Australian Broker Call

Macquarie rates AMP as Neutral (3) -

AMP has received final regulatory approval for the sale of the life business. Macquarie estimates this leaves AMP with around $950m in excess capital.

The broker anticipates investors will become more constructive on the business in the short term but considers the stock fully valued, highlighting the earnings risk over the medium term, particularly in wealth management.

Neutral maintained. Target rises to $1.85 from $1.20.

Target price is $1.85 Current Price is $1.91 Difference: minus $0.06 (current price is over target).
If AMP meets the Macquarie target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $1.49, suggesting downside of -20.5% (ex-dividends)

The company's fiscal year ends in December.

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

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

AMP has received clearance from the regulator to sell its life business. This will reduce stock overhang, comments Morgan Stanley, and provide support to the share price.

The company has stated a part of the net cash proceeds of $2.5bn will go towards debt repayment and towards funding investment for the new AMP.

The broker suggests the remaining proceeds could be used for other activities including providing a safety buffer for the client remediation programme, resuming dividend payment and supporting growth in AMPCI and AMP bank.

Morgan Stanley rates the stock as Equal-weight with a target price of $1.40. Industry view: In-line.

Target price is $1.40 Current Price is $1.91 Difference: minus $0.51 (current price is over target).
If AMP meets the Morgan Stanley target it will return approximately minus 27% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $1.49, suggesting downside of -20.5% (ex-dividends)

The company's fiscal year ends in December.

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

Ord Minnett rates CL1 as Upgrade to Buy from Hold (1) -

The share price has fallen -37% since the peak in February, including -17% in the past week, Ord Minnett notes.

The company has not formally updated guidance since the first half result but the broker retains forecasts broadly in line with previously provided targets and is comfortable these can be achieved.

The stock has now fallen far enough and the broker envisages good value amid several catalysts on the horizon, upgrading to Buy from Hold. Target is reduced to $1.50 from $1.76.

Target price is $1.50 Current Price is $1.15 Difference: $0.35
If CL1 meets the Ord Minnett target it will return approximately 30% (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

Ord Minnett rates CMW as Lighten (4) -

ARA Asset Management has made an offer for Cromwell of 29 for every 100 securities it does not already own at 90c a share. The company is seeking greater ownership and representation on the board.

Ord Minnett estimates a 100% acceptance rate would mean the Singapore-based ARA lifts its stake to 45.8%, which is extremely unlikely.

Whether it will ultimately gain control is unclear at this stage, the broker points out. Lighten rating and $0.60 target maintained.

Target price is $0.60 Current Price is $0.94 Difference: minus $0.34 (current price is over target).
If CMW meets the Ord Minnett target it will return approximately minus 36% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $1.01, suggesting upside of 7.1% (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

Credit Suisse rates CWN as Outperform (1) -

Crown Resorts has announced it can resume operations in Perth under temporary capacity restrictions.

Credit Suisse's modelling of FY21 main gaming floor revenue in Perth is 87% of FY19, while incorporating a "fairly normal" June half in 2021 and implying around a 60% run rate in the December half.

The broker also assumes VIP travel restrictions impede Chinese New Year casino visits and lowers Crown Sydney VIP volume estimates.

Credit Suisse acknowledges little confidence in forecasting the year ahead as capacity constraints and casino visits are uncertain. Outperform rating and $12 target maintained.

Target price is $12.00 Current Price is $10.19 Difference: $1.81
If CWN meets the Credit Suisse target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $10.21, suggesting upside of 3.6% (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

Ord Minnett rates CZI as Downgrade to Hold from Buy (3) -

OZ Minerals ((OZL)) has launched a $73m scrip takeover bid for Cassini Resources. Management and major shareholders support the transaction and Ord Minnett envisages limited chance of a fresh or higher bid emerging.

Importantly, shareholders will retain the Yarrawinda project option via a new vehicle. The broker reduces the target to $0.16 from $0.30 to reflect the offer price and downgrades to Hold from Speculative Buy.

Target price is $0.16 Current Price is $0.17 Difference: minus $0.01 (current price is over target).
If CZI meets the Ord Minnett target it will return approximately minus 6% (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

Ord Minnett rates HMC as Hold (3) -

Home Consortium has lifted preliminary June 2020 valuations 2.8% to $1bn with a 5% increase on external valuations. Ord Minnett believes this is a strong result relative to large shopping centre owners, which have booked de-valuations of around -10%.

The broker also notes good progress on the development pipeline, with Coffs Harbour now complete. Hold maintained. Target rises to $3.20 from $3.00.

Target price is $3.20 Current Price is $3.21 Difference: minus $0.01 (current price is over target).
If HMC meets the Ord Minnett target it will return approximately minus 0% (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: 0.5

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

Citi rates HVN as Buy (1) -

Citi notes Harvey Norman is generating high operating leverage, with around 20% pre-tax profit growth over the 11 months to May compared with around 7.4% sales growth.

While growth has been exceptional in recent months this is unlikely to be maintained and the broker suspects the Australian franchisee business is the main benefactor, given the closures experienced in most offshore businesses.

Citi upgrades estimates for FY20 by 27% and FY21 by 5%. Buy rating retained. Target is raised to $4.60 from $4.50.

Target price is $4.60 Current Price is $3.62 Difference: $0.98
If HVN meets the Citi target it will return approximately 27% (excluding dividends, fees and charges).

Current consensus price target is $3.98, suggesting upside of 11.0% (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

Credit Suisse rates HVN as Neutral (3) -

Credit Suisse acknowledges it is "unusual" to reduce a target price, lowered to $3.90 from $4.17, on an earnings upgrade.

However, the broker finds the Australian housing outlook too uncertain, particularly after September when temporary income support measures cease.

Harvey Norman is guiding to pre-tax profit in FY20 being up 20%. Given the relative size of the segments, the broker suspects the Australian franchise is providing that outcome. Neutral.

Target price is $3.90 Current Price is $3.62 Difference: $0.28
If HVN meets the Credit Suisse target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $3.98, suggesting upside of 11.0% (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

Macquarie rates HVN as Outperform (1) -

Macquarie believes government support programs are helping the cost base for Harvey Norman, which will then normalise in FY21.

However, the broker acknowledges travel restrictions could mean retail sales remain elevated even after the stimulus unwinds.

The company has guided to a 20% increase in pre-tax profit in FY20. Macquarie considers this a commendable result, given around 27% of the business was either closed or on tight restrictions for part of the second half.

Outperform rating and $4.20 target retained.

Target price is $4.20 Current Price is $3.62 Difference: $0.58
If HVN meets the Macquarie target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $3.98, suggesting upside of 11.0% (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 HVN as Hold (3) -

Ord Minnett increases estimates for earnings per share in FY20 by 19%, given the company's profit update.

Total sales for the Australian franchising operations grew 17.5% in the five months to May, with all but two stores operating throughout the coronavirus crisis.

Ord Minnett retains a Hold rating and raises the target to $3.85 from $3.75.

Target price is $3.85 Current Price is $3.62 Difference: $0.23
If HVN meets the Ord Minnett target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $3.98, suggesting upside of 11.0% (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 HVN as Buy (1) -

The FY20 update was strong, UBS observes, with pre-tax profit up 20% year-on-year. There was no detail on the performance of various divisions. UBS increases estimates by 16% to reflect the update.

The company is benefiting from increased at-home consumption yet UBS continues to envisage risks as stimulus fades after September. Buy rating maintained. Target is raised to $4.35 from $4.25.

Target price is $4.35 Current Price is $3.62 Difference: $0.73
If HVN meets the UBS target it will return approximately 20% (excluding dividends, fees and charges).

Current consensus price target is $3.98, suggesting upside of 11.0% (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 JHX as Overweight (1) -

James Hardie Industries’ revised guidance for the first quarter of FY21 points to an excellent start to the year, comment the analysts, with the North America Fibre Cement (NAFC) business margin guidance at 27-29%. 

The guidance mostly points to better than expected trading in each of the company’s key businesses. Morgan Stanley has revised operating income estimates upwards for FY21-23 while increasing earnings forecasts by 15% for FY21 and 4% for FY22 and FY23 each.

Morgan Stanley retains its Overweight rating with its target price increased to $34 from $32. Industry view: Cautious.

Target price is $34.00 Current Price is $28.45 Difference: $5.55
If JHX meets the Morgan Stanley target it will return approximately 20% (excluding dividends, fees and charges).

Current consensus price target is $31.75, suggesting upside of 15.0% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: 1.0

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

Credit Suisse rates MFG as Underperform (5) -

Credit Suisse reiterates an Underperform rating, largely because of valuation. Magellan Financial is the most expensive manager across the broker's coverage in Australia, the US and the EU.

The broker acknowledges a strong fund performance, flow momentum and product pipeline, but believes these features are factored into the stock.

Credit Suisse also notes speculation the company is branching into unlisted assets and alternatives, backing a new investment banking operation called Blackwattle. Target is $47.

Target price is $47.00 Current Price is $57.51 Difference: minus $10.51 (current price is over target).
If MFG meets the Credit Suisse target it will return approximately minus 18% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $45.27, suggesting downside of -22.0% (ex-dividends)

The company's fiscal year ends in June.

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

Macquarie rates ORA as Neutral (3) -

Orora is undertaking a review of its strategy for continuing businesses. The board's preference is to pursue growth opportunities and, in their absence, return excess capital.

Macquarie notes the company experienced strong initial beverage consumption in March and early April but this is since tailed off as demand was pulled forward.

Meanwhile, wine demand remains soft. Reflecting the share consolidation, the broker increases the target to $3.05 from $2.44. Neutral maintained.

Target price is $3.05 Current Price is $2.31 Difference: $0.74
If ORA meets the Macquarie target it will return approximately 32% (excluding dividends, fees and charges).

Current consensus price target is $2.78, suggesting upside of 25.7% (ex-dividends)

The company's fiscal year ends in June.

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

Macquarie rates OZL as Outperform (1) -

Macquarie incorporates a block cave expansion at Carrapateena into forecasts for the first time after the company has outlined a development plan on the back of the prefeasibility study.

The expansion increases the broker's estimates for 2029-32 copper and gold production. The expansion is expected to cost -$1.25bn. Outperform rating maintained. Target is raised to $13.00 from $11.50.

Target price is $13.00 Current Price is $10.75 Difference: $2.25
If OZL meets the Macquarie target it will return approximately 21% (excluding dividends, fees and charges).

Current consensus price target is $11.09, suggesting upside of 2.3% (ex-dividends)

The company's fiscal year ends in December.

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 OZL as Overweight (1) -

OZ Minerals’ Carrapateena block cave expansion project, located in South Australia on the eastern margin of the Gawler Craton, is an underground cave operation.

The project, undergoing a pre-feasibility study, shows post-tax Net Present Value (NPV) of circa $600m which is a huge surprise against Morgan Stanley’s expected marginal NPV.

The project has two block caves, with the life of the main block cave calculated up to 2037 and the second one (smaller) up to 2045. The company expects production of 110-120ktpa of copper and 110-120kozpa of gold from block cave 1, both above the broker’s expectations. The second cave will add 40-55ktpa of copper and circa 45kozpa of gold over 2038-45.

Morgan Stanley reiterates its Overweight rating with a target price of $12.20. Industry view: Attractive.

Target price is $12.20 Current Price is $10.75 Difference: $1.45
If OZL meets the Morgan Stanley target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $11.09, suggesting upside of 2.3% (ex-dividends)

The company's fiscal year ends in December.

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

Ord Minnett rates OZL as Accumulate (2) -

OZ Minerals has launched a $73m scrip takeover bid for Cassini Resources ((CZI)). Ord Minnett is surprised by the bid, although believes the deal reaffirms a positive view on the project.

The broker envisages merit in the company simplifying the ownership structure of West Musgrave ahead of project financing and a final decision. Accumulate reiterated. Target rises to $10.50 from $9.90.

Target price is $10.50 Current Price is $10.75 Difference: minus $0.25 (current price is over target).
If OZL 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 $11.09, suggesting upside of 2.3% (ex-dividends)

The company's fiscal year ends in December.

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 OZL as Buy (1) -

The prefeasibility study has indicated that a transition to a block cave at the lower half of the Carrapateena ore body is accretive to value. Mining rates would lift to 12mtpa from 5mtpa for around -$1.2-1.3bn of incremental expenditure.

First production could be in 2026. As a result, UBS upgrades valuation by 18%. A final investment decision is due in 2023.

The broker maintains a Buy rating, as OZ Minerals has numerous growth options that should be de-risked over time. Target is raised to $11.90 from $10.90.

Target price is $11.90 Current Price is $10.75 Difference: $1.15
If OZL meets the UBS target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $11.09, suggesting upside of 2.3% (ex-dividends)

The company's fiscal year ends in December.

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 PRN as Buy (1) -

FY20 net profit guidance of $106-110m is -4-8% below the lower end of the guidance that was withdrawn in March.

While the company has stated there has been minimal impact from the pandemic, UBS believes there have been material impacts from the direct shut-down of sites and reduced productivity because of travel restrictions.

FY21 guidance is expected at the results in late August. The broker considers the valuation attractive and retains a Buy rating. Target is reduced to $2.00 from $2.15.

Target price is $2.00 Current Price is $1.29 Difference: $0.71
If PRN meets the UBS target it will return approximately 55% (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

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

Citi notes the share price has risen 34% since the equity raising in early May. While the near-term operating outlook remains uncertain, the broker lowers the rating to Neutral from Buy/High Risk.

Qube Holdings has announced Woolworths ((WOW)) as its next major tenant at Moorebank, further defining the path to realisation of the project.

Capital expenditure at Moorebank continues to expand, with the company funding more of the development and warehousing for tenants than originally expected.

Citi awaits further clarification on the capital intensity in the FY20 results. Target is raised to $3.15 from $2.71.

Target price is $3.15 Current Price is $2.91 Difference: $0.24
If QUB meets the Citi target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $2.89, suggesting upside of 2.2% (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

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

Qube Holdings’ trading conditions are expected to improve with recovery in the Australian economy.

The company recently entered into an agreement with Woolworths ((WOW)) to build two distribution centres in Moorebank, considered a strategically sound move by Morgan Stanley.

Morgan Stanley retains its Equal-weight rating with the target price increased to $3.30 from $2.58. Industry view: Cautious.

Target price is $3.30 Current Price is $2.91 Difference: $0.39
If QUB meets the Morgan Stanley target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $2.89, suggesting upside of 2.2% (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

Morgans rates QUB as Downgrade to Reduce from Hold (5) -

Qube Holdings has signed Woolworths ((WOW)) as a tenant at its Moorebank logistics terminal. The trade off is an increase in Moorebank's ultimate construction budget.

Morgans has lifted its target to $2.45 from $2.38 but as this is still well short of the trading price, which included a big jump on the news, the broker downgrades to Reduce from Hold.

The risk for the broker is it may be undervaluing Moorebank but as a high beta stock, Qube is vulnerable if a broader market decline transpires, the broker notes.

Target price is $2.45 Current Price is $2.91 Difference: minus $0.46 (current price is over target).
If QUB meets the Morgans target it will return approximately minus 16% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.89, suggesting upside of 2.2% (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

Ord Minnett rates QUB as Downgrade to Hold from Buy (3) -

Qube Holdings has agreed to fund $420-460m in construction costs to develop two distribution centres for Woolworths ((WOW)) in Moorebank, leased over 20 years.

Ord Minnett believes Woolworths can attract other such customers to the precinct, de-risking assumptions surrounding warehouse utilisation.

The company is on track to generate an 18% development margin through the transaction.

However, Ord Minnett downgrades to Hold from Buy, given the current headwinds for transport and the increased capital expenditure. Target is raised to $2.95 from $2.58.

Target price is $2.95 Current Price is $2.91 Difference: $0.04
If QUB meets the Ord Minnett target it will return approximately 1% (excluding dividends, fees and charges).

Current consensus price target is $2.89, suggesting upside of 2.2% (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

Ord Minnett rates RDC as Buy (1) -

The company expects positive operating earnings (EBITDA) following the recommencement of trading in all but one venue in Queensland.

In response to early indications that restrictions could be more dire, the company had acted proactively by standing down staff and reducing operating expenses.

Ord Minnett observes Redcape Hotel Group has managed the crisis well by preserving cash and the business remains well-placed to recover as restrictions ease.

Buy rating retained. Target is reduced to $0.92 from $0.94.

Target price is $0.92 Current Price is $0.83 Difference: $0.09
If RDC meets the Ord Minnett target it will return approximately 11% (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

UBS rates REG as Neutral (3) -

UBS believes Regis Healthcare will experience a deterioration in occupancy in the fourth quarter with continued pressure on operating margins as staff and PPE costs accelerate in response to new pandemic protocols, similar to what competitors have flagged.

This impact is expected to be largely countered by $8m of one-off government funding in the second half, but the company is exposed in FY21 as additional payments fall away.

UBS envisages limited scope for outperformance and maintains a Neutral rating. Target is reduced to $1.50 from $2.10.

Target price is $1.50 Current Price is $1.47 Difference: $0.03
If REG meets the UBS target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $1.66, suggesting upside of 11.4% (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

Citi rates SCP as Sell (5) -

The company's trading update has flagged a -$22m cash rent shortfall for the four months from March to June 19. Collection rates have improved recently and management expects the momentum will be maintained.

The company will continue to pursue payments from tenants for all outstanding amounts not covered by agreed rental waivers.

Meanwhile, sales results were better than Citi anticipated and highlight the non-discretionary nature of the company's business. The broker retains a Sell rating on valuation with a target of $1.87.

Target price is $1.87 Current Price is $2.32 Difference: minus $0.45 (current price is over target).
If SCP meets the Citi target it will return approximately minus 19% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.27, suggesting downside of -1.8% (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

Macquarie rates SCP as Neutral (3) -

Second half distributions have been affected by around $22m in "non-collections". While collections may still have improved over June, Macquarie acknowledges its expectations of rental earnings may have been too high.

All up, the broker believes the -12% reduction in the distribution year-on-year is a relatively sound result, considering the headwinds. On a relative valuation a Neutral rating is retained. Target is reduced to $2.36 from $2.48.

Target price is $2.36 Current Price is $2.32 Difference: $0.04
If SCP meets the Macquarie target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $2.27, suggesting downside of -1.8% (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

UBS rates SCP as Neutral (3) -

The company has guided to a second-half distribution of 5c, slightly less than UBS expected. This takes into account the capital raising in April and the rental shortfall from the pandemic.

It also implies around 60% of specialty rent, or 27% of the total, has not been collected between March and June 2020. Valuation declines of -3% are in line with UBS estimates. Neutral rating and $2.27 target maintained.

Target price is $2.27 Current Price is $2.32 Difference: minus $0.05 (current price is over target).
If SCP meets the UBS target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.27, suggesting downside of -1.8% (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

Macquarie rates SDF as Outperform (1) -

Macquarie observes the performance to the end of May was in line with expectations.

The company has experienced a continuation of premium rate increases and some small volume reductions in the broker network. Working capital remains strong.

The broker retains an Outperform rating and lifts the target to $3.70 from $3.60.

Target price is $3.70 Current Price is $3.40 Difference: $0.3
If SDF meets the Macquarie target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $3.78, suggesting upside of 9.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.9

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

Macquarie rates SEK as Neutral (3) -

The company's trading update indicates Zhaopin has stabilised more quickly than expected, although the lockdown in Beijing highlights the uncertain environment.

The company's estimates for FY20 revenue and operating earnings (EBITDA) are $1.58bn and $410m, respectively. Macquarie assesses the outlook has improved to some extent and balance sheet risk has also been reduced.

The key going forward is execution on the company's strategy, which has potential to drive yield growth at a high incremental margin.

Macquarie retains a Neutral rating and raises the target to $21.20 from $16.25.

Target price is $21.20 Current Price is $21.62 Difference: minus $0.42 (current price is over target).
If SEK meets the Macquarie target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $21.29, suggesting downside of -2.4% (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

Macquarie rates SYD as Outperform (1) -

Macquarie assesses the near-term risk is being reflected in the share price. The broker's worst-case scenario is an elongated recovery.

Domestic traffic should start to return in July/August while international remains a possibility in October/November to a limited extent.

The broker suspects the pandemic will create a structural change in the market as numerous airlines are foreseeing it could take until 2023-25 to return passenger numbers to 2019 levels.

Macquarie retains an Outperform rating and reduces the target by -6.4% to $6.57.

Target price is $6.57 Current Price is $5.94 Difference: $0.63
If SYD meets the Macquarie target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $6.26, suggesting upside of 6.6% (ex-dividends)

The company's fiscal year ends in December.

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

UBS rates TCL as Downgrade to Neutral from Buy (3) -

Transurban's update has revealed steadily improving traffic on Australian roads. This has given the company confidence to allow a June half distribution of 16c, ahead of UBS estimates.

The broker forecasts $0.49 in distributions for FY21 based on a 100% pay-out. Rating is downgraded to Neutral from Buy following a strong performance in the share price. Target is raised to $14.85 from $13.85.

Target price is $14.85 Current Price is $14.79 Difference: $0.06
If TCL meets the UBS target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $13.69, suggesting downside of -4.1% (ex-dividends)

The company's fiscal year ends in June.

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

Citi rates WOW as No Rating (-1) -

Citi notes sales growth has been "excellent" in the fourth quarter, albeit with relatively low levels of operating leverage.

Two new distribution centres in NSW will replace three old facilities and underpin capital expenditure over the next three years. Benefits are not expected until FY26.

Meanwhile, EBIT guidance of $3.2-3.25bn implies around 9% earnings growth in the second half, excluding hotels and unallocated costs. Citi points out this is broadly in line with the first half.

No rating or target has been provided.

Current Price is $36.38. Target price not assessed.

Current consensus price target is $37.98, suggesting upside of 5.0% (ex-dividends)

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

Credit Suisse rates WOW as Neutral (3) -

Credit Suisse found the company's update mixed. Sales growth is above forecasts across all businesses with the exception of hotels, while guidance for costs increased.

Big W was an under-appreciated positive in the update because of the increasing likelihood of profitability, which in turn increases the options for reinvestment and disposal.

Like-for-like sales growth of 8.6% in Australian food was below Metcash ((MTS)), which the broker assesses validates its view of market share shifts resulting from the localisation of shopping.

Credit Suisse also suspects a potential return of capital is unlikely until the de-merger of ALH in the second half of 2021. Neutral maintained. Target is reduced to $38.88 from $38.97.

Target price is $38.88 Current Price is $36.38 Difference: $2.5
If WOW meets the Credit Suisse target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $37.98, suggesting upside of 5.0% (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

Macquarie rates WOW as Outperform (1) -

A significant acceleration in costs is likely to drag on FY20 earnings, in Macquarie's view, although food sales have accelerated since the last update. Australian food sales were up 9% in the fourth quarter, with New Zealand up 15%, liquor up 21% and Big W up 28%.

Macquarie notes earnings are also being dragged down by hotels, which remain loss-making, although venues are re-opening and this should improve throughout the year.

Meanwhile, Big W is materially outperforming peers. The broker retains an Outperform rating and raises the target 3.9% to $40.50.

Target price is $40.50 Current Price is $36.38 Difference: $4.12
If WOW meets the Macquarie target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $37.98, suggesting upside of 5.0% (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

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

Woolworths reported sales growth over ten weeks to June 14 of 8.6% for Australian food.  This was mirrored in New Zealand food sales which saw growth of 15% along with growth in Big W and Endeavor Drinks.

However, the supermarket's operating income guidance is -5% below the broker’s estimate, implying largely flat full-year earnings reflecting losses incurred in the second half.

The broker considers Australian food to be the key driver, going forward. The supermarket will also be investing about -$700-800m over the next four years in developing two distribution centres at Moorebank, with the broker expecting benefits in FY25.

Morgan Stanley has reduced operating earnings estimates for FY20-22 and prefers Coles ((COL)), calling it a purer supermarket play with better yield.

Morgan Stanley retains its Equal-weight rating with a target price of $36. Industry view: Cautious.

Target price is $36.00 Current Price is $36.38 Difference: minus $0.38 (current price is over target).
If WOW meets the Morgan Stanley target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $37.98, suggesting upside of 5.0% (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

Morgans rates WOW as Hold (3) -

Woolworths is to develop two automated distribution centres at Qube Holdings' ((QUB)) Moorebank terminal costing -$700-780m over four years.

This will reduce supply chain costs over time, management points out, but given the timeframe the broker is yet to factor this in. 

Meanwhile, Woolworths provided a trading update, setting FY20 earnings guidance -3% below the broker's forecast, albeit 2% above consensus. Target falls to $35.40 from $35.86, Hold retained.

Target price is $35.40 Current Price is $36.38 Difference: minus $0.98 (current price is over target).
If WOW meets the Morgans target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $37.98, suggesting upside of 5.0% (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

UBS rates WOW as Buy (1) -

FY20 earnings (EBIT) guidance is $3.2-3.25bn, a little weaker than expected. Fourth quarter sales have been strong but UBS was disappointed by the lack of operating leverage with higher-than-forecast incremental costs relating to the pandemic.

Most of these costs should reverse through FY21 which, in the broker's calculation, should deliver 7-9% growth, ex hotels.

UBS asserts a couple of quarters of heightened sales and the extra costs are not material to the valuations of listed grocers. Buy rating maintained. Target is reduced to $39.10 from $39.70.

Target price is $39.10 Current Price is $36.38 Difference: $2.72
If WOW meets the UBS target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $37.98, suggesting upside of 5.0% (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

Morgans rates WPL as Hold (3) -

The broker retains a Hold rating on Woodside Petroleum, but is cautious as there are many questions that remain unanswered. Does Woodside buy Chevron's North West Shelf stake, now on offer?

The broker thinks as operator, Woodside will be interested, but how will it pay for it? The broker rates a capital raising as "probable".

Are Woodside's partners confident enough at current oil/LNG prices to proceed? And how will investors react to falling dividends?

A slight pushback on Sangomar starting up lifts the broker's target to $22.90 from $22.56, but "cautious" Hold retained.

Target price is $22.90 Current Price is $21.93 Difference: $0.97
If WPL meets the Morgans target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $25.16, suggesting upside of 16.6% (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: 0.4

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

Ord Minnett rates WSA as Upgrade to Buy from Hold (1) -

Ord Minnett reviews the valuation for Western Areas and has become more positive on the nickel sector. Odysseus mine assumptions are updated and exploration value has increased.

Western Areas has greater leverage to a positive longer-term nickel price compared with what the broker had been previously modelling and the rating is upgraded to Buy from Hold. Target is raised to $3.30 from $2.20.

Target price is $3.30 Current Price is $2.68 Difference: $0.62
If WSA meets the Ord Minnett target it will return approximately 23% (excluding dividends, fees and charges).

Current consensus price target is $2.71, suggesting downside of -1.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY20:

Forecast for FY21:

Market Sentiment: 0.7

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