Australian Broker Call

Morgans rates AGL as Reduce (5) -

Morgans observes AGL Energy has performed strongly over the last three months and appears to have shrugged off concerns regarding regulation.

While the dividend yield in the current financial year appears reasonable, the broker believes the outlook is not so bright. Morgans expects price pressure in the electricity market will cause net profit to decline by -10% in FY20.

The broker believes the market has priced in strong near-term earnings but downside risks in the future are being ignored. Reduce maintained. Target is raised to $18.02 from $16.89.

Target price is $18.02 Current Price is $21.83 Difference: minus $3.81 (current price is over target).
If AGL meets the Morgans target it will return approximately minus 17% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $20.82, suggesting downside of -4.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.1

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

Credit Suisse rates AHY as Upgrade to Outperform from Neutral (1) -

Pulp prices are falling and Credit Suisse now expects a -30% reduction in pulp costs for Asaleo in 2020, with 2019 supply already hedged. Now that local tissue business has been divested, the broker sees more stable revenue and margins ahead.

Forecast cost relief leads to a forecast earnings increase of 18% in 2020. Target rises to $1.25 from 95c. Upgrade to Outperform from Neutral, noting a 5% yield.

Target price is $1.25 Current Price is $1.00 Difference: $0.25
If AHY meets the Credit Suisse target it will return approximately 25% (excluding dividends, fees and charges).

Current consensus price target is $1.15, suggesting upside of 15.0% (ex-dividends)

The company's fiscal year ends in December.

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

Deutsche Bank rates ANN as Buy (1) -

Ansell has announced the acquisition of Ringers Gloves for US$70m. The transaction is expected to be dilutive in FY19 and accretive in FY20.

Deutsche Bank maintains a Buy rating and $28.30 target.

Target price is $28.30 Current Price is $23.23 Difference: $5.07
If ANN meets the Deutsche Bank target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $25.86, suggesting upside of 11.3% (ex-dividends)

Forecast for FY19:

Forecast for FY20:

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

Market Sentiment: 0.5

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

Morgan Stanley rates ANN as Overweight (1) -

Ansell has acquired US-based Ringers Gloves for US$70m. The company provides specialty gloves to the oil & gas industry.

Morgan Stanley observes the portfolio is complimentary to Ansell's existing brands. The broker maintains an Overweight rating and $25.39 target. Industry view is In-Line.

Target price is $25.39 Current Price is $23.23 Difference: $2.16
If ANN meets the Morgan Stanley target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $25.86, suggesting upside of 11.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

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

Market Sentiment: 0.5

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

Ord Minnett rates ANN as Hold (3) -

Ansell will acquire Ringers Gloves which sells specialty impact gloves to the oil & gas and general industry sector.

Ord Minnett increases the magnitude of its share buyback assumptions for the second half and FY20, boosting earnings estimates by 2% and 4.5% for FY19 and FY20 respectively.

Target rises to $25.00 from $24.50. Hold rating maintained.

Target price is $25.00 Current Price is $23.23 Difference: $1.77
If ANN meets the Ord Minnett target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $25.86, suggesting upside of 11.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

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

Market Sentiment: 0.5

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

UBS rates ANN as Neutral (3) -

Ansell has announced the acquisition of US industrial glove manufacturer, Ringers Gloves, for US$70m. UBS incorporates the acquisition into forecasts and updates for the share buyback, resulting in upgrades to earnings per share of 0.8% in FY19 and 1.6% in FY20.

The broker expects the company to report a slowdown in European manufacturing activity and sluggish growth in healthcare when it reports on February 18.

UBS maintains a Neutral rating and raises the target to $24.50 from $23.80.

Target price is $24.50 Current Price is $23.23 Difference: $1.27
If ANN meets the UBS target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $25.86, suggesting upside of 11.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

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

Market Sentiment: 0.5

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

Ord Minnett rates AQZ as Buy (1) -

Qantas ((QAN)) has taken a 19.9% stake in Alliance Aviation and, in Ord Minnett's opinion, crashed Virgin Australia's ((VAH)) party.

Qantas has stated it ultimately expects to seek regulatory approval from the ACCC to build on its current shareholding, although did not indicate when that might be.

 ACCC approval is far from a foregone conclusion and the broker suspects that, until the regulator's views are better known, it will preclude Qantas from making a full takeover bid.

Ord Minnett maintains a Buy rating and $2.60 target.

Target price is $2.60 Current Price is $2.50 Difference: $0.1
If AQZ meets the Ord Minnett target it will return approximately 4% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 1.0

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

Macquarie rates BLD as Outperform (1) -

After issuing its second profit warning since October last year, including a greater skew to the second half for the running financial year, Macquarie analysts have placed their estimates under review.

On their initial indication, H1 guidance (now revised) implies those forecasts might have to be cut by -18%, at least for H1. Outperform. Target seems to have dropped to $6.60 from $7.15 prior, but we'll know more when the official research report will become public tomorrow.

Target price is $6.60 Current Price is $4.53 Difference: $2.07
If BLD meets the Macquarie target it will return approximately 46% (excluding dividends, fees and charges).

Current consensus price target is $6.75, suggesting upside of 49.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.6

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

Macquarie rates GOR as Outperform (1) -

Macquarie notes Gruyere is less than five months from first gold and construction is almost complete. The company expects the project to ramp up to full production over a 6-7 month period.

The broker maintains a Outperform rating and $0.85 target. No meaningful earnings are forecast until FY20.

Target price is $0.85 Current Price is $0.76 Difference: $0.09
If GOR meets the Macquarie target it will return approximately 12% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

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

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

Ord Minnett believes, while some dynamics will remain structural, such as weak first half cash flow, the medium-term growth prospects for the business remain intact.

The share price has de-rated and the broker upgrades to Accumulate from Hold. Ord Minnett believes the company can consistently generate more than 6% growth in organic earnings over the medium term.

Market concerns about customer concentration in the automotive division are considered to be overstated. Target is raised to $12.70 from $12.00.

Target price is $12.70 Current Price is $11.55 Difference: $1.15
If GUD meets the Ord Minnett target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $13.81, suggesting upside of 19.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.7

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

Citi rates HSO as Neutral (3) -

The board of Healthscope unanimously recommends the revised bid from Brookfield, at $2.50 a share. The transaction also includes a sale and lease-back of 22 properties.

The takeover still requires approval from the Foreign Investment Review Board, which is likely in Citi's view. Meanwhile, first half results missed the broker's estimates.

Neutral rating maintained. Target is raised to $2.37 from $2.25.

Target price is $2.37 Current Price is $2.47 Difference: minus $0.1 (current price is over target).
If HSO meets the Citi target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.43, suggesting downside of -1.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.0

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

Credit Suisse rates HSO as Neutral (3) -

Healthscope's board has approved a takeover by Brookfield at $2.50 per share despite this being -3% lower than the indicative bid made prior to due diligence. The broker believes property value secured the deal, with Healthscope concurrently entering into a sale & lease-back of its property assets.

Given greater takeover certainty, the broker lifts its target to $2.50, retaining Neutral. BGH-AusSuper has indicated it might come back with another swing if allowed due diligence, but the bid would have to exceed $2.50 for the board to be interested.

Target price is $2.50 Current Price is $2.47 Difference: $0.03
If HSO meets the Credit Suisse target it will return approximately 1% (excluding dividends, fees and charges).

Current consensus price target is $2.43, suggesting downside of -1.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.0

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

Deutsche Bank rates HSO as Hold (3) -

The company has entered into an implementation deed under which Brookfield will acquire Healthscope by way of a scheme of arrangement and simultaneous off-market takeover offer.

The board has recommended the transaction. Deutsche Bank retains a Hold rating.

Current Price is $2.47. Target price not assessed.

Current consensus price target is $2.43, suggesting downside of -1.8% (ex-dividends)

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.0

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

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

The company has entered into an implementation deed with Brookfield, whereby Brookfield will acquire the stock for $2.50 a share.

Morgan Stanley notes the company is still targeting at least 10% growth in FY19 hospital earnings. Equal-weight rating maintained. Industry view is In-Line. Target is $2.46.

Target price is $2.46 Current Price is $2.47 Difference: minus $0.01 (current price is over target).
If HSO meets the Morgan Stanley target it will return approximately minus 0% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.43, suggesting downside of -1.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.0

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

Morgans rates HSO as Hold (3) -

First half trading and the hospital division results were below Morgans' expectations. This has taken a backseat to the Brookfield bid, the broker notes, with the company accepting a slightly revised offer of $2.50 a share via a scheme of arrangement.

Morgans increases the target to $2.50 from $2.20. Hold rating maintained.

Target price is $2.50 Current Price is $2.47 Difference: $0.03
If HSO meets the Morgans target it will return approximately 1% (excluding dividends, fees and charges).

Current consensus price target is $2.43, suggesting downside of -1.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.0

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

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

Ord Minnett notes a strong outlook for domestic commercial insurance rates, leading to an upgrade to Accumulate from Hold for Insurance Australia Group.

The broker finds a favourable insurance cycle, little risk from the Royal Commission and stronger reinsurance protections are underpinning the stock. Target is raised to $8.00 from $7.10.

Target price is $8.00 Current Price is $7.30 Difference: $0.7
If IAG meets the Ord Minnett target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $7.63, suggesting upside of 4.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.3

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

Citi rates IFL as Neutral (3) -

December quarter flows were a little worse than Citi expected and FY19 and FY20 forecasts have been trimmed.

At face value the stock appears cheap, with a high dividend yield forecast, but the broker observes risks are elevated.

The broker maintains a Neutral/High Risk rating and $5.70 target.

Target price is $5.70 Current Price is $4.86 Difference: $0.84
If IFL meets the Citi target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $5.01, suggesting upside of 3.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.0

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

Credit Suisse rates IFL as Neutral (3) -

IOOF's funds under management fell -5.8% in the Dec Q on a combination of weak market conditions and fund outflows greater than the broker forecast. The broker has lowered forecast earnings on the back of, among other things, weaker FUM, lower organic flows for Advice and new lower prices under the BT badge.

IOOF is trading at a -50% discount to the market but given uncertainty over the closure of the ANZ Wealth acquisition, APRA's proceedings against the company and the Royal Commission report about to be delivered, the broker retains Neutral. Target unchanged at $4.60.

Target price is $4.60 Current Price is $4.86 Difference: minus $0.26 (current price is over target).
If IFL meets the Credit Suisse target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $5.01, suggesting upside of 3.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.0

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

Macquarie rates IFL as Neutral (3) -

Advice was soft in the December quarter, although Macquarie notes platform business held up. Advice flows were affected by the recent repricing of Panorama.

The broker considers the current material discount in the stock is warranted while uncertainty exists.

While Macquarie envisages significant value at current levels a Neutral rating is maintained. Target is reduced $4.75 from $5.10.

Target price is $4.75 Current Price is $4.86 Difference: minus $0.11 (current price is over target).
If IFL meets the Macquarie target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $5.01, suggesting upside of 3.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.0

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

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

December quarter funds under administration were slightly below expectations. Platform and investment management net flows were stronger than expected, while advice disappointed Morgan Stanley.

The company has highlighted that its new Insignia Wrap has replicated the BT offer and captured $976m in inflows. Equal-weight. Target is $5.00. Industry view: In Line.

Target price is $5.00 Current Price is $4.86 Difference: $0.14
If IFL meets the Morgan Stanley target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $5.01, suggesting upside of 3.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.0

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

UBS rates IFL as Neutral (3) -

Net fund flows in the December quarter were below UBS estimates, particularly in the advice division. The broker expects the headwinds from the company's re-launch of the business, designed to match Panorama price reductions, to moderate significantly.

The main question is whether the company can sustain its better outcomes versus large retail wealth peers given the damage to its brand post the run in with the regulator and the risks surrounding the Hayne Royal Commission.

Neutral rating and $5 target maintained.

Target price is $5.00 Current Price is $4.86 Difference: $0.14
If IFL meets the UBS target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $5.01, suggesting upside of 3.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.0

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

Credit Suisse rates LNK as Outperform (1) -

The broker has lowered forecast earnings for Link on the back of the divestment of Corporate & Private Clients to be completed later this year, net of lower interest costs post-sale given proceeds will be used to pay down debt, and net of currency mark to market. Target falls to $8.20 from $8.30.

The broker retains Outperform, believing Link can deliver around 10%pa earnings growth over the next 3-4 years albeit in a lumpy fashion.

Target price is $8.20 Current Price is $7.21 Difference: $0.99
If LNK meets the Credit Suisse target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $8.27, suggesting upside of 14.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.6

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

Deutsche Bank rates LNK as Hold (3) -

The company will sell its European Trustee business for GBP$240m. Deutsche Bank considers this a positive move as the company has no competitive advantage in the business, having been acquired as part of the broader deal to acquire Capita Asset Services in the UK.

The sale reduces earnings per share by around -11%, the broker calculates. Deutsche Bank remains concerned that, subsequent to listing, the pace of expansion has been rapid and operating complexity has increased, leaving management stretched.

Target is reduced to $7.20 from $7.60. Hold maintained.

Target price is $7.20 Current Price is $7.21 Difference: minus $0.01 (current price is over target).
If LNK meets the Deutsche Bank target it will return approximately minus 0% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $8.27, suggesting upside of 14.7% (ex-dividends)

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.6

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

Macquarie rates LNK as Outperform (1) -

The company will sell its corporate & private clients business for GBP240m. Macquarie, while not expecting the divestment, notes the sale is because of a lack of scale in this area, and the capital required for industry consolidation.

The broker reduces the target to $8.70 from $8.90 and maintains an Outperform rating.

Target price is $8.70 Current Price is $7.21 Difference: $1.49
If LNK meets the Macquarie target it will return approximately 21% (excluding dividends, fees and charges).

Current consensus price target is $8.27, suggesting upside of 14.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.6

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

Morgan Stanley rates LNK as Overweight (1) -

The company has sold its corporate & private clients division, which is a surprise to Morgan Stanley. The broker had expected Link would be a buyer of assets, given considerable consolidation opportunities within this fragmented corporate trust market.

The sale price of GBP240m is also below the broker's valuation. Overweight rating and $8.50 target maintained. Industry view is In-Line.

Target price is $8.50 Current Price is $7.21 Difference: $1.29
If LNK meets the Morgan Stanley target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $8.27, suggesting upside of 14.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.6

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

Morgans rates ORG as Add (1) -

Morgans observes the stock has declined -25% over the last year, amid concerns about regulation in the electricity market and a volatile oil price.

Morgans believes the market has over-reacted to the risks and has not adequately accounted for the factors that may mitigate some of those risks.

The broker believes Origin Energy will have capacity to increase dividends from much stronger cash flows after de-leveraging.

The broker maintains an Add rating and raises the target to $8.15 from $8.09.

Target price is $8.15 Current Price is $7.23 Difference: $0.92
If ORG meets the Morgans target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $8.61, suggesting upside of 19.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.9

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

Macquarie rates PNL as Outperform (1) -

First production has been delayed by 6-8 weeks, although additional offtake agreements have allowed the company to effectively pre-sell all 2019 and the majority of 2020 production.

While the delay is far from ideal, Macquarie expects Paringa Resources will be able to meet its sales obligations.

Outperform rating maintained. Target is reduced to $0.27 from $0.30.

Target price is $0.27 Current Price is $0.17 Difference: $0.1
If PNL meets the Macquarie target it will return approximately 59% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

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 RIO as Downgrade to Hold from Accumulate (3) -

Ord Minnett notes iron ore prices have rallied in response to supply uncertainty as a result of the tailings dam failure at the Vale mine in Brazil. The broker concludes supply disruption from the tragedy is likely to be modest.

Still, the better iron ore price improves the outlook for Australian iron ore miners, although the recent rally in share prices has accounted for this.

The broker downgrades Rio Tinto to Hold from Accumulate, although maintains a preference for RIO over BHP ((BHP)) based on cheaper metrics. Target is raised to $92 from $90.

Target price is $92.00 Current Price is $86.67 Difference: $5.33
If RIO meets the Ord Minnett target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $86.36, suggesting downside of -0.4% (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: 0.4

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

Deutsche Bank rates RWC as Hold (3) -

The company has maintained FY19 guidance and the first half is only expected to contribute 45-47%.

The weighting to the second half is on the back of lower second half commodity costs, seasonality in John Guest and the progressive accumulation of transaction synergies.

Deutsche Bank, while pleased with how the integration of John Guest is going, believes Reliance Worldwide must continue to progress growth beyond repair/maintenance and into new construction.

However this is likely to be difficult in a deteriorating macro environment. Hold rating maintained. Target is $4.60.

Target price is $4.60 Current Price is $4.71 Difference: minus $0.11 (current price is over target).
If RWC meets the Deutsche Bank target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $5.61, suggesting upside of 19.2% (ex-dividends)

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.7

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

Macquarie rates RWC as Outperform (1) -

The company has reiterated FY19 earnings (EBITDA) guidance of $280-290m. The skew to the second half is greater than Macquarie would have expected.

The stock is the broker's favoured sector exposure and the valuation appears to have suffered amid wider fears regarding the US new housing market, compounded to some extent by Brexit.

Macquarie maintains an Outperform rating and $6.40 target.

Target price is $6.40 Current Price is $4.71 Difference: $1.69
If RWC meets the Macquarie target it will return approximately 36% (excluding dividends, fees and charges).

Current consensus price target is $5.61, suggesting upside of 19.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.7

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

Morgans rates RWC as Add (1) -

Morgans finds the confirmation of FY19 earnings guidance a positive while noting the John Guest acquisition is performing well. The main negative from the trading update was the reliance on a modest freeze in the US.

The company noted the current polar vortex has not yet affected the southern parts of the country, which is an important factor in relation to the impact of freeze conditions on plumbing installations.

Morgans notes a greater skew to the second half than previously expected amid ongoing uncertainty around weather events, which could negatively affect earnings.

The broker maintains an Add rating, nonetheless, and reduces the target to $5.57 from $6.25.

Target price is $5.57 Current Price is $4.71 Difference: $0.86
If RWC meets the Morgans target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $5.61, suggesting upside of 19.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.7

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

Morgan Stanley rates SHL as Overweight (1) -

The company has completed the acquisition of Aurora. As anatomical pathology is not subject to funding cuts the deal diluted some of the US top-line risk and increases the company's US business by around 38%.

The US is now representing 28% of the group. Morgan Stanley estimates Aurora will be slightly accretive to earnings from FY19. Overweight. Target is $27.70. Industry view is In-Line.

Target price is $27.70 Current Price is $23.13 Difference: $4.57
If SHL meets the Morgan Stanley target it will return approximately 20% (excluding dividends, fees and charges).

Current consensus price target is $25.33, suggesting upside of 9.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.5

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

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

While the company has a strong track record, Morgans takes a slightly more cautious stance heading into the results on February 18. No formal earnings guidance has been provided.

The broker believes an acquisition is a realistic proposition in 2019, which represents the primary upside risk to forecasts.

However, the stock is trading at a fair multiple, with the prospect of softer organic growth in the near term, and the broker downgrades to Hold from Add. Target is reduced to $11.20 from $11.65.

Target price is $11.20 Current Price is $9.50 Difference: $1.7
If SIQ meets the Morgans target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $12.08, suggesting upside of 27.1% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.7

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

Credit Suisse rates SYD as Downgrade to Underperform from Neutral (5) -

In anticipation of lower air travel demand in 2019, international airlines are cutting their capacity plans, Credit Suisse notes. To that end, the broker lowers its international passenger growth forecast to 0% from 5% previously and domestic to 0% from 2%.

The broker's dividend forecasts fall -4% in 2019 and -9% in 2020. Target falls to $6.40 from $6.80. Downgrade to Underperform from Neutral.

Target price is $6.40 Current Price is $6.49 Difference: minus $0.09 (current price is over target).
If SYD meets the Credit Suisse target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $7.06, suggesting upside of 8.7% (ex-dividends)

The company's fiscal year ends in December.

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 TLS as Re-initiate coverage with Neutral (3) -

Credit Suisse sees the current telco market in Australia as challenging, given competitive intensity in mobile and margin pressure from the NBN rollout. 5G may provide an opportunity, but only longer term.

The broker resumes coverage (after a one year hiatus) of Telstra with a Neutral rating and $3.10 target, noting a still reasonable dividend yield and believing Telstra is best placed to benefit longer term from 5G.

Target price is $3.10 Current Price is $3.14 Difference: minus $0.04 (current price is over target).
If TLS meets the Credit Suisse target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.00, suggesting downside of -4.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.2

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

Credit Suisse rates TPM as Re-initiate coverage with Neutral (5) -

Credit Suisse sees the current telco market in Australia as challenging, given competitive intensity in mobile and margin pressure from the NBN rollout. 5G may provide an opportunity, but only longer term.

The broker resumes coverage (after a one year hiatus) of TPG with an Underperform rating and $5.60 target, believing the market has more than factored in the successful completion of the merger with Vodafone when risk/reward is skewed to the downside.

Target price is $5.60 Current Price is $7.02 Difference: minus $1.42 (current price is over target).
If TPM meets the Credit Suisse target it will return approximately minus 20% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $6.51, suggesting downside of -7.3% (ex-dividends)

The company's fiscal year ends in July.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.3

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

Credit Suisse rates VOC as Re-initiate coverage with Neutral (3) -

Credit Suisse sees the current telco market in Australia as challenging, given competitive intensity in mobile and margin pressure from the NBN rollout. 5G may provide an opportunity, but only longer term.

The broker resumes coverage (after a one year hiatus) of Vocus with Neutral rating and $3.25 target, noting the company is in a transition year but is also more insulated from sector trends given greater exposure to enterprise and wholesale markets.

Target price is $3.25 Current Price is $3.29 Difference: minus $0.04 (current price is over target).
If VOC meets the Credit Suisse target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.10, suggesting downside of -5.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.3

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