Australian Broker Call

Ord Minnett rates ALG as Upgrade to Hold from Lighten (3) -

Ord Minnett upgrades its rating for Ardent Leisure to Hold from Lighten on valuation after the share price has fallen in recent days.

The 60c target price is retained.

Target price is $0.60 Current Price is $0.67 Difference: minus $0.07 (current price is over target).
If ALG meets the Ord Minnett target it will return approximately minus 10% (excluding dividends, fees and charges - negative figures indicate an expected loss).

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

Macquarie rates AMI as Outperform (1) -

In a major de-risking for Aurelia Metals' Federation project, according to Macquarie, the NSW Department of Planning and Environment for Federation has granted Development Consent.

The broker notes the Development Consent will allow the company to pursue funding options to bring the project online.

Outperform rating and 20c target price retained.

Target price is $0.20 Current Price is $0.12 Difference: $0.08
If AMI meets the Macquarie target it will return approximately 67% (excluding dividends, fees and charges).

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

Morgans rates AMS as No Rating (-1) -

Atomos has entered voluntary suspension pending the audit outcome of its 1H results. Management cited resourcing issues across operating jurisdictions as the reason for delay.

A trading update suggests to Morgans ongoing softness in trading conditions. Given increased uncertainty in the retail environment, management explained the business may not return to profits until FY24.

The board has appointed a corporate advisor to strategically review the business. In the meantime, the broker awaits further clarity and places the company's prior Add rating and 75c target under review.

Current Price is $0.07. Target price not assessed.

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

Morgans rates AVH as Initiation of coverage with Add (1) -

Morgans initiates coverage on regenerative (skin restoration) medicine company Avita Medical with an Add rating and $4.45 target.

The company has an approved device called the Recell system (spray-on skin) and is largely targeting the US acute burns market. Further approvals are pending mid-2023 in the areas of soft tissue repair and vitiligo (loss of skin colour in patches).

The broker believes management's estimates for total addressable markets are reasonable, as follows: burns US$600m, soft tissue repair US$1bn and vitiligo US$5.2bn.

The analysts note recent revenue guidance for both the 1Q and the whole of 2023 by CEO Jim Corbett has propelled the share price higher.

Target price is $4.45 Current Price is $3.91 Difference: $0.54
If AVH meets the Morgans target it will return approximately 14% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

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

Macquarie rates CNB as Outperform (1) -

Following drilling results, management at Carnaby Resources indicated the “the 40,000m RC and diamond drilling program will no doubt culminate in a very material maiden resource for the Greater Duchess Copper Gold project.”

The broker believes the maiden resource in the 2Q of 2023 could exceed 300kt of copper and presents a major near-term catalyst.

Outperform and $1.70 target retained.

Target price is $1.70 Current Price is $1.17 Difference: $0.53
If CNB meets the Macquarie target it will return approximately 45% (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

Morgan Stanley rates CSL as Overweight (1) -

Morgan Stanley notes for every three Myasthenia Gravis (MG) patients lost to Vyvgart prescription medicine, CSL would need to diagnose only one primary immunodeficiency disease (PID) patient.

The brokers feels the need to reiterate this statement after Dutch-based competitor Argenx released 4Q results disclosing Vyvgart revenues in line with Morgan Stanley's forecast.

The Overweight rating and $339 target are unchanged. Industry View: In-Line.

Target price is $339.00 Current Price is $291.80 Difference: $47.2
If CSL meets the Morgan Stanley target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $335.99, suggesting upside of 14.9% (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

Macquarie rates CVN as Neutral (3) -

Carnarvon Energy has sold -10% of its Bedout Basin interests for US$146m, which Macquarie points out reduces the need for an equity raise ahead of capex at Dorado and exploration costs at Bedout.

The broker expects reserves-based debt is available to support the company's 10% stake in the Dorado project.

The Neutral rating and 16c target are unchanged.

Target price is $0.16 Current Price is $0.14 Difference: $0.02
If CVN meets the Macquarie target it will return approximately 14% (excluding dividends, fees and charges).

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

Citi rates CWY as Neutral (3) -

After reviewing Cleanaway Waste Management's 1H results (released over a week ago), Citi makes only slight upgrades to its earnings forecasts.

The broker expects underlying revenue will stay strong with ongoing pass-through of price rises and a full contribution from the GRL acquisition.

FY23 guidance is for underlying EBITDA of $670m, which reflects a slightly higher skew to the 2H (GRL acquisition again).

The broker raises its target to $2.95 from $2.84. Neutral.

Target price is $2.95 Current Price is $2.60 Difference: $0.35
If CWY meets the Citi target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $2.75, suggesting upside of 5.9% (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

Morgans rates EPY as Add (1) -

After reviewing 1H results by EarlyPay, Morgans comments outsized exposures and losses have disappointed and it will take time for investors to rebuild confidence.

A before tax loss of -$7.5m including expected credit loss (ECL) provisioning of- $14.1m was reported. The company has provisioned -$9.6m against the RevRoof exposure (detailed late-2022) and improved procedures and policies have now been implemented.

Excluding RevRoof, underlying NPAT was $1.6m for the 1H, which included a further -$4.5m of additional provisioning.

The target is slashed to 28c from 52c though the broker retains an Add rating, noting the potential for corporate activity.

Target price is $0.28 Current Price is $0.20 Difference: $0.08
If EPY meets the Morgans target it will return approximately 40% (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

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

December-22 APRA data show personal outgrew commercial lines of insurance for the first time in five years.

Morgan Stanley suggests this data is supportive for Insurance Australia Group, despite ongoing market share losses.

Equal-weight rating and $4.75 target retained. Industry View: In-Line. 

Target price is $4.75 Current Price is $4.61 Difference: $0.14
If IAG meets the Morgan Stanley target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $5.23, suggesting upside of 12.2% (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

Macquarie rates KAR as Outperform (1) -

Following confirmation by Karoon Energy a 9.2% oil export tax will apply in Brazil from March 1 for four months, Macquarie suggests uncertainty prevails over whether this period is followed by a more permanent tax or other reforms.

Management expects the four-month impact will be in the range of -US$22-35m. Unfortunately, bemoans the broker, the tax is being levied at a point of peak oil production rates for the company.

The Outperform rating is unchanged and the target falls by -1.6% to $3.00.

Target price is $3.00 Current Price is $2.16 Difference: $0.84
If KAR meets the Macquarie target it will return approximately 39% (excluding dividends, fees and charges).

Current consensus price target is $3.16, suggesting upside of 48.4% (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: 1.0

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

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

Ord Minnett downgrades its rating for Mineral Resources to Lighten from Hold on valuation alone, after a recent share price rally.

The $75 target price is maintained.

Target price is $75.00 Current Price is $90.03 Difference: minus $15.03 (current price is over target).
If MIN meets the Ord Minnett target it will return approximately minus 17% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $97.33, suggesting upside of 8.6% (ex-dividends)

The company's fiscal year ends in June.

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

Morgan Stanley rates SUN as Overweight (1) -

December-22 APRA data show personal outgrew commercial lines of insurance for the first time in five years.

Morgan Stanley suggests this data is supportive for Suncorp Group, despite ongoing market share losses.

Overweight rating and $14.50 target retained. Industry View: In-Line. 

Target price is $14.50 Current Price is $12.75 Difference: $1.75
If SUN meets the Morgan Stanley target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $14.50, suggesting upside of 13.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.9

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

Ord Minnett rates UMG as Upgrade to Accumulate from Hold (2) -

Ord Minnett upgrades its rating for United Malt to Accumulate from Hold on valuation after recent share price slippage.

The $4.00 target price is retained.

Target price is $4.00 Current Price is $3.45 Difference: $0.55
If UMG meets the Ord Minnett target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $3.86, suggesting upside of 12.7% (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