charges).

Current consensus price target is $19.76, suggesting upside of 33.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.7

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

Citi rates WOW as Buy (1) -

Citi removes petrol from its forecasts and valuation following the divestment of the business to EG Group. This paves the way for a potential $1.5-2bn capital return in either February or August 2019, the broker suggests.

The broker downgrades earnings estimates by -5% on an annualised basis as a result of the divestment and as Woolworths continues to fund half of the petrol discount as well as around $10m in stranded costs. The latter should gradually decline.

Buy rating and $33 target maintained.

Target price is $33.00 Current Price is $28.92 Difference: $4.08
If WOW meets the Citi target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $28.92, suggesting downside of -0.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.1

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 does not believe the company will be a major winner in the US, but also that it does not need to be in order to justify it share price. Success in other international markets and Australasia should drive the share price in the near term.

While the US market is a large opportunity, it is competitive and Intuit is a strong incumbent. A number of the drivers of accounting software uptake are also different. One key aspect is the lack of a near-term regulatory catalyst.

Morgan Stanley suggests the company has learned from past experience and has refined its strategy to focus more broadly. The broker retains an Overweight rating and $50 target. Industry view is Attractive.

Target price is $50.00 Current Price is $40.46 Difference: $9.54
If XRO meets the Morgan Stanley target it will return approximately 24% (excluding dividends, fees and charges).

Current consensus price target is $44.30, suggesting upside of 9.5% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY19:

Forecast for FY20:

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

Market Sentiment: 0.1

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