Australian Broker Call

Morgan Stanley rates 360 as Overweight (1) -

In anticipation of Life360's 1Q earnings on May 16, Morgan Stanley wants to see a number of matters disclosed including a road map for the migration of Tile to a subscription business.

The broker will also seek to more accurately quantify the impact of management's cost-out initiative in January, in terms of operating leverage and margins going forward.

Overweight rating and $8.50 retained. Industry view: In Line.

Target price is $8.50 Current Price is $5.46 Difference: $3.04
If 360 meets the Morgan Stanley target it will return approximately 56% (excluding dividends, fees and charges).

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: 1.0

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

Macquarie rates COL as Outperform (1) -

Macquarie calculates the online grocery market is set to grow by 55% over the next five years and will become a key battleground for growth in supermarkets, believing the Ocado solution should narrow the current gap for Coles Group to Woolworths Group ((WOW)).

With the commissioning of Ocado centres in Sydney and Melbourne over the next year the broker expects margins will improve as delivery and picking costs are optimised.

Because of the rising cost of living, Macquarie seeks relative safety in staples, particular Coles and an Outperform rating is maintained. Target is steady at $20.

Target price is $20.00 Current Price is $18.09 Difference: $1.91
If COL meets the Macquarie target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $17.76, suggesting downside of -2.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.2

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

Citi rates CSL as Buy (1) -

Citi's argenx analyst has examined the implication of the argenx Ph2/3 ADHERE data for subcutaneous efgartigimod in CIDP for CSL given argenx is preparing to publish top-line data in July.

Citi estimates that CIDP constitutes roughly 25% of CSL's immunoglobin, or 10% of group sales.

While there is a risk that CSL's shares could be sold in the event of a successful trial (which is expected), the broker estimates the impact on CSL's revenue will be limited.

Buy rating and $350 target price retained.

Target price is $350.00 Current Price is $301.27 Difference: $48.73
If CSL meets the Citi target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $337.18, suggesting upside of 12.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

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

Market Sentiment: 0.8

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

UBS rates CSR as Buy (1) -

CSR is expected to report FY23 results on May 10 and UBS expects EBIT of $327m. The outlook is considered positive, with pricing traction and backlog support into the first half of FY24.

Moreover, aluminium and property earnings should be supportive as housing comes off the boil.

The aluminium business has the most potential to surprise to the upside in the results, the broker asserts, given favourable forward hedging and the likelihood that consensus earnings expectations are too conservative.

The Buy rating and target price of $6.50 are retained.

Target price is $6.50 Current Price is $5.50 Difference: $1
If CSR meets the UBS target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $5.29, suggesting downside of -3.7% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.2

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

Macquarie rates FPR as Outperform (1) -

First half net profit beat Macquarie's forecasts, driven by end-of-lease income. FleetPartners Group has also declared a $43m buyback, ahead of the target range.

The company has stated a strategic party is considering a significant minority interest, potentially through market purchases, although there is no certainty it will occur.

Macquarie believes the business is delivering an attractive operating performance while margins appear to have normalised in a 7.5-7.7% range. Operating expenditure appears to have been well managed despite the current inflationary environment.

The broker retains an Outperform rating and raises the target to $2.41 from $2.28. The main risk is moderation in used car prices before supply constraints normalise.

Target price is $2.41 Current Price is $2.09 Difference: $0.32
If FPR meets the Macquarie target it will return approximately 15% (excluding dividends, fees and charges).

The company's fiscal year ends in September.

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 FPR as Overweight (1) -

Following 1H results by FleetPartners Group, Morgan Stanley believes near-term headwinds (including supply constraints) will normalise. A key positive is thought to be the strength in New Business Writings (NBW) ex supply constraints.

The financial performance itself is labeled "solid" with net profit of $42.6m beating forecasts, including market consensus, by some 7-8%.

The broker's Overweight rating is maintained given an undemanding valuation, more buybacks and strategic optionality. The $2.70 target price is also maintained.

Target price is $2.70 Current Price is $2.09 Difference: $0.61
If FPR meets the Morgan Stanley target it will return approximately 29% (excluding dividends, fees and charges).

The company's fiscal year ends in September.

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

Shaw and Partners rates FZO as Buy (1) -

Family Zone Cyber Safety's 3Q results exceeded Shaw and Partners forecasts. Of the $6m in annual recurring revenue (ARR), $2m was due to a currenct tailwind.

While the March quarter is seasonally strong in the UK, the broker expects further tailwinds in the upcoming June quarter, which is the cyclical sales peak in the company's US market.

The analyst highlights the average revenue per user (ARPU) metric which continues to be a highlight, with education products reaching $6.2m/year from $6.0m in the prior quarter and $5.5m in the 1Q, driven by cross sell and upsell.

The target falls to 44c from 55c after the broker incorporates the latest capital raise and the 3Q results into forecasts. Buy.

Target price is $0.44 Current Price is $0.17 Difference: $0.275
If FZO meets the Shaw and Partners target it will return approximately 167% (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

Citi rates GOZ as Initiation of coverage with Buy (1) -

Citi initiates coverage of Growthpoint Properties Australia with a Buy rating and $3.60 target price, the broker observing the company is trading at discounts to both peers and historical averages.

Citi appreciates the company's move to raise its cap rate to a toppish 5.2%, which the broker considers cushions it from the risks associated with increasing cap rates across the subsector.

Cit observes the company's higher gearing is also mitigated by longer weighted average leases (WALE) of 6.3 years.

In terms of the growth profile, the company has been building its long WALE industrial portfolio to 34%, and its Fortius asset-management purchase offers long-term earnings growth without upsetting the balance sheet.

Target price is $3.60 Current Price is $3.31 Difference: $0.29
If GOZ meets the Citi target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $3.74, suggesting upside of 15.2% (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

Morgans rates GQG as Add (1) -

Morgans marks-to-market its forecasts for GQG Partners and makes EPS forecasts upgrades over FY23-25 of 3.4-4.3%. The target price is raised to $1.95 from $1.93.

The analyst notes a mixed/volatile performance year-to-date with meaningful underperformance in Global and US Equity to the end of March, followed by an outperformance across all strategies in April.

The broker likes the group's strong flows and undemanding valuation. The Add rating is unchanged.

Target price is $1.95 Current Price is $1.42 Difference: $0.535
If GQG meets the Morgans target it will return approximately 38% (excluding dividends, fees and charges).

Current consensus price target is $2.04, suggesting upside of 42.7% (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: 1.0

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

UBS rates GQG as Buy (1) -

UBS observes, since the IPO, shares of GQG Partners have re-rated sharply lower. The shares trade at around -30% below the float price while over the same period funds under management have grown 26%.

The broker considers the growth, largely achieved organically, in the face of negative markets  is an impressive result and, at 10x PE, the the stock is not priced for long-term growth.

Moreover, the business performed well in April with weighted average return across the funds of 3.9%, outperforming benchmarks. Buy rating and $2.20 target maintained.

Target price is $2.20 Current Price is $1.42 Difference: $0.785
If GQG meets the UBS target it will return approximately 55% (excluding dividends, fees and charges).

Current consensus price target is $2.04, suggesting upside of 42.7% (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: 1.0

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

Morgans rates HMC as Add (1) -

HMC Capital, as manager of Healthco Healthcare & Wellness REIT ((HCW)), has acquired 11 hospitals leased to Helathscope for -$1.2bn. The assets will be owned across both Healthco Healthcare & Wellness REIT and an unlisted healthcare fund.

As a result, Healthco Healthcare & Wellness REIT has raised $320m via a placement and entitlement issue. HMC Capital also raised $125m via a fully underwritten placement at $3.50 and a further $39m via a non-underwritten share purchase plan.

After the capital raising, Morgans valuation/target falls to $5.18 from $5.51. It's noted the REIT is building a track record of executing complex deals. Add.

Target price is $5.18 Current Price is $4.24 Difference: $0.94
If HMC meets the Morgans target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $4.87, suggesting upside of 16.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.5

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

UBS rates IPL as Buy (1) -

Incitec Pivot is due to report its first half earnings on May 17 and UBS expects support from elevated fertiliser demand during the early part of the period, while noting recent diammonium phosphate/ammonia prices have been falling, given easing global gas prices and a weak application season in the northern spring.

Hence FY23 and FY24 EBIT forecasts are reduced by -13% and -27%, respectively. The broker continues to include WALA in earnings forecasts pending completion of the transaction. Buy rating maintained. Target is reduced to $3.55 from $3.60.

Target price is $3.55 Current Price is $3.19 Difference: $0.36
If IPL meets the UBS target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $3.93, suggesting upside of 21.7% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.6

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

Shaw and Partners rates LAU as Buy (1) -

Clayton McDonald has been appointed CEO, effective July 17, to replace Kim Lindsay, who is retiring.

McDonald is Group Executive Bulk at Aurizon ((AZJ)), and prior to that, worked at Toll, and Shaw and Partners considers the appointment a good fit.

Meanwhile, the broker conducted site tours in Sydney and Brisbane, which confirmed the company as a favourite among small caps.

Lindsay Australia's leading position in logistics, rural supply and transport (in a highly fragmented market), combined with growth opportunities from its rail expansion strategy and agriculture focus, pleases the broker, as does the companies very low debt, accompanied by a dividend.

From an ESG perspective, the company has implemented a Guardian camera system to provide early warning and intervention for fatigue and distraction, advises the broker, although how this will affect operations is not made clear.

Buy rating and $1.60 target price retained.

Target price is $1.60 Current Price is $1.30 Difference: $0.3
If LAU meets the Shaw and Partners target it will return approximately 23% (excluding dividends, fees and charges).

Current consensus price target is $1.47, suggesting upside of 10.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 1.0

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

Bell Potter rates LYC as Buy (1) -

Lynas Rare Earths has been given a six-months reprieve to the ban on importing lanthanide concentrate to Malaysia, which was due to be imposed on July1 2023. A complete shutdown of operations has now been avoided over the first quarter of FY24.

The company will continue to appeal the ban on importation after the January 1 2024 deadline. Adjusting the numbers means Bell Potter increases its FY24 earnings profile.

The broker retains a Buy rating, noting the transition over the next six months is a high risk, as the business relocates cracking and leaching operations to Australia. Target is raised to $8.90 from $8.00.

Target price is $8.90 Current Price is $7.37 Difference: $1.53
If LYC meets the Bell Potter target it will return approximately 21% (excluding dividends, fees and charges).

Current consensus price target is $8.14, suggesting upside of 11.1% (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 LYC as Upgrade to Outperform from Neutral (1) -

Lynas Rare Earths has secured an important six-month extension to its operating licence in Malaysia. This should enable full production to be maintained while the plant in Kalgoorlie is ramped up, Macquarie observes.

A longer-term extension to the full operating license in Malaysia presents upside risks to the broker's base case.

Following the receipt of the licence extension Macquarie removes the production hiatus from numbers, which translates to a 45% lift in FY24 production forecasts. Rating is upgraded to Outperform from Neutral and the target raised to $8.60 from $6.50.

Target price is $8.60 Current Price is $7.37 Difference: $1.23
If LYC meets the Macquarie target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $8.14, suggesting upside of 11.1% (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

Morgans rates MFG as Hold (3) -

Morgans marks-to-market its forecasts for Magellan Financial.

While the broker's FY23 forecast is boosted by 3.4% due to the inclusion of a $15m performance fee, the FY24/25 EPS forecasts are downgraded on lower funds under management (FUM).

While the analyst believes peak outflows have passed, there's still a risk remaining to the Retail FUM base with regard to flows and management fee pricing.

The target falls to $10.02 from $10.71. Hold.

Target price is $10.02 Current Price is $8.54 Difference: $1.48
If MFG meets the Morgans target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $8.98, suggesting upside of 4.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.1

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

Ord Minnett rates NHF as Downgrade to Lighten from Hold (4) -

As the share price of nib Holdings has moved through the trigger level, Ord Minnett downgrades to Lighten from Hold. Target is $7.

Target price is $7.00 Current Price is $8.04 Difference: minus $1.04 (current price is over target).
If NHF meets the Ord Minnett target it will return approximately minus 13% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $7.50, suggesting downside of -8.0% (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

UBS rates ORI as Buy (1) -

Orica will report first half earnings on May 11 and has indicated previously the strength of the FY22 result continued into the first half of FY23. Better underlying earnings are attributed to pricing power, commodities demand and higher technology earnings.

UBS will be looking for evidence of increasing ammonium nitrate contract prices, given tight global supplies and near record Australian import parity pricing. Buy rating and $18 target maintained.

Target price is $18.00 Current Price is $16.64 Difference: $1.36
If ORI meets the UBS target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $16.59, suggesting upside of 1.0% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.5

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

Macquarie rates PAN as Outperform (1) -

Panoramic Resources has intercepted thick nickel mineralisation in a drill program at Savannah to establish DHEM survey platforms.

Macquarie notes the survey will allow the company to accurately target extensions to known mineralisation and provide a tool to target future drill holes.

Success in defining the additional mineralisation could result in extensions to current resources and possibly mine life past FY35. Outperform rating and $0.19 target maintained.

Target price is $0.19 Current Price is $0.14 Difference: $0.055
If PAN meets the Macquarie target it will return approximately 41% (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

Macquarie rates PLL as Outperform (1) -

First quarter net loss from Piedmont Lithium was in line with Macquarie's forecasts although net cash was -17% lower because of the timing of expenditure. The company has the right to 50% of spodumene produced from Sayona Quebec at a price of US$900/t.

As production increases the broker expects strong cash flow will start to occur from the offtake and enable the business to self fund the remaining share of the Ewoyaa project and the Tennessee lithium hydroxide plant. Target is steady at $2.00. Outperform retained.

Target price is $2.00 Current Price is $0.84 Difference: $1.16
If PLL meets the Macquarie target it will return approximately 138% (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 PNI as Add (1) -

Morgans marks-to-market its forecasts for Pinnacle Investment Management and notes Metrics Credit has invested in 'Horizon 2' initiatives which is impacting profitability for the Affiliate.

The broker lowers its FY23 forecast by around -2.8% on the back of the metrics commentary and a subdued performance fee outlook. The target falls to $10.60 from $10.75. 

The analyst likes the group's diversified business model and strong long-term growth. Add.

Target price is $10.60 Current Price is $8.96 Difference: $1.64
If PNI meets the Morgans target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $9.84, suggesting upside of 11.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.5

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

Macquarie rates QAL as Outperform (1) -

Qualitas has a new mandate for up to $1bn with a global institutional investor for investments in commercial real estate opportunities.

Macquarie believes the transaction demonstrates the attractive nature of the commercial real estate credit sub-sector and the company's ability to grow through material partnerships.

Qualitas now has significant sources of capital to accelerate deployment over the medium term and Macquarie retains an Outperform rating. Target is $3.27.

Target price is $3.27 Current Price is $2.60 Difference: $0.67
If QAL meets the Macquarie target it will return approximately 26% (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

UBS rates QAN as Neutral (3) -

Post the pandemic, UBS assesses the Qantas domestic business is better positioned. Domestic fares and market share should benefit from changes to the competitive landscape such as the exit of Tiger and repositioning of Virgin Australia.

The broker expects domestic industry revenue in FY24 will be 7% higher than FY19.

Some valuation upside is anticipated for Qantas, based on fundamental valuations and global comparables but UBS does not believe the stock will return to its mid-cycle PE of 9.8x until it has absorbed several years of upcoming replacement expenditure.

Neutral maintained. Target is steady at $7.60.

Target price is $7.60 Current Price is $6.37 Difference: $1.23
If QAN meets the UBS target it will return approximately 19% (excluding dividends, fees and charges).

Current consensus price target is $7.65, suggesting upside of 19.9% (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 QBE as Overweight (1) -

Leading into QBE Insurance's 1Q update and AGM on May 12, Morgan Stanley sees an overall positive backdrop, including strong March quarter pricing updates from peers.

The broker notes the company is taking further steps to reduce earnings volatility and thinks the share price has more room to re-rate.

The Overweight rating and $17 target are retained. Industry View: In-Line.

Target price is $17.00 Current Price is $15.46 Difference: $1.54
If QBE meets the Morgan Stanley target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $16.28, suggesting upside of 6.2% (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: 0.7

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

Macquarie rates SQ2 as Outperform (1) -

Macquarie notes Block's first quarter was better than expected, with revenue of US$4.99bn. Volumes were strong across the company's businesses which the broker attributes to growth in penetration across customers and clients.

Management has indicated losses on consumer receivables fell to 0.7%. Take-up rates also rose "impressively", the broker adds.

Among the large financial technology stocks, Block continues to be Macquarie's choice and an Outperform rating and $145 target are maintained.

Target price is $145.00 Current Price is $88.41 Difference: $56.59
If SQ2 meets the Macquarie target it will return approximately 64% (excluding dividends, fees and charges).

Current consensus price target is $146.00, suggesting upside of 68.2% (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: 0.7

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

Macquarie rates TWR as Outperform (1) -

Tower has downgraded FY23 net profit to NZD8-13m from NZD18-23m. FY23 large events allowance has increased to NZD50m, with around -NZD34m in losses incurred to the end of April.

The company has increased its gross written premium guidance to 15-20%, expecting to report a statutory loss after-tax for the first half of -NZD3m and will not pay an interim dividend.

As reinsurance markets become more difficult, Macquarie notes the winding back of cover leads to increased earnings volatility. And, unfortunately, the severity of catastrophes, the first half and higher-than-average frequency have weighed on Tower.

Outperform maintained. Target is reduced to NZD0.84 from NZD0.88.

Current Price is $0.55. Target price not assessed.

The company's fiscal year ends in September.

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: 1.0

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

Citi rates WBC as Buy (1) -

Westpac's March-half result outpaced consensus by 4% but missed Citi's forecasts by -3% (as net interest margins fell short due to rising competition), and the dividend disappointed.

Costs proved the star of the show, down 1%, but the company has retreated from its FY24 targets and Citi wonders why.

Buy rating and $26.25 target price retained.

Target price is $26.25 Current Price is $21.74 Difference: $4.51
If WBC meets the Citi target it will return approximately 21% (excluding dividends, fees and charges).

Current consensus price target is $24.38, suggesting upside of 12.0% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.6

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

Macquarie rates WBC as Neutral (3) -

Macquarie notes Westpac has abolished its "ambitious" absolute cost reduction target, while the first half result was "clean" and slightly below forecasts as funding tailwinds did not materialise to the extent expected.

The broker observes that, despite early signs of mortgage competition abating, the back books of the banks are significantly more profitable than the front books.

Furthermore, as customers look for better deals, Macquarie expects churn towards the front book rates will continue. The broker considers the stock appropriately valued at current levels and maintains a Neutral rating. Target is reduced to $22 from $23.

Target price is $22.00 Current Price is $21.74 Difference: $0.26
If WBC meets the Macquarie target it will return approximately 1% (excluding dividends, fees and charges).

Current consensus price target is $24.38, suggesting upside of 12.0% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.6

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

Morgan Stanley rates WBC as Overweight (1) -

Following Westpac's 1H results, Morgan Stanley believes margin management has improved. Management noted the "exit" margin was in line with the 2Q and felt deposits wouldn't be a meaningful headwind in the 2H.

However, the broker was disappointed by a material change to the cost outlook. The FY24 cost base target of -$8.6bn for "Core WBC" was removed and CEO Peter King specifically stated that “costs are not going to reduce.”

As a result of this commentary, Morgan Stanley raises its expense forecasts in FY24 and FY25 by around -4-5%. The target falls to $22.80 from $23.60. Industry View: In-Line.

Target price is $22.80 Current Price is $21.74 Difference: $1.06
If WBC meets the Morgan Stanley target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $24.38, suggesting upside of 12.0% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.6

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

Morgans rates WBC as Add (1) -

Following 1H results for Westpac, Morgans lowers its FY23-25 cash EPS forecasts by -5%, -11% and -7%, respectively, due to cuts to the net interest margin (NIM) and non-interest income and higher operating expenses.

Morgans expected greater leverage to higher rates than the 10bps increase in core NIM.

A partial offset to the broker's forecast downgrades came from a lower assumed long-run credit impairment charge rate. The target price falls to $24.22 from $25.98.

While NIM leverage and stepping away from management's FY24 cost target were disappointing aspects of the result for the analyst, there was solid 1H earnings growth and a lift in return on equity (ROE) by 2% to 11.3%.

Further positives included a step-up in DPS, and a strong capital and liquidity position at the end of the first half. Add.

Target price is $24.22 Current Price is $21.74 Difference: $2.48
If WBC meets the Morgans target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $24.38, suggesting upside of 12.0% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.6

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

Ord Minnett rates WBC as Accumulate (2) -

Ord Minnett continues to believe cost savings and regaining momentum in lending are critical to closing the gap between Westpac's share price and its target, reduced -3% to $28. Accumulate rating maintained.

The broker found Westpac's first half results strong, noting profit was up 15% and revenue up 7%. Along with major bank peers, intense mortgage and deposit competition means the trajectory of earnings is likely down heading into the second half of FY23.

A negative revenue impact is countered by higher non-interest income and a larger asset base, Ord Minnett adds, as the bank is expected to grow loans and deposits in line with the market and without resorting to market-leading discounting.

Target price is $28.00 Current Price is $21.74 Difference: $6.26
If WBC meets the Ord Minnett target it will return approximately 29% (excluding dividends, fees and charges).

Current consensus price target is $24.38, suggesting upside of 12.0% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.6

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

UBS rates WBC as Neutral (3) -

 On further analysis of the first half results UBS raises earnings estimates for FY23 by 7% and reduces FY24 by -2%, driven by changes to net interest margin assumptions, decreasing costs and flat revenue forecasts.

The broker considers Westpac fairly valued and retains a Neutral rating. UBS suspects the slowdown in mortgage lending will present challenges to growth, given the size and importance to the overall franchise. Target is raised to $23.00 from $22.50.

Target price is $23.00 Current Price is $21.74 Difference: $1.26
If WBC meets the UBS target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $24.38, suggesting upside of 12.0% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.6

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

Macquarie rates WDS as Neutral (3) -

Ahead of the federal budget, which has mooted changes to the petroleum resource rent tax (PRRT), Macquarie adjusts its model for Woodside Energy to commence payments of PRRT from Pluto and Wheatstone from the September quarter.

The broker notes the company is investing heavily in growth projects while also maintaining a high dividend pay-out. Gearing is expected to rise each year, from 9% currently to 17% by 2027 when Scarborough starts contributing LNG cash flow.

Gearing would remain within the company's 10-20% target range. Macquarie reduces the target to $32 from $33 and retains a Neutral rating.

Target price is $32.00 Current Price is $34.05 Difference: minus $2.05 (current price is over target).
If WDS meets the Macquarie target it will return approximately minus 6% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $36.02, suggesting upside of 6.1% (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: 0.1

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

Morgan Stanley rates WES as Initiation of coverage with Equal-weight (3) -

Morgan Stanley initiates coverage on Wesfarmers to build-out its coverage of the Australian consumer industry. An Equal-weight rating and $47.50 target price are set. Industry view: In-line.

The broker describes the company as a true conglomerate due to its diverse business operations. However, the broker anticipates an increase in the group's capital intensity, earnings volatility and operational risk.

The Wesfarmers Chemicals, Energy & Fertilisers (WesCEF) division will see a structural shift in earnings from FY25, when Mt Holland reaches the company's lithium production target.

The analysts anticipate a muted FY24 growth outlook on weak discreationary spending and a slow down of Bunnings like-for-like growth due to cyclical weakness in the domestic housing market.

Morgan Stanley also expects a peak in near-term WesCEF earnings in FY24 as global gas prices retrace.

Target price is $47.50 Current Price is $51.50 Difference: minus $4 (current price is over target).
If WES meets the Morgan Stanley target it will return approximately minus 8% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $49.85, suggesting downside of -2.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.0

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