Australian Broker Call

June 01, 2017

Access Broker Call Report Archives here

COMPANIES DISCUSSED IN THIS ISSUE

Click on symbol for fast access.

The number next to the symbol represents the number of brokers covering it for this report -(if more than 1)

THIS REPORT WILL BE UPDATED SHORTLY

Last Updated: 10:39 AM

Your daily news report on the latest recommendation, valuation, forecast and opinion changes.

This report includes concise but limited reviews of research recently published by Stockbrokers, which should be considered as information concerning likely market behaviour rather than advice on the securities mentioned. Do not act on the contents of this Report without first reading the important information included at the end.

For more info about the different terms used by stockbrokers, as well as the different methodologies behind similar sounding ratings, download our guide HERE

Today's Upgrades and Downgrades
BLD - BORAL Downgrade to Hold from Accumulate Ord Minnett
PMV - PREMIER INVESTMENTS Upgrade to Buy from Neutral Citi
SFH - SPECIALTY FASHION Upgrade to Buy from Neutral Citi
WES - WESFARMERS Downgrade to Underweight from Equal-weight Morgan Stanley
AMC  AMCOR LIMITED

Paper & Packaging

Overnight Price: $15.34

Macquarie rates AMC as Outperform (1) -

Macquarie observes, as western Europe accounts for 33% of first half revenue, the improving value of the euro is shifting to a tailwind.

More broadly, the outlook for European economic activity is improving with the broker noting Nestle's comments that European consumer spending is resilient.

The broker continues to like the defensive nature of the business because of its broad geographical and business mix. Outperform retained. Target rises to $17.17 from $16.77.

Target price is $17.17 Current Price is $15.34 Difference: $1.83
If AMC meets the Macquarie target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $15.58, suggesting upside of 0.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Macquarie forecasts a full year FY17 dividend of 57.65 cents and EPS of 80.77 cents.
At the last closing share price the estimated dividend yield is 3.76%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.99.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 77.8, implying annual growth of N/A.

Current consensus DPS estimate is 58.9, implying a prospective dividend yield of 3.8%.

Current consensus EPS estimate suggests the PER is 19.9.

Forecast for FY18:

Macquarie forecasts a full year FY18 dividend of 63.90 cents and EPS of 89.40 cents.
At the last closing share price the estimated dividend yield is 4.17%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.16.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 86.6, implying annual growth of 11.3%.

Current consensus DPS estimate is 65.2, implying a prospective dividend yield of 4.2%.

Current consensus EPS estimate suggests the PER is 17.9.

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

ANZ  AUSTRALIA & NEW ZEALAND BANKING GROUP

Banks

Overnight Price: $28.01

UPDATED

UBS rates ANZ as Neutral (3) -

The broker still cannot reconcile what the banks believe they will lose on the levy and what the Treasurer believes he will gain. The broker's calculations concur with the banks own estimates of around a -$1.1bn net cost compared to the government's $1.5bn.

The broker has cut bank forecast earnings by -1-2% on the assumption the cost will be passed on to customers, mortgage brokers and staff while dividends will remain intact.

Neutral and $30.50 target retained for ANZ.

Target price is $30.50 Current Price is $28.01 Difference: $2.49
If ANZ meets the UBS target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $30.90, suggesting upside of 10.3% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY17:

UBS forecasts a full year FY17 dividend of 160.00 cents and EPS of 225.00 cents.
At the last closing share price the estimated dividend yield is 5.71%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.45.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 230.2, implying annual growth of 13.6%.

Current consensus DPS estimate is 161.1, implying a prospective dividend yield of 5.8%.

Current consensus EPS estimate suggests the PER is 12.2.

Forecast for FY18:

UBS forecasts a full year FY18 dividend of 160.00 cents and EPS of 229.00 cents.
At the last closing share price the estimated dividend yield is 5.71%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.23.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 236.8, implying annual growth of 2.9%.

Current consensus DPS estimate is 163.6, implying a prospective dividend yield of 5.8%.

Current consensus EPS estimate suggests the PER is 11.8.

Market Sentiment: 0.2

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

AVN  AVENTUS RETAIL PROPERTY FUND

REITs

Overnight Price: $2.38

UPDATED

UBS rates AVN as Neutral (3) -

Aventus has acquired two large format retail assets in Sydney which increase scale, improve average portfolio quality, and provide potential for increased leasing leverage and operational synergies, the broker suggests.

The dilution effect of the subsequent capital raising is offset to an extent by waiving the management fee. The broker retains Neutral, increasing its target to $2.52 from $2.46.

Target price is $2.52 Current Price is $2.38 Difference: $0.14
If AVN meets the UBS target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $2.53, suggesting upside of 6.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

UBS forecasts a full year FY17 dividend of 16.00 cents and EPS of 17.60 cents.
At the last closing share price the estimated dividend yield is 6.72%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.52.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 17.8, implying annual growth of -4.3%.

Current consensus DPS estimate is 16.0, implying a prospective dividend yield of 6.8%.

Current consensus EPS estimate suggests the PER is 13.3.

Forecast for FY18:

UBS forecasts a full year FY18 dividend of 16.40 cents and EPS of 18.30 cents.
At the last closing share price the estimated dividend yield is 6.89%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.01.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 18.5, implying annual growth of 3.9%.

Current consensus DPS estimate is 16.4, implying a prospective dividend yield of 6.9%.

Current consensus EPS estimate suggests the PER is 12.8.

Market Sentiment: 0.5

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

BLD  BORAL LIMITED

Building Products & Services

Overnight Price: $6.85

Ord Minnett rates BLD as Downgrade to Hold from Accumulate (3) -

Ord Minnett envisages the company entering a period of robust earnings growth, underpinned by the consolidation of the acquisition of US-based Headwaters and the realisation of synergies from Meridian Bricks and the USG joint venture.

Nevertheless, the broker believes the growth profile is now factored into the share price. Rating is downgraded to Hold from Accumulate. Target is raised to $6.65 from $6.50.

Target price is $6.65 Current Price is $6.85 Difference: minus $0.2 (current price is over target).
If BLD meets the Ord Minnett target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $6.95, suggesting upside of 3.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Ord Minnett forecasts a full year FY17 dividend of 25.00 cents and EPS of 23.00 cents.
At the last closing share price the estimated dividend yield is 3.65%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 29.78.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 30.9, implying annual growth of -9.6%.

Current consensus DPS estimate is 24.2, implying a prospective dividend yield of 3.6%.

Current consensus EPS estimate suggests the PER is 21.8.

Forecast for FY18:

Ord Minnett forecasts a full year FY18 dividend of 26.00 cents and EPS of 31.00 cents.
At the last closing share price the estimated dividend yield is 3.80%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 22.10.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 35.4, implying annual growth of 14.6%.

Current consensus DPS estimate is 24.5, implying a prospective dividend yield of 3.6%.

Current consensus EPS estimate suggests the PER is 19.1.

Market Sentiment: 0.7

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

BSL  BLUESCOPE STEEL LIMITED

Steel & Scrap

Overnight Price: $11.50

Macquarie rates BSL as Outperform (1) -

Ahead  of a  tour of US steel business, Macquarie updates its view and notes an improving US outlook.

Earnings per share momentum has slowed because of raw material price volatility but the broker envisages potential for upside in the company's North Star performance in FY18.

The stock remains a cheaper steel stock in a comparable global universe, the broker calculates. Outperform retained.Target is reduced to $14.30 from $14.95.

Target price is $14.30 Current Price is $11.50 Difference: $2.8
If BSL meets the Macquarie target it will return approximately 24% (excluding dividends, fees and charges).

Current consensus price target is $13.54, suggesting upside of 16.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Macquarie forecasts a full year FY17 dividend of 9.00 cents and EPS of 124.30 cents.
At the last closing share price the estimated dividend yield is 0.78%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.25.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 122.5, implying annual growth of 97.4%.

Current consensus DPS estimate is 9.6, implying a prospective dividend yield of 0.8%.

Current consensus EPS estimate suggests the PER is 9.5.

Forecast for FY18:

Macquarie forecasts a full year FY18 dividend of 14.00 cents and EPS of 141.50 cents.
At the last closing share price the estimated dividend yield is 1.22%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 8.13.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 117.3, implying annual growth of -4.2%.

Current consensus DPS estimate is 14.3, implying a prospective dividend yield of 1.2%.

Current consensus EPS estimate suggests the PER is 9.9.

Market Sentiment: 0.7

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

BXB  BRAMBLES LIMITED

Transportation & Logistics

Overnight Price: $10.37

UPDATED

Macquarie rates BXB as Neutral (3) -

Macquarie believes the strength in the euro provides a potential tailwind for the company while North American weakness is set to continue because of inflation in the lumber price.

Given the restructure of the US business and elevated lumber prices, the broker expects conversion of whitewood customers will be limited.

Neutral rating retained. Target is $10.37.

Target price is $10.37 Current Price is $10.37 Difference: $0
If BXB meets the Macquarie target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $10.55, suggesting upside of 1.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Macquarie forecasts a full year FY17 dividend of 28.43 cents and EPS of 51.14 cents.
At the last closing share price the estimated dividend yield is 2.74%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 20.28.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 51.9, implying annual growth of N/A.

Current consensus DPS estimate is 31.8, implying a prospective dividend yield of 3.1%.

Current consensus EPS estimate suggests the PER is 20.0.

Forecast for FY18:

Macquarie forecasts a full year FY18 dividend of 28.96 cents and EPS of 53.80 cents.
At the last closing share price the estimated dividend yield is 2.79%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 19.28.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 56.5, implying annual growth of 8.9%.

Current consensus DPS estimate is 31.9, implying a prospective dividend yield of 3.1%.

Current consensus EPS estimate suggests the PER is 18.4.

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

CBA  COMMONWEALTH BANK OF AUSTRALIA

Banks

Overnight Price: $79.65

UPDATED

UBS rates CBA as Neutral (3) -

The broker still cannot reconcile what the banks believe they will lose on the levy and what the Treasurer believes he will gain. The broker's calculations concur with the banks own estimates of around a -$1.1bn net cost compared to the government's $1.5bn.

Th broker has cut bank forecast earnings by -1-2% on the assumption the cost will be passed on to customers, mortgage brokers and staff while dividends will remain intact.

Neutral rating and $83 target retained for CBA.

Target price is $83.00 Current Price is $79.65 Difference: $3.35
If CBA meets the UBS target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $80.73, suggesting upside of 1.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

UBS forecasts a full year FY17 dividend of 424.00 cents and EPS of 552.00 cents.
At the last closing share price the estimated dividend yield is 5.32%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.43.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 556.4, implying annual growth of 0.2%.

Current consensus DPS estimate is 424.0, implying a prospective dividend yield of 5.3%.

Current consensus EPS estimate suggests the PER is 14.3.

Forecast for FY18:

UBS forecasts a full year FY18 dividend of 430.00 cents and EPS of 558.00 cents.
At the last closing share price the estimated dividend yield is 5.40%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.27.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 574.0, implying annual growth of 3.2%.

Current consensus DPS estimate is 430.4, implying a prospective dividend yield of 5.4%.

Current consensus EPS estimate suggests the PER is 13.9.

Market Sentiment: -0.3

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

GMG  GOODMAN GROUP

Infra & Property Developers

Overnight Price: $8.50

Morgan Stanley rates GMG as Overweight (1) -

The stock is up 18% for the year to date and trading at a premium to Morgan Stanley's net asset value and price target for the first time since initiating on the stock in 2010.

The broker agrees it is becoming harder to argue the shares are undervalued but continues to prefer the stock versus the rest of the sector.

The business has been the beneficiary of the structural trends of e-commerce and supply chain efficiencies and is in the frame to build the Amazon distribution centres in Australia.

The broker notes, whether or not the company gains that business, the project pipeline is managed carefully to avoid peaks and troughs and the impact on earnings or valuation will be minimal.

Overweight and $8.20 target retained. Industry view is Cautious.

Target price is $8.20 Current Price is $8.50 Difference: minus $0.3 (current price is over target).
If GMG meets the Morgan Stanley target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $7.91, suggesting downside of -6.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Morgan Stanley forecasts a full year FY17 dividend of 25.60 cents and EPS of 43.20 cents.
At the last closing share price the estimated dividend yield is 3.01%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 19.68.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 44.6, implying annual growth of -38.1%.

Current consensus DPS estimate is 25.9, implying a prospective dividend yield of 3.0%.

Current consensus EPS estimate suggests the PER is 19.1.

Forecast for FY18:

Morgan Stanley forecasts a full year FY18 dividend of 27.10 cents and EPS of 46.10 cents.
At the last closing share price the estimated dividend yield is 3.19%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.44.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 45.9, implying annual growth of 2.9%.

Current consensus DPS estimate is 27.2, implying a prospective dividend yield of 3.2%.

Current consensus EPS estimate suggests the PER is 18.5.

Market Sentiment: 0.3

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

HSO  HEALTHSCOPE LIMITED

Healthcare services

Overnight Price: $2.02

UBS rates HSO as Buy (1) -

The broker retains a Buy rating and $3.00 target on Healthscope, noting recent industry data implies low structural risk for the company's $800m+ Mona Vale hospital project, which is ahead of schedule.

On opening, Healthscope will receive $40m in bullet payments from the closure of the Manly and Mona Vale public hospitals, the broker notes.

Target price is $3.00 Current Price is $2.02 Difference: $0.98
If HSO meets the UBS target it will return approximately 49% (excluding dividends, fees and charges).

Current consensus price target is $2.57, suggesting upside of 27.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

UBS forecasts a full year FY17 dividend of 7.00 cents and EPS of 11.00 cents.
At the last closing share price the estimated dividend yield is 3.47%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.36.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 10.8, implying annual growth of 3.8%.

Current consensus DPS estimate is 7.7, implying a prospective dividend yield of 3.8%.

Current consensus EPS estimate suggests the PER is 18.7.

Forecast for FY18:

UBS forecasts a full year FY18 dividend of 8.00 cents and EPS of 11.00 cents.
At the last closing share price the estimated dividend yield is 3.96%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.36.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 11.3, implying annual growth of 4.6%.

Current consensus DPS estimate is 8.2, implying a prospective dividend yield of 4.1%.

Current consensus EPS estimate suggests the PER is 17.9.

Market Sentiment: 0.2

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

HVN  HARVEY NORMAN HOLDINGS LIMITED

Consumer Electronics

Overnight Price: $3.77

UPDATED

Morgan Stanley rates HVN as Underweight (5) -

Morgan Stanley believes Australian Department stores are far more exposed to the entry of Amazon than the leading specialty retailers. The broker believes category killer retail formats will withstand the onslaught, as those stores in the US have competed successfully with Amazon.

Harvey Norman's Underweight rating retained. Target is reduced to $3.50 from $4.30. Industry view is move to Cautious from In-Line, as this broker believes the impact of Amazon will be broad-based.

Target price is $3.50 Current Price is $3.77 Difference: minus $0.27 (current price is over target).
If HVN meets the Morgan Stanley target it will return approximately minus 7% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.42, suggesting upside of 17.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Morgan Stanley forecasts a full year FY17 dividend of 32.00 cents and EPS of 35.60 cents.
At the last closing share price the estimated dividend yield is 8.49%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.59.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 35.1, implying annual growth of 11.9%.

Current consensus DPS estimate is 32.1, implying a prospective dividend yield of 8.5%.

Current consensus EPS estimate suggests the PER is 10.7.

Forecast for FY18:

Morgan Stanley forecasts a full year FY18 dividend of 30.00 cents and EPS of 35.10 cents.
At the last closing share price the estimated dividend yield is 7.96%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.74.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 35.9, implying annual growth of 2.3%.

Current consensus DPS estimate is 30.9, implying a prospective dividend yield of 8.2%.

Current consensus EPS estimate suggests the PER is 10.5.

Market Sentiment: -0.3

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

JBH  JB HI-FI LIMITED

Consumer Electronics

Overnight Price: $23.12

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

Morgan Stanley believes Australian department stores are far more exposed to the entry of Amazon than the leading specialty retailers. The broker believes category killer retail formats will withstand the onslaught, as those stores in the US have competed successfully with Amazon.

JB Hi-Fi operates with far higher sales density versus its peers and has a market leading position, enabling superior buying terms, the broker observes.

Equal-weight retained. Target is reduced to $27 from $30. Industry view is moved to Cautious from In-Line as the broker believes the impact of Amazon will be broad-based.

Target price is $27.00 Current Price is $23.12 Difference: $3.88
If JBH meets the Morgan Stanley target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $27.22, suggesting upside of 17.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Morgan Stanley forecasts a full year FY17 dividend of 121.00 cents and EPS of 200.00 cents.
At the last closing share price the estimated dividend yield is 5.23%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.56.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 185.4, implying annual growth of 20.6%.

Current consensus DPS estimate is 118.3, implying a prospective dividend yield of 5.1%.

Current consensus EPS estimate suggests the PER is 12.5.

Forecast for FY18:

Morgan Stanley forecasts a full year FY18 dividend of 139.00 cents and EPS of 211.00 cents.
At the last closing share price the estimated dividend yield is 6.01%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.96.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 205.8, implying annual growth of 11.0%.

Current consensus DPS estimate is 134.0, implying a prospective dividend yield of 5.8%.

Current consensus EPS estimate suggests the PER is 11.2.

Market Sentiment: -0.1

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

JIN  JUMBO INTERACTIVE LIMITED

Overnight Price: $2.67

UPDATED

Morgans rates JIN as Add (1) -

The company is forecasting total transaction value in FY17 of $142.2m, down -7.2% because of a lower number of jackpots. The board has set a new pay-out ratio at 85%.

Morgans believes there is scope for special dividends to be paid, given a surplus cash position and a franking credit balance.

The company has estimated a final dividend of 5.1c taking the full year to 8.6c. Add rating retained. Target is reduced to $3.17 from $3.19.

Target price is $3.17 Current Price is $2.67 Difference: $0.5
If JIN meets the Morgans target it will return approximately 19% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY17:

Morgans forecasts a full year FY17 dividend of 9.00 cents and EPS of 16.00 cents.
At the last closing share price the estimated dividend yield is 3.37%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.69.

Forecast for FY18:

Morgans forecasts a full year FY18 dividend of 15.00 cents and EPS of 17.00 cents.
At the last closing share price the estimated dividend yield is 5.62%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.71.

Market Sentiment: 1.0

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

MLX  METALS X LIMITED

Tin

Overnight Price: $0.78

Macquarie rates MLX as Outperform (1) -

Macquarie visited Nifty mine and confirmed that the underground development work is proceeding as planned and the company will be in a position to start materially lifting production late this year.

Incorporating a slight change to the reserve drives a 2% upgrade to FY20 and FY21 estimates. Outperform rating and $1 target retained.

Target price is $1.00 Current Price is $0.78 Difference: $0.225
If MLX meets the Macquarie target it will return approximately 29% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY17:

Macquarie forecasts a full year FY17 dividend of 0.00 cents and EPS of 1.60 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 48.44.

Forecast for FY18:

Macquarie forecasts a full year FY18 dividend of 1.00 cents and EPS of 5.20 cents.
At the last closing share price the estimated dividend yield is 1.29%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.90.

Market Sentiment: 1.0

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

MYR  MYER HOLDINGS LIMITED

Household & Personal Products

Overnight Price: $0.87

UPDATED

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

Morgan Stanley believes Australian department stores are far more exposed to the entry of Amazon than leading specialty retailers. Australia is overbuilt with department stores versus other developed markets,  the broker observes.

Long leases for department stores mean stores cannot be closed as they become unprofitable and the online offer is weak. They also generate a disproportionate percentage of sales from apparel, a category where Amazon is successful.

Equal-weight rating retained. Target is lowered to $0.80 from $1.10.  Industry view is moved to Cautious from In-Line.

Target price is $0.80 Current Price is $0.87 Difference: minus $0.065 (current price is over target).
If MYR 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 $0.95, suggesting upside of 10.2% (ex-dividends)

The company's fiscal year ends in July.

Forecast for FY17:

Morgan Stanley forecasts a full year FY17 dividend of 5.70 cents and EPS of 8.60 cents.
At the last closing share price the estimated dividend yield is 6.59%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.06.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 8.5, implying annual growth of 10.4%.

Current consensus DPS estimate is 5.5, implying a prospective dividend yield of 6.4%.

Current consensus EPS estimate suggests the PER is 10.2.

Forecast for FY18:

Morgan Stanley forecasts a full year FY18 dividend of 6.00 cents and EPS of 9.10 cents.
At the last closing share price the estimated dividend yield is 6.94%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.51.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 9.1, implying annual growth of 7.1%.

Current consensus DPS estimate is 5.8, implying a prospective dividend yield of 6.7%.

Current consensus EPS estimate suggests the PER is 9.5.

Market Sentiment: 0.0

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

NAB  NATIONAL AUSTRALIA BANK LIMITED

Banks

Overnight Price: $30.12

UPDATED

UBS rates NAB as Sell (5) -

The broker still cannot reconcile what the banks believe they will lose on the levy and what the Treasurer believes he will gain. The broker's calculations concur with the banks own estimates of around a -$1.1bn net cost compared to the government's $1.5bn.

Th broker has cut bank forecast earnings by -1-2% on the assumption the cost will be passed on to customers, mortgage brokers and staff while dividends will remain intact.

Sell rating and $30 target retained for NAB.

Target price is $30.00 Current Price is $30.12 Difference: minus $0.12 (current price is over target).
If NAB meets the UBS target it will return approximately minus 0% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $31.80, suggesting upside of 5.6% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY17:

UBS forecasts a full year FY17 dividend of 198.00 cents and EPS of 240.00 cents.
At the last closing share price the estimated dividend yield is 6.57%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.55.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 242.9, implying annual growth of -0.9%.

Current consensus DPS estimate is 195.6, implying a prospective dividend yield of 6.5%.

Current consensus EPS estimate suggests the PER is 12.4.

Forecast for FY18:

UBS forecasts a full year FY18 dividend of 198.00 cents and EPS of 237.00 cents.
At the last closing share price the estimated dividend yield is 6.57%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.71.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 243.8, implying annual growth of 0.4%.

Current consensus DPS estimate is 193.7, implying a prospective dividend yield of 6.4%.

Current consensus EPS estimate suggests the PER is 12.4.

Market Sentiment: -0.1

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

PMV  PREMIER INVESTMENTS LIMITED

Apparel & Footwear

Overnight Price: $12.41

UPDATED

Citi rates PMV as Upgrade to Buy from Neutral (1) -

Citi believes investors are too bearish, arguing the current weakness in sales is transitory. The analysts do acknowledge there is downside to market consensus forecasts. Citi's advice to investors is: pick your moment.

Upgrade to Buy from Neutral. While the analysts also believe market concerns around discounting are being overplayed, their new target of $13.80 compares with $15.10 previously.

Target price is $13.80 Current Price is $12.41 Difference: $1.39
If PMV meets the Citi target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $15.52, suggesting upside of 25.0% (ex-dividends)

The company's fiscal year ends in July.

Forecast for FY17:

Citi forecasts a full year FY17 dividend of 51.00 cents and EPS of 65.10 cents.
At the last closing share price the estimated dividend yield is 4.11%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 19.06.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 70.2, implying annual growth of 5.9%.

Current consensus DPS estimate is 52.9, implying a prospective dividend yield of 4.3%.

Current consensus EPS estimate suggests the PER is 17.7.

Forecast for FY18:

Citi forecasts a full year FY18 dividend of 57.00 cents and EPS of 72.80 cents.
At the last closing share price the estimated dividend yield is 4.59%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.05.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 79.2, implying annual growth of 12.8%.

Current consensus DPS estimate is 59.4, implying a prospective dividend yield of 4.8%.

Current consensus EPS estimate suggests the PER is 15.7.

Market Sentiment: 0.8

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

PRY  PRIMARY HEALTH CARE LIMITED

Healthcare services

Overnight Price: $3.68

Credit Suisse rates PRY as Underperform (5) -

From July 1 indexation returns for GP bulk billing incentive items but Credit Suisse believes this is immaterial for Primary Health Care's revenue and earnings.

The broker calculates an effective price increase for the company's GP business of around 1.4% in FY19 and around 2% from FY20 onwards.

The broker has already factored in a staggered price increase following the budget and believes current valuations and the slow turnaround in the GP business support the maintenance of an Underperform rating. Target is $3.40.

Target price is $3.40 Current Price is $3.68 Difference: minus $0.28 (current price is over target).
If PRY meets the Credit Suisse target it will return approximately minus 8% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.54, suggesting downside of -3.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Credit Suisse forecasts a full year FY17 dividend of 10.80 cents and EPS of 17.51 cents.
At the last closing share price the estimated dividend yield is 2.93%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 21.02.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 16.9, implying annual growth of 17.4%.

Current consensus DPS estimate is 11.3, implying a prospective dividend yield of 3.1%.

Current consensus EPS estimate suggests the PER is 21.8.

Forecast for FY18:

Credit Suisse forecasts a full year FY18 dividend of 12.00 cents and EPS of 19.41 cents.
At the last closing share price the estimated dividend yield is 3.26%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.96.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 19.4, implying annual growth of 14.8%.

Current consensus DPS estimate is 12.8, implying a prospective dividend yield of 3.5%.

Current consensus EPS estimate suggests the PER is 19.0.

Market Sentiment: 0.0

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

QUB  QUBE HOLDINGS LIMITED

Transportation & Logistics

Overnight Price: $2.64

UPDATED

Citi rates QUB as Buy (1) -

As Qube announced an equity raising of $350m, it is Citi's view this capital raising occurs in response to increased confidence in the company's ability to fill the warehouse footprint and rail throughput, as well as pursue "additional inorganic growth options". Don't you love this analyst lingo? They're talking acquisitions.

With resource volumes having stabilised and Patrick apparently performing in-line with expectations, Citi analysts predict the share price will move up as new customers (both warehouse plus rail) are announced at Moorebank. Buy.

Target price is $3.01 Current Price is $2.64 Difference: $0.37
If QUB meets the Citi target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $2.65, suggesting upside of 0.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Citi forecasts a full year FY17 dividend of 5.50 cents and EPS of 8.70 cents.
At the last closing share price the estimated dividend yield is 2.08%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 30.34.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 7.7, implying annual growth of -6.0%.

Current consensus DPS estimate is 5.6, implying a prospective dividend yield of 2.1%.

Current consensus EPS estimate suggests the PER is 34.3.

Forecast for FY18:

Citi forecasts a full year FY18 dividend of 5.80 cents and EPS of 10.10 cents.
At the last closing share price the estimated dividend yield is 2.20%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 26.14.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 9.0, implying annual growth of 16.9%.

Current consensus DPS estimate is 5.9, implying a prospective dividend yield of 2.2%.

Current consensus EPS estimate suggests the PER is 29.3.

Market Sentiment: 0.4

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


Macquarie rates QUB as Outperform (1) -

The company has announced a $350m equity raising to fund the new Moorebank warehousing, and further strategic growth initiatives. The raising comprises a 1-for-15 accelerated non-renounceable offer at $2.35 a share and a $122m placement.

Macquarie believes the announcement provides a level of certainty with regard to initial tenancy at Moorebank and should go some way to allay fears around the near-term prospects.

Medium-term growth options are attractive in the broker's opinion and an Outperform rating is maintained. Target is $2.81.

Target price is $2.81 Current Price is $2.64 Difference: $0.17
If QUB meets the Macquarie target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $2.65, suggesting upside of 0.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Macquarie forecasts a full year FY17 dividend of 5.50 cents and EPS of 6.50 cents.
At the last closing share price the estimated dividend yield is 2.08%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 40.62.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 7.7, implying annual growth of -6.0%.

Current consensus DPS estimate is 5.6, implying a prospective dividend yield of 2.1%.

Current consensus EPS estimate suggests the PER is 34.3.

Forecast for FY18:

Macquarie forecasts a full year FY18 dividend of 5.70 cents and EPS of 8.80 cents.
At the last closing share price the estimated dividend yield is 2.16%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 30.00.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 9.0, implying annual growth of 16.9%.

Current consensus DPS estimate is 5.9, implying a prospective dividend yield of 2.2%.

Current consensus EPS estimate suggests the PER is 29.3.

Market Sentiment: 0.4

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


Ord Minnett rates QUB as Buy (1) -

The announcement of a $350m capital raising was a surprise to Ord Minnett as the broker believed the logistics group could fund its foreseeable growth opportunities.

The timing, given that more than half the proceeds will be used to pay down debt, suggests to the broker that the company is positioning for an, as yet unspecified, opportunity.

The equity raising does not change the broker's view on Moorebank but has created some uncertainty about the use of proceeds, which could weigh on the share price in the short term. Buy rating retained. Target is reduced to $3.05 from $3.25.

Target price is $3.05 Current Price is $2.64 Difference: $0.41
If QUB meets the Ord Minnett target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $2.65, suggesting upside of 0.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Ord Minnett forecasts a full year FY17 dividend of 5.00 cents and EPS of 7.00 cents.
At the last closing share price the estimated dividend yield is 1.89%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 37.71.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 7.7, implying annual growth of -6.0%.

Current consensus DPS estimate is 5.6, implying a prospective dividend yield of 2.1%.

Current consensus EPS estimate suggests the PER is 34.3.

Forecast for FY18:

Ord Minnett forecasts a full year FY18 dividend of 5.00 cents and EPS of 10.00 cents.
At the last closing share price the estimated dividend yield is 1.89%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 26.40.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 9.0, implying annual growth of 16.9%.

Current consensus DPS estimate is 5.9, implying a prospective dividend yield of 2.2%.

Current consensus EPS estimate suggests the PER is 29.3.

Market Sentiment: 0.4

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

SFH  SPECIALTY FASHION GROUP LIMITED

Apparel & Footwear

Overnight Price: $0.40

UPDATED

Citi rates SFH as Upgrade to Buy from Neutral (1) -

Citi believes investors are too bearish, arguing the current weakness in sales is transitory. The analysts do acknowledge there is downside to market consensus forecasts. Citi's advice to investors is: pick your moment.

Upgrade to Buy/High Risk from Neutral. While the analysts also believe market concerns around discounting are being overplayed, their new target of $0.55 compares with $0.70 previously.

Target price is $0.55 Current Price is $0.40 Difference: $0.155
If SFH meets the Citi target it will return approximately 39% (excluding dividends, fees and charges).

Current consensus price target is $0.55, suggesting upside of 39.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Citi forecasts a full year FY17 dividend of 0.00 cents and EPS of 0.50 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 79.00.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 2.4, implying annual growth of N/A.

Current consensus DPS estimate is N/A, implying a prospective dividend yield of N/A.

Current consensus EPS estimate suggests the PER is 16.5.

Forecast for FY18:

Citi forecasts a full year FY18 dividend of 0.00 cents and EPS of 4.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.88.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 4.9, implying annual growth of 104.2%.

Current consensus DPS estimate is 1.0, implying a prospective dividend yield of 2.5%.

Current consensus EPS estimate suggests the PER is 8.1.

Market Sentiment: 1.0

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

SFR  SANDFIRE RESOURCES NL

Copper

Overnight Price: $6.11

Macquarie rates SFR as Outperform (1) -

Macquarie refines production forecasts for DeGrussa to incorporate higher mining rates at Monty and 100% of output under the ore purchase and sale agreement with Talisman Mining ((TLM)).

The higher mining rated at Monty is expected to mean group production rises to 85,000 tonnes in FY20. Outperform maintained. Target is $7.70.

Target price is $7.70 Current Price is $6.11 Difference: $1.59
If SFR meets the Macquarie target it will return approximately 26% (excluding dividends, fees and charges).

Current consensus price target is $6.86, suggesting upside of 12.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Macquarie forecasts a full year FY17 dividend of 21.00 cents and EPS of 58.60 cents.
At the last closing share price the estimated dividend yield is 3.44%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.43.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 55.3, implying annual growth of 81.1%.

Current consensus DPS estimate is 16.7, implying a prospective dividend yield of 2.7%.

Current consensus EPS estimate suggests the PER is 11.0.

Forecast for FY18:

Macquarie forecasts a full year FY18 dividend of 31.00 cents and EPS of 95.30 cents.
At the last closing share price the estimated dividend yield is 5.07%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 6.41.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 75.4, implying annual growth of 36.3%.

Current consensus DPS estimate is 22.1, implying a prospective dividend yield of 3.6%.

Current consensus EPS estimate suggests the PER is 8.1.

Market Sentiment: 0.4

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

SGM  SIMS METAL MANAGEMENT LIMITED

Steel & Scrap

Overnight Price: $13.33

Macquarie rates SGM as Outperform (1) -

Ahead  of a  tour of US steel business, Macquarie updates its view and notes an improving US outlook.

Scrap metal continues to enjoy support from better prices and collector economics. The stock has enjoyed a strong run but the broker considers the medium term outlook is still attractive. Outperform retained. Target rises to $14.20 from $14.00.

Target price is $14.20 Current Price is $13.33 Difference: $0.87
If SGM meets the Macquarie target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $13.22, suggesting downside of -0.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Macquarie forecasts a full year FY17 dividend of 38.00 cents and EPS of 65.50 cents.
At the last closing share price the estimated dividend yield is 2.85%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 20.35.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 68.4, implying annual growth of 27.4%.

Current consensus DPS estimate is 38.9, implying a prospective dividend yield of 2.9%.

Current consensus EPS estimate suggests the PER is 19.5.

Forecast for FY18:

Macquarie forecasts a full year FY18 dividend of 37.00 cents and EPS of 75.20 cents.
At the last closing share price the estimated dividend yield is 2.78%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.73.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 81.9, implying annual growth of 19.7%.

Current consensus DPS estimate is 41.4, implying a prospective dividend yield of 3.1%.

Current consensus EPS estimate suggests the PER is 16.3.

Market Sentiment: 0.4

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

SUL  SUPER RETAIL GROUP LIMITED

Automobiles & Components

Overnight Price: $7.70

UPDATED

Morgan Stanley rates SUL as Overweight (1) -

Morgan Stanley believes Australian department stores are far more exposed to the entry of Amazon than the leading specialty retailers. The broker believes category killer retail formats will withstand the onslaught, as those stores in the US have competed successfully with Amazon.

Super Retail operates market-leading businesses and its category exposure positions it favourably, in the broker's opinion. Target is reduced to $11 from $12. Overweight retained. Industry view is move to Cautious from In-Line, as this broker believes the impact of Amazon will be broad-based.

Target price is $11.00 Current Price is $7.70 Difference: $3.3
If SUL meets the Morgan Stanley target it will return approximately 43% (excluding dividends, fees and charges).

Current consensus price target is $10.32, suggesting upside of 34.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Morgan Stanley forecasts a full year FY17 dividend of 49.00 cents and EPS of 65.40 cents.
At the last closing share price the estimated dividend yield is 6.36%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.77.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 65.5, implying annual growth of 106.0%.

Current consensus DPS estimate is 45.0, implying a prospective dividend yield of 5.8%.

Current consensus EPS estimate suggests the PER is 11.8.

Forecast for FY18:

Morgan Stanley forecasts a full year FY18 dividend of 58.00 cents and EPS of 76.50 cents.
At the last closing share price the estimated dividend yield is 7.53%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.07.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 74.4, implying annual growth of 13.6%.

Current consensus DPS estimate is 50.7, implying a prospective dividend yield of 6.6%.

Current consensus EPS estimate suggests the PER is 10.3.

Market Sentiment: 0.6

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

WBC  WESTPAC BANKING CORPORATION

Banks

Overnight Price: $30.50

UPDATED

UBS rates WBC as Neutral (3) -

The broker still cannot reconcile what the banks believe they will lose on the levy and what the Treasurer believes he will gain. The broker's calculations concur with the banks own estimates of around a -$1.1bn net cost compared to the government's $1.5bn.

Th broker has cut bank forecast earnings by -1-2% on the assumption the cost will be passed on to customers, mortgage brokers and staff while dividends will remain intact.

Neutral and $32.50 target retained for Westpac.

Target price is $32.50 Current Price is $30.50 Difference: $2
If WBC meets the UBS target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $33.34, suggesting upside of 9.3% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY17:

UBS forecasts a full year FY17 dividend of 188.00 cents and EPS of 236.00 cents.
At the last closing share price the estimated dividend yield is 6.16%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.92.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 238.0, implying annual growth of 6.0%.

Current consensus DPS estimate is 188.0, implying a prospective dividend yield of 6.2%.

Current consensus EPS estimate suggests the PER is 12.8.

Forecast for FY18:

UBS forecasts a full year FY18 dividend of 188.00 cents and EPS of 241.00 cents.
At the last closing share price the estimated dividend yield is 6.16%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.66.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 244.3, implying annual growth of 2.6%.

Current consensus DPS estimate is 188.9, implying a prospective dividend yield of 6.2%.

Current consensus EPS estimate suggests the PER is 12.5.

Market Sentiment: 0.1

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

WES  WESFARMERS LIMITED

Food, Beverages & Tobacco

Overnight Price: $42.70

Morgan Stanley rates WES as Downgrade to Underweight from Equal-weight (5) -

Morgan Stanley believes the market is misconstruing the impact of Amazon's entry into Australia by selling category killers rather than conglomerate Wesfarmers.

The broker suspects that as Amazon rolls out its 1P business in Australia, especially apparel - a huge success in the US, earnings from Kmart will fall considerably. Bunnings should be relatively insulated, in the broker's opinion, while Kmart and Target are vulnerable.

The broker reduces valuations for the latter two and downgrades to Underweight from Equal-weight. Target is reduced to $36 from $41.  Industry view is moved to Cautious from In-line.

Target price is $36.00 Current Price is $42.70 Difference: minus $6.7 (current price is over target).
If WES meets the Morgan Stanley target it will return approximately minus 16% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $41.87, suggesting downside of -2.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Morgan Stanley forecasts a full year FY17 dividend of 216.00 cents and EPS of 245.00 cents.
At the last closing share price the estimated dividend yield is 5.06%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.43.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 259.1, implying annual growth of 615.7%.

Current consensus DPS estimate is 218.9, implying a prospective dividend yield of 5.1%.

Current consensus EPS estimate suggests the PER is 16.5.

Forecast for FY18:

Morgan Stanley forecasts a full year FY18 dividend of 216.00 cents and EPS of 248.00 cents.
At the last closing share price the estimated dividend yield is 5.06%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.22.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 262.2, implying annual growth of 1.2%.

Current consensus DPS estimate is 220.6, implying a prospective dividend yield of 5.2%.

Current consensus EPS estimate suggests the PER is 16.3.

Market Sentiment: -0.3

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

Summaries
AMC - AMCOR Outperform - Macquarie Overnight Price $15.34
ANZ - ANZ BANKING GROUP Neutral - UBS Overnight Price $28.01
AVN - AVENTUS RETAIL PROPERTY Neutral - UBS Overnight Price $2.38
BLD - BORAL Downgrade to Hold from Accumulate - Ord Minnett Overnight Price $6.85
BSL - BLUESCOPE STEEL Outperform - Macquarie Overnight Price $11.50
BXB - BRAMBLES Neutral - Macquarie Overnight Price $10.37
CBA - COMMBANK Neutral - UBS Overnight Price $79.65
GMG - GOODMAN GRP Overweight - Morgan Stanley Overnight Price $8.50
HSO - HEALTHSCOPE Buy - UBS Overnight Price $2.02
HVN - HARVEY NORMAN HOLDINGS Underweight - Morgan Stanley Overnight Price $3.77
JBH - JB HI-FI Equal-weight - Morgan Stanley Overnight Price $23.12
JIN - JUMBO INTERACTIVE Add - Morgans Overnight Price $2.67
MLX - METALS X Outperform - Macquarie Overnight Price $0.78
MYR - MYER Equal-weight - Morgan Stanley Overnight Price $0.87
NAB - NATIONAL AUSTRALIA BANK Sell - UBS Overnight Price $30.12
PMV - PREMIER INVESTMENTS Upgrade to Buy from Neutral - Citi Overnight Price $12.41
PRY - PRIMARY HEALTH CARE Underperform - Credit Suisse Overnight Price $3.68
QUB - QUBE HOLDINGS Buy - Citi Overnight Price $2.64
Outperform - Macquarie Overnight Price $2.64
Buy - Ord Minnett Overnight Price $2.64
SFH - SPECIALTY FASHION Upgrade to Buy from Neutral - Citi Overnight Price $0.40
SFR - SANDFIRE Outperform - Macquarie Overnight Price $6.11
SGM - SIMS METAL MANAGEMENT Outperform - Macquarie Overnight Price $13.33
SUL - SUPER RETAIL Overweight - Morgan Stanley Overnight Price $7.70
WBC - WESTPAC BANKING Neutral - UBS Overnight Price $30.50
WES - WESFARMERS Downgrade to Underweight from Equal-weight - Morgan Stanley Overnight Price $42.70
RATING SUMMARY
Rating No. Of Recommendations
1. Buy

14

3. Hold

8

5. Sell

4

Thursday 01 June 2017

Access Broker Call Report Archives here

Disclaimer:
The content of this information does in no way reflect the opinions of FNArena, or of its journalists. In fact we don't have any opinion about the stock market, its value, future direction or individual shares. FNArena solely reports about what the main experts in the market note, believe and comment on. By doing so we believe we provide intelligent investors with a valuable tool that helps them in making up their own minds, reading market trends and getting a feel for what is happening beneath the surface. This document is provided for informational purposes only. It does not constitute an offer to sell or a solicitation to buy any security or other financial instrument. FNArena employs very experienced journalists who base their work on information believed to be reliable and accurate, though no guarantee is given that the daily report is accurate or complete. Investors should contact their personal adviser before making any investment decision.