Australian Broker Call

Macquarie rates AAD as Neutral (3) -

First half results were lower than expected. The outlook for Main Event appears mixed to Macquarie, with comparable growth expected to moderate. The theme parks recovery is also behind expectations.

Macquarie envisages limited near-term catalysts for a re-rating and maintains a Neutral rating. Target is raised to $2.05 from $2.00.

Target price is $2.05 Current Price is $1.87 Difference: $0.18
If AAD meets the Macquarie target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $2.02, suggesting upside of 7.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.1

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

Ord Minnett rates ALL as Accumulate (2) -

After analysing the trends in the social and online gaming market, along with the company's product offering, Ord Minnett suggests intense competition will limit monetisation rates for casual gaming while in-app purchases are the primary source of revenue.

Earnings estimates are adjusted because of a lower US tax rate and to reflect the higher contribution from Plarium and Big Fish in FY18. Accumulate maintained. Target rises to $27.50 from $24.20.

Target price is $27.50 Current Price is $23.75 Difference: $3.75
If ALL meets the Ord Minnett target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $27.86, suggesting upside of 17.3% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.6

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

UBS rates CGF as Neutral (3) -

UBS highlights the trade-off in trying to simultaneously support both sales and ROE in a falling credit spread environment.

The broker suggests headwinds emanating from domestic lifetime annuity sales and rising risks to Japanese AUD annuity sales mean the company may need to extend pricing support. Margins appears set to continue compressing.

Neutral maintained. Target reduced to $12.85 from $12.90.

Target price is $12.85 Current Price is $12.03 Difference: $0.82
If CGF meets the UBS target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $12.36, suggesting upside of 2.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: -0.3

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

Deutsche Bank rates IPL as Buy (1) -

Deutsche Bank believes Incitec Pivot is positioned to benefit from rising global fertiliser prices, a lower US gas price and improved demand for explosives in North America and Australia. The broker increases earnings forecasts by 5-9%.

A Buy rating is maintained. Target is raised to $4.55 from $4.30.

Target price is $4.55 Current Price is $3.82 Difference: $0.73
If IPL meets the Deutsche Bank target it will return approximately 19% (excluding dividends, fees and charges).

Current consensus price target is $4.04, suggesting upside of 5.9% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.4

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

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

The good news for Mineral Deposits is the Grande Cote mineral sands operation in Senegal, 90% owned by TiZir, which is 50% owned by Mineral Deposits, ramped up production at a time titanium and zircon prices were firming. The bad news is operational problems at the company's smelter in Norway halted production.

The cost turned out to be greater than Morgans had forecast and hence Mineral Deposits' earnings result was a disappointment. However the smelter has now ramped up to a greater efficiency level than first modelled.

Revised production and cost projections lead the broker to increase its target to $1.51 from $1.18. Upgrade to Add from Hold.

Target price is $1.51 Current Price is $1.08 Difference: $0.43
If MDL meets the Morgans target it will return approximately 40% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

Forecast for FY17:

Forecast for FY18:

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

Market Sentiment: 1.0

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

Macquarie rates MHJ as Outperform (1) -

The company will close 24 of the 30 Emma & Roe stores, leaving a residual 6 stores in a single market area footprint. The company believes this will provide the best opportunity to install its new model quickly.

Macquarie expects the balance of FY18 will be somewhat disrupted as the company completes this re-positioning and its exit from the US. All trading losses are expected to be eliminated by FY19. The broker expects an improving trend in the second half of FY18 from the core geographies.

Outperform maintained. Target is $1.32.

Target price is $1.32 Current Price is $1.12 Difference: $0.2
If MHJ meets the Macquarie target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $1.32, suggesting upside of 17.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.8

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

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

Further analysis suggests to Citi that Nufarm is entering an era of continuous double digit percentage growth, currently calculated as three year CAGR of 11%. The analysts refer to recent acquisitions, which introduce higher margins, as well as the launch of Nufarm's long-awaited Omega-3 canola product.

Earnings estimates have been lifted. Citi suggests the release of interim financials should confirm a strong rebound in profits. There is also an Investor Day scheduled for May. Target increased to $9.50 from $9.07. Upgrade to Buy from Neutral.

Target price is $9.50 Current Price is $8.04 Difference: $1.46
If NUF meets the Citi target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $9.46, suggesting upside of 17.6% (ex-dividends)

The company's fiscal year ends in July.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.6

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

UBS rates RFG as Downgrade to Sell from Neutral (5) -

First half results were weaker than expected. The company has flagged the closure of another 160-200 outlets over the next 15 months and suspended dividends. UBS downgrades earnings per share estimates by -50-60% from FY20 onwards, and downgrades the rating to Sell from Neutral.

The company has cited pressure on major shopping centres, particularly the increasing amount of floor space dedicated to competing food offerings. The broker also believes the new banking covenants will be difficult to comply with. Target is reduced to $0.90 from $2.15.

Target price is $0.90 Current Price is $1.11 Difference: minus $0.21 (current price is over target).
If RFG meets the UBS target it will return approximately minus 19% (excluding dividends, fees and charges - negative figures indicate an expected loss).

The company's fiscal year ends in June.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: -1.0

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

Macquarie rates STO as Neutral (3) -

Following the earthquake in PNG, which has impacted production from PNG LNG, Macquarie downgrades the company's 2018 estimates for earnings per share by -6%.

The broker also reduces 2018 production estimates to 59.6mmboe, which remains within the guidance range of 55-60mmboe.

Macquarie maintains a Neutral rating and expects the company to easily achieve its US$2bn target for net debt by the end of 2018. Target is $5.30.

Target price is $5.30 Current Price is $4.99 Difference: $0.31
If STO meets the Macquarie target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $5.32, suggesting upside of 6.5% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY18:

Forecast for FY19:

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

Ord Minnett rates SXY as Hold (3) -

Ord Minnett updates its model to incorporate adjustments to the timing and ramp up of phases 3 and 4 at the Western Surat and Atlas projects.

Hold rating retained and target raised to $0.42 from $0.41.

Target price is $0.42 Current Price is $0.38 Difference: $0.04
If SXY meets the Ord Minnett target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $0.41, suggesting upside of 8.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.4

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

Deutsche Bank rates TLS as Buy (1) -

Telstra and News Corp ((NWS)) have agreed to combine Foxtel and Fox Sports Australia. The transaction is expected to enable a better use of assets. News Corp will have a 65% shareholding in the combined entity and Telstra the remainder.

Telstra expects to record a one-off accounting gain of $263m but has indicated there is no change to FY18 guidance from the transaction. A Buy rating is maintained. Target is reduced to $4.05 from $4.07.

Target price is $4.05 Current Price is $3.32 Difference: $0.73
If TLS meets the Deutsche Bank target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $3.65, suggesting upside of 9.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.1

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

Credit Suisse rates VCX as Neutral (3) -

Credit Suisse struggles with the company's view that incremental development expenditure is more accretive to value than further buyback activity.

Despite the stock trading at a -16% discount to NTA the uncertainty regarding the outlook for asset values and negative retail sentiment keeps the broker on a Neutral call. $2.79 target maintained.

Target price is $2.79 Current Price is $2.43 Difference: $0.36
If VCX meets the Credit Suisse target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $2.83, suggesting upside of 16.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.4

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