Australian Broker Call

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

A rotor fault has seen one of four units at AGL Energy's Loy Yang A project offline since April 15, with the company provided a preliminary return to service date of August 1. Morgan Stanley notes the company is considering repair and return to service options.

An update on the situation is expected in early May. The company addressed supply chain constraints and portfolio impacts, noting the remaining Loy Yang A units, as well as the Somerton and Southern Hydro projects, should be able to cover the production dip.

The Equal-Weight rating and target price of $8.48 are retained. Industry view: Cautious.

Target price is $8.48 Current Price is $8.52 Difference: minus $0.04 (current price is over target).
If AGL meets the Morgan Stanley target it will return approximately minus 0% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $8.37, suggesting downside of -3.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.5

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

Ord Minnett rates AGL as Downgrade to Accumulate from Buy (2) -

Ord Minnett estimates a -$43m reduction in FY22 net profit, following AGL Energy's announcement that Unit 2 at Loy Yang A Power Station has suffered an electrical fault and is now out of service. It's thought higher wholesale prices in Victoria could be an offset.

While the sharemarket has overreacted, in the broker's opinion, the company's rating is still lowered to Accumulate from Buy, while the target price slips to $9.30 from $9.40.

A management update on the financial impact is expected by the first week of May. Meanwhile, the broker notes the outage may last until 1 August.

Target price is $9.30 Current Price is $8.52 Difference: $0.78
If AGL meets the Ord Minnett target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $8.37, suggesting downside of -3.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.5

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

Morgans rates ALX as Hold (3) -

Morgans now expects a strong lift in dividends paid by Atlas Arteria, starting in the 2H, after good 1Q traffic numbers for  the APRR motorway network in France.

Nonetheless, the broker is surprised by the recent share price strength given rising interest rates and an adverse exchange rate move.

The Hold rating and $6.41 price target are maintained.

Target price is $6.41 Current Price is $6.78 Difference: minus $0.37 (current price is over target).
If ALX meets the Morgans target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $6.78, suggesting downside of -0.5% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.5

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

Ord Minnett rates BGA as Hold (3) -

Ord Minnett believes input pricing pressure, particularly farm gate milk prices, will remain a key headwind to Bega Cheese's near-term earnings. By contrast, management expects most of the costs to be contained within FY22.

This difference in view follows the company's downgrade to FY22 guidance for earnings (EBITDA) to $175-190m from $195-215m.

The analyst suggests declining milk production in Australia and increased competition for supply will result in the upward
pressure on farm gate milk prices. The target falls to $4.80 from $5.10, while the Hold rating is maintained.

Target price is $4.80 Current Price is $5.19 Difference: minus $0.39 (current price is over target).
If BGA 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 $5.18, suggesting upside of 0.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.0

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

Citi rates BXB as Buy (1) -

Brambles has upgraded plastic ROCI, revenue, profit and cash-flow guidance after a pleasing March quarter.

Citi notes volumes have stabilised in the Americas and the EMEA in the face of strong price rises, and believes lumber prices may be easing more rapidly than forecast.

Citi notes that currency consensus is mixed but overall expects Brambles will enjoy minor upgrades.

Buy rating and $12.12 target price retained.

Target price is $12.12 Current Price is $10.02 Difference: $2.1
If BXB meets the Citi target it will return approximately 21% (excluding dividends, fees and charges).

Current consensus price target is $11.50, suggesting upside of 6.2% (ex-dividends)

The company's fiscal year ends in June.

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: 0.4

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

Citi rates CGF as Neutral (3) -

Challenger has upgraded guidance to the upper end of its original range, and Citi says the market is ahead of the upgrade.

On the downside, Citi notes that maturities are surprisingly elevated for a March quarter, leading to a slower quarter growth rate.

The company also reported net outflows of -$1.7bn in the quarter.

Neutral rating and $7 target price retained.

Target price is $7.00 Current Price is $6.83 Difference: $0.17
If CGF meets the Citi target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $6.81, suggesting downside of -9.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.1

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

Macquarie rates COE as Underperform (5) -

Cooper Energy delivered third quarter production 11% ahead of Macquarie's estimates, driven by stronger Orbost processing rate, but revenue of $49.2m was a -4% miss.

The company has deferred the commissioning of Orbost's solids filtration system until after winter, implying exposure to spot pricing in coming months is expected to deliver more benefit than the uplift in processing capacity that the filtration system would provide.

Macquarie notes a more stable performance from Orbost will allow Cooper Energy to focus on gas growth, but expects recapitalisation will be required in the near-term.

The Underperform rating and target price of $0.24 are retained.

Target price is $0.24 Current Price is $0.31 Difference: minus $0.07 (current price is over target).
If COE meets the Macquarie target it will return approximately minus 23% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $0.28, suggesting downside of -8.4% (ex-dividends)

The company's fiscal year ends in June.

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

Morgans rates COE as Add (1) -

Morgans maintains its Add rating and $0.35 price target for Cooper Energy following 3Q results which slightly exceeded expectations.

The broker highlights another strong quarter from the Sole gas project and a smooth ramp-up at the Athena gas plant. There's thought to be further upside to production output following Phase 2B works at Orbost.

Target price is $0.35 Current Price is $0.31 Difference: $0.04
If COE meets the Morgans target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $0.28, suggesting downside of -8.4% (ex-dividends)

The company's fiscal year ends in June.

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

Ord Minnett rates COE as Hold (3) -

Ord Minnett assesses a positive 3Q production report by Cooper Energy, with higher realised gas prices trumping lower sales volumes. The Hold rating and $0.33 target price are maintained.

Management reiterated the earnings and production guidance for FY22, which are tracking towards the top-end of the respective ranges.

Target price is $0.33 Current Price is $0.31 Difference: $0.02
If COE meets the Ord Minnett target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $0.28, suggesting downside of -8.4% (ex-dividends)

The company's fiscal year ends in June.

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

Macquarie rates CVN as Neutral (3) -

Carnarvon Energy's Apus project remains dry, with a 2,900m deep drilling program failing to encounter any commercial oil volumes. The 6 cents per share value Macquarie had attributed to the company's Apus stake is now removed from the company's valuation.

The broker expects focus to return to Dorado ahead of a final investment decision on the project mid-year. Macquarie expects Carnarvon Energy could retain up to 10-12.5% of the project, selling down 7.5-10%. With a potential 30% sell down from Santos ((STO)), a new partner could take a 37.5-40% stake.

The Neutral rating and target price of $0.26 are retained.

Target price is $0.26 Current Price is $0.27 Difference: minus $0.01 (current price is over target).
If CVN meets the Macquarie 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 FY22:

Forecast for FY23:

Market Sentiment: 0.5

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

Macquarie rates DCN as Underperform (5) -

A preliminary third quarter update from Dacian Gold has production at 23,600 ounces, a notable -18% miss of Macquarie's forecast. While company commentary suggested third quarter production was in line with forecast, the full year guidance is downgraded to 94-97,000 ounces from a previous 100-110,000 ounces.

All in sustaining costs guidance also increased to $1,850-1,950 per ounce from $1,750-1,850. Macquarie notes impacts of covid on labour drove the downgraded outlook, and accounting for the updated guidance drives the broker's anticipated losses up 9%.

The Underperform rating is retained and the target price decreases to $0.24 from $0.25.

Target price is $0.24 Current Price is $0.28 Difference: minus $0.04 (current price is over target).
If DCN meets the Macquarie target it will return approximately minus 14% (excluding dividends, fees and charges - negative figures indicate an expected loss).

The company's fiscal year ends in June.

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

Ord Minnett rates DXS as Buy (1) -

Dexus confirmed it has been in discussions with AMP ((AMP)) regarding its real estate platform named Collimate Capital, though notes no purchase deal has been reached.

The broker estimates a $300m debt-funded acquisition would be around 6% accretive to funds from operations (FFO) on a stabilised basis. The Buy rating and $12.50 target are unchanged.

Target price is $12.50 Current Price is $10.71 Difference: $1.79
If DXS meets the Ord Minnett target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $12.02, suggesting upside of 9.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.8

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

Morgans rates MDC as Speculative Buy (1) -

Morgans is becoming increasingly positive on the licensing potential across Medlab Clinical’s asset base. This follows the signing of a UK licensing deal to manufacture, package, and sell its depression product NRGBiotic.

While it is difficult to judge the materiality of the new licensing deal, the analyst highlights there are over 70 partnering engagements and several deals in final stages of negotiation. The Speculative Buy rating and $0.30 target price are maintained.

Target price is $0.30 Current Price is $0.11 Difference: $0.19
If MDC meets the Morgans target it will return approximately 173% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

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

Macquarie rates MGR as Outperform (1) -

With Mirvac Group's Development Day scheduled for the end of April, Macquarie notes given the headwinds impacting the company's key office and retail exposures, which make up a combined 84% of the investment portfolio, developments will be key to growth.

The broker predicts an assumed $3.2bn in developments can contribute 2.5% annual growth, and coupled with 2.6% annual underlying rent growth should support 5.0% per annum net profit interest growth, which should be attractive in the medium-term.

Further, Macquarie notes future development commitments may require Mirvac Group to recycle capital from lower quality assets.

The Outperform rating is retained and the target price decreases to $2.89 from $2.92.

Target price is $2.89 Current Price is $2.40 Difference: $0.49
If MGR meets the Macquarie target it will return approximately 20% (excluding dividends, fees and charges).

Current consensus price target is $3.05, suggesting upside of 24.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.8

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

Citi rates MP1 as Buy (1) -

Megaport's March-quarter trading update fell shy of Citi's forecasts and the broker spies potential for consensus revenue downgrades of -3% in FY22 as the transition to a go-to-market strategy hits direct sales.

Net new services rose 6% (ahead of Citi's forecasts), services per port rose and new product take-up was strong.

On the downside, the direct channel performance weakened and port additions disappointed, as did growth in some territories, and cash burn rose due to inventory investment.

Buy rating and $19.30 target price retained.

Target price is $19.30 Current Price is $12.76 Difference: $6.54
If MP1 meets the Citi target it will return approximately 51% (excluding dividends, fees and charges).

Current consensus price target is $18.11, suggesting upside of 78.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.6

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

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

Ramsay Health Care has received a conditional non-binding indicative bid from a KKR-led consortium at $88 a share.

Citi says the bid exposes hidden asset value and appears to carry an option to pay out franking credits on top of the bid price.

Regardless of whether KKR proceeds after due diligence, Citi says the bid highlights the company's value and that private equity's flexibility should allow it to realise the value gap between Ramsay's underperforming share price and the ASX200 (-30% over five years).

The broker further notes the strategic hospital market position in Australia cannot be replicated, the business being built over a 50-year timeframe.

Rating is downgraded to Neutral from Buy. Target price rises to $88 from $74.00.

Target price is $88.00 Current Price is $80.00 Difference: $8
If RHC meets the Citi target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $77.00, suggesting downside of -7.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.1

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

Macquarie rates RHC as Upgrade to Outperform from Neutral (1) -

A consortium led by investment group KKR has made a bid for Ramsay Health Care at $88 per share. Macquarie notes the bid price is less dividends, and with an expected special dividend of $7.91 and an interim dividend of $0.49 shareholders could expect to receive $79.61 per share.

Macquarie has previously noted upside value in Ramsay Health Care's onshore business, and the broker believes the bid highlights the domestic operations and property portfolio value, assuming an implied 12.6x earnings multiple for the Australian business.

The broker anticipates further upside to the company's share price, and notes deal completion is the key risk to its outlook.

The rating is upgraded to Outperform from Neutral and the target price increases to $88.00 from $69.40.

Target price is $88.00 Current Price is $80.00 Difference: $8
If RHC meets the Macquarie target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $77.00, suggesting downside of -7.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.1

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

Morgan Stanley rates RHC as Underweight (5) -

KKR has made a takeover bid for Ramsay Health Care at $88 per share. Morgan Stanley notes a stagnant share price for the last five years, driven by staffing costs, lower indexation and emerging alternative care models, could pose a financial constraint for an acquirer.

The broker also highlighted that synergies could be evident with Ramsey Sante and KKR-owned French operator Elsan, but doubts potential synergies are enough to support the bid price.

The Underweight rating and target price of $62.00 are retained. Industry view: In-Line.

Target price is $62.00 Current Price is $80.00 Difference: minus $18 (current price is over target).
If RHC meets the Morgan Stanley target it will return approximately minus 23% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $77.00, suggesting downside of -7.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.1

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

Morgans rates RHC as Hold (3) -

Morgans feels the bid by the KKR-led consortium for Ramsay Health Care is opportunistic and unlikely to succeed. There is considered to be regulatory risk given Ramsay Health Care's strong global presence and an existing KKR asset in the space.

The indicative $88/share all cash offer is via a scheme of arrangement, and also allows shareholders to opt for script in the holding entity, as well as any fully franked special dividend, to deplete franking balances.

The broker raises its target to $80 from $67.69, which is at a -10% discount to the offer price to reflect risks. The Hold rating is maintained.

Target price is $80.00 Current Price is $80.00 Difference: $0
If RHC meets the Morgans target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $77.00, suggesting downside of -7.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.1

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

Citi rates RIO as Upgrade to Buy from Neutral (1) -

Rio Tinto's March-quarter production and trading update missed Citi and consensus forecasts but management reiterated guidance on both fronts.

While Citi eases iron-ore production forecasts to the lower end of guidance, it sharply upgrades iron-ore price forecasts, which translates to a 2022/2023 earnings upgrade.

Citi upgrades to Buy from Neutral. Target price rises to $135 from $120.

Target price is $135.00 Current Price is $118.30 Difference: $16.7
If RIO meets the Citi target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $125.21, suggesting upside of 7.2% (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: 0.6

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

Credit Suisse rates RIO as Outperform (1) -

Rio Tinto's March quarter results missed Credit Suisse forecasts by a decent clip on all metrics and while the company reiterated guidance, the broker is not so sure.

Labour shortages, geopolitical tensions, covid and supply-chain constraints remain the key challenges.

While most metrics fell between -5% to -20% shy, the broker notes that positive pricing tailwinds remain, and downside risk may be offset by tighter markets. Add to that the company's balance sheet, healthy dividend yield, and its growing long-term exposure to aluminium and future-facing commodities; and the broker remains upbeat.

Target price rises to $138 from $130 to reflect price and foreign-exchange movements in the March quarter. Outperform rating retained.

Target price is $138.00 Current Price is $118.30 Difference: $19.7
If RIO meets the Credit Suisse target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $125.21, suggesting upside of 7.2% (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: 0.6

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

Macquarie rates RIO as Outperform (1) -

Macquarie has described Rio Tinto's first quarter performance as solid, highlighting iron ore volumes offset some weakness in copper and aluminium production.

During the quarter the company produced 71.7m tonnes of iron ore, and shipped 71.5m tonnes, in line with Macquarie's estimates, but Macquarie notes with shipments subject to weather the company may miss the bottom end of its reaffirmed full year guidance.

The broker also noted continuing buoyancy in iron ore pricing should support upgrades for Rio Tinto in 2023, with spot pricing offering a 73% boost to earnings.

The Outperform rating and target price of $140.00 are retained.

Target price is $140.00 Current Price is $118.30 Difference: $21.7
If RIO meets the Macquarie target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $125.21, suggesting upside of 7.2% (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: 0.6

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

Morgan Stanley rates RIO as Overweight (1) -

Rio Tinto has delivered a softer first quarter result than expected by Morgan Stanley, with iron ore production missing the broker's forecast by -2%, while aluminium was in-line and mined copper a 7% beat.

The company attributed the iron ore miss to covid impacts on its work force, despite the opening of WA borders improving labour availability.

With Rio Tinto retaining guidance, Morgan Stanley looks to project ramp up to improve production performance, noting first ore is still expected from Gudai Darri in the second quarter, while wet plan commissioning challenges impact Robe Valley ramp up.

The Overweight rating and target price of $129.50 are retained. Industry view: Attractive.

Target price is $129.50 Current Price is $118.30 Difference: $11.2
If RIO meets the Morgan Stanley target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $125.21, suggesting upside of 7.2% (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: 0.6

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

Morgans rates RIO as Hold (3) -

Following 1Q results for Rio Tinto showing volumes below consensus estimates for iron ore, copper and aluminium, Morgans lowers its target price to $114 from $122. Thankfully, strong metals prices are assessed to be trumping operational and productivity challenges.

Management maintained FY22 guidance. The broker sees the shares as trading near fair value and maintains its Hold rating.

Target price is $114.00 Current Price is $118.30 Difference: minus $4.3 (current price is over target).
If RIO meets the Morgans target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $125.21, suggesting upside of 7.2% (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: 0.6

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

Ord Minnett rates RIO as Hold (3) -

Ord Minnett assesses an operationally soft March quarter production report from Rio Tinto, with titanium dioxide providing the only divisional beat versus expectation. Nonetheless, management left FY22 guidance unchanged.

Reduced throughput at the Escondida mine and lower grades at Oyu Tolgoi, ensured that copper missed the broker's estimate, while aluminium production was reduced in Canada following strikes at Kitimat.

More positively, the analyst assesses materially less global iron ore supply in 2022 than expected, which should provide price support and help along the Rio Tinto share price. The Hold rating is retained and the target falls to $116 from $118.

Target price is $116.00 Current Price is $118.30 Difference: minus $2.3 (current price is over target).
If RIO meets the Ord Minnett target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $125.21, suggesting upside of 7.2% (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: 0.6

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

UBS rates RIO as Neutral (3) -

Rio Tinto's March-quarter trading update disappointed UBS, which says a dramatic step up will be required in the second half to meet guidance.

But management reaffirms guidance and flagged an update on Simandou around May 24 (the broker expects a definitive agreement).

The usual culprits - labour shortages, supply chain disruptions, covid and weather - were to blame for a sharp fall in metrics across the board.

Neutral rating and $104.00 target price retained based on the near-term commodity outlook.

Target price is $104.00 Current Price is $118.30 Difference: minus $14.3 (current price is over target).
If RIO meets the UBS target it will return approximately minus 12% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $125.21, suggesting upside of 7.2% (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: 0.6

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

Morgans rates STA as Add (1) -

Morgans assesses lower development risks for Strandline Resources following a $50m placement to fund accelerated work on its three key growth projects.

After the broker reduces its valuation risk discounts on Coburn, Fungoni and Tajiri and factors in additional cash flows from the Coburn expansion, the target price rises to $0.70 from $0.60. The Add rating is maintained.

Target price is $0.70 Current Price is $0.45 Difference: $0.25
If STA meets the Morgans target it will return approximately 56% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

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

Macquarie rates STO as Outperform (1) -

Macquarie finds Santos set for sector leading growth through to 2027 following recent acquisitions and the announcement of a US$250m on-market buyback.

According to the broker Santos has materially improved its balance sheet and credit rating with its successful Barossa sell downs, the acquisition of Oil Search, the deferral of the Dorado final investment decision, and ongoing strength in the oil and gas market.

The company is now targeting gearing of 15-25%, and Macquarie expects the company can sit within this range through 2023, and below it in 2024.

The Outperform rating is retained and the target price decreases to $10.35 from $10.50.

Target price is $10.35 Current Price is $8.23 Difference: $2.12
If STO meets the Macquarie target it will return approximately 26% (excluding dividends, fees and charges).

Current consensus price target is $9.76, suggesting upside of 16.6% (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: 0.8

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

Morgan Stanley rates STO as Overweight (1) -

Alongside a US$250m share buyback, Santos has announced a number of changes to its capital management framework. Morgan Stanley notes dividends of 10-30% of free cash up to US$65 per barrel are retained, but shareholders can now expect returns of at least 40% of free cash above US$65 per barrel.

The broker estimates that at US$100 per barrel, the company would generate US$3.4bn in free cash.

The Overweight rating and target price of $10.40 are retained. Industry view: Attractive.

Target price is $10.40 Current Price is $8.23 Difference: $2.17
If STO meets the Morgan Stanley target it will return approximately 26% (excluding dividends, fees and charges).

Current consensus price target is $9.76, suggesting upside of 16.6% (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: 0.8

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

Morgans rates STO as Add (1) -

Morgans believes that by announcing a share buyback of up to US$250m (starting this May), Santos is confident that the share price is cheap. Nonetheless, the buyback is considered an unnecessary value risk at currently high prices.

Also, as part of a new capital management framework, the company is linking future dividends to a share of free cashflow. The broker likes this approach that also leaves capacity to flex distributions.

Morgans raises its target price to $10.10 from $10.00 and maintains the Add rating.

Target price is $10.10 Current Price is $8.23 Difference: $1.87
If STO meets the Morgans target it will return approximately 23% (excluding dividends, fees and charges).

Current consensus price target is $9.76, suggesting upside of 16.6% (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: 0.8

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

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

Whitehaven Coal's March-quarter production met Citi's forecasts but the broker expects rising costs and a volatile FY22 coal price will conspire to cap further price strength.

Management reiterated production and cost guidance and shifted guidance to the top end of the range thanks to strong diesel prices and industry demurrage.

The broker has a new price deck, expecting spot prices to be volatile in the short term and lowers 2022 thermal coal forecasts -12% and raises 2023/2024 prices 12% from a low base.

FY22 EPS forecasts fall -16% accordingly.

Target price rises to $4.90 from $4.20. Rating is downgraded to Neutral from Buy following recent share price strength.

Target price is $4.90 Current Price is $4.80 Difference: $0.1
If WHC meets the Citi target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $5.47, suggesting upside of 13.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.8

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

Credit Suisse rates WHC as Outperform (1) -

Whitehaven Coal's March-quarter trading update fell a touch shy of Credit Suisse forecasts as covid, tight labour markets and wet weather took their toll.

On the upside, product quality improved and the company was net cash $161m as at April 19 after dividends and buybacks, compared with net debt of $400m at the end of December.

Management reiterates guidance pending no material covid or weather events, and reassures that no new capital expenditure will occur this year, and that market dynamics remain supportive of prices into 2023.

Credit Suisse says capital management is still an upside catalyst and spies a highly cash-generative year.

Target price rises to $5.60 from $4.70. Outperform rating retained.

Target price is $5.60 Current Price is $4.80 Difference: $0.8
If WHC meets the Credit Suisse target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $5.47, suggesting upside of 13.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.8

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

Macquarie rates WHC as Outperform (1) -

While Whitehaven Coal delivered better than expected production in the third quarter, Macquarie notes shipments disappointed given weather impacts during the period.

Realised pricing was up 50% quarter-on-quarter to $315 per tonne, and while the broker notes elevated pricing looks to persist it has lowered realised price forecasts -12-25% for FY23 and FY24 to account for product mix and a lag in realised pricing.

Accordingly, earnings per share forecasts decrease -29%, -39% and -20% through to FY24.

The Outperform rating is retained and the target price decreases to $7.00 from $8.00.

Target price is $7.00 Current Price is $4.80 Difference: $2.2
If WHC meets the Macquarie target it will return approximately 46% (excluding dividends, fees and charges).

Current consensus price target is $5.47, suggesting upside of 13.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.8

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

Morgan Stanley rates WHC as Overweight (1) -

With the New South Wales floods impacting third quarter production, particularly at Tarrawonga, Morgan Stanley notes a production pick up will be required in the fourth quarter to meet Whitehaven Coal's retained guidance. 

The broker notes production of 5.4-6.9m tonnes will be required in the coming quarter, but Morgan Stanley sees this as achievable given fourth quarter production rates in the last three years. 

Weather events are also expected to drive costs to the upper end of the $79-84 per tonne guidance range. Positively, performance at Narrabri looks to improve, with a return to shallower ground expected in the second half of FY23.

The Overweight rating and target price of $5.45 are retained. Industry view: Attractive.

Target price is $5.45 Current Price is $4.80 Difference: $0.65
If WHC meets the Morgan Stanley target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $5.47, suggesting upside of 13.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.8

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

Morgans rates WHC as Add (1) -

Morgans upgrades its 2H volume and price assumptions for Whitehaven Coal, following 3Q sales which showed greater than expected resilience to recent rains in NSW. The target price lifts to $5.24 from $5.10.

The broker sees clear upside risk to both valuation and dividends with coal prices trading above consensus expectations. It's highlighted the valuation is very sensitive to the duration for which record prices continue. The Add rating is maintained.

Target price is $5.24 Current Price is $4.80 Difference: $0.44
If WHC meets the Morgans target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $5.47, suggesting upside of 13.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.8

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