Australian Broker Call

Macquarie rates APT as Outperform (1) -

Afterpay has provided a trading update and details of measures taken in response to the virus. The company has enjoyed robust sales in the face of macro headwinds, the broker notes, and is managing risk exposures well at this stage.

The update highlights levers Afterpay can pull to get the business through this period, backed by a strong balance sheet.

The broker has trimmed earnings forecasts near term but not changed its long term growth thesis. Outperform retained, target falls to $36 from $42.

Target price is $36.00 Current Price is $27.95 Difference: $8.05
If APT meets the Macquarie target it will return approximately 29% (excluding dividends, fees and charges).

Current consensus price target is $26.04, suggesting downside of -6.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.5

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

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

Morgan Stanley notes growth slowed in the second half of March, given the lock-downs and the company's tightening of credit settings. However, April appears to have recovered.

Online sales in March were up 12 percentage points from the first half of FY20, revealing the company is capable of driving more sales through its online channel and merchants are accelerating the shift to online.

Morgan Stanley believes the update addresses a key investor concern about Afterpay's ability to manage its unsecured consumer exposures.

Equal-weight. Target is $19.00. Industry view is In-Line.

Target price is $19.00 Current Price is $27.95 Difference: minus $8.95 (current price is over target).
If APT meets the Morgan Stanley target it will return approximately minus 32% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $26.04, suggesting downside of -6.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.5

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

Morgans rates APT as Add (1) -

Morgans considers the third quarter sales performance reasonably solid, noting underlying sales were up 97%. While the downturn is only in the early stages there appear to be no material changes to the gross loan ratio.

Morgans assesses the company has the capital to handle most negative scenarios for the near term. Add rating maintained. Target is reduced to $33.11 from $39.92.

Target price is $33.11 Current Price is $27.95 Difference: $5.16
If APT meets the Morgans target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $26.04, suggesting downside of -6.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.5

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

Ord Minnett rates APT as Buy (1) -

The company has indicated it has not yet experienced a material deterioration in performance as the pandemic restrictions get underway. Risk settings have been tightened proactively.

Ord Minnett notes the Australasian segment is proving resilient, owing to a broader sector exposure as opposed to the US and UK which are more concentrated in fashion and cosmetics.

Customer numbers remain robust and, while guidance for targets has been withdrawn officially, the business remains on track to reach 9.5m customers. Ord Minnett retains a Buy rating and reduces the target to $34.00 from $37.40.

Target price is $34.00 Current Price is $27.95 Difference: $6.05
If APT meets the Ord Minnett target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $26.04, suggesting downside of -6.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.5

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

UBS rates APT as Downgrade to Sell from Neutral (5) -

The third quarter trading update was in line with UBS estimates. The broker considers the fall-out from the pandemic remains unclear and, while the balance sheet is strong and a capital raising unlikely, the business is fundamentally an unsecured consumer lending enterprise trading in the lead up to a severe recession.

Ultimately, UBS suspects the outcomes will be a function of how much growth the company is prepared to sacrifice to manage bad debts, and the severity of the pandemic. The broker's rating is downgraded to Sell from Neutral. Target is reduced to $13.00 from $13.20.

Target price is $13.00 Current Price is $27.95 Difference: minus $14.95 (current price is over target).
If APT meets the UBS target it will return approximately minus 53% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $26.04, suggesting downside of -6.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.5

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

Citi rates BLD as Buy (1) -

The transaction with Knauf is unlikely to obtain the required regulatory approval from the ACCC by the June 30 sunset date and the companies are working towards a revised transaction.

Boral is intent on achieving a cash neutral outcome, rather than the -US$335m capital outlay specified in the original deal.

Citi suggests the new deal may improve Boral's balance sheet but is likely to lead to a smaller stake in subsequent ventures. The business is well-placed from a balance-sheet perspective in the broker's view.

Target is $3.00. Buy/High Risk retained.

Target price is $3.00 Current Price is $2.74 Difference: $0.26
If BLD meets the Citi target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $3.50, suggesting upside of 27.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.6

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

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

Citi now expects global GDP to contract by -2.3% in 2020, with advanced economies contracting by more than -4.5%.

The broker expects the first half of FY21 to be the most affected, with domestic despatches of steel down -11%. Citi forecasts US steel demand to fall by -20% in 2020.

EBIT estimates for BlueScope are cut by -37% for FY20. Rating is downgraded to Neutral from Buy. Target is lowered to $12 from $13.

Target price is $12.00 Current Price is $10.22 Difference: $1.78
If BSL meets the Citi target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $11.68, suggesting upside of 14.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.4

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

Citi rates BUB as Buy (1) -

While Bubs Australia may have benefited from consumer stockpiling during the March quarter, Citi does not underestimate the emergence of the brand and management's execution.

The broker believes the business is well-placed for a strong fourth quarter as market share gains are consolidated. FY20-22 sales forecasts are upgraded to reflect the increased momentum.

Buy/High Risk retained. Target is raised to $1.10 from $0.90.

Target price is $1.10 Current Price is $0.92 Difference: $0.18
If BUB meets the Citi target it will return approximately 20% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 1.0

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

Credit Suisse rates CAJ as Outperform (1) -

Capitol Health has surprised Credit Suisse by raising equity, given just a few days ago the current earnings trajectory suggested this was not needed.

The broker suspects, given the company had indicated an evolving market for acquisitions, the proceeds are likely to be deployed into assets where competition for ownership has declined.

The company will raise up to $40m via a placement and share purchase plan.. Outperform rating maintained. Target reduced to $0.25 from $0.26.

Target price is $0.25 Current Price is $0.20 Difference: $0.05
If CAJ meets the Credit Suisse target it will return approximately 25% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.5

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

Morgans rates CAR as Add (1) -

Morgans lowers FY20 and FY21 forecasts to reflect the cost of dealer support programs. While costly, these fee holidays have avoided churn and helped grow market share against rivals.

The broker trims forecasts and valuation to reflect the cost of the package, incorporating around -$23m in dealer support. Add maintained. Target is reduced to $15.09 from $15.67.

Target price is $15.09 Current Price is $14.01 Difference: $1.08
If CAR meets the Morgans target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $16.58, suggesting upside of 18.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.3

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

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

Ord Minnett reviews its investment thesis for Coca-Cola Amatil in light of the pandemic and resultant social distancing amid reduced tourism and weaker consumer activity.

Estimates are reduced by -19% for FY20 and -14% for FY21. The potential for cost savings is unclear, giving previous cost-saving initiatives.

Despite the recent decline in the share price, the broker assesses valuation support has been removed and the rating is downgraded to Hold from Accumulate. Target is lowered to $9.00 from $12.50.

Target price is $9.00 Current Price is $9.36 Difference: minus $0.36 (current price is over target).
If CCL 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 $10.92, suggesting upside of 16.7% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.1

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

Morgans rates CGC as Hold (3) -

Morgans reviews the supply conditions in Morocco/Spain and the demand environment in the UK/Europe. Overall, the broker envisages downside risk to current expectations for a recovery in the Moroccan blueberry business in FY20.

Still, the company is assessed to be well positioned to endure soft short-term demand and will likely be in a stronger competitive position when the pandemic has passed. Hold rating and $3.05 target maintained.

Target price is $3.05 Current Price is $2.98 Difference: $0.07
If CGC meets the Morgans target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $3.16, suggesting upside of 5.9% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.2

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

Credit Suisse rates CIP as Neutral (3) -

The company has raised $130m through an institutional placement and will undertake a non-underwritten unit purchase plan to raise $10m.

Credit Suisse would be surprised if this was purely an exercise for the balance sheet, suspecting the company is intending to make acquisitions.

While the industrial sector will not be immune to an economic slowdown, Credit Suisse believes it will lag other sectors that are more impacted.

The broker does not rule out that some tenants may come under pressure and allows for this in estimates. Neutral maintained. Target is reduced to $2.66 from $3.38.

Target price is $2.66 Current Price is $2.66 Difference: $0
If CIP meets the Credit Suisse target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $2.91, suggesting upside of 9.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.3

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

Morgans rates CSL as Hold (3) -

CSL has provided a trading update which indicates there is strong demand across product lines and China's production is starting to return to normal. However, there remain challenges with plasma collections in the US.

Morgans reduces FY21-22 estimates for net profit by up to -2.2%. The broker considers the stock a core holding but also believes the issues will continue for some time. Hold maintained. Target is reduced to $299.70 from $303.10.

Target price is $299.70 Current Price is $323.39 Difference: minus $23.69 (current price is over target).
If CSL meets the Morgans target it will return approximately minus 7% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $314.81, suggesting downside of -2.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

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

Market Sentiment: 0.3

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

UBS rates FXL as Buy (1) -

UBS expects a material impact from the pandemic on FlexiGroup, particularly within cards and the Buy Now Pay Later business. This is 78% of the company's book.

Nevertheless, the broker assesses there is reasonable funding capacity on the balance sheet.

On a medium-term view, UBS is positive about the company's strategy and the business simplification. Buy rating maintained. Target is reduced to $1.60 from $2.20.

Target price is $1.60 Current Price is $0.92 Difference: $0.68
If FXL meets the UBS target it will return approximately 74% (excluding dividends, fees and charges).

Current consensus price target is $1.31, suggesting upside of 41.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.8

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

Macquarie rates GEM as Upgrade to Neutral from Underperform (3) -

G8 Education has raised $301m in 377 million new shares representing 82% of the prior issue. Government assistance is keeping the child care sector viable, Macquarie notes, with G8's revenues and cash costs expected to be breakeven, but includes a -20% rent reduction not yet locked in.

The raising has reduced balance sheet concerns and the broker has lifted its target to 78c from 50c, upgrading to Neutral from Underperform on expectation of short term share price strength. But Macquarie sees ongoing demand/supply challenges for the sector through to the end of 2021 and a structural drop in occupancy as a result of the virus.

Target price is $0.78 Current Price is $1.00 Difference: minus $0.22 (current price is over target).
If GEM meets the Macquarie target it will return approximately minus 22% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $1.21, suggesting upside of 21.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.2

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

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

UBS believes the government decision to support the childcare industry makes sense. The $301m equity raising has dramatically improved the balance sheet and should support the business through a period of weak conditions, the broker assesses.

This should also provide additional ability to fund acquisitions. On balance, UBS considers the risk/return is skewed to the upside and upgrades to Buy from Neutral. Target is reduced to $1.30 from $1.75.

Target price is $1.30 Current Price is $1.00 Difference: $0.3
If GEM meets the UBS target it will return approximately 30% (excluding dividends, fees and charges).

Current consensus price target is $1.21, suggesting upside of 21.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.2

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

Citi rates HLS as Buy (1) -

Healius has indicated that pathology revenue is down -30% and imaging revenue down -40%. Medical centres have been less affected, given the introduction of telehealth consultations.

Citi now assumes pathology revenue will decline -20% in the fourth quarter and imaging revenue by -25%. The company is closing smaller facilities and negotiating to defer rent while staff are being stood down until businesses are able to open.

Citi retains a Buy rating, assuming FY21 returns to normal. Target is reduced to $2.75 from $2.80.

Target price is $2.75 Current Price is $2.36 Difference: $0.39
If HLS meets the Citi target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $2.89, suggesting upside of 22.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.6

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

Credit Suisse rates HLS as Neutral (3) -

Healius has experienced a -30% or more decline in pathology revenue and a -40% or more decline in imaging revenue because of the pandemic and the deferral of elective health care.

While the revenue performance for medical centres was not disclosed, GP attendances remain strong because of telehealth consultations, which now make up around 40% of total attendance.

Despite the deterioration in the operating environment, Healius is maintaining its bank coverage ratio and has deferred payment of its first half dividend to October.

Credit Suisse expects earnings are likely to decline -20% in FY20. Neutral maintained. Target is $2.47.

Target price is $2.47 Current Price is $2.36 Difference: $0.11
If HLS meets the Credit Suisse target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $2.89, suggesting upside of 22.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.6

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

Morgans rates HLS as Add (1) -

The company has noted deferrals of non-essential testing and elective surgery are only being partially offset by increased coronavirus testing and the uptake of GP telehealth.

Morgans finds several positive aspects, as pathology is showing signs of stabilisation and patient visits to medical centres remain strong.

Taking a conservative approach, the broker assumes a -30% decline in revenue in the fourth quarter of FY20. Add rating maintained. Target is reduced to $3.04 from $3.45.

Target price is $3.04 Current Price is $2.36 Difference: $0.68
If HLS meets the Morgans target it will return approximately 29% (excluding dividends, fees and charges).

Current consensus price target is $2.89, suggesting upside of 22.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.6

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

UBS rates HLS as No Rating (-1) -

The company's trading update has indicated a sharp decline in pathology revenue as routine testing has only been partially offset by coronavirus testing.

There has also been a substantial impact to imaging revenue because of the deferral of elective surgery. The company advises there has been a rapid uptake in telehealth services, nonetheless.

UBS makes significant downgrades to FY20 and FY21 estimates. The main issue, in the broker's opinion, is the longer-term funding of Medicare services in Australia.

UBS is restricted on providing a rating and target at present.

Current Price is $2.36. Target price not assessed.

Current consensus price target is $2.89, suggesting upside of 22.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.6

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

Macquarie rates IEL as Outperform (1) -

The broker has reviewed its position on IDP Education post equity raising, envisaging a three-stage recovery beginning with localised lockdowns and travel restrictions extending lower volumes, followed by lockdowns easing but travel restrictions lagging in FY21, and finally normalisation in FY22 with IDP taking market share.

The raising puts the company in a good position ahead of a recovery, the broker opines. Target falls to $15.05 from $23.30, Outperform retained.

Target price is $15.05 Current Price is $14.17 Difference: $0.88
If IEL meets the Macquarie target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $15.71, suggesting upside of 10.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 1.0

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

Citi rates IVC as Buy (1) -

InvoCare will raise up to $250m through an institutional placement and share purchase plan. Funds will be used to pay down debt and shore up the balance sheet.

The company is prioritising capital preservation and deferring the payment of the final dividend as well as some expenditure. Regional acquisitions remain part of the company's growth plans.

Citi assumes social distancing lasts for three months and revenue in the second quarter declines by -15% with costs down -7.5%. The broker maintains a Buy rating and reduces the target to $12.75 from $13.50.

Target price is $12.75 Current Price is $11.54 Difference: $1.21
If IVC meets the Citi target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $12.59, suggesting upside of 9.1% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.3

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

Macquarie rates IVC as Outperform (1) -

InvoCare has revealed Australian case averages have only fallen -10% to date despite funeral restrictions, and -40% in New Zealand, although Australia is 84% of revenue. The company has nevertheless deferred its dividend and is seeking $200m in new capital to underpin liquidity, boost its balance sheet and support growth.

The broker suspects the NZ trend suggests downside risk in Australia in the short term, but the rebound should be swift and the raising leaves InvoCare well placed to execute on its growth strategy and fund further acquisitions. Target falls to $12.80 from $15.70, Outperform retained.

Target price is $12.80 Current Price is $11.54 Difference: $1.26
If IVC meets the Macquarie target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $12.59, suggesting upside of 9.1% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.3

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

Ord Minnett rates IVC as Hold (3) -

The company has announced an institutional placement of $150m, subsequently increased to $200m, while the trading update was broadly ahead of expectations.

Ord Minnett assesses it is too early to project the recent experience and some downside risk remains. However, the capital raising provides breathing room with respect to debt covenants.

Hold rating maintained. Target is reduced to $12.50 from $14.00.

Target price is $12.50 Current Price is $11.54 Difference: $0.96
If IVC meets the Ord Minnett target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $12.59, suggesting upside of 9.1% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.3

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

Morgan Stanley rates MFG as Underweight (5) -

Morgan Stanley still considers the valuation is too expensive, although a premium to Australian peers is justified. Retail outflows continued in March while inflows in active ETFs were not enough to offset this.

The broker downgrades FY21 and FY22 estimates by -13%, reflecting the more challenging outlook for retail flows.

Target is reduced to $40 from $50. Underweight maintained. Industry view is: In-Line.

Target price is $40.00 Current Price is $48.23 Difference: minus $8.23 (current price is over target).
If MFG meets the Morgan Stanley target it will return approximately minus 17% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $43.15, suggesting downside of -10.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.0

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

Credit Suisse rates NWS as Outperform (1) -

There has been no quantitative guidance on the impact of the pandemic from the company, but Credit Suisse reduces short-term earnings estimates across all segments.

The broker is mostly concerned about subscription video services, and does not expect higher digital subscriptions at news & information services, increased digital sales in books and cost reductions will offset the heavy reduction in advertising revenue and lower listings in digital real estate.

That said, Credit Suisse assesses current trading implies no value for the business outside of REA Group ((REA)) and cash holdings, which is excessively punitive. Outperform maintained. Target is reduced to $22.70 from $23.90.

Target price is $22.70 Current Price is $14.91 Difference: $7.79
If NWS meets the Credit Suisse target it will return approximately 52% (excluding dividends, fees and charges).

Current consensus price target is $24.02, suggesting upside of 61.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

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

Market Sentiment: 0.5

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

Ord Minnett rates OPC as Initiation of coverage with Buy (1) -

OptiComm is a fixed fibre network provider, specialising in wholesale fibre carrier services to new residential housing developments. This creates a high-quality and defensive cash flow, Ord Minnett assesses.

Social distancing measures have accelerated demand for high-speed data plans, which drives the company's recurring network revenue.

Ord Minnett factors in a -15% slowdown in greenfield construction rates in FY21, ahead of possible weakness in housing conditions. The broker initiates coverage with a Buy rating and $5.42 target.

Target price is $5.42 Current Price is $4.85 Difference: $0.57
If OPC meets the Ord Minnett target it will return approximately 12% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.5

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

Citi rates PDL as Neutral (3) -

Citi found the second quarter update relatively resilient. Pendal Group has no debt and the broker considers the business attractively diversified.

However, a material recovery in performance fees and organic flows appears some time away. Rating is moved to Neutral from Neutral/High Risk and the target lifted to $5.00 from $3.80.

Target price is $5.00 Current Price is $5.39 Difference: minus $0.39 (current price is over target).
If PDL meets the Citi target it will return approximately minus 7% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $6.22, suggesting upside of 15.3% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.6

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

Credit Suisse rates PDL as Neutral (3) -

Outflows in the March quarter proved worse than Credit Suisse expected, although a large proportion were lower-margin Westpac-related outflows and cash/fixed-income outflows.

The broker's review of JO Hambro indicates the overall performance is soft, which could leave the company exposed if there are reallocations away from equities.

Earnings are expected to decline in FY20 and FY21 and limited scope for performance fee recovery is envisaged in the near term.

Target is $4.90. Neutral.

Target price is $4.90 Current Price is $5.39 Difference: minus $0.49 (current price is over target).
If PDL meets the Credit Suisse target it will return approximately minus 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $6.22, suggesting upside of 15.3% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.6

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

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

Funds under management were down -15.2% in the March quarter. Net outflows were largely concentrated in the Westpac-managed funds under management.

Morgans considers market and share price volatility are likely to continue although, given a relatively undemanding valuation, the business is leveraged to any marked improvement.

Rating is upgraded to Add from Hold on valuation support. Target is raised to $6.37 from $5.81.

Target price is $6.37 Current Price is $5.39 Difference: $0.98
If PDL meets the Morgans target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $6.22, suggesting upside of 15.3% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.6

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

Macquarie rates PGL as Upgrade to Neutral from Underperform (3) -

Prospa Group has received access to the government's SME scheme to help small businesses through the lock down, while the government's Structured Finance Support Fund will materially assist non-ADI financial companies to manage customer assistance claims in a manner afforded ADIs (ie banks), Macquarie notes. 

The SME scheme, and potential SFSF access, alter the outlook for Prospa, the broker suggests. Upgrade to Neutral from Outperform. Target unchanged at 94c.

Target price is $0.94 Current Price is $1.05 Difference: minus $0.11 (current price is over target).
If PGL meets the Macquarie target it will return approximately minus 10% (excluding dividends, fees and charges - negative figures indicate an expected loss).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.0

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

Macquarie rates PMV as Neutral (3) -

On March 27, Premier Investments announced its stores will shut for four weeks and the majority of staff would stand down or work without pay. The broker believed at the time that Peter Alexander was the only online store to remain open. However, the company's other online stores reopened that weekend, and the government has subsequently offered wage subsidies.

Online sales represented 13% of total in the first half and the broker expects these will remain relatively healthy over the shutdown period, while remaining cautious over the highly discretionary nature of Premier's offering. The company nevertheless is seen as having the balance sheet, scale and brand power to put it in a good position post-virus. Neutral retained, target rises to $11.71 from $11.25.

Target price is $11.71 Current Price is $13.35 Difference: minus $1.64 (current price is over target).
If PMV meets the Macquarie target it will return approximately minus 12% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $13.80, suggesting upside of 3.3% (ex-dividends)

The company's fiscal year ends in July.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.4

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

UBS rates QAN as Buy (1) -

While assessing Qantas can cope with a lengthy period of travel restrictions, UBS is now looking at what the business will be after the pandemic has passed.

A slow recovery in earnings is assumed, while the deferral of discretionary expenditure and capital management should reduce gearing back to the target by the end of FY22.

UBS also believes the strong liquidity position and high exposure to domestic earnings places the airline in a strong position. Buy rating maintained. Target is reduced to $4.65 from $6.80.

Target price is $4.65 Current Price is $3.55 Difference: $1.1
If QAN meets the UBS target it will return approximately 31% (excluding dividends, fees and charges).

Current consensus price target is $4.19, suggesting upside of 18.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.4

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

Citi rates QBE as Buy (1) -

While the company's capital raising is considered large and the earnings downgrade significant, Citi assesses the balance sheet is now well able to withstand the risks.

Citi also believes the business is in a good position to benefit from any flight to quality. QBE experienced its highest first quarter rate increases in a decade in the March quarter, with underlying gross written premium up more than 9%.

Citi continues to believe premium rates can rise but expects some slowing in momentum. Buy retained. Target is raised to $10.55 from $10.40.

Target price is $10.55 Current Price is $8.84 Difference: $1.71
If QBE meets the Citi target it will return approximately 19% (excluding dividends, fees and charges).

Current consensus price target is $12.42, suggesting upside of 40.5% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

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

Market Sentiment: 0.8

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

Credit Suisse rates QBE as Outperform (1) -

The first quarter trading update provided few clues for Credit Suisse as to actual earnings, beyond the -US$830m loss on investment income in the quarter. This appears to be driven by a loss on the high-yield and emerging market debt portfolio.

QBE has instigated initiatives which include an exit of equities, high-yield and emerging market debt. All up, the broker suggests the capital position is now at the upper end of the target level amid reduced investment risk as well as lower weather and crop risk.

Outperform rating maintained. Target is reduced to $10.15 from $12.00.

Target price is $10.15 Current Price is $8.84 Difference: $1.31
If QBE meets the Credit Suisse target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $12.42, suggesting upside of 40.5% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

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

Market Sentiment: 0.8

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

Morgan Stanley rates QBE as Overweight (1) -

Morgan Stanley believes the capital raising has addressed investor concerns about the downside risk. The company is also taking out extra reinsurance on crop, hail and North American reserves.

The investment portfolio has been de-risked, with QBE exiting all equities, emerging market and high-yield debt. However, the broker notes this will reduce investment earnings going forward.

Overweight rating maintained. Target is $15.50. Industry view is In-Line.

Target price is $15.50 Current Price is $8.84 Difference: $6.66
If QBE meets the Morgan Stanley target it will return approximately 75% (excluding dividends, fees and charges).

Current consensus price target is $12.42, suggesting upside of 40.5% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

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

Market Sentiment: 0.8

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

UBS rates QBE as Buy (1) -

Weaker markets have driven larger-than-expected losses in the first quarter. To protect against further market volatility and higher claims scenarios in the short term QBE is seeking to raise US$825m in equity.

This will come at a -20% cost to FY21 estimates for earnings per share, UBS calculates. This reflects a lower asset return mix and the capital raising dilution.

Still, UBS considers QBE is well-positioned to grow and benefit from leverage to an improving global premium rate backdrop.

Buy rating retained. Target is lowered to $11.20 from $13.60.

Target price is $11.20 Current Price is $8.84 Difference: $2.36
If QBE meets the UBS target it will return approximately 27% (excluding dividends, fees and charges).

Current consensus price target is $12.42, suggesting upside of 40.5% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

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

Market Sentiment: 0.8

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

Macquarie rates RMD as Underperform (5) -

ResMed is enjoying increased ventilator sales as a result of the virus but the broker believes fewer new sleep apnoea patients and lower device revenues will more than offset.

To that end the broker believes that while virus impacts remain uncertain, earnings risk remains to the downside for ResMed and this is not being factored in by the market.

Underperform retained. Target rises to $18.60 from $17.00 to reflect a lower risk-free rate and A$.

Target price is $18.60 Current Price is $25.00 Difference: minus $6.4 (current price is over target).
If RMD meets the Macquarie target it will return approximately minus 26% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $23.58, suggesting downside of -5.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

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

Market Sentiment: 0.0

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

Macquarie rates SFR as Outperform (1) -

Sandfire Resources has received approval to proceed with the development of its 85% owned Black Butte project in Montana. An updated feasibility study is yet to be released. The broker had already assumed approval but the project only accounts for 6% of valuation.

Sandfire's net cash position at end-December was 25% of capitalisation. Outperform retained, target falls to $5.10 from $5.70 on a blended net present value/enterprise value model.

Target price is $5.10 Current Price is $4.39 Difference: $0.71
If SFR meets the Macquarie target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $5.39, suggesting upside of 22.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.6

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

Morgan Stanley rates SFR as Overweight (1) -

Sandfire Resources has received a positive decision for Black Butte, which allows mining. While technical studies have been completed for the feasibility study this could be delayed because of the pandemic.

Morgan Stanley believes the project requires a better valuation in order to proceed to construction. Overweight maintained. Target is $6.10. Industry view is In-Line.

Target price is $6.10 Current Price is $4.39 Difference: $1.71
If SFR meets the Morgan Stanley target it will return approximately 39% (excluding dividends, fees and charges).

Current consensus price target is $5.39, suggesting upside of 22.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.6

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

UBS rates SYD as Buy (1) -

UBS reduces forecasts to reflect a deeper and longer impact on airport traffic from restrictions related to the pandemic.

The broker downgrades operating earnings (EBITDA) estimates by around -70% in 2020 and -25% in 2021. This results in negative cash flow generation in 2020.

The broker also assumes no dividends will be declared for 2020. The broker reduces the target to $7.10 from $7.70. Buy retained.

Target price is $7.10 Current Price is $5.84 Difference: $1.26
If SYD meets the UBS target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $6.61, suggesting upside of 13.3% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.2

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

Ord Minnett rates TYR as Accumulate (2) -

Tyro Payments has recorded a -42% decline in transaction value as of the first 10 days of April. Ord Minnett believes this captures the full extent of the government's social distancing measures and the impact on the business.

The broker now expects softer trading over the remainder of the fourth quarter. The company is still expected to be benefiting from a recovery in consumer spending once the measures are unwound.

Accumulate maintained. Target is reduced to $2.80 from $4.45.

Target price is $2.80 Current Price is $2.79 Difference: $0.01
If TYR meets the Ord Minnett target it will return approximately 0% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.8

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

Ord Minnett rates VVA as Buy (1) -

Buy rating and $3 price target retained upon Viva Leisure's market update which included management's expectation it can probably negotiate -90% relief from rent with landlords.

This has strengthened Ord Minnett's confidence the company can reduce its cash burn to close to zero while its gyms are not operating. It also implies the company will likely be leaner when it re-emerges on the other end of the lock downs.

The analysts are flagging they are likely to increase forecasts post today's update. Further post-crisis opportunities seen are through picking up members from clubs no longer operating and through acquiring clubs at reasonable prices

Target price is $3.00 Current Price is $1.75 Difference: $1.25
If VVA meets the Ord Minnett target it will return approximately 71% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 1.0

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

Macquarie rates WBC as Neutral (3) -

Westpac has announced -$1.43bn of provisions and write-downs, mostly related to AUSTRAC proceedings. This puts the bank's tier one capital ratio at the bottom end of peers at 10.9%, the broker notes.

The broker sees the risk of capital raisings and large dividend cuts over the next three periods for the whole sector.

Westpac is nevertheless trading at around a -5% discount to peers versus an historical -1% and the broker recognises longer term value support. Neutral and $17 target retained.

Target price is $17.00 Current Price is $16.29 Difference: $0.71
If WBC meets the Macquarie target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $19.16, suggesting upside of 17.6% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.4

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

Morgan Stanley rates WBC as Underweight (5) -

First half results will include provisions and asset write-downs to the tune of -$1.43bn, post tax. These charges are -$130m higher than Morgan Stanley estimated.

Westpac has also noted the charges will reduce CET1 ratio by -30 basis points. The lower cash earnings in the first half will be taken into account when considering the dividend.

Underweight. Target is $17.20. Industry view: In Line.

Target price is $17.20 Current Price is $16.29 Difference: $0.91
If WBC meets the Morgan Stanley target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $19.16, suggesting upside of 17.6% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.4

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

Ord Minnett rates WBC as Accumulate (2) -

Westpac has flagged a number of charges relating to AUSTRAC provisions, customer remediation and other one-off items, totalling -$1.4bn. Much of this was anticipated and Ord Minnett had already forecast a -$1bn AUSTRAC penalty.

Still, the broker is disappointed with the ongoing "drip feed" of remediation costs. Valuation remains attractive to the broker and an Accumulate rating is retained with a target of $18.

Target price is $18.00 Current Price is $16.29 Difference: $1.71
If WBC meets the Ord Minnett target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $19.16, suggesting upside of 17.6% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.4

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

UBS rates WBC as Neutral (3) -

Westpac has updated on the large items that are affecting the first half results. The items are expected to reduce the CET1 ratio by -30 basis points taking it to 10.4% and just below APRA's unquestionably strong benchmark.

UBS believes this provides a strong case for the bank to suspend dividends in the current half-year. Neutral rating retained. Target is $18.50.

Target price is $18.50 Current Price is $16.29 Difference: $2.21
If WBC meets the UBS target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $19.16, suggesting upside of 17.6% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.4

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