Australian Broker Call

Citi rates ALU as Neutral (3) -

Following four consecutive months of declining website visits for Altium's Octoparts platform, the website has reported a positive start to the new year with site visits up 21% month-on-month and 5% year-on-year in January. 

Citi expects Altium can deliver a strong first half result supported by price increase, and sees potential for lower hiring activity to offer upside. 

The Neutral rating and target price of $37.60 are retained.

Target price is $37.60 Current Price is $38.93 Difference: minus $1.33 (current price is over target).
If ALU 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 $36.34, suggesting downside of -8.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

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

Market Sentiment: 0.5

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

Citi rates AMC as Neutral (3) -

Taking a first look at Amcor's 1H result today, Citi notes earnings (EBIT) of US$399m were a beat compared to the consensus estimate for US$385m.

Corporate expenses were less than the analyst had forecast, while revenue was in line. Total volumes fell by -2% year-on-year with weakness in The Flexibles and Rigid divisions.

Management reiterated guidance for FY23 EPS of US77-81cps (though is more cautious on the demand environment) compared to the US78.6cps expected by consensus.

The Neutral rating and target price of US$13 are retained.

Current Price is $17.27. Target price not assessed.

Current consensus price target is $17.60, suggesting upside of 5.4% (ex-dividends)

Forecast for FY23:

Forecast for FY24:

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

Market Sentiment: 0.0

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

Credit Suisse rates AMC as Neutral (3) -

In a first take on today's 1H results for Amcor, Credit Suisse notes an earnings (EBITA) beat was due to lower corporate costs, while a cash from operations miss was due to an increase in working capital, previously flagged by management.

Earnings of US$791m compared to the broker's forecast of US$780m and the expectation by consensus for US$770m.

Management left FY23 EPS guidance unchanged at US77-81c.

The $17.25 target and Neutral rating are unchanged.

Target price is $17.25 Current Price is $17.27 Difference: minus $0.02 (current price is over target).
If AMC meets the Credit Suisse target it will return approximately minus 0% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $17.60, suggesting upside of 5.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

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

Market Sentiment: 0.0

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

Macquarie rates AMC as Neutral (3) -

In a first look at today's 1H results for Amcor, Macquarie highlights an underlying earnings beat against the broker's forecast on lower tax and corporate costs.

However, volumes were lower and the analyst considers the outlook tone was more cautious regarding the demand environment, despite the maintenance of FY23 EPS guidance at between US77-81cps.

Macquarie notes price/mix had a favourable impact on net sales of 3%, which reflects growth across a range of high-value end markets and the ongoing focus on optimisation for mix.

The Neutral rating and $17.94 target are retained.

Target price is $17.94 Current Price is $17.27 Difference: $0.67
If AMC meets the Macquarie target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $17.60, suggesting upside of 5.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

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

Market Sentiment: 0.0

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

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

In a first look at today's announcement, Morgan Stanley assesses an in-line 1H result for Amcor, despite some deterioration in volume. Increased caution on the demand environment by the company was noted.

Despite this caution, management maintained FY23 adjusted EPS guidance of US77-81cps and FY23 free cash flow of between US$1bn to 1.1bn.

First half earnings (EBIT) were a 1% beat versus the broker's forecast and in-line with consensus.

The Equal-weight rating and $17.00 target are unchanged. Industry view: In Line.

Target price is $17.00 Current Price is $17.27 Difference: minus $0.27 (current price is over target).
If AMC meets the Morgan Stanley target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $17.60, suggesting upside of 5.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

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

Market Sentiment: 0.0

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

UBS rates AMC as Neutral (3) -

In a first take on Amcor's 1H results, UBS notes cost/price/mix management offset volume pressures and earnings (EBIT) were in line with the forecasts of both the analyst and consensus.

First half sales rose by 6% to US$7.4bn and earnings increased by 3% to US$791m. A dividend of US12.25cps was declared, in line with the broker's forecast.

Management reiterated FY23 guidance for reported EPS growth of -1% to 4%, when the broker had been estimating -3% and consensus -2%.

UBS considers outlook statements were more cautious due to pressure on volumes from destocking and the current demand environment.

The current share buyback is increased to US$500m from US$400m, with US$40m repurchased year-to-date.

The $18.65 target and Neutral rating are unchanged.

Target price is $18.65 Current Price is $17.27 Difference: $1.38
If AMC meets the UBS target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $17.60, suggesting upside of 5.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

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

Market Sentiment: 0.0

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

UBS rates BLD as Neutral (3) -

Upon first assessment, UBS considers today's 1H result for Boral was positive, driven by solid volume growth and average selling prices for all segments, except Quarries.

Underlying profit of $57m compared to forecasts by the broker and consensus for $27m and $37m, respectively, while earnings (EBIT) for the 1H of $94m trumped the analyst's forecast for $64m.

Management guides to 2H earnings broadly in line with the 1H, which the broker feels is a conservative stance, given the pricing traction in the 1H implied by 12% year-on-year net revenue growth and more than 4% volume growth.

UBS retains its Neutral rating and $3.55 target for Boral.

Target price is $3.55 Current Price is $3.52 Difference: $0.03
If BLD meets the UBS target it will return approximately 1% (excluding dividends, fees and charges).

Current consensus price target is $3.09, suggesting downside of -21.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: -0.2

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

Macquarie rates BSL as Neutral (3) -

Steel prices have been on the rise, Macquarie notes, largely driven by rebounding Chinese activity levels and some producer discipline in the US. The broker has lifted its target on BlueScope Steel to $18.10 from $16.60.

But softening US economic conditions and risks to Australian residential and R&R building activity remain key concerns in the broker's view.

Neutral retained.

Target price is $18.10 Current Price is $19.05 Difference: minus $0.95 (current price is over target).
If BSL meets the Macquarie target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $19.17, suggesting downside of -1.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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

Citi rates BWP as Sell (5) -

In a first glance at 1H results for BWP Trust, Citi highlights cap rates remain stable at 5.05% (compared to 5.04% in FY22).

This outcome resulted in tangible assets (NTA) growth of 5.3% for the half to $3.95/share, broadly in line with the current share price, notes the analyst.

Management guidance for FY23 was unchanged with dividends expected to be similar to FY22. This suggests to the analysts capital profits may be used to support dividends.

While the broker likes the operationally strong result and the defensive nature of Bunnings warehouses, the stock is still considered expensive. Sell and $3.70 target.

Target price is $3.70 Current Price is $3.92 Difference: minus $0.22 (current price is over target).
If BWP meets the Citi target it will return approximately minus 6% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.75, suggesting downside of -3.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: -1.0

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

Morgan Stanley rates CNI as Overweight (1) -

In the wake of 1H results, Morgan Stanley has taken the opportunity to chat with management and came away with several observations, including a potential cost of debt tailwind. From April, some high-margin bonds roll-off the REIT's debt portfolio.

The broker also notes asset devaluation was approximately -2.5% during the 1H across the total of assets under management (AUM).

The Overweight rating and $2.50 target are unchanged. Industry View: In-Line.

Target price is $2.50 Current Price is $1.86 Difference: $0.64
If CNI meets the Morgan Stanley target it will return approximately 34% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.7

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

Citi rates CSL as Buy (1) -

Citi has updated on CSL to account for updates in the company's reporting set to take effect from the first half. 

CSL will now report net profit after tax as net profit after tax but before IP amortisation, impairment, and other one-off costs, and Citi has changes its reporting accordingly. 

The Buy rating and target price of $335.00 are retained.

Target price is $335.00 Current Price is $308.07 Difference: $26.93
If CSL meets the Citi target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $328.20, suggesting upside of 7.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

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

Citi rates DHG as Neutral (3) -

Despite near-term conditions remaining challenging, Citi sees the risk-reward balance for both Domain Holdings Australia and REA Group ((REA)) to be more compelling over a 12-month period, particularly given cost out reductions undertaken by both. 

The broker does anticipate a -14% year-on-year listing volumes decline over the second half, before returning to growth in the second quarter of FY24. For Domain Holdings Australia, the broker expects recent contract wins to support depth revenue and notes the company will be cycling easier comparables. 

The rating is upgraded to Buy from Neutral and the target price increases to $3.90 from $3.44. 

Target price is $3.90 Current Price is $3.30 Difference: $0.6
If DHG meets the Citi target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $3.57, suggesting upside of 8.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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

Macquarie rates DMP as Underperform (5) -

Domino's Pizza Enterprises has had a busy first half, Macquarie notes, featuring completion of the Malaysian and Singapore acquisition and a capital raise to buy out the German stake.

The broker anticipates higher growth in Asia in FY23 before slowing in FY24-25 and has adjusted earnings forecasts accordingly.

With valuation multiples still elevated relative to global peers, Macquarie retains Underperform. Target unchanged at $60.

Target price is $60.00 Current Price is $71.31 Difference: minus $11.31 (current price is over target).
If DMP meets the Macquarie target it will return approximately minus 16% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $75.57, suggesting upside of 7.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.4

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

Morgans rates DXC as Add (1) -

As part of 1H results commentary, management at Dexus Convenience Retail REIT reiterated FY23 guidance though narrowed the range to 21.4-21.8cpu for funds from operations (FFO).

Additional asset sales were made during the half to pay down debt and the analyst expects further sales, though finds it hard to predict either timing or dollar amounts.

The Add rating is maintained, while the target slips to $3.53 from $3.60.

Target price is $3.53 Current Price is $2.87 Difference: $0.66
If DXC meets the Morgans target it will return approximately 23% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.8

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

Ord Minnett rates GNC as Hold (3) -

GrainCorp looks set to deliver another above average crop for its third consecutive year, with forecasts from the Bureau of Agriculture predicting east coast winter grain production to be the third highest on record at around 27m metric tonnes. Ord Minnett expects east coast crops to be less impressive at around 18m metric tonnes. 

While GrainCorp has benefited from higher export demand driving high grain prices in recent years, Ord Minnett expects this trend will not persist long-term, and anticipates a normalisation of grain production following this fiscal year. 

The Hold rating and target price of $6.70 are retained.

Target price is $6.70 Current Price is $7.41 Difference: minus $0.71 (current price is over target).
If GNC meets the Ord Minnett target it will return approximately minus 10% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $8.78, suggesting upside of 18.6% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.6

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

Macquarie rates GQG as Outperform (1) -

Macquarie observes GQG Partners experienced strong funds inflows in January after some volatile months. Since inception
GQG has delivered very impressive performance across investment strategies, the broker notes.

Since November, performance has been disappointing, with the fund manager over/underweight the wrong sectors. Three months doesn't a trend make, says Macquarie, but the broker will be monitoring closely given underperformance would lead to outflows.

The sudden departure of a senior portfolio manager in November also raises the issue of "key man risk".

Nonetheless, Outperform retained, target rises to $2.05 from $1.95.

Target price is $2.05 Current Price is $1.54 Difference: $0.515
If GQG meets the Macquarie target it will return approximately 34% (excluding dividends, fees and charges).

Current consensus price target is $2.09, suggesting upside of 37.5% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY22:

Forecast for FY23:

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

Credit Suisse rates HLS as Underperform (5) -

Healius's pre-announced December-half earnings (EBITDA) missed consensus forecasts by -10% but met Credit Suisse's forecast.

EBIT proved a -34% miss on consensus and the company's Group EBIT margin was roughly half its pre-covid margin at 4.6%, reflecting the sharp drop-off in covid testing and slow business as usual revenue, says the broker.

Add to this a lag in reducing the cost base, and margins suffered.

While guidance was not forthcoming, management did expect the June half to be much stronger. But the broker is awaiting an improvement in costs before getting too excited, noting the balance sheet is looking tight (but does not expect an equity raising).

Underperform rating retained. Target price falls to $2.95 from $3.10.

Target price is $2.95 Current Price is $2.98 Difference: minus $0.03 (current price is over target).
If HLS meets the Credit Suisse target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.25, suggesting upside of 15.2% (ex-dividends)

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.1

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

Macquarie rates HLS as Outperform (1) -

Healius has pre-released unaudited first half results which are below Macquarie's forecasts, primarily driven by weaker than expected business-as-usual (BAU) pathology revenue. Imaging and covid revenues were slightly ahead of expectations.

Despite the miss, Macquarie remains positive on the medium-longer term outlook, expecting recovery in BAU activity with margin support under the company's Sustainable Improvement Program.

The broker also continues to see valuation support on FY24 earnings forecasts. Outperform retained, target falls to $4.00 from $4.80.

Target price is $4.00 Current Price is $2.98 Difference: $1.02
If HLS meets the Macquarie target it will return approximately 34% (excluding dividends, fees and charges).

Current consensus price target is $3.25, suggesting upside of 15.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.1

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

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

Preliminary 1H results for Healius revealed misses against consensus forecasts for revenue and earnings (EBIT) of -3% and -30%, respectively.

Morgan Stanley notes covid testing continues to decline, while pressure on the Pathology base business is still evident from staff and GP shortages.

The Pathology earnings (EBITDA) margin fell to 21% from 29.2% in the 2H of FY22 and the analyst fails to see how the Sustainable Improvement Program can offset these margin pressures.

The rating is downgraded to Underweight from Equal-weight. The target falls to $2.65 from $3.00. Equal-weight. Industry view In-Line.

Target price is $2.65 Current Price is $2.98 Difference: minus $0.33 (current price is over target).
If HLS meets the Morgan Stanley target it will return approximately minus 11% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.25, suggesting upside of 15.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.1

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

Morgans rates HLS as Add (1) -

Morgans sees renewed hope for a recovery at Healius with industry volumes slowly reverting back to normal and costs easing, as part of the transition from covid testing to business-as-usual diagnostics.

The broker holds this view despite softer-than-expected 1H interim results which revealed revenue and operating income declines of -30% and -60%, respectively, and contracting margins.

The analyst attributes the weak performance to an -88% decline in covid testing and seasonal weakness for Pathology and Imaging.

The target falls to $3.30 from $3.77 on weaker FY23-25 forecasts. Add.

Target price is $3.30 Current Price is $2.98 Difference: $0.32
If HLS meets the Morgans target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $3.25, suggesting upside of 15.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.1

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

Ord Minnett rates IGO as Lighten (4) -

Ord Minnett found IGO's second quarter operational performance mixed, but strong cash flow from its TLEA Tianqi lithium joint venture supported a record 14 cent dividend. The company delivered revenue of $542m and earnings of $834m over the first half. 

While production was down -20% quarter-on-quarter on operational disruptions at Nova, it was largely in line with the broker's expectations. Ord Minnett found Greenbushes to be a stand out of the quarter, delivering large margins. 

The Lighten rating is retained and the target price increases to $13.90 from $10.10.

Target price is $13.90 Current Price is $14.45 Difference: minus $0.55 (current price is over target).
If IGO meets the Ord Minnett target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $16.33, suggesting upside of 10.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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

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

When InvoCare announces 1H results on February 22, Morgan Stanley expects moderating volume growth to 5.1% and 4.5% price growth in Australian funerals.

The broker eagerly awaits this result and considers it a potential catalyst should the extraordinarily strong trends for key metrics in the September quarter be confirmed.

The Equal-weight rating and $11.25 target are retained. Industry view is In-Line.

Target price is $11.25 Current Price is $11.09 Difference: $0.16
If IVC meets the Morgan Stanley target it will return approximately 1% (excluding dividends, fees and charges).

Current consensus price target is $11.76, suggesting upside of 5.6% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.2

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

Citi rates MQG as Neutral (3) -

Citi expects Macquarie Group will report third quarter net profit of around $2bn, after early commentary from the company suggested profit year-to-date is slightly up on the last fiscal year. This would be materially ahead of the broker's forecast, as commodities and global markets net present cost held up over the first half.

With this assumption in mind, Citi has lifted its full year cash earnings expectations 22% to $5.1bn, while commodities momentum continuing to surprise to the upside drives increases in FY24 and FY25. 

The Neutral rating is retained and the target price increases to $190.00 from $172.00.

Target price is $190.00 Current Price is $190.33 Difference: minus $0.33 (current price is over target).
If MQG meets the Citi target it will return approximately minus 0% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $199.13, suggesting upside of 2.0% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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

Credit Suisse rates MQG as Underperform (5) -

Macquarie Group's December-quarter trading update appears to have outpaced Credit Suisse's forecasts, as higher market volatility boosted revenues in the company's commodities and global markets business, particularly trading in gas and power.

Credit Suisse raises FY23 forecasts accordingly but does not capitalise them in later years given the transitory nature of the earnings.

But the broker does not find the result pleasing and retains an Underperform rating, believing Macquarie's earnings skew to more volatile sources reflects lower quality earnings.

Underperform rating retained. Target price rises to $165 from $150.

Target price is $165.00 Current Price is $190.33 Difference: minus $25.33 (current price is over target).
If MQG meets the Credit Suisse target it will return approximately minus 13% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $199.13, suggesting upside of 2.0% (ex-dividends)

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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

Morgan Stanley rates MQG as Overweight (1) -

In the wakew of Macquarie Group's quarterly report, Morgan Stanley has raised its FY23 earnings forecast by 12% on stronger commodity revenues (up 58% year on year), partly offset by higher impairments.

This implies Macquarie should grow FY23 earnings by almost 6% after 56% growth in FY22. But growing FY24 earnings becomes tougher as commodities revenues normalise, offset by better gains on sale plus growth in asset management and retail banking.

The broker nonetheless sees upside risk to FY24 earnings if commodities remain stronger for longer, Macquarie unlocks operating scale or Green Energy leads larger than expected gains on sale.

Target rises to $231 from $218, Overweight retained. Industry view: In-Line.

Target price is $231.00 Current Price is $190.33 Difference: $40.67
If MQG meets the Morgan Stanley target it will return approximately 21% (excluding dividends, fees and charges).

Current consensus price target is $199.13, suggesting upside of 2.0% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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

Morgans rates MQG as Add (1) -

Following a 3Q trading update, Morgans points out the combined profits of the annuity style businesses were substantially down on the previous corresponding period due to large green energy realisations in the prior year.

These businesses include Macquarie Asset Management, and Banking and Financial Services.

On the flipside, the combined performance of the market-facing businesses was substantially up on the prior year. These include Commodities and Global Markets (an exceptional outcome, according to the analyst due to volatility) and Macquarie Capital. 

The broker raises its target to $222.8 from $214.5 on higher EPS forecasts and maintains its Add rating.

Target price is $222.80 Current Price is $190.33 Difference: $32.47
If MQG meets the Morgans target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $199.13, suggesting upside of 2.0% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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

Ord Minnett rates MQG as Hold (3) -

Macquarie Group delivered a better than expected third quarter according to Ord Minnett, with profits year-to-date ahead of the record profit delivered in the first three quarters of FY22.

Commodities and global markets continue to outperform Ord Minnett's expectations, and the company is now guiding to income from this division to be up "substantially" in FY23.  

Ord Minnett anticipates second half profit to be in line with first half profit of $2.3bn (as guided by Macquarie management), driving an 18% increase to the broker's full year profit forecast to $4.6bn. 

The Hold rating and target price of $175.00 are retained. 

Target price is $175.00 Current Price is $190.33 Difference: minus $15.33 (current price is over target).
If MQG meets the Ord Minnett target it will return approximately minus 8% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $199.13, suggesting upside of 2.0% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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

UBS rates MQG as Buy (1) -

UBS provided this summary on Macquarie Group's release yesterday:

Macquarie Group's December-quarter update outpaced consensus by and UBS's forecasts thanks to a strong contribution from its Commodities and Global Markets (CMG) division, and the broker now expects a record first-half result and that consensus earnings upgrades may be on the cards.

EPS forecasts rise to reflect the beat in commodities income.

UBS believes the market doubts the CMG gains can be sustained but the broker begs to differ, expecting its operating division to prosper from its product and geographic diversification, and observes the bank has a healthy balance sheet to deploy to organic and inorganic growth opportunities.

The broker has also now added upgraded earnings forecasts. EPS forecasts rise 7% in FY23; 0.6% in FY23; and 2.4% in FY25. Target price rises to $211 from $190. Buy.

Target price is $211.00 Current Price is $190.33 Difference: $20.67
If MQG meets the UBS target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $199.13, suggesting upside of 2.0% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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

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

Morgan Stanley considers a court win against a former CEO is a significant positive for Nuix and raises its target price to $1.25 from $1.00.

The win reduces uncertainty and lowers legal costs, according to the analyst, as well as avoiding the payment of damages/issue of new shares.

The Equal weight rating is unchanged. Sector view is Attractive.

Target price is $1.25 Current Price is $1.30 Difference: minus $0.05 (current price is over target).
If NXL meets the Morgan Stanley target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.0

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

Ord Minnett rates PPH as Hold (3) -

Ord Minnett suggests Pushpay Holdings shareholders vote in favour of the acquisition proposed by Pegasus Bidco, noting a majority of investors have endorsed the deal.

The broker expects the acquisition will proceed, and sees it as an opportunity to accelerate capital returns without impacting on organic growth. 

Further, Ord Minnett does not see an alternative scenario where investors would realise value over the medium-term if the deal doesn't proceed.

The Hold rating is retained and the target price decreases to $1.20 from $1.25.

Target price is $1.20 Current Price is $1.19 Difference: $0.015
If PPH meets the Ord Minnett target it will return approximately 1% (excluding dividends, fees and charges).

The company's fiscal year ends in March.

Forecast for FY23:

Forecast for FY24:

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

Market Sentiment: 0.0

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

Citi rates REA as Neutral (3) -

Despite near-term conditions remaining challenging, Citi sees the risk-reward balance for both REA Group and Domain Holdings Australia ((DHG)) to be more compelling over a 12-month period, particularly given cost out reductions undertaken by both. 

The broker does anticipate a -14% year-on-year listing volumes decline over the second half, before returning to growth in the second quarter of FY24. For REA Group, the broker expects guidance of achieving positive jaws in its core domestic business to be a stretch. 

The rating is upgraded to Buy from Neutral and the target price increases to $144.00 from $126.00.

Target price is $144.00 Current Price is $123.69 Difference: $20.31
If REA meets the Citi target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $123.43, suggesting downside of -0.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.0

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

Citi rates RGN as Buy (1) -

While Citi feels Region Group delivered a solid first half result when looking at metrics the company can control, the broker also noted higher variable funding costs and cap rate increases are weighing on the company's earnings outlook. 

The broker finds Region Group relatively attractive at its current valuation, noting its defensive position in a challenging interest environment. It expects the company's portfolio of convenience retail centres, anchored by non-discretionary food stores, will prove more defensive in a downturn than large retail formats. 

The Buy rating is retained and the target price decreases to $3.00 from $3.10.

Target price is $3.00 Current Price is $2.67 Difference: $0.33
If RGN meets the Citi target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $2.77, suggesting upside of 7.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.0

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

Credit Suisse rates RGN as Neutral (3) -

Region Group's December-half funds from operations (FFO) missed consensus and Credit Suisse's forecasts, partly due to timing issues.

A rise in net property income was wiped out by a 34.7% rise in net interest expense as debt costs continued to rise (and are expected to continue to do so in the second half as central banks continue with their tightening programs). Portfolio occupancy was steady.

Retail sales posted respectable growth and the broker doubts moderating inflation will materially affect June-half revenue given only 9% of specialty leases are linked to the CPI.

Management retained guidance but upgraded its full-year Australian FFO guidance.

Neutral rating retained. Target price eases to $2.83 from $2.86.

Target price is $2.83 Current Price is $2.67 Difference: $0.16
If RGN meets the Credit Suisse target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $2.77, suggesting upside of 7.2% (ex-dividends)

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.0

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

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

Region Group's first half adjusted funds from operations were in line with Macquarie, with FY23 AFFO guidance upgraded some 1% driven on lower lease incentives.

Tenant performance was solid, with re-leasing spreads improving, however the broker expects the rising cost of debt will be major headwind into FY24.

Macquarie likes Region's solid defensive revenues and balance sheet, but the AFFO outlook is soft due to interest rate hedging concerns. On an elevated valuation, the broker downgrades to Underperform from Neutral. Target falls to $2.52 from $2.54.

Target price is $2.52 Current Price is $2.67 Difference: minus $0.15 (current price is over target).
If RGN 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 $2.77, suggesting upside of 7.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.0

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

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

Overall, Morgan Stanley assesses a strong 1H result for Region Group which highlights the current resilience of convenience retail.

The broker maintains its Equal-weight rating and $3.00 target after the REIT reported 1H funds from operations (FFO) of 8.35cpu. FY23 adjusted FFO guidance was upgraded to 15.2cpu from 15cpu.

Given rising interest rates and asset yields, the analysts suggest a cut in Region Group's development profile by -$50m may be a good move by management.

Target price is $3.00 Current Price is $2.67 Difference: $0.33
If RGN meets the Morgan Stanley target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $2.77, suggesting upside of 7.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.0

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

Ord Minnett rates RGN as Hold (3) -

Region Group's first half result was in line with Ord Minnett's expectations, with funds from operations declining -0.2% year-on-year to $94.1m. The broker highlights the impact of higher rates is becoming evident, with the average cost of debt rising to 3.2% from 2.5% in the previous fiscal year. 

Despite the REIT's name change in November, the broker points out its strategy and focus on a portfolio of convenience retail assets and opportunistic acquisitions remains the same. 

The Hold rating and target price of $2.55 are retained.

Target price is $2.55 Current Price is $2.67 Difference: minus $0.12 (current price is over target).
If RGN meets the Ord Minnett target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.77, suggesting upside of 7.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.0

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

UBS rates RGN as Neutral (3) -

Region Group's December-half funds from operations (FFO) missed consensus and UBS's forecasts and FFO guidance was retained.

Australian funds from operations guidance rose. 

Costs outpaced income and debt servicing costs continued to rise. Management noted that inflation was strong and likely to exceed comparable supermarkets sales growth given like-for-like sales growth turned negative in 2022.

FFOPS forecasts fall -2% to reflect the company's new hedging profile. FFOPS forecasts fall between -0.4% and -1.3% across FY24 to FY27, which the broker says is unappealing for an A-REIT.

Neutral rating retained. Target price eases -1% to $2.69 from $2.72.

Target price is $2.69 Current Price is $2.67 Difference: $0.02
If RGN meets the UBS target it will return approximately 1% (excluding dividends, fees and charges).

Current consensus price target is $2.77, suggesting upside of 7.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.0

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

Macquarie rates SGM as Underperform (5) -

Ahead of Sims' first half result, Macquarie has lifted its target to $12.75 from $9.60 on higher scrap prices, which is still way below the current trading price, hence Underperform retained.

The broker foresees earnings pressure from lower volumes, due to weaker economic activity, and lower trading margins, due to competition. Macquarie's FY24 profit forecast is currently -19% below consensus.

Target price is $12.75 Current Price is $15.41 Difference: minus $2.66 (current price is over target).
If SGM meets the Macquarie target it will return approximately minus 17% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $13.54, suggesting downside of -12.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: -0.3

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

Morgan Stanley rates SLC as Overweight (1) -

Morgan Stanley's FY23-25 earnings (EBITDA) forecasts for Superloop increase by 8%,13% and 12%, respectively, after incorporating the MyRepublic acquisition, which completed late last year.

The analyst appreciates the highly accretive nature of the transaction which should also accelerate market share gains for NBN customers.

The target rises to $1.10 from $1.05. The Overweight rating is maintained. Industry view: In-Line.

Target price is $1.10 Current Price is $0.72 Difference: $0.385
If SLC meets the Morgan Stanley target it will return approximately 54% (excluding dividends, fees and charges).

Current consensus price target is $1.18, suggesting upside of 66.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 1.0

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

Morgans rates SRX as Initiation of coverage with Add (1) -

Morgans initiates coverage on established natural rutile producer Sierra Rutile (based in Sierra Leone), which began trading on the ASX on July 22, 2022, following its demerger from Iluka Resources ((ILU)).

The broker likes the company's large resource base (it owns and operates a multi-mine mineral sands operation), with attractive fundamentals and begins with an Add rating and 45c target price.

A definitive feasability study for Sembehun, the company's development project, is due for completion by the 4Q of FY23.

Sierra Rutile supplies around 20-25% of global natural rutile to the titanium pigment and metals markets, and the analyst explains prices have rallied by circa 50% since covid (and are holding steady) due to strong demand.

Target price is $0.45 Current Price is $0.20 Difference: $0.25
If SRX meets the Morgans target it will return approximately 125% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 1.0

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

UBS rates SUN as Buy (1) -

After looking at today's 1H result for Suncorp Group for the first time, UBS highlights cash profit was a -7% miss versus the consensus expectation. The performances by both Australia and New Zealand in General Insurance (GI) were considered disappointing.

The underlying GI margin was in line with consensus and the analyst considers the Bank result looks strong, with the net interest margin (NIM) ahead of expectation and impairments close to zero.

A fully franked interim dividend of 33cps compared to the broker's forecast for 32cps.

FY23 guidance for key items was reaffirmed. The broker's Buy rating and $15 target are retained.

Target price is $15.00 Current Price is $12.47 Difference: $2.53
If SUN meets the UBS target it will return approximately 20% (excluding dividends, fees and charges).

Current consensus price target is $14.09, suggesting upside of 8.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 1.0

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

Citi rates TCL as Buy (1) -

Transurban Group has delivered a beat to its full year dividend guidance, which Citi attributes to not only improved traffic recovery but also a number of one offs.

The broker highlights longer-term estimates remain, but it does expect Transurban Group can deliver a 6% dividend compound annual growth rate through to FY26.

Citi notes $2.5bn in corporate liquidity should support the company's committed capital expenditure through to FY26, although further funding may be required in time to complete its growth pipeline. 

The Buy rating is retained and the target price increases to $16.00 from $15.70.

Target price is $16.00 Current Price is $13.95 Difference: $2.05
If TCL meets the Citi target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $14.06, suggesting upside of 0.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.1

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

Credit Suisse rates TCL as Downgrade to Underperform from Neutral (5) -

Transurban Group's December-half earnings missed consensus forecasts by -1.5% and nosed out Credit Suisse's forecasts by 1%. 

Management increased FY23 dividend guidance to 57c from 53c and said the company had a strong investment pipeline, expecting the M4-M8 Link and West Gate Tunnel Project to be cash-flow neutral in the early stages.

As a result, and after incorporating the 50% sale of A25, the broker cuts free cash flow and dividend forecasts

Transurban's CEO Scott Charlton has announced his intention to resign at the end of 2023 and the broker suspects it may be difficult to find a replacement that fits the company's brand.

Rating downgraded to Underperform from Neutral, the broker considering the shares to be fully valued. Target price rises to $12.30 from $12.

Target price is $12.30 Current Price is $13.95 Difference: minus $1.65 (current price is over target).
If TCL meets the Credit Suisse target it will return approximately minus 12% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $14.06, suggesting upside of 0.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.1

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

Macquarie rates TCL as Outperform (1) -

Transurban Group's first half result slightly beat Macquarie on better traffic and lower interest cost performance. This has led to an increase in FY23 dividend guidance to 57c from 53c.

The traffic outlook is encouraging, the broker suggests, with the WestConnex to ramp over the next 18 months with the Rozelle interchange. Cost discipline appears to be increasing with benefits coming from some of the initiatives in the last six months.

The development pipeline near term is attractive with M7 to financial close, Logan widening to be confirmed and 50% of Eastlink to bid on.

Outperform retained, target rises to $14.51 from $14.19.

Target price is $14.51 Current Price is $13.95 Difference: $0.56
If TCL meets the Macquarie target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $14.06, suggesting upside of 0.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.1

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

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

Transurban Group's 1H proportional revenue was broadly in line with Morgan Stanley's forecast, while proportional earnings (EBITDA) of $1,238m were slightly below the consensus estimate.

Management raised FY23 DPS guidance to 57c from 53c.

The analysts highlight other announcements including the end-of-2023 stepping down of CEO Scott Charlton and the -50% sale of equity in the A25 toll road and bridge.

The Equal-weight rating and $13.71 target is maintained. Industry view: Cautious.

Target price is $13.71 Current Price is $13.95 Difference: minus $0.24 (current price is over target).
If TCL meets the Morgan Stanley target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $14.06, suggesting upside of 0.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.1

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

Morgans rates TCL as Hold (3) -

Transurban Group's 1H result was broadly in line with market expectations, according to Morgans. Management upgraded FY23 DPS guidance by 4cps to 57c.

A 35% increase in portfolio average daily traffic, combined with a strong increase in tolls, helped drive a 43% increase in toll revenue, explains the analyst. It's noted inflation is benefiting the around 68% of revenues that have direct linkage to the spike in CPI

Other announcements included the CEO's intended departure by late 2023 and the sale of a -50% stake in the A25 toll road and bridge.

The Hold rating is unchanged and the target rises to $14.21 form $13.85.

Target price is $14.21 Current Price is $13.95 Difference: $0.26
If TCL meets the Morgans target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $14.06, suggesting upside of 0.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.1

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

Ord Minnett rates TCL as Lighten (4) -

Strong recovery in traffic volumes and elevated toll increases has seen Transurban Group's first half earnings lift 54% to $1.24bn, while free flow lifted 84% to $845m. 

Ord Minnett highlights momentum in traffic volumes and toll increases looks likely to continue, with many tolls linked to inflation and likely to benefit from a lagged flow through over the next year. 

The Lighten rating is retained and the target price increases to $12.50 from $12.00.

Target price is $12.50 Current Price is $13.95 Difference: minus $1.45 (current price is over target).
If TCL meets the Ord Minnett target it will return approximately minus 10% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $14.06, suggesting upside of 0.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.1

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

Credit Suisse rates WES as Neutral (3) -

Credit Suisse reduces its target price for Wesfarmers to $48.80 from $50.08 heading into the company's December-half result, despite expecting a solid overall result.

The broker has decided to lower outer-year Bunnings margin forecasts, expecting a reduction in the contribution from the higher-margin do-it-yourself business.

On the upside, the broker expects the company will benefit from improved ammonia pricing. Neutral rating retained.

Target price is $48.80 Current Price is $49.89 Difference: minus $1.09 (current price is over target).
If WES meets the Credit Suisse target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $48.40, suggesting downside of -2.6% (ex-dividends)

Forecast for FY23:

Forecast for FY24:

Market Sentiment: -0.2

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

Morgans rates WGN as Hold (3) -

Wagners Holding Co has issued a trading update downgrading 1H earnings (EBIT) guidance to $4.1m from $5.5m. FY23 guidance was also downgraded to a range of $14-16m from $20.9m.

Morgans attributes the downgrades to challenging market conditions in the SE Queensland concrete market and a slow ramp-up for the Composite Fibre Technologies (CFT) business.

The Hold rating is maintained, despite a favourable valuation, as the analyst awaits evidence of earnings growth. The target falls to 70c form 90c.

Target price is $0.70 Current Price is $0.67 Difference: $0.03
If WGN meets the Morgans target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $1.04, suggesting upside of 57.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.3

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