Australian Broker Call

Citi rates ABC as Neutral (3) -

Citi recently upgraded Adbri to Neutral from Sell, noting industry pricing appears to be holding higher for longer. Adbri has this morning upgraded earnings guidance to $310-315m versus expectations of $306m.

At the midpoint this implies a 10% increase on the first half, Citi notes. This compares to guidance of “moderately” higher growth.

Capex guidance for the year decreased to $310-320m from $330-350m. However, with Kwinana expected to be largely the same, it implies the circa -$25m reduction is being taken from the base business.

Neutral and $2.25 target retained for now.

Target price is $2.25 Current Price is $2.09 Difference: $0.16
If ABC meets the Citi target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $2.17, suggesting downside of -4.4% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: -0.4

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

Morgans rates ADH as Hold (3) -

Morgans updates its earnings estimates for Consumer Discretionary stocks to account for recent currency movements and trading updates. It's felt the key picks are Lovisa Holdings and Super Retail Group.

While profit forecasts fall by -1% in both FY24 and FY25, generally due to lower gross margins and higher operating cost assumptions, the broker's revised FY24 estimates still sit 3% above consensus.

Morgans increases its target for Adairs to $1.70 from $1.40 due to higher peer multiples, and maintains a Hold rating.

Target price is $1.70 Current Price is $1.79 Difference: minus $0.09 (current price is over target).
If ADH meets the Morgans target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $1.65, suggesting downside of -13.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.0

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

Macquarie rates AGL as Outperform (1) -

Macquarie lowers its target for AGL Energy to $10.89 from $11.51 to reflect softer electricity pricing, the broker also assumes a higher weighted average cost of capital (WACC).

The analyst feels softer forward curves will translate into lower earnings expectations in FY25, and particularly in FY26, which has less hedging.

Macquarie sees signs of profitability re-emerging from higher churn in the retail environment across the major markets of NSW and Victoria. The Outperform rating is maintained.

Target price is $10.89 Current Price is $9.53 Difference: $1.36
If AGL meets the Macquarie target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $11.54, suggesting upside of 25.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.5

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

Macquarie rates AIA as Outperform (1) -

The final decision from the NZ Commerce Commission's Input Methodologies Review represents a win for airports, says Macquarie, with the final determination an increase in regulatory P50 WACC to 8.02% from 7.19%, setting a new benchmark against which Auckland International Airport's PSE5 aeronautical pricing will be reviewed.

Macquarie points out from FY28, this will allow Auckland International Airport to target a higher total return. While Auckland International Airport, alongside other New Zealand airports, had been dissatisfied by the draft determination, it is not yet clear if the final determination will appease the sector.

The Outperform rating and target price of NZ$9.56 are retained.

Current Price is $7.89. Target price not assessed.

Current consensus price target is $7.85, suggesting upside of 1.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

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

Market Sentiment: 0.0

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

Macquarie rates AWC as Neutral (3) -

Alumina Ltd's AWAC joint venture has had its five year mine plan approved by the WA government.The plan is subject to strict environmental considerations, which include enhanced protections for drinking water.

The state government has also granted AWAC an exception, allowing it to continue mining operations even if the state Environmental Protection Authority decides to undertake a separate Environmental Impact Assessment.

The Neutral rating and target price of 80 cents are retained.

Target price is $0.80 Current Price is $0.88 Difference: minus $0.075 (current price is over target).
If AWC meets the Macquarie target it will return approximately minus 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $1.01, suggesting upside of 13.2% (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: 0.6

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

Morgans rates AX1 as Add (1) -

Morgans updates its earnings estimates for Consumer Discretionary stocks under the broker's coverage for recent currency movements and trading updates during the AGM season. It's felt the key picks are Lovisa Holdings and Super Retail Group.

While profit forecasts fall by -1% in both FY24 and FY25, generally due to lower gross margins and higher operating cost assumptions, the broker's revised FY24 estimates still sit 3% above consensus.

The target for Accent Group falls to $2.30 from $2.40 on lower earnings estimates and a higher weighted cost of capital (WACC) assumption by the broker. Add.

Target price is $2.30 Current Price is $1.96 Difference: $0.345
If AX1 meets the Morgans target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $2.17, suggesting upside of 10.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.3

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

Morgans rates BLX as Add (1) -

Morgans updates its earnings estimates for Consumer Discretionary stocks under the broker's coverage for recent currency movements and trading updates during the AGM season. It's felt the key picks are Lovisa Holdings and Super Retail Group.

While profit forecasts fall by -1% in both FY24 and FY25, generally due to lower gross margins and higher operating cost assumptions, the broker's revised FY24 estimates still sit 3% above consensus.

Morgans increases its target for Beacon Lighting to $2.50 from $2.20 due to higher peer multiples, and maintains an Add rating.

Target price is $2.50 Current Price is $2.34 Difference: $0.16
If BLX meets the Morgans target it will return approximately 7% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 1.0

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

Morgans rates BRG as Hold (3) -

Morgans updates its earnings estimates for Consumer Discretionary stocks under the broker's coverage for recent currency movements and trading updates during the AGM season. It's felt the key picks are Lovisa Holdings and Super Retail Group.

While profit forecasts fall by -1% in both FY24 and FY25, generally due to lower gross margins and higher operating cost assumptions, the broker's revised FY24 estimates still sit 3% above consensus.

Morgans increases its target for Breville Group to $26 from $25 due to higher peer multiples, and maintains a Hold rating.

Target price is $26.00 Current Price is $26.07 Difference: minus $0.07 (current price is over target).
If BRG meets the Morgans target it will return approximately minus 0% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $27.18, suggesting upside of 3.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.6

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

Ord Minnett rates CBO as Buy (1) -

Cobram Estate Olives has provided a positive trading update, Ord Minnett notes, with first half sales growth for the first five months of FY24 well in excess of the prior period, in both the Australian and US markets.

Completion of the US harvest yielded 3.2m litres of olive oil, up 89% year on year, slightly below the broker's expectations, albeit likely to be offset by the transfer of Australian oil.

FY24 is shaping up as a milestone year for the company, Ord Minnett suggests, potentially passing through peak investment/gearing and with tailwinds from rising crop maturity and gross profit generation in all markets, across a relatively fixed cost structure.

Buy retained, target rises to $1.82 from $1.61.

Target price is $1.82 Current Price is $1.61 Difference: $0.21
If CBO meets the Ord Minnett target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $1.77, suggesting upside of 5.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

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 CBO as Buy (1) -

Cobram Estate Olives announced that its US olive oil intake would be up 89% year on year, and also stated that its Australian and California packaged olive oil sales for the first five months of FY24 are well ahead of the same period last year.

Shaw and Partners notes the European Commission recently predicted that exports from the EU may fall over -10% in 2024. This creates a market share opportunity for Cobram Estate even with higher output prices.

The company reports that the Australia growing season is “shaping up well” with initial estimates for harvest volume in-line with management expectation.

Target rises to $1.80 from $1.75, Buy retained.

Target price is $1.80 Current Price is $1.61 Difference: $0.19
If CBO meets the Shaw and Partners target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $1.77, suggesting upside of 5.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 1.0

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

Morgans rates COI as Initiation of coverage with Speculative Buy (1) -

Morgans initiates coverage on emerging coal seam gas (CSG) producer Comet Ridge, which has assets located in Queensland's Bowen Basin, with a Speculative Buy rating and 28c target.

The core focus by management is on the Mahalo Gas Hub where two key projects are being progressed: the 100%-owned Mahalo North and the 57%-owned Mahalo joint venture in partnership with Santos ((STO)).

The broker cautions remaining approvals and pipeline agreements are material and critical steps towards development, but also notes a positive risk/reward skew.

The positive skew partly relates to proximity to market and the broker's forecast for a sustained supply deficit from late-2025 for the east coast gas market.

Target price is $0.28 Current Price is $0.17 Difference: $0.11
If COI meets the Morgans target it will return approximately 65% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Market Sentiment: 1.0

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

Morgans rates DMP as Add (1) -

Morgans updates its earnings estimates for Consumer Discretionary stocks under the broker's coverage for recent currency movements and trading updates during the AGM season. It's felt the key picks are Lovisa Holdings and Super Retail Group.

While profit forecasts fall by -1% in both FY24 and FY25, generally due to lower gross margins and higher operating cost assumptions, the broker's revised FY24 estimates still sit 3% above consensus.

Morgans increases its target for Domino's Pizza Enterprises to $61 from $60 due to higher peer multiples, and maintains an Add rating.

Target price is $61.00 Current Price is $56.80 Difference: $4.2
If DMP meets the Morgans target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $58.93, suggesting upside of 5.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.6

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

Morgans rates DXC as Add (1) -

Morgans raises its target for Dexus Convenience Retail REIT to $3.28 from $3.17 after announced property revaluations of -1.1% for around half of the portfolio were less than the total -4% the broker had been expecting across FY24.

The weighted average cap rate increased by 20bps to 6.30%.

The analyst believes the portfolio remains well positioned and offers investors an attractive dividend yield. The Add rating is maintained.

Target price is $3.28 Current Price is $2.75 Difference: $0.53
If DXC meets the Morgans target it will return approximately 19% (excluding dividends, fees and charges).

Current consensus price target is $2.97, suggesting upside of 12.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.8

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

Morgans rates DXI as Add (1) -

Morgans updates its forecasts for Dexus Industria REIT following the recent announcement by management the Kemps Creek development project would not proceed due to ongoing planning uncertainty and heightened risks.

While the broker expects cap rates will expand further in the near-term, the industrial portfolio remains robust with a positive outlook for rental growth.

The Add rating is unchanged and the target creeps up to $3.18 from $3.17.

Target price is $3.18 Current Price is $2.84 Difference: $0.34
If DXI meets the Morgans target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $2.96, suggesting upside of 3.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.3

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

Ord Minnett rates GQG as Buy (1) -

GQG Partners has had a strong year-to-date performance with robust net flows and funds under management growth despite volatile equity markets, Ord Minnett notes. Given equity markets have performed well since end-November, the broker believes GQG will post a strong 2023 result.

Ord Minnett expects GQG’s strong investment performance over longer timeframes to support longer-term net flows. Yet the stock remain inexpensive on a lower than market-average PE but higher than average yield of 8.8%.

Target rises to $2.20 from $2.15, Buy retained.

Target price is $2.20 Current Price is $1.61 Difference: $0.595
If GQG meets the Ord Minnett target it will return approximately 37% (excluding dividends, fees and charges).

Current consensus price target is $2.10, suggesting upside of 30.4% (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 JBH as Hold (3) -

Morgans updates its earnings estimates for Consumer Discretionary stocks under the broker's coverage for recent currency movements and trading updates during the AGM season. It's felt the key picks are Lovisa Holdings and Super Retail Group.

While profit forecasts fall by -1% in both FY24 and FY25, generally due to lower gross margins and higher operating cost assumptions, the broker's revised FY24 estimates still sit 3% above consensus.

Morgans increases its target for JB Hi-Fi to $51 from $49 due to higher peer multiples, and maintains a Hold rating.

Target price is $51.00 Current Price is $50.32 Difference: $0.68
If JBH meets the Morgans target it will return approximately 1% (excluding dividends, fees and charges).

Current consensus price target is $44.65, suggesting downside of -12.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: -0.5

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

Morgans rates LOV as Add (1) -

Morgans updates its earnings estimates for Consumer Discretionary stocks under the broker's coverage for recent currency movements and trading updates during the AGM season. It's felt the key picks are Lovisa Holdings and Super Retail Group.

While profit forecasts fall by -1% in both FY24 and FY25, generally due to lower gross margins and higher operating cost assumptions, the broker's revised FY24 estimates still sit 3% above consensus.

Morgans maintains its Add rating and $27.50 target for Lovisa Holdings.

Target price is $27.50 Current Price is $22.53 Difference: $4.97
If LOV meets the Morgans target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $22.99, suggesting downside of -0.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.6

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

Morgans rates M7T as Add (1) -

A new contract renewal confirms Morgans' view that Mach7 Technologies' existing eUnity contracts are cum upgrade upon renewal, and the offering presents value at higher prices.

This opinion by the broker follows the announcement of a five-year subscription renewal with major customer Sentara Healthcare for eUnity, which increases annual recurring revenue (ARR) by $1m.

The analysts consider management has a strong ability to push through more normalised (higher) prices. This outcome will potentially accelerate the company's goal of covering its cost base solely with recurring contracts in the next few years, notes the broker.

The Add rating and $1.54 target are unchanged.

Target price is $1.54 Current Price is $0.74 Difference: $0.8
If M7T meets the Morgans target it will return approximately 108% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 1.0

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

Macquarie rates ORA as Outperform (1) -

Following completion of Orora's Saverglass acquisition at the beginning of December, Orora has reaffirmed its base business growth expectations, guiding to higher earnings in FY24 than FY23.

Softer volumes have been reported across the spirits sector, a result of a weaker end consumer and inventory destocking, and Macquarie is anticipating a -3% volume decline over the full year for Saverglass, despite being somewhat insulated from broader market softness.

The Outperform rating is retained and the target price decreases to $3.30 from $3.40.

Target price is $3.30 Current Price is $2.60 Difference: $0.7
If ORA meets the Macquarie target it will return approximately 27% (excluding dividends, fees and charges).

Current consensus price target is $3.21, suggesting upside of 25.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.6

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

Morgan Stanley rates ORA as Overweight (1) -

While Orora has acknowledged subdued market conditions and recent destocking, Saverglass earnings for the remainder of FY24 are expected to be in line with the proforma run-rate. This is broadly in line with Morgan Stanley, and much better than feared.

Management nonetheless warned this outcome may be affected if a prolonged customer destocking or softness in consumer demand persists beyond early 2024. In the medium-long terms, Orora remains confident in Saverglass' potential.

Overweight and $3.50 target retained. Industry view: In Line.

Target price is $3.50 Current Price is $2.60 Difference: $0.9
If ORA meets the Morgan Stanley target it will return approximately 35% (excluding dividends, fees and charges).

Current consensus price target is $3.21, suggesting upside of 25.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.6

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

Morgans rates ORA as Hold (3) -

Now that the Saverglass acquisition has been completed (December 4), Orora has updated on the Saverglass performance since.

Morgans was forecasting earnings (EBITDA) growth of around 14% for FY24, but was slightly disappointed by management's guidance for earnings to be broadly in line with the run-rate in FY23.

There was no change in the company's outlook for Australasia and North America.

Following the trading update, the broker lowers its target to $2.70 from $3.00 and retains a Hold recommendation.

Target price is $2.70 Current Price is $2.60 Difference: $0.1
If ORA meets the Morgans target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $3.21, suggesting upside of 25.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.6

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

UBS rates ORA as Neutral (3) -

With the Saverglass transaction now complete, UBS has updated Orora forecasts to reflect the acquisition. Forecasts assume a -10% decline in Saverglass' earnings in FY24 versus initial guidance for flat earnings.

The broker's valuation analysis indicates that the current share price may imply a -17% decline in Saverglass' earnings. UBS believes Saverglass' flat earnings outlook considers a strong degree of cost management to offset weaker volumes.

The broker's base case assumes ongoing destocking in premium alcohol.

Target falls to $2.84 from $3.75, Neutral retained.

Target price is $2.84 Current Price is $2.60 Difference: $0.24
If ORA meets the UBS target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $3.21, suggesting upside of 25.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.6

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

Macquarie rates ORG as Outperform (1) -

With Origin Energy in the cash generation part of its cycle, Macquarie is anticipating the company can deliver $5.7bn in free cash generation, despite lower earnings than the broker has been expecting. 

Macquarie also expects Origin Energy to generate $4.6bn post capital expenditure through to FY27, and anticipates the company reconsidering its current 30-50% free cash payout to reflect balance sheet strength.

However, softer forward prices and higher coal costs lower the earnings outlook for FY25 and FY26. The Outperform rating is retained and the target price is reduced to $9.26 from $9.39.

Target price is $9.26 Current Price is $7.99 Difference: $1.27
If ORG meets the Macquarie target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $8.80, suggesting upside of 10.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.5

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

Shaw and Partners rates PLY as Buy (1) -

Playside Studios has announced a multi-game license agreement with Warner Bros. This is another strong validation that Playside is moving to the next level within the global games industry, Shaw and Partners suggests.

Warner Bros has some "fantastic" intellectual property and this long-term agreement highlights the confidence that it has in Playside's ability to bring that content to life, Shaw notes.

Playside Studios is "delivering in spades", yet it remains an undiscovered tech stock in the broker's view. It is a top pick for Shaw.

Buy and 80c target retained.

Target price is $0.80 Current Price is $0.59 Difference: $0.215
If PLY meets the Shaw and Partners target it will return approximately 37% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 1.0

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

Ord Minnett rates SEK as Lighten (4) -

Seek has been "over-earning" since the pandemic, and Ord Minnett believes both volumes and yields will normalise in the near-term. Seek's latest employment report is consistent with this view.

While listing volumes are set to come off sharply in FY24, the broker expects Seek to prop up sales with material price rises, but expects this will lead to market share loss.

On current price, Seek screens as materially overvalued, Ord Minnett declares. Lighten and $19 target retained.

Target price is $19.00 Current Price is $25.16 Difference: minus $6.16 (current price is over target).
If SEK meets the Ord Minnett target it will return approximately minus 24% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $26.54, suggesting upside of 5.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

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 SIG as Downgrade to Hold from Buy (3) -

Sigma Healthcare's share price is up circa 37% since it announced its intended merger with Chemist Warehouse. Based on the information released, Shaw and Partners estimates that this is effectively a nil premium/discount merger.

As the transaction is subject to regulatory approval, the broker makes no changes to forecasts at this time. Given the current share price, and the regulatory review process that will likely take several months, the broker downgrades to Hold from Buy.

90c target retained.

Target price is $0.90 Current Price is $1.05 Difference: minus $0.145 (current price is over target).
If SIG meets the Shaw and Partners target it will return approximately minus 14% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $0.82, suggesting downside of -16.3% (ex-dividends)

The company's fiscal year ends in January.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.2

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

Morgans rates STP as Add (1) -

Morgans updates its earnings estimates for Consumer Discretionary stocks under the broker's coverage for recent currency movements and trading updates during the AGM season. It's felt the key picks are Lovisa Holdings and Super Retail Group.

While profit forecasts fall by -1% in both FY24 and FY25, generally due to lower gross margins and higher operating cost assumptions, the broker's revised FY24 estimates still sit 3% above consensus.

Morgans increases its target for Step One Clothing to $1.00 from 75c partly due to the removal of the broker's discount to peers. An Add rating is maintained.

Target price is $1.00 Current Price is $0.88 Difference: $0.12
If STP meets the Morgans target it will return approximately 14% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 1.0

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

Morgans rates SUL as Add (1) -

Morgans updates its earnings estimates for Consumer Discretionary stocks under the broker's coverage for recent currency movements and trading updates during the AGM season. It's felt the key picks are Lovisa Holdings and Super Retail Group.

While profit forecasts fall by -1% in both FY24 and FY25, generally due to lower gross margins and higher operating cost assumptions, the broker's revised FY24 estimates still sit 3% above consensus.

Morgans increases its target for Super Retail to $17 from $15 due to higher peer multiples, and maintains an Add rating.

Target price is $17.00 Current Price is $15.06 Difference: $1.94
If SUL meets the Morgans target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $12.72, suggesting downside of -16.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: -0.2

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

Morgans rates TRS as Upgrade to Add from Hold (1) -

Morgans updates its earnings estimates for Consumer Discretionary stocks under the broker's coverage for recent currency movements and trading updates during the AGM season. It's felt the key picks are Lovisa Holdings and Super Retail Group.

While profit forecasts fall by -1% in both FY24 and FY25, generally due to lower gross margins and higher operating cost assumptions, the broker's revised FY24 estimates still sit 3% above consensus.

The analysts' target for the Reject Shop rises to $6.25 from $5.85 on higher peer multiples, and the rating is upgraded to Add from Hold.

Target price is $6.25 Current Price is $5.15 Difference: $1.1
If TRS meets the Morgans target it will return approximately 21% (excluding dividends, fees and charges).

Current consensus price target is $6.28, suggesting upside of 23.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.8

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

Morgans rates UNI as Add (1) -

Morgans updates its earnings estimates for Consumer Discretionary stocks under the broker's coverage for recent currency movements and trading updates during the AGM season. It's felt the key picks are Lovisa Holdings and Super Retail Group.

While profit forecasts fall by -1% in both FY24 and FY25, generally due to lower gross margins and higher operating cost assumptions, the broker's revised FY24 estimates still sit 3% above consensus.

Morgans increases its target for Universal Store to $4.55 from $4.25 due to higher peer multiples, and maintains an Add rating.

Target price is $4.55 Current Price is $3.88 Difference: $0.67
If UNI meets the Morgans target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $4.31, suggesting upside of 8.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.8

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

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

Morgan Stanley anticipates a modest positive investor reaction to the ACCC not objecting to Viva Energy's OTR acquisition (184 sites). Viva has undertaken to divest 25 South Australia sites in exchange for 13 sites across the country with Chevron.

Post acquisition, Viva's network increases to some 16% national market share. While the acquisition is key, Morgan Stanley is cautious of execution challenges, and tougher competition in convenience outside South Australia.

Equal-weight and $3.21 target retained. Industry view: Attractive.

Target price is $3.21 Current Price is $3.32 Difference: minus $0.11 (current price is over target).
If VEA meets the Morgan Stanley target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.39, suggesting downside of -0.3% (ex-dividends)

The company's fiscal year ends in December.

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

Bell Potter rates VHT as Downgrade to Hold from Buy (3) -

Volpara Health Technologies has received an all cash takeover bid from Korean company Lunit at $1.15 per share, an offer that the Board finds in the best interests of shareholders to accept. The company's two largest shareholders have indicated they will vote in favour of the offer.

Bell Potter points out the bid is a 47.4% premium to the previous closing price, valuing Volpara Health Technologies at $296m. The broker expects a counter bid is unlikely, feeling an absence of significant scale and rapid growth will be barriers to a competing bid.

The rating is downgraded to Hold from Buy and the target price increases to $1.15 from 85 cents.

Target price is $1.15 Current Price is $1.10 Difference: $0.055
If VHT meets the Bell Potter target it will return approximately 5% (excluding dividends, fees and charges).

The company's fiscal year ends in March.

Forecast for FY24:

Forecast for FY25:

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

Market Sentiment: 0.0

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

Morgans rates VHT as Downgrade to Hold from Add (3) -

South Korean-listed Lunit Inc has agreed to acquire 100% of Volpara Health Technologies' shares at $1.15 via a Scheme of Implementation Agreement.

The transaction value of $285.5m is broadly in line with Morgans valuation for Volpara, and management and major shareholders have unanimously recommended voting in favour of the proposed scheme.

The analysts suggest shareholders sit tight to see if another bidder emerges.

The broker's target falls to $1.15 from $1.17 to align with the offer, while the rating is downgraded to Hold from Add.

Target price is $1.15 Current Price is $1.10 Difference: $0.055
If VHT meets the Morgans target it will return approximately 5% (excluding dividends, fees and charges).

The company's fiscal year ends in March.

Forecast for FY24:

Forecast for FY25:

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

Market Sentiment: 0.0

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

Citi rates ZIP as Neutral High Risk (3) -

Citi sees positives for customer acquisition and transaction volume growth for Zip Co from a pilot program between the company and Google Pay in the US. The program essentially adds another distribution method for Zip Pay, explains the broker.

The analyst concedes it is difficult to quantify the impact as the program (beginning in January) will only be rolled out to a few participating merchants.

The Neutral, High Risk rating and 51c target are unchanged.

Target price is $0.51 Current Price is $0.54 Difference: minus $0.025 (current price is over target).
If ZIP meets the Citi target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $0.79, suggesting upside of 25.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY24:

Forecast for FY25:

Market Sentiment: 0.3

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