Australian Broker Call

Citi rates ALL as Buy (1) -

Citi regards Aristocrat Leisure's move to replace Interactive business CEO Moti Malul, who is stepping down, with Dylan Slaney as a "well-qualified replacement." 

The broker notes Slaney was CEO of Light & Wonder's ((LNW) iGaming business from 2021-2024, and in those years revenue and EBITDA each grew by around 10%, with momentum continuing after that.

The broker expects the company to remain committed to achieving its US$1bn Interactive revenue target by FY29.

Buy. Target unchanged at $71.

Target price is $71.00 Current Price is $67.47 Difference: $3.53
If ALL meets the Citi target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $73.09, suggesting upside of 6.0% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.9

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

Citi rates ANZ as Neutral (3) -

ANZ Bank has today announced an agreement to settle five ASIC investigations with penalties totaling -$240m. 

In addition, the bank will spend -$150m in FY26 on a Root Cause Remediation Plan to address non-financial risk shortcomings, funded by reprioritising spend, explains Citi.

The issues span markets and retail operations, including bond issuance practices, inaccurate data submissions, customer hardship handling, and deceased estates.

In an initial assessment, the broker considers these outcomes an important step in repairing regulatory relationships, with the added cost signaling seriousness of intent.

New CEO Nuno Matos has already announced -3,500 job cuts, is reshaping technology strategy through ANZ Plus, and is tightening non-financial risk management, point out the analysts.

Citi expects ANZ to use its October strategy day to reset the agenda, with progress suggesting a cleaner platform for growth. Increased scope for better returns is seen via efficiency gains and technology renewal.

Target $32.50. Neutral.

Target price is $32.50 Current Price is $33.19 Difference: minus $0.69 (current price is over target).
If ANZ meets the Citi target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $29.82, suggesting downside of -9.6% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: -0.3

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

Macquarie rates BRG as Outperform (1) -

Macquarie Kitchen Benchmark revenue rose 1.8% on the prior year for 2Q 2025 and the De'Longhi revenue index growth was 12%.

From 2018-2024, Breville Group has outperformed the Benchmark revenue growth by around 11% due to strength in coffee, new product development, and new markets, the analyst notes.

Williams Sonoma, a US retail channel, upgraded its 2025 revenue guidance by 2%, and Currys UK, a leading retail channel for Breville, reported like-for-like revenue growth of 3% for the 17 weeks ending August 30.

Uncertainty around tariffs continues to create challenges and volatility for small domestic appliance markets, and many companies have started to announce price increases in the US market, including De'Longhi, Electrolux, Shark Ninja, to name a few.

No change in Outperform rating and $39.20 target price. No change in the analyst's EPS forecasts.

Target price is $39.20 Current Price is $30.59 Difference: $8.61
If BRG meets the Macquarie target it will return approximately 28% (excluding dividends, fees and charges).

Current consensus price target is $36.73, suggesting upside of 18.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.5

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

Ord Minnett rates COH as Hold (3) -

The Nucleus Nexa launch has lifted Cochlear’s price-to-earnings multiple to 42 times from 38 times, a level Ord Minnett considers appropriate.

Management expects FY26 earnings to be second-half weighted, as many US patients deferred surgery ahead of the launch, notes the broker. Implant sales in the second half are now expected to exceed the first half, with a full period of contribution from the new implant.

Ord Minnett cautions services revenue remains under pressure from cost-of-living constraints in the US, though upgrades of the Nucleus 7 should provide some offset.

The broker maintains a Hold rating and a $295 target price.

Target price is $295.00 Current Price is $299.79 Difference: minus $4.79 (current price is over target).
If COH 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 $311.74, suggesting upside of 3.0% (ex-dividends)

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.0

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

Citi rates HVN as Buy (1) -

Citi has a Buy rating on both Harvey Norman and JB Hi-Fi, and expects both to outperform the market as consensus earnings are revised higher. For context, the broker's FY26 EBIT forecasts for both are 4% above consensus.

The broker notes the company has relatively less exposure to the electrical categories but more to house prices. 

Two factors currently point to strong house price growth, and thus for furniture and bedding categories: the pull-forward of the 5% deposit scheme for first-home buyers and the rise in Westpac-MI house price expectations index. 

No change to forecasts. Target price $7.70.

Target price is $7.70 Current Price is $7.23 Difference: $0.47
If HVN meets the Citi target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $6.98, suggesting downside of -2.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.3

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

Macquarie rates IFT as Outperform (1) -

Ahead of Infratil's upcoming investor day on Thursday, Macquarie views the non-core asset sale strategy as positive and sensible, but circa -NZ$1.5bn may need to be divested to lower the number of investments to seven from 14, which is viewed as a more rational outcome.

The sales would also allow for a shrinking of the valuation gap of some -19% against the company's NAV.

An update on CDC, Canberra Data Centres, will also be a focus for investors, including an update on earnings (EBITDA) guidance for FY26 at $400m at the midpoint, provided last May, up 21% on the prior year, and a doubling of earnings (EBITDA) by FY27 with 80% contracted.

No change in Outperform rating with a NZ$12.47 target price, up from NZ$12.32.

Current Price is $11.25. Target price not assessed.

Current consensus price target is N/A

The company's fiscal year ends in March.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 1.0

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

Morgan Stanley rates IGO as Underweight (5) -

Morgan Stanley reckons IGO Ltd's share price fully reflects exposure to the clean energy metals thematic.

The broker remains cautious on acquisition risks, particularly with the Nova Operation approaching the end of life in 2026 and the group’s minority position in Greenbushes limiting control.

Underweight. Target unchanged at $3.90. Industry view: Attractive.

Target price is $3.90 Current Price is $4.34 Difference: minus $0.44 (current price is over target).
If IGO meets the Morgan Stanley target it will return approximately minus 10% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.95, suggesting upside of 6.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.0

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

Citi rates JBH as Buy (1) -

Citi has a Buy rating on both JB Hi-Fi and Harvey Norman, and expects both to outperform the market as consensus earnings are revised higher. For context, the broker's FY26 EBIT forecasts for both are 4% above consensus.

The broker expects the company to benefit from an improved outlook for consumer spending, growth in PCs, gaming, and especially robot vacuums, as well as further gains in market share.

No change to forecasts. Target price $120.

Target price is $120.00 Current Price is $114.35 Difference: $5.65
If JBH meets the Citi target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $104.94, suggesting downside of -7.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: 0.0

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

Citi rates JHX as Neutral (3) -

Citi notes AGM's are usually non-events, but James Hardie Industries' upcoming AGM on Oct 30 might be more material than usual due to a combination of board renewal, governance scrutiny, and weaker trading momentum.

The broker's view of governance documents suggests a majority of the board (6 of 11 directors) may be up for re-election at this AGM.

While an outcome is not being speculated, the broker reckons a change in Chair might lead to a management change, and have implications for the balance sheet.

Neutral. Target unchanged at $35.

Target price is $35.00 Current Price is $30.14 Difference: $4.86
If JHX meets the Citi target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $35.88, suggesting upside of 18.8% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY26:

Forecast for FY27:

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

Market Sentiment: 0.3

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

Macquarie rates JHX as Outperform (1) -

Against a challenging macro US housing outlook, Macquarie continues to like James Hardie Industries and Reliance Worldwide ((RWC)) for US building materials exposure.

Macquarie US contractors optimism index slipped -5pts to 49 in August due to consumer uncertainty and high mortgage rates, which continue to impact the home buying and renovation markets.

Noting the risks to James Hardie's balance, the analyst continues to be positive on the investment thesis and notes the stock price has fallen considerably and earnings are well below mid-cycle. Softening monetary policy should be a boost.

Outperform rated with a $37.20 target price.

Target price is $37.20 Current Price is $30.14 Difference: $7.06
If JHX meets the Macquarie target it will return approximately 23% (excluding dividends, fees and charges).

Current consensus price target is $35.88, suggesting upside of 18.8% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY26:

Forecast for FY27:

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

Market Sentiment: 0.3

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

Macquarie rates OBM as Downgrade to Underperform from Outperform (5) -

Ora Banda Mining is downgraded by Macquarie to Underperform from Outperform with an unchanged target of 95c post the updated resource and reserve growth update.

The miner's annual R&R statement showed resources up 8% to 2.1Moz and ore reserves up 24% to 236koz (net of depletion), with an underground reserve of around 1.7mt at 3.3g/t for 176koz.

The bulk of the reserve is from Sand King, the analyst highlights, rising 54% to 84koz, and Riverina up 5% to 92koz.

Further growth is flagged from the sizeable exploration program over FY26, which is expected to boost resource/reserves.

Macquarie trims production estimates from lower Riverina grades and reduces FY26 EPS estimate by -9%.

Target price is $0.95 Current Price is $1.16 Difference: minus $0.21 (current price is over target).
If OBM meets the Macquarie target it will return approximately minus 18% (excluding dividends, fees and charges - negative figures indicate an expected loss).

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

Market Sentiment: -0.3

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

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

Morgan Stanley expects the ramp-up issues at Paladin Energy's Langer Heinrich mine encountered in FY25 to be resolved in FY26.

Beyond this, the broker notes the company offers growth potential via Patterson Lake South, but believes this is already fairly reflected in the current valuation.

Equal-weight. Target unchanged at $7.30. Industry View: Attractive.

Target price is $7.30 Current Price is $7.74 Difference: minus $0.44 (current price is over target).
If PDN meets the Morgan Stanley target it will return approximately minus 6% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $8.73, suggesting upside of 10.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

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

Market Sentiment: 0.8

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

Macquarie rates RWC as Outperform (1) -

Against a challenging macro US housing outlook, Macquarie continues to like James Hardie Industries ((JHX)) and Reliance Worldwide for US building materials exposure.

Macquarie US contractors optimism index slipped -5pts to 49 in August due to consumer uncertainty and high mortgage rates, which continue to impact the home buying and renovation markets.

The analyst reckons Reliance's management is continuing to manage the business well considering the challenges, positioning the business for any recovery, and the valuation remains attractive.

No change in Outperform rating and $5.30 target.

Target price is $5.30 Current Price is $4.12 Difference: $1.18
If RWC meets the Macquarie target it will return approximately 29% (excluding dividends, fees and charges).

Current consensus price target is $4.68, suggesting upside of 12.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

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

Market Sentiment: 0.3

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

Citi rates SCG as Buy (1) -

Citi has been eyeing a gradual decline in funding costs for Scentre Group and saw the first evidence in the $1bn 1-year senior note issue in the Australian market, which is expected to lower the cost of debt for the group.

The notes were issued at 5.35% fixed, but swapped to floating at 138bps margin over 3-month BBSW. The weighted average interest rate of debt and subordinated notes before this was 5.7%, and senior facilities at 220bps margin.

The broker expects the new proceeds to be used to repay existing debt.

Buy. Target unchanged at $4.60.

Target price is $4.60 Current Price is $4.20 Difference: $0.4
If SCG meets the Citi target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $4.04, suggesting downside of -3.8% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.2

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

Morgan Stanley rates SFR as Underweight (5) -

Morgan Stanley believes the market is more than pricing Sandfire Resources' options to extend reserve lives at Motheo and Matsa, and development potential at Black Butte.

Underweight. Target unchanged at $8.35.  Industry View: Attractive.

Target price is $8.35 Current Price is $12.47 Difference: minus $4.12 (current price is over target).
If SFR meets the Morgan Stanley target it will return approximately minus 33% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $12.00, suggesting downside of -3.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY26:

Forecast for FY27:

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

Macquarie rates WDS as Neutral (3) -

Subject to more emission restrictions on nitrogen oxides (NOx), Woodside Energy has received approval from the Federal Government for North West Shelf life extension to 2070.

The energy producer is required to reduce NOx emissions by around -60% to -65%, above previous levels of -40% by 2031, which will be more expensive to achieve and only likely on Trains 4 & 5.

Macquarie tweaks EPS forecasts by -0.9% for 2025 and up 1.1% for 2026. No change to Neutral rating and $25 target.

The analyst finds it challenging to be more upbeat given the higher costs and impact on valuation, as well as the softening macro environment for oil and LNG.

Target price is $25.00 Current Price is $24.22 Difference: $0.78
If WDS meets the Macquarie target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $26.16, suggesting upside of 8.0% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY25:

Forecast for FY26:

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