Australian Broker Call

Credit Suisse rates AIA as Outperform (1) -

Auckland International Airport has advised it should need to spend roughly -NZ$6bn over 10 years and Credit Suisse adjusts its forecasts to match the company's guidance.

Outperform rating retained. Target price rises to A$8.85 from A$7.50.

Target price is $8.85 Current Price is $8.04 Difference: $0.81
If AIA meets the Credit Suisse target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $7.93, suggesting downside of -0.8% (ex-dividends)

Forecast for FY23:

Forecast for FY24:

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

Market Sentiment: -0.2

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

Morgans rates BCB as Add (1) -

Morgans downgrades its NEWC thermal coal price forecasts for FY23 and FY24 by -6% and -16%, respectively, and slightly upgrades its FY23 hot coking coal price estimate. 

According to the broker, all coal producers under its coverage offer upside potential from rising medium-to-long-term coal prices.

As flagged by Morgans in advance, February dividends disappointed as coal companies were retaining cash for potential M&A activity.

The broker points out a key upcoming catalyst for Bowen Coking Coal is the attainment of positive operating cash flow in the March quarter.

The Add rating and 42c target are unchanged.

Target price is $0.42 Current Price is $0.28 Difference: $0.145
If BCB meets the Morgans target it will return approximately 53% (excluding dividends, fees and charges).

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

Ord Minnett rates BRG as Buy (1) -

Consistent with Breville Group's experience, points out Ord Minnett, recent 4Q results from peer Delonghi showed weakening European sales due to the macroeconomic backdrop, lower consumer confidence and inflationary pressures.

Management at Delonghi expects further retail de-stocking in early 2023 though forecasts progressive improvement in economic conditions in 2023.

The broker notes Breville's strong longer-term growth profile and retains its Buy rating and $23.50 target. 

Target price is $23.50 Current Price is $19.30 Difference: $4.2
If BRG meets the Ord Minnett target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $22.42, suggesting upside of 16.8% (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 CAR as Overweight (1) -

Morgan Stanley further contemplates the decision by Carsales to increase its stake in Webmotors.

The broker likes Carsales' acquisition track record and notes the company well understood the Webmotors business before increasing its stake.

Moreover, market feedback suggests to the analyst the US/global car market is robust and de-synched from the broader economy during covid, with OEM supply still lagging.

Morgan Stanley retains its Overweight rating and raises its target to $27.00 from $26.50. Industry View: Attractive.

Target price is $27.00 Current Price is $22.08 Difference: $4.92
If CAR meets the Morgan Stanley target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $25.12, suggesting upside of 14.5% (ex-dividends)

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

Macquarie rates CHN as Outperform (1) -

Chalice Mining reported an earnings loss within 2% of Macquarie's forecasts. Free cash outflow and net cash at end-Dec were reported with the Dec quarter update and were in line with expectation.

An updated resource for Gonneville presents a key near-term catalyst for Chalice ahead of the scoping study release later this year, the broker notes.

Outperform and $8.00 target retained.

Target price is $8.00 Current Price is $6.07 Difference: $1.93
If CHN meets the Macquarie target it will return approximately 32% (excluding dividends, fees and charges).

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 CRN as Add (1) -

Morgans downgrades its NEWC thermal coal price forecasts for FY23 and FY24 by -6% and -16%, respectively, and slightly upgrades its FY23 hot coking coal price estimate. 

According to the broker, all coal producers under its coverage offer upside potential from rising medium-to-long-term coal prices.

As flagged by Morgans in advance, February dividends disappointed as coal companies were retaining cash for potential M&A activity.

The broker feels Coronado Global Resources' earnings outlook is improving due to a buoyant hot coking coal price.

The Add rating is unchanged and the target rises to $2.50 from $2.45.

Target price is $2.50 Current Price is $1.75 Difference: $0.755
If CRN meets the Morgans target it will return approximately 43% (excluding dividends, fees and charges).

Current consensus price target is $2.26, suggesting upside of 22.3% (ex-dividends)

The company's fiscal year ends in December.

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

Macquarie rates GL1 as Outperform (1) -

Global Lithium reported an underlying earnings loss -59% below Macquarie's estimate due to lower exploration expenses as most spend was capitalised. The cash flow result was released at the company’s Dec quarter update and proved in line with estimates.

Free cash outflow and net cash position as at the end of December met expectations.

The recent scoping study for Manna implied a robust project, the broker notes. Drilling updates for Manna and Marble Bar present key near-term catalysts. Outperform and $3.60 target retained.

Target price is $3.60 Current Price is $1.32 Difference: $2.285
If GL1 meets the Macquarie target it will return approximately 174% (excluding dividends, fees and charges).

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 KAR as Overweight (1) -

Morgan Stanley envisages upside risk for the Karoon Energy share price in the coming months when management updates its reserve statement, which will include Neon-2 appraisal results.

Should a large 2C upgrade be announced at Neon-2, the broker believes the reserve would justify a standalone floating production storage and offloading (FPSO) concept.

The Overweight rating and $2.70 target are unchanged. Industry view: Attractive.

Target price is $2.70 Current Price is $2.03 Difference: $0.67
If KAR meets the Morgan Stanley target it will return approximately 33% (excluding dividends, fees and charges).

Current consensus price target is $3.10, suggesting upside of 49.0% (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: 1.0

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

Citi rates LTR as Neutral (3) -

In a result that did not surprise Citi, Liontown Resources delivered a -$6.9m loss in the first half and closed out the period with cash of $384m. 

The company has recently lifted capital expenditure requirements to $895m, flagging a subsequent funding shortfall which it says will be secured before the end of the fiscal year. According to Citi, options for funding the gap include debt, equity and potential DSO sales. 

The Neutral rating and target price of $1.80 are retained. 

Target price is $1.80 Current Price is $1.42 Difference: $0.38
If LTR meets the Citi target it will return approximately 27% (excluding dividends, fees and charges).

Current consensus price target is $2.00, suggesting upside of 37.1% (ex-dividends)

The company's fiscal year ends in June.

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 LTR as Outperform (1) -

Liontown Resources reported an underlying earnings loss 24% greater than Macquarie had anticipated, primarily driven by higher labour and corporate overhead costs. Higher costs also translated to wider after-tax losses than the broker's forecast.

Liontown started open pit mining at the Kathleen Valley project in early February. Earnings from direct shipping ore sales are not included in the broker's base case and present upside potential to valuation.

Early cash flows from DSO sales also provide a source of funding for the Kathleen Valley project during its capex-heavy phase.

Outperform and $2.60 target retained.

Target price is $2.60 Current Price is $1.42 Difference: $1.18
If LTR meets the Macquarie target it will return approximately 83% (excluding dividends, fees and charges).

Current consensus price target is $2.00, suggesting upside of 37.1% (ex-dividends)

The company's fiscal year ends in June.

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

Morgan Stanley rates NEC as Overweight (1) -

According to Morgan Stanley, Nine Entertainment is winning insufficient market share to ward off current weakness in the TV ad market.

The company reported free-to-air revenue growth of 3% in the 1H, when the Metro TV market experienced a -6% fall in revenue.

When ad markets recover, Nine Entertainment's higher market share should deliver a significant rebound in earnings, but, for the moment, the broker reduces its target to $2.75 from $3.20. Overweight. industry View: Attractive.

Target price is $2.75 Current Price is $1.89 Difference: $0.86
If NEC meets the Morgan Stanley target it will return approximately 46% (excluding dividends, fees and charges).

Current consensus price target is $2.54, suggesting upside of 35.0% (ex-dividends)

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

Morgans rates NHC as Add (1) -

Morgans downgrades its NEWC thermal coal price forecasts for FY23 and FY24 by -6% and -16%, respectively, and slightly upgrades its FY23 hot coking coal price estimate. 

According to the broker, all coal producers under its coverage offer upside potential from rising medium-to-long-term coal prices.

As flagged by Morgans in advance, February dividends disappointed as coal companies were retaining cash for potential M&A activity.

New Hope reports 1H results on March 21, and the broker suggests the interim dividend may underwhelm the market. However, short-term share price volatility may provide a cheaper entry point.

The Add rating is unchanged and the target drops to $6.65 from $7.15.

Target price is $6.65 Current Price is $5.24 Difference: $1.41
If NHC meets the Morgans target it will return approximately 27% (excluding dividends, fees and charges).

Current consensus price target is $5.97, suggesting upside of 12.9% (ex-dividends)

The company's fiscal year ends in July.

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

Ord Minnett rates NHC as Upgrade to Accumulate from Hold (2) -

Following New Hope's recent share price fall, Ord Minnett upgrades its rating to Accumulate from Hold on valuation. 

No changes are made to forecasts and the broker's $6.50 target is maintained.

Target price is $6.50 Current Price is $5.24 Difference: $1.26
If NHC meets the Ord Minnett target it will return approximately 24% (excluding dividends, fees and charges).

Current consensus price target is $5.97, suggesting upside of 12.9% (ex-dividends)

The company's fiscal year ends in July.

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

Ord Minnett rates NWS as Upgrade to Accumulate from Hold (2) -

Following News Corp's recent share price fall, Ord Minnett upgrades its rating to Accumulate from Hold on valuation. 

No changes are made to forecasts and the broker's $29 target is maintained.

Target price is $29.00 Current Price is $23.56 Difference: $5.44
If NWS meets the Ord Minnett target it will return approximately 23% (excluding dividends, fees and charges).

Current consensus price target is $33.18, suggesting upside of 37.3% (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: 0.6

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

Morgan Stanley rates PFP as Overweight (1) -

Following the results season, Morgan Stanley has increased confidence on share price outperformance by Propel Funeral Partners.

The broker prefers Propel over the market leader in A&NZ, InvoCare ((IVC)), for its ability to execute low risk M&A at scale, sufficient to drive material EPS upgrades.

Morgan Stanley retains its Overweight rating and $5.55 target. Industry View: In-Line.

Target price is $5.55 Current Price is $4.21 Difference: $1.34
If PFP meets the Morgan Stanley target it will return approximately 32% (excluding dividends, fees and charges).

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

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

Following Perpetual's recent share price fall, Ord Minnett upgrades its rating to Buy from Accumulate on valuation. 

No changes are made to forecasts and the broker's $33 target is maintained.

Target price is $33.00 Current Price is $21.40 Difference: $11.6
If PPT meets the Ord Minnett target it will return approximately 54% (excluding dividends, fees and charges).

Current consensus price target is $30.40, suggesting upside of 41.9% (ex-dividends)

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 QBE as Upgrade to Hold from Lighten (3) -

Ord Minnett upgrades its rating for QBE Insurance to Hold from Lighten on valuation after a recent share price fall.

The broker's $13.00 target is unchanged.

Target price is $13.00 Current Price is $14.08 Difference: minus $1.08 (current price is over target).
If QBE 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 $16.49, suggesting upside of 14.5% (ex-dividends)

The company's fiscal year ends in December.

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: 0.9

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

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

Ord Minnett initiates coverage of Sandfire Resources with a Buy rating and $6.90 target price. It's felt the share price will benefit from investors seeking leveraged exposure to what is becoming the ASX's largest 'pure play' copper producer.

Relative to other smaller copper companies on the ASX, Sandfire is "safer" given its size, liquidity and longer-term growth profile, according to the analyst.

Investors with a longer-term investment horizon will need to ride-out near-term volatilty/risks associated with the ramp-up at Motheo in Botswana and volatile copper prices, suggests the broker.

Ord Minnett also expects a "premium transfer" from OZ Minerals ((OZL)) following completion of the BHP Group ((BHP)) deal.

Target price is $6.90 Current Price is $5.56 Difference: $1.34
If SFR meets the Ord Minnett target it will return approximately 24% (excluding dividends, fees and charges).

Current consensus price target is $6.34, suggesting upside of 13.7% (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: 0.4

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

Ord Minnett rates SKT as Upgrade to Accumulate from Hold (2) -

Following SKY Network Television's recent share price fall, Ord Minnett upgrades its rating to Accumulate from Hold on valuation. 

No changes are made to forecasts and the broker's $2.75 target is maintained.

Target price is $2.75 Current Price is $2.25 Difference: $0.5
If SKT meets the Ord Minnett target it will return approximately 22% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

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

Market Sentiment: 0.8

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

Morgans rates SMR as Add (1) -

Morgans downgrades its NEWC thermal coal price forecasts for FY23 and FY24 by -6% and -16%, respectively, and slightly upgrades its FY23 hot coking coal price estimate. 

According to the broker, all coal producers under its coverage offer upside potential from rising medium-to-long-term coal prices.

As flagged by Morgans in advance, February dividends disappointed as coal companies were retaining cash for potential M&A activity.

Stanmore Resources appears excessively cheap to the analysts for its growth and return potential.

The Add rating is unchanged and the target rises to $5.15 from $4.80.

Target price is $5.15 Current Price is $3.35 Difference: $1.8
If SMR meets the Morgans target it will return approximately 54% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

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

Ord Minnett rates SUL as Upgrade to Lighten from Sell (4) -

Following Super Retail's recent share price fall, Ord Minnett upgrades its rating to Lighten from Sell on valuation. 

No changes are made to forecasts and the broker's $9.50 target is maintained.

Target price is $9.50 Current Price is $12.50 Difference: minus $3 (current price is over target).
If SUL meets the Ord Minnett target it will return approximately minus 24% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $13.34, suggesting upside of 7.1% (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 TWE as Neutral (3) -

While retail wine sales declined industry wide in North America, Treasury Wine Estates appears to have underperformed the sector led by an -8% sales decline from its 19Crimes brand. 

Citi highlights higher pricing across the 19Crimes brand was not enough to offset a -12% volume decline in the period. 

Matua and Penfolds both reported sales increases, and Citi expects Treasury Wine Estates will remain focused on growing the availability and distribution of the Penfolds brand in North America. 

The Neutral rating and target price of $14.25 are retained.

Target price is $14.25 Current Price is $12.63 Difference: $1.62
If TWE meets the Citi target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $14.27, suggesting upside of 11.0% (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 WHC as Add (1) -

Morgans downgrades its NEWC thermal coal price forecasts for FY23 and FY24 by -6% and -16%, respectively, and slightly upgrades its FY23 hot coking coal price estimate. 

According to the broker, all coal producers under its coverage offer upside potential from rising medium-to-long-term coal prices.

As flagged by Morgans in advance, February dividends disappointed as coal companies were retaining cash for potential M&A activity.

Whitehaven Coal appears excessively cheap to the analysts for its growth and return potential.

The Add rating is unchanged and the target drops to $10.35 from $10.80.

Target price is $10.35 Current Price is $6.75 Difference: $3.6
If WHC meets the Morgans target it will return approximately 53% (excluding dividends, fees and charges).

Current consensus price target is $10.25, suggesting upside of 46.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.9

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