Australian Broker Call

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January 18, 2018

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COMPANIES DISCUSSED IN THIS ISSUE

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

Last Updated: 01:26 PM

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
APO - APN OUTDOOR Downgrade to Neutral from Buy UBS
ORE - OROCOBRE Upgrade to Neutral from Underperform Macquarie
OZL - OZ MINERALS Downgrade to Hold from Add Morgans
Neutral UBS
S32 - SOUTH32 Downgrade to Neutral from Buy Citi
Downgrade to Underperform from Neutral Credit Suisse
WBC - WESTPAC BANKING Upgrade to Outperform from Neutral Macquarie
A2M  THE A2 MILK COMPANY LIMITED

Dairy

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Overnight Price: $7.61

Macquarie rates A2M as Outperform (1) -

The company is expanding its US business across the north eastern region. This expansion follows the company achieving sales-based targets across other regions, notably in California and the south east.

Macquarie envisages upside from new product launches as the company proves up its opportunity. Outperform retained. Target is $8.29.

Target price is $8.29 Current Price is $7.61 Difference: $0.68
If A2M meets the Macquarie target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $8.57, suggesting upside of 12.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Macquarie forecasts a full year FY18 dividend of 0.00 cents and EPS of 20.60 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 36.95.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 21.2, implying annual growth of N/A.

Current consensus DPS estimate is 3.0, implying a prospective dividend yield of 0.4%.

Current consensus EPS estimate suggests the PER is 35.9.

Forecast for FY19:

Macquarie forecasts a full year FY19 dividend of 14.06 cents and EPS of 28.12 cents.
At the last closing share price the estimated dividend yield is 1.85%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 27.07.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 28.2, implying annual growth of 33.0%.

Current consensus DPS estimate is 7.5, implying a prospective dividend yield of 1.0%.

Current consensus EPS estimate suggests the PER is 27.0.

This company reports in NZD. 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

ACK  AUSTOCK GROUP LIMITED

Insurance

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Overnight Price: $1.57

Morgans rates ACK as Hold (3) -

December quarter funds under management were strong, Morgans asserts, and the only negative in the update was a minor lift in quarterly withdrawals to -$14m.

The broker lifts FY18 and FY19 forecasts for earnings per share by 37% and 85% respectively. Target rises to $1.68 from $1.07.

While the update reveals a significant step change in momentum under the new management, the broker requires further evidence of the trend that is emerging in order to be more positive. Hold rating maintained.

Target price is $1.68 Current Price is $1.57 Difference: $0.11
If ACK meets the Morgans target it will return approximately 7% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY18:

Morgans forecasts a full year FY18 dividend of 1.20 cents and EPS of 1.80 cents.
At the last closing share price the estimated dividend yield is 0.76%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 87.22.

Forecast for FY19:

Morgans forecasts a full year FY19 dividend of 2.40 cents and EPS of 3.40 cents.
At the last closing share price the estimated dividend yield is 1.53%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 46.18.

Market Sentiment: 0.0

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

ALU  ALTIUM LIMITED

Hardware & Equipment

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Overnight Price: $14.24

UPDATED

UBS rates ALU as Neutral (3) -

The Altium Designer 18 (AD18) product was formally released on 15 December and UBS's assessment of feedback post the formal and updated release is highly supportive of strong earnings momentum medium-term.

In addition, the company's balance sheet allows for inorganic growth options, the broker points out. A change in analyst has changed the valuation methodology which now pushes up the price target to $14.20 (valuation $12.87) versus $9.10 previously.

As the stock is seen as fairly priced vis a vis peers, the Neutral rating remains in place, supported by higher forecasts.

Target price is $14.20 Current Price is $14.24 Difference: minus $0.04 (current price is over target).
If ALU 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 $12.90, suggesting downside of -9.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

UBS forecasts a full year FY18 dividend of 25.00 cents and EPS of 27.00 cents.
At the last closing share price the estimated dividend yield is 1.76%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 52.74.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 33.8, implying annual growth of 55.8%.

Current consensus DPS estimate is 29.2, implying a prospective dividend yield of 2.1%.

Current consensus EPS estimate suggests the PER is 42.1.

Forecast for FY19:

UBS forecasts a full year FY19 dividend of 33.00 cents and EPS of 35.00 cents.
At the last closing share price the estimated dividend yield is 2.32%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 40.69.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 37.8, implying annual growth of 11.8%.

Current consensus DPS estimate is 33.8, implying a prospective dividend yield of 2.4%.

Current consensus EPS estimate suggests the PER is 37.7.

Market Sentiment: 0.0

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

APO  APN OUTDOOR GROUP LIMITED

Out of Home Advertising

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Overnight Price: $4.54

UPDATED

UBS rates APO as Downgrade to Neutral from Buy (3) -

The downgrade, explains UBS, is motivated by trying to balance the positives (new experienced CEO and still positive industry growth) with the negatives of increasing competition for contracts and a slowing in industry growth recently.

The company is scheduled to report 2017 results on Feb 20. Short term, UBS is not expecting much in terms of earnings growth as the company needs to absorb the loss of the Yarra Trams contract. Target remains $4.75.

Target price is $4.75 Current Price is $4.54 Difference: $0.21
If APO meets the UBS target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $5.23, suggesting upside of 15.2% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY17:

UBS forecasts a full year FY17 dividend of 19.00 cents and EPS of 32.00 cents.
At the last closing share price the estimated dividend yield is 4.19%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.19.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 31.9, implying annual growth of 9.6%.

Current consensus DPS estimate is 19.0, implying a prospective dividend yield of 4.2%.

Current consensus EPS estimate suggests the PER is 14.2.

Forecast for FY18:

UBS forecasts a full year FY18 dividend of 19.00 cents and EPS of 31.00 cents.
At the last closing share price the estimated dividend yield is 4.19%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.65.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 32.7, implying annual growth of 2.5%.

Current consensus DPS estimate is 20.1, implying a prospective dividend yield of 4.4%.

Current consensus EPS estimate suggests the PER is 13.9.

Market Sentiment: 0.5

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

AZJ  AURIZON HOLDINGS LIMITED

Transportation & Logistics

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Overnight Price: $4.63

UBS rates AZJ as Neutral (3) -

In December, The Queensland Competition Authority issued the draft decision on Aurizon's regulatory undertaking. UBS suggested at that time the draft is a materially lower position than previously expected.

The analysts have now incorporated lower forecasts into their modeling, from 2019 onwards. The price target loses 20c to $4.70 as a result.

Target price is $4.70 Current Price is $4.63 Difference: $0.07
If AZJ meets the UBS target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $4.76, suggesting upside of 2.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

UBS forecasts a full year FY18 dividend of 26.00 cents and EPS of 26.00 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 17.81.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 25.0, implying annual growth of N/A.

Current consensus DPS estimate is 26.2, implying a prospective dividend yield of 5.7%.

Current consensus EPS estimate suggests the PER is 18.5.

Forecast for FY19:

UBS forecasts a full year FY19 dividend of 28.00 cents and EPS of 28.00 cents.
At the last closing share price the estimated dividend yield is 6.05%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.54.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 26.7, implying annual growth of 6.8%.

Current consensus DPS estimate is 26.0, implying a prospective dividend yield of 5.6%.

Current consensus EPS estimate suggests the PER is 17.3.

Market Sentiment: -0.3

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

BAT  BATTERY MINERALS LIMITED

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Overnight Price: $0.07

Morgans rates BAT as Add (1) -

The company has secured a maiden binding offtake agreement and MOU with Chinese graphite user, Qingdao Electronics Materials and Japanese trading house Meiwa.

Morgans incorporates a preliminary valuation for the company's Balama deposit, which sits alongside strike of the Syrah Resources ((SYR)) deposit of the same name. The broker maintains its speculative Add rating and raises the target to $0.26 from $0.23.

Target price is $0.26 Current Price is $0.07 Difference: $0.19
If BAT meets the Morgans target it will return approximately 271% (excluding dividends, fees and charges).

Forecast for FY16:

Forecast for FY17:

Morgans forecasts a full year FY17 dividend of 0.00 cents and EPS of minus 2.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 3.50.

Market Sentiment: 1.0

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

BPT  BEACH ENERGY LIMITED

Crude Oil

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Overnight Price: $1.30

Credit Suisse rates BPT as Re-instate Coverage with Neutral (3) -

Credit Suisse reinstates coverage with a Neutral rating and $1.25 target.  The broker likes the Lattice deal, particularly given both the oil price environment and the level of fixed price contracts.

While finding several positives in the stock, Credit Suisse does not consider the valuation cheap, and would like more detail on the financials surrounding the Lattice transaction. Valuation appears relatively stretched given the broker's oil price deck.

Target price is $1.25 Current Price is $1.30 Difference: minus $0.05 (current price is over target).
If BPT meets the Credit Suisse target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $1.03, suggesting downside of -20.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Credit Suisse forecasts a full year FY18 dividend of 4.00 cents and EPS of 6.09 cents.
At the last closing share price the estimated dividend yield is 3.08%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 21.35.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 7.4, implying annual growth of -64.4%.

Current consensus DPS estimate is 2.6, implying a prospective dividend yield of 2.0%.

Current consensus EPS estimate suggests the PER is 17.6.

Forecast for FY19:

Credit Suisse forecasts a full year FY19 dividend of 4.00 cents and EPS of 13.75 cents.
At the last closing share price the estimated dividend yield is 3.08%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.45.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 9.4, implying annual growth of 27.0%.

Current consensus DPS estimate is 2.4, implying a prospective dividend yield of 1.8%.

Current consensus EPS estimate suggests the PER is 13.8.

Market Sentiment: -0.2

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

CAJ  CAPITOL HEALTH LIMITED

Healthcare services

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Overnight Price: $0.28

Credit Suisse rates CAJ as No Rating (-1) -

Credit Suisse updates its numbers to account for recent acquisitions. The broker believes the company has acquired a good franchise in Tasmania in a structurally attractive market and the Victorian diagnostic imaging market remains strong.

The broker is restricted on the stock at present and cannot provide a target or rating.

Current Price is $0.28. Target price not assessed.

The company's fiscal year ends in June.

Forecast for FY18:

Credit Suisse forecasts a full year FY18 dividend of 0.56 cents and EPS of 1.23 cents.
At the last closing share price the estimated dividend yield is 2.00%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 22.76.

Forecast for FY19:

Credit Suisse forecasts a full year FY19 dividend of 0.82 cents and EPS of 1.81 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 15.47.

Market Sentiment: 0.5

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

GNC  GRAINCORP LIMITED

Agriculture

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Overnight Price: $7.51

Macquarie rates GNC as Neutral (3) -

Macquarie reduces FY18 and FY19 forecasts for earnings per share by -22% and -14% respectively to account for a weaker-than-expected harvest and exports outlook.

The broker expects the stock to be range bound heading into a probable soft update at the AGM, as the market absorbs the earnings impact from a low crop year and an uncompetitive Australian grains scenario.

Neutral retained. Target is reduced to $7.88 from $8.36.

Target price is $7.88 Current Price is $7.51 Difference: $0.37
If GNC meets the Macquarie target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $8.84, suggesting upside of 17.7% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY18:

Macquarie forecasts a full year FY18 dividend of 16.30 cents and EPS of 32.60 cents.
At the last closing share price the estimated dividend yield is 2.17%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 23.04.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 38.7, implying annual growth of -29.3%.

Current consensus DPS estimate is 28.6, implying a prospective dividend yield of 3.8%.

Current consensus EPS estimate suggests the PER is 19.4.

Forecast for FY19:

Macquarie forecasts a full year FY19 dividend of 22.80 cents and EPS of 45.60 cents.
At the last closing share price the estimated dividend yield is 3.04%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.47.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 49.4, implying annual growth of 27.6%.

Current consensus DPS estimate is 30.6, implying a prospective dividend yield of 4.1%.

Current consensus EPS estimate suggests the PER is 15.2.

Market Sentiment: 0.4

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

IDX  INTEGRAL DIAGNOSTICS LIMITED

Medical Equipment & Devices

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Overnight Price: $2.29

Credit Suisse rates IDX as No Rating (-1) -

The company has upgraded guidance and now expects FY18 net profit growth of around 20%. Credit Suisse adjusts for the new guidance and upgrades forecasts for earnings per share by 7.8% for FY18 and 5-6% for FY19-20.

The broker is restricted on the stock at present and cannot provide a target or rating.

Current Price is $2.29. Target price not assessed.

Current consensus price target is $2.12, suggesting downside of -7.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Credit Suisse forecasts a full year FY18 dividend of 8.82 cents and EPS of 12.60 cents.
At the last closing share price the estimated dividend yield is 3.85%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.17.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 12.1, implying annual growth of 13.1%.

Current consensus DPS estimate is 8.1, implying a prospective dividend yield of 3.5%.

Current consensus EPS estimate suggests the PER is 18.9.

Forecast for FY19:

Credit Suisse forecasts a full year FY19 dividend of 9.70 cents and EPS of 13.86 cents.
At the last closing share price the estimated dividend yield is 4.24%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.52.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 12.8, implying annual growth of 5.8%.

Current consensus DPS estimate is 8.8, implying a prospective dividend yield of 3.8%.

Current consensus EPS estimate suggests the PER is 17.9.

Market Sentiment: 0.0

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

MGX  MOUNT GIBSON IRON LIMITED

Iron Ore

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Overnight Price: $0.42

Citi rates MGX as Neutral (3) -

December quarter production and sales were broadly in line with Citi's estimates. The broker marks to market changes to iron ore and FX, resulting in an upgrade for FY18 forecasts to a net profit of $19m, from a loss of -$5m previously. FY19 net profit estimates increase to $27m from $12m.

Neutral/High Risk rating. Target is raised $0.45 from $0.42.

Target price is $0.45 Current Price is $0.42 Difference: $0.03
If MGX meets the Citi target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $0.46, suggesting upside of 10.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Citi forecasts a full year FY18 dividend of 0.00 cents and EPS of 1.70 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 24.71.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 1.1, implying annual growth of -54.4%.

Current consensus DPS estimate is 1.3, implying a prospective dividend yield of 3.1%.

Current consensus EPS estimate suggests the PER is 38.2.

Forecast for FY19:

Citi forecasts a full year FY19 dividend of 0.00 cents and EPS of 2.40 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.50.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 1.9, implying annual growth of 72.7%.

Current consensus DPS estimate is 1.3, implying a prospective dividend yield of 3.1%.

Current consensus EPS estimate suggests the PER is 22.1.

Market Sentiment: 0.3

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


Macquarie rates MGX as Outperform (1) -

Macquarie observes a consistent December quarter from Iron Hill, with the increase in lump sales enabling the company to counter the significant discounts in the iron ore market.

Updates on the progress of Koolan Island present the most significant near-term catalyst for the company, in Macquarie's view, while a decision to deploy the significant cash balance on an acquisition is also possible in the medium term

Outperform rating. Target is $0.50.

Target price is $0.50 Current Price is $0.42 Difference: $0.08
If MGX meets the Macquarie target it will return approximately 19% (excluding dividends, fees and charges).

Current consensus price target is $0.46, suggesting upside of 10.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Macquarie forecasts a full year FY18 dividend of 2.00 cents and EPS of minus 0.30 cents.
At the last closing share price the estimated dividend yield is 4.76%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 140.00.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 1.1, implying annual growth of -54.4%.

Current consensus DPS estimate is 1.3, implying a prospective dividend yield of 3.1%.

Current consensus EPS estimate suggests the PER is 38.2.

Forecast for FY19:

Macquarie forecasts a full year FY19 dividend of 2.00 cents and EPS of minus 1.70 cents.
At the last closing share price the estimated dividend yield is 4.76%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 24.71.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 1.9, implying annual growth of 72.7%.

Current consensus DPS estimate is 1.3, implying a prospective dividend yield of 3.1%.

Current consensus EPS estimate suggests the PER is 22.1.

Market Sentiment: 0.3

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


UPDATED

UBS rates MGX as Neutral (3) -

As it turned out, the production ramp up at Iron Hill did not eventuate as UBS had expected and thus the December production report proved disappointing.

However, the analysts add the addition of a third daily train service in November lifts the yearly capacity from 2.9Mtpa to ~circa 4Mtpa, implying the company can still achieve its sales target of 3.5Mt to 3.8Mt for FY18.

Realised fines price also proved below expectation. Given the market is not yet prepared to pay up for the Koolan Island Restart project (28% completed), UBS continues to incorporate a discount in its valuation.

Price target moves to 44c from 42c. Neutral rating retained.

Target price is $0.44 Current Price is $0.42 Difference: $0.02
If MGX meets the UBS target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $0.46, suggesting upside of 10.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

UBS forecasts a full year FY18 dividend of 2.00 cents and EPS of 2.00 cents.
At the last closing share price the estimated dividend yield is 4.76%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 21.00.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 1.1, implying annual growth of -54.4%.

Current consensus DPS estimate is 1.3, implying a prospective dividend yield of 3.1%.

Current consensus EPS estimate suggests the PER is 38.2.

Forecast for FY19:

UBS forecasts a full year FY19 dividend of 2.00 cents and EPS of 5.00 cents.
At the last closing share price the estimated dividend yield is 4.76%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 8.40.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 1.9, implying annual growth of 72.7%.

Current consensus DPS estimate is 1.3, implying a prospective dividend yield of 3.1%.

Current consensus EPS estimate suggests the PER is 22.1.

Market Sentiment: 0.3

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

ORE  OROCOBRE LIMITED

Rare Earth & Minerals

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Overnight Price: $7.17

Deutsche Bank rates ORE as Hold (3) -

The company has announced a $282m placement to Toyota Tsusho at $7.50 a share and a fully underwritten 1-for-20 entitlement offer at $6.55 a share to raise $79m.

Funds will be used to scale up Olaroz. Deutsche Bank considers the stock fairly valued and maintains a Hold rating. Target is raised to $7.40 from $6.80.

Target price is $7.40 Current Price is $7.17 Difference: $0.23
If ORE meets the Deutsche Bank target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $7.30, suggesting upside of 1.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Deutsche Bank forecasts a full year FY18 dividend of 0.00 cents and EPS of 18.21 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 39.38.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 17.5, implying annual growth of 695.5%.

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

Current consensus EPS estimate suggests the PER is 41.0.

Forecast for FY19:

Deutsche Bank forecasts a full year FY19 dividend of 0.00 cents and EPS of 41.93 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.10.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 27.8, implying annual growth of 58.9%.

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

Current consensus EPS estimate suggests the PER is 25.8.

Market Sentiment: 0.2

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


Macquarie rates ORE as Upgrade to Neutral from Underperform (3) -

Although the company has solved funding problems for stage 2 and the hydroxide plant, with its placement to Toyota Tsusho along with an entitlement offer, Macquarie points out this comes with two large caveats.

The first is that management broke a promise in 2017 that it would not raise capital. The second is the implied acknowledgement that stage 2 was underestimated.

Still, the broker notes the placement at a premium highlights a belief that lithium prices will be higher for longer. Rating is upgraded to Neutral from Underperform.  Target is raised to $7.35 from $6.50.

Target price is $7.35 Current Price is $7.17 Difference: $0.18
If ORE meets the Macquarie target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $7.30, suggesting upside of 1.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Macquarie forecasts a full year FY18 dividend of 0.00 cents and EPS of 20.40 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 35.15.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 17.5, implying annual growth of 695.5%.

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

Current consensus EPS estimate suggests the PER is 41.0.

Forecast for FY19:

Macquarie forecasts a full year FY19 dividend of 0.00 cents and EPS of 12.80 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 56.02.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 27.8, implying annual growth of 58.9%.

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

Current consensus EPS estimate suggests the PER is 25.8.

Market Sentiment: 0.2

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


Morgan Stanley rates ORE as Underweight (5) -

Morgan Stanley is favourably disposed to the company's equity raising of $361m, which includes a  $282m placement with Toyota Tsusho. However, the broker suspects stage 2 marketing rights, a lucrative revenue stream, were key to the deal.

The broker believes the equity is trading above fair value, even after incorporating growth projects and retains an Underweight rating, an Attractive industry view and raises the target to $5.10 from $4.50.

Target price is $5.10 Current Price is $7.17 Difference: minus $2.07 (current price is over target).
If ORE meets the Morgan Stanley target it will return approximately minus 29% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $7.30, suggesting upside of 1.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Morgan Stanley forecasts a full year FY18 EPS of 9.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 79.67.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 17.5, implying annual growth of 695.5%.

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

Current consensus EPS estimate suggests the PER is 41.0.

Forecast for FY19:

Morgan Stanley forecasts a full year FY19 EPS of 13.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 55.15.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 27.8, implying annual growth of 58.9%.

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

Current consensus EPS estimate suggests the PER is 25.8.

Market Sentiment: 0.2

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

OZL  OZ MINERALS LIMITED

Copper

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Overnight Price: $9.15

Citi rates OZL as Buy (1) -

December quarter production was strong in terms of both copper and gold. Citi believes progress at Carrapateena and regional exploration should support the share price through 2018.

The broker notes a promising West Musgrave project will require a $20-30m investment in FY18  for a pre-feasibility study which could be completed during this year. Citi is also encouraged by the exploration efforts at Jericho and expects a steady flow of results from this as well as other projects.

Buy rating retained. Target is raised to $11.50 from $11.40.

Target price is $11.50 Current Price is $9.15 Difference: $2.35
If OZL meets the Citi target it will return approximately 26% (excluding dividends, fees and charges).

Current consensus price target is $9.54, suggesting upside of 4.2% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY17:

Citi forecasts a full year FY17 dividend of 23.00 cents and EPS of 74.80 cents.
At the last closing share price the estimated dividend yield is 2.51%.
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 74.5, implying annual growth of 108.7%.

Current consensus DPS estimate is 17.0, implying a prospective dividend yield of 1.9%.

Current consensus EPS estimate suggests the PER is 12.3.

Forecast for FY18:

Citi forecasts a full year FY18 dividend of 27.00 cents and EPS of 78.50 cents.
At the last closing share price the estimated dividend yield is 2.95%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.66.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 64.0, implying annual growth of -14.1%.

Current consensus DPS estimate is 16.0, implying a prospective dividend yield of 1.7%.

Current consensus EPS estimate suggests the PER is 14.3.

Market Sentiment: 0.4

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


Credit Suisse rates OZL as Neutral (3) -

December quarter and 2017 production was in line with expectations. Credit Suisse notes 2018 copper guidance is up 10,000t and Carrapateena's timetable is unchanged.

Neutral rating and $8.25 target.

Target price is $8.25 Current Price is $9.15 Difference: minus $0.9 (current price is over target).
If OZL meets the Credit Suisse target it will return approximately minus 10% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $9.54, suggesting upside of 4.2% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY17:

Credit Suisse forecasts a full year FY17 dividend of 12.00 cents and EPS of 75.78 cents.
At the last closing share price the estimated dividend yield is 1.31%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.07.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 74.5, implying annual growth of 108.7%.

Current consensus DPS estimate is 17.0, implying a prospective dividend yield of 1.9%.

Current consensus EPS estimate suggests the PER is 12.3.

Forecast for FY18:

Credit Suisse forecasts a full year FY18 dividend of 12.00 cents and EPS of 69.54 cents.
At the last closing share price the estimated dividend yield is 1.31%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.16.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 64.0, implying annual growth of -14.1%.

Current consensus DPS estimate is 16.0, implying a prospective dividend yield of 1.7%.

Current consensus EPS estimate suggests the PER is 14.3.

Market Sentiment: 0.4

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


Deutsche Bank rates OZL as Hold (3) -

The company produced 30,000t of copper in the December quarter, 15% ahead of Deutsche Bank's estimates. Gold production was 36% ahead of estimates.

Deutsche Bank lifts 2017 forecasts for earnings per share by 34% on the better-than-expected result. A Hold rating is maintained on valuation. Target rises to $8.70 from $8.60.

Target price is $8.70 Current Price is $9.15 Difference: minus $0.45 (current price is over target).
If OZL meets the Deutsche Bank target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $9.54, suggesting upside of 4.2% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY17:

Deutsche Bank forecasts a full year FY17 dividend of 20.00 cents and EPS of 79.00 cents.
At the last closing share price the estimated dividend yield is 2.19%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.58.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 74.5, implying annual growth of 108.7%.

Current consensus DPS estimate is 17.0, implying a prospective dividend yield of 1.9%.

Current consensus EPS estimate suggests the PER is 12.3.

Forecast for FY18:

Deutsche Bank forecasts a full year FY18 dividend of 20.00 cents and EPS of 77.00 cents.
At the last closing share price the estimated dividend yield is 2.19%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.88.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 64.0, implying annual growth of -14.1%.

Current consensus DPS estimate is 16.0, implying a prospective dividend yield of 1.7%.

Current consensus EPS estimate suggests the PER is 14.3.

Market Sentiment: 0.4

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


Macquarie rates OZL as Outperform (1) -

December quarter production was strong with copper exceeding Macquarie's forecasts. The company also performed strongly on costs, assisted by high gold production.

Macquarie expects the positive trend to continue, noting increased production guidance for 2018 and 2019.

Outperform rating. Target is raised to $11 from $10.

Target price is $11.00 Current Price is $9.15 Difference: $1.85
If OZL meets the Macquarie target it will return approximately 20% (excluding dividends, fees and charges).

Current consensus price target is $9.54, suggesting upside of 4.2% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY17:

Macquarie forecasts a full year FY17 dividend of 22.00 cents and EPS of 88.60 cents.
At the last closing share price the estimated dividend yield is 2.40%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.33.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 74.5, implying annual growth of 108.7%.

Current consensus DPS estimate is 17.0, implying a prospective dividend yield of 1.9%.

Current consensus EPS estimate suggests the PER is 12.3.

Forecast for FY18:

Macquarie forecasts a full year FY18 dividend of 28.00 cents and EPS of 63.10 cents.
At the last closing share price the estimated dividend yield is 3.06%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.50.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 64.0, implying annual growth of -14.1%.

Current consensus DPS estimate is 16.0, implying a prospective dividend yield of 1.7%.

Current consensus EPS estimate suggests the PER is 14.3.

Market Sentiment: 0.4

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


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

In the wake of the December quarter production numbers and higher copper prices, Morgans makes material upgrades to forecasts.

The broker believes several approaching catalysts, including the anticipated receipt of the Carrapateena mining lease and an update on Prominent Hill's long-term power strategy, have potential to create interest in coming months.

The stock remains a preferred copper exposure but the broker downgrades to Hold from Add following recent price strength. Target rises to $9.40 from $8.87.

Target price is $9.40 Current Price is $9.15 Difference: $0.25
If OZL meets the Morgans target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $9.54, suggesting upside of 4.2% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY17:

Morgans forecasts a full year FY17 dividend of 15.00 cents and EPS of 67.00 cents.
At the last closing share price the estimated dividend yield is 1.64%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.66.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 74.5, implying annual growth of 108.7%.

Current consensus DPS estimate is 17.0, implying a prospective dividend yield of 1.9%.

Current consensus EPS estimate suggests the PER is 12.3.

Forecast for FY18:

Morgans forecasts a full year FY18 dividend of 13.00 cents and EPS of 55.00 cents.
At the last closing share price the estimated dividend yield is 1.42%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.64.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 64.0, implying annual growth of -14.1%.

Current consensus DPS estimate is 16.0, implying a prospective dividend yield of 1.7%.

Current consensus EPS estimate suggests the PER is 14.3.

Market Sentiment: 0.4

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


Ord Minnett rates OZL as Hold (3) -

Ord Minnett observes 2018 will be a big year for capex, with the company flagging around $650m in expenditure. The broker also notes that more than half of its valuation relates to Carrapateena, a project that still carries development risk.

Hold rating maintained, given a strong run up in the share price. Target rises to $8.70 from $8.60.

This stock is not covered in-house by Ord Minnett. Instead, the broker whitelabels research by JP Morgan.

Target price is $8.70 Current Price is $9.15 Difference: minus $0.45 (current price is over target).
If OZL meets the Ord Minnett target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $9.54, suggesting upside of 4.2% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY17:

Ord Minnett forecasts a full year FY17 dividend of 20.00 cents and EPS of 81.00 cents.
At the last closing share price the estimated dividend yield is 2.19%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.30.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 74.5, implying annual growth of 108.7%.

Current consensus DPS estimate is 17.0, implying a prospective dividend yield of 1.9%.

Current consensus EPS estimate suggests the PER is 12.3.

Forecast for FY18:

Ord Minnett forecasts a full year FY18 dividend of 12.00 cents and EPS of 55.00 cents.
At the last closing share price the estimated dividend yield is 1.31%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.64.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 64.0, implying annual growth of -14.1%.

Current consensus DPS estimate is 16.0, implying a prospective dividend yield of 1.7%.

Current consensus EPS estimate suggests the PER is 14.3.

Market Sentiment: 0.4

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


UPDATED

UBS rates OZL as Neutral (3) -

Performance during the December quarter has surprised in a positive sense and UBS analysts observe management has upgraded guidances for copper volumes, with costs surprising to the downside (which is a positive).

UBS says it recently downgraded to Neutral from Buy as the shares are considered more fair value at current level. Price target is $9.73.

Also, the analysts add mining lease approval at Carrapateena and a progress update on power strategy are expected in Q1 2018.

Target price is $9.73 Current Price is $9.15 Difference: $0.58
If OZL meets the UBS target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $9.54, suggesting upside of 4.2% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY17:

UBS forecasts a full year FY17 dividend of 7.00 cents and EPS of 75.00 cents.
At the last closing share price the estimated dividend yield is 0.77%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.20.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 74.5, implying annual growth of 108.7%.

Current consensus DPS estimate is 17.0, implying a prospective dividend yield of 1.9%.

Current consensus EPS estimate suggests the PER is 12.3.

Forecast for FY18:

UBS forecasts a full year FY18 dividend of 0.00 cents and EPS of 71.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.89.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 64.0, implying annual growth of -14.1%.

Current consensus DPS estimate is 16.0, implying a prospective dividend yield of 1.7%.

Current consensus EPS estimate suggests the PER is 14.3.

Market Sentiment: 0.4

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

RMD  RESMED INC

Medical Equipment & Devices

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Overnight Price: $11.02

Credit Suisse rates RMD as Neutral (3) -

Credit Suisse reviews assumptions, which results in minor upgrades to earnings estimates for FY18. The broker forecasts revenue growth of around 6% in the second quarter on a constant currency basis.

The broker observes risks include protracted competitor litigation and escalation of ASP discounting, while the potential upside to forecasts could arise from better operating cost leverage and US tax reform.

Neutral retained. Target rises to $10.60 from $10.40.

Target price is $10.60 Current Price is $11.02 Difference: minus $0.42 (current price is over target).
If RMD meets the Credit Suisse target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $10.82, suggesting downside of -1.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Credit Suisse forecasts a full year FY18 dividend of 18.60 cents and EPS of 36.87 cents.
At the last closing share price the estimated dividend yield is 1.69%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 29.89.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 38.5, implying annual growth of N/A.

Current consensus DPS estimate is 18.4, implying a prospective dividend yield of 1.7%.

Current consensus EPS estimate suggests the PER is 28.6.

Forecast for FY19:

Credit Suisse forecasts a full year FY19 dividend of 20.16 cents and EPS of 41.69 cents.
At the last closing share price the estimated dividend yield is 1.83%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 26.43.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 43.5, implying annual growth of 13.0%.

Current consensus DPS estimate is 19.9, implying a prospective dividend yield of 1.8%.

Current consensus EPS estimate suggests the PER is 25.3.

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

Market Sentiment: 0.6

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


Morgan Stanley rates RMD as Overweight (1) -

Morgan Stanley envisages high single-digit growth in devices in FY18 and mid-teen masks growth. Gross margin is expected to improve to 59.4% in FY19  from 58.4% in FY17.

The broker suspects FY18 guidance for a flat gross margin,  which seems to assume no acceleration in mask sales, is conservative. The primary catalyst for positive revisions to earnings per share is still expected to be a sustained improvement in the product mix.

Overweight rating. Industry view is In-Line. Price target is raised to US$88.20 from US$82.70.

Current Price is $11.02. Target price not assessed.

Current consensus price target is $10.82, suggesting downside of -1.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Morgan Stanley forecasts a full year FY18 dividend of 18.34 cents and EPS of 41.41 cents.
At the last closing share price the estimated dividend yield is 1.66%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 26.62.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 38.5, implying annual growth of N/A.

Current consensus DPS estimate is 18.4, implying a prospective dividend yield of 1.7%.

Current consensus EPS estimate suggests the PER is 28.6.

Forecast for FY19:

Morgan Stanley forecasts a full year FY19 dividend of 18.51 cents and EPS of 49.04 cents.
At the last closing share price the estimated dividend yield is 1.68%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 22.47.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 43.5, implying annual growth of 13.0%.

Current consensus DPS estimate is 19.9, implying a prospective dividend yield of 1.8%.

Current consensus EPS estimate suggests the PER is 25.3.

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

Market Sentiment: 0.6

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

S32  SOUTH32 LIMITED

Mining

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Overnight Price: $3.83

Citi rates S32 as Downgrade to Neutral from Buy (3) -

Citi makes modest upgrades to FY18 and FY19 forecasts for earnings per share, driven by marking to market commodity prices and the accretion from buybacks.

The broker notes the December quarter production was mixed with manganese, nickel and metallurgical coal all above estimates but thermal coal, silver and alumina below. After a strong rally in the share price, Citi downgrades to Neutral from Buy and maintains a target of $3.75.

Target price is $3.75 Current Price is $3.83 Difference: minus $0.08 (current price is over target).
If S32 meets the Citi target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.50, suggesting downside of -8.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Citi forecasts a full year FY18 dividend of 16.91 cents and EPS of 34.46 cents.
At the last closing share price the estimated dividend yield is 4.41%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.11.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 27.9, implying annual growth of N/A.

Current consensus DPS estimate is 15.6, implying a prospective dividend yield of 4.1%.

Current consensus EPS estimate suggests the PER is 13.7.

Forecast for FY19:

Citi forecasts a full year FY19 dividend of 14.30 cents and EPS of 27.31 cents.
At the last closing share price the estimated dividend yield is 3.73%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.03.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 27.6, implying annual growth of -1.1%.

Current consensus DPS estimate is 15.4, implying a prospective dividend yield of 4.0%.

Current consensus EPS estimate suggests the PER is 13.9.

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


Credit Suisse rates S32 as Downgrade to Underperform from Neutral (5) -

Strength in commodity prices has meant the stock has rallied almost 17% since Christmas and Credit Suisse now looks for a lower entry point. Rating is downgraded to Underperform from Neutral.

The broker concedes that, if commodity prices hold up, value will remain compelling given the state of the balance sheet and the capacity for further shareholder returns.

Target is raised to $3.50 from $3.10.

Target price is $3.50 Current Price is $3.83 Difference: minus $0.33 (current price is over target).
If S32 meets the Credit Suisse target it will return approximately minus 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.50, suggesting downside of -8.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Credit Suisse forecasts a full year FY18 dividend of 10.86 cents and EPS of 27.36 cents.
At the last closing share price the estimated dividend yield is 2.83%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.00.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 27.9, implying annual growth of N/A.

Current consensus DPS estimate is 15.6, implying a prospective dividend yield of 4.1%.

Current consensus EPS estimate suggests the PER is 13.7.

Forecast for FY19:

Credit Suisse forecasts a full year FY19 dividend of 9.73 cents and EPS of 24.50 cents.
At the last closing share price the estimated dividend yield is 2.54%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.63.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 27.6, implying annual growth of -1.1%.

Current consensus DPS estimate is 15.4, implying a prospective dividend yield of 4.0%.

Current consensus EPS estimate suggests the PER is 13.9.

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


Deutsche Bank rates S32 as Sell (5) -

December quarter production improved modestly in copper equivalent terms and was slightly ahead of Deutsche Bank's forecasts.

Carrington disappointed the broker because of lower grades while manganese stood out, increasing around 20% quarter on quarter to meet strong demand.

FY18 production guidance is maintained. Deutsche Bank retains a Sell rating on valuation. Target is $3.10.

Target price is $3.10 Current Price is $3.83 Difference: minus $0.73 (current price is over target).
If S32 meets the Deutsche Bank target it will return approximately minus 19% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.50, suggesting downside of -8.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Deutsche Bank forecasts a full year FY18 dividend of 22.11 cents and EPS of 32.51 cents.
At the last closing share price the estimated dividend yield is 5.77%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.78.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 27.9, implying annual growth of N/A.

Current consensus DPS estimate is 15.6, implying a prospective dividend yield of 4.1%.

Current consensus EPS estimate suggests the PER is 13.7.

Forecast for FY19:

Deutsche Bank forecasts a full year FY19 dividend of 23.41 cents and EPS of 37.71 cents.
At the last closing share price the estimated dividend yield is 6.11%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.16.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 27.6, implying annual growth of -1.1%.

Current consensus DPS estimate is 15.4, implying a prospective dividend yield of 4.0%.

Current consensus EPS estimate suggests the PER is 13.9.

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


Macquarie rates S32 as Neutral (3) -

The December quarter production numbers showed strength in manganese ore offset by weaker output from Worsley and Cannington. FY18 production guidance for South African manganese has been upgraded by 9%.

Guidance for Cannington has been maintained, but a weak first half suggests to Macquarie that guidance could be at risk.

Neutral rating and $3.50 target maintained.

Target price is $3.50 Current Price is $3.83 Difference: minus $0.33 (current price is over target).
If S32 meets the Macquarie target it will return approximately minus 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.50, suggesting downside of -8.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Macquarie forecasts a full year FY18 dividend of 14.56 cents and EPS of 29.26 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 13.09.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 27.9, implying annual growth of N/A.

Current consensus DPS estimate is 15.6, implying a prospective dividend yield of 4.1%.

Current consensus EPS estimate suggests the PER is 13.7.

Forecast for FY19:

Macquarie forecasts a full year FY19 dividend of 15.09 cents and EPS of 30.17 cents.
At the last closing share price the estimated dividend yield is 3.94%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.70.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 27.6, implying annual growth of -1.1%.

Current consensus DPS estimate is 15.4, implying a prospective dividend yield of 4.0%.

Current consensus EPS estimate suggests the PER is 13.9.

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


Ord Minnett rates S32 as Hold (3) -

While South32 has a strong outlook for cash flow because of buoyant commodity markets Ord Minnett finds the stock trading near fair value. December quarter numbers were mixed, with Cannington weak on lower grades and manganese volumes strong.

Hold rating retained. Target is raised to $3.85 from $3.40.

This stock is not covered in-house by Ord Minnett. Instead, the broker whitelabels research by JP Morgan.

Target price is $3.85 Current Price is $3.83 Difference: $0.02
If S32 meets the Ord Minnett target it will return approximately 1% (excluding dividends, fees and charges).

Current consensus price target is $3.50, suggesting downside of -8.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Ord Minnett forecasts a full year FY18 dividend of 19.51 cents and EPS of 32.51 cents.
At the last closing share price the estimated dividend yield is 5.09%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.78.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 27.9, implying annual growth of N/A.

Current consensus DPS estimate is 15.6, implying a prospective dividend yield of 4.1%.

Current consensus EPS estimate suggests the PER is 13.7.

Forecast for FY19:

Ord Minnett forecasts a full year FY19 dividend of 16.91 cents and EPS of 29.91 cents.
At the last closing share price the estimated dividend yield is 4.41%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.81.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 27.6, implying annual growth of -1.1%.

Current consensus DPS estimate is 15.4, implying a prospective dividend yield of 4.0%.

Current consensus EPS estimate suggests the PER is 13.9.

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


UPDATED

UBS rates S32 as Neutral (3) -

While management has stuck with its guidance for FY18, UBS analysts believe both alumina and aluminium will struggle to meet guidance this financial year. In addition, Cannington is currently mining lower grade and there is risk of weaker domestic demand continuing into 2H FY18 at South Africa Energy Coal.

UBS notes South32 has commenced the process to transition the South African coal asset as a stand-alone business from April onwards.

Also, the analysts believe the current buyback program won't be executed in full and thus a higher dividend payout ratio is assumed to compensate for the shortfall. Neutral rating and $3.45 price target retained.

Target price is $3.45 Current Price is $3.83 Difference: minus $0.38 (current price is over target).
If S32 meets the UBS target it will return approximately minus 10% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.50, suggesting downside of -8.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

UBS forecasts a full year FY18 dividend of 20.81 cents and EPS of 29.91 cents.
At the last closing share price the estimated dividend yield is 5.43%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.81.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 27.9, implying annual growth of N/A.

Current consensus DPS estimate is 15.6, implying a prospective dividend yield of 4.1%.

Current consensus EPS estimate suggests the PER is 13.7.

Forecast for FY19:

UBS forecasts a full year FY19 dividend of 18.21 cents and EPS of 35.11 cents.
At the last closing share price the estimated dividend yield is 4.75%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 10.91.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 27.6, implying annual growth of -1.1%.

Current consensus DPS estimate is 15.4, implying a prospective dividend yield of 4.0%.

Current consensus EPS estimate suggests the PER is 13.9.

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

SAR  SARACEN MINERAL HOLDINGS LIMITED

Gold & Silver

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Overnight Price: $1.56

Citi rates SAR as Sell (5) -

December quarter production was in line, or slightly softer, than expectations but Citi finds no threat to FY18 guidance.

While the stock is a high-quality producer the broker maintains a Sell rating based on valuation. Target is reduced to $1.34 from $1.38.

Target price is $1.34 Current Price is $1.56 Difference: minus $0.22 (current price is over target).
If SAR meets the Citi target it will return approximately minus 14% (excluding dividends, fees and charges - negative figures indicate an expected loss).

The company's fiscal year ends in June.

Forecast for FY18:

Citi forecasts a full year FY18 dividend of 0.00 cents and EPS of 7.50 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 20.80.

Forecast for FY19:

Citi forecasts a full year FY19 dividend of 0.00 cents and EPS of 8.70 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.93.

Market Sentiment: -0.5

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


Macquarie rates SAR as Neutral (3) -

December quarter production was in line with Macquarie's expectations. The broker expects mining costs to fall at Carosue Dam as new underground contractors take effect along with improvement in ounces per vertical metre.

Falling strip ratios are also expected to deliver strong production at Thunderbox. Neutral rating and $1.90 target maintained.

Target price is $1.90 Current Price is $1.56 Difference: $0.34
If SAR meets the Macquarie target it will return approximately 22% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY18:

Macquarie forecasts a full year FY18 dividend of 2.00 cents and EPS of 11.50 cents.
At the last closing share price the estimated dividend yield is 1.28%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.57.

Forecast for FY19:

Macquarie forecasts a full year FY19 dividend of 3.00 cents and EPS of 18.20 cents.
At the last closing share price the estimated dividend yield is 1.92%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 8.57.

Market Sentiment: -0.5

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

SKI  SPARK INFRASTRUCTURE GROUP

Infrastructure & Utilities

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Overnight Price: $2.41

Macquarie rates SKI as Outperform (1) -

Macquarie makes minor downward revisions to reflect an update of Transgrid assumptions. The broker suggests there is upside in the quantum of opportunities for Transgrid, as well as the non-regulated areas of the South Australian and Victorian networks.

Outperform rating. Target is reduced to $2.65 from $2.69.

Target price is $2.65 Current Price is $2.41 Difference: $0.24
If SKI meets the Macquarie target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $2.56, suggesting upside of 6.0% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY17:

Macquarie forecasts a full year FY17 dividend of 15.30 cents and EPS of 13.90 cents.
At the last closing share price the estimated dividend yield is 6.35%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.34.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 7.8, implying annual growth of 61.8%.

Current consensus DPS estimate is 15.3, implying a prospective dividend yield of 6.3%.

Current consensus EPS estimate suggests the PER is 30.9.

Forecast for FY18:

Macquarie forecasts a full year FY18 dividend of 16.00 cents and EPS of 14.00 cents.
At the last closing share price the estimated dividend yield is 6.64%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.21.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 8.1, implying annual growth of 3.8%.

Current consensus DPS estimate is 16.1, implying a prospective dividend yield of 6.7%.

Current consensus EPS estimate suggests the PER is 29.8.

Market Sentiment: 0.1

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

SRX  SIRTEX MEDICAL LIMITED

Pharmaceuticals & Biotech/Lifesciences

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Overnight Price: $18.23

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

Morgan Stanley suggests the lower end of FY18 EBITDA guidance is achievable on annualised cost reductions alone. The broker retains a "wait & see" approach to the stock until new initiatives gain traction.

The company's trading update forecasts FY18 operating earnings in the $75-85m range, which implies a strong skew to the second half.

Equal-weight rating, In-Line industry view retained. Target is raised to $17.70 from $16.20.

Target price is $17.70 Current Price is $18.23 Difference: minus $0.53 (current price is over target).
If SRX meets the Morgan Stanley target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $19.13, suggesting upside of 4.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Morgan Stanley forecasts a full year FY18 dividend of 30.00 cents and EPS of 96.00 cents.
At the last closing share price the estimated dividend yield is 1.65%.
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 91.3, implying annual growth of N/A.

Current consensus DPS estimate is 29.3, implying a prospective dividend yield of 1.6%.

Current consensus EPS estimate suggests the PER is 20.0.

Forecast for FY19:

Morgan Stanley forecasts a full year FY19 dividend of 30.00 cents and EPS of 106.00 cents.
At the last closing share price the estimated dividend yield is 1.65%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.20.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 101.7, implying annual growth of 11.4%.

Current consensus DPS estimate is 30.7, implying a prospective dividend yield of 1.7%.

Current consensus EPS estimate suggests the PER is 17.9.

Market Sentiment: 0.3

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

TWE  TREASURY WINE ESTATES LIMITED

Food, Beverages & Tobacco

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Overnight Price: $15.16

Morgan Stanley rates TWE as Overweight (1) -

Morgan Stanley lifts estimates based on a lower US corporate tax rate and surging demand in Asia. The broker expects very strong underlying results from the Asian business based on channel checks and peers in that region.

The broker believes the market will soon begin to focus on the company's very strong FY19 outlook, which will be aided by healthy vintages, traction for French brands and the tax cuts.

Target is raised to $18 from $16. Overweight rating retained. Industry outlook is Cautious.

Target price is $18.00 Current Price is $15.16 Difference: $2.84
If TWE meets the Morgan Stanley target it will return approximately 19% (excluding dividends, fees and charges).

Current consensus price target is $14.09, suggesting downside of -7.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY18:

Morgan Stanley forecasts a full year FY18 dividend of 35.40 cents and EPS of 50.00 cents.
At the last closing share price the estimated dividend yield is 2.34%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 30.32.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 46.5, implying annual growth of 27.4%.

Current consensus DPS estimate is 30.9, implying a prospective dividend yield of 2.0%.

Current consensus EPS estimate suggests the PER is 32.6.

Forecast for FY19:

Morgan Stanley forecasts a full year FY19 dividend of 46.80 cents and EPS of 66.00 cents.
At the last closing share price the estimated dividend yield is 3.09%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 22.97.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 58.6, implying annual growth of 26.0%.

Current consensus DPS estimate is 39.2, implying a prospective dividend yield of 2.6%.

Current consensus EPS estimate suggests the PER is 25.9.

Market Sentiment: -0.1

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

WBC  WESTPAC BANKING CORPORATION

Banks

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Overnight Price: $31.07

Macquarie rates WBC as Upgrade to Outperform from Neutral (1) -

Macquarie expects banks to return capital to shareholders via special dividends and buybacks despite a more subdued underlying earnings growth profile.

The broker continues to believe the medium-term outlook for banks is challenging, as growth will be constrained by the highly leveraged household sector and margins affected by competition.

Nevertheless, the broker finds relative value at current levels, upgrading Westpac to Outperform from Neutral. Target is raised to $35.00 from $34.50.

Target price is $35.00 Current Price is $31.07 Difference: $3.93
If WBC meets the Macquarie target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $33.76, suggesting upside of 8.7% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY18:

Macquarie forecasts a full year FY18 dividend of 199.00 cents and EPS of 244.40 cents.
At the last closing share price the estimated dividend yield is 6.40%.
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 244.1, implying annual growth of 2.6%.

Current consensus DPS estimate is 192.8, implying a prospective dividend yield of 6.2%.

Current consensus EPS estimate suggests the PER is 12.7.

Forecast for FY19:

Macquarie forecasts a full year FY19 dividend of 203.00 cents and EPS of 245.80 cents.
At the last closing share price the estimated dividend yield is 6.53%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.64.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 248.8, implying annual growth of 1.9%.

Current consensus DPS estimate is 195.7, implying a prospective dividend yield of 6.3%.

Current consensus EPS estimate suggests the PER is 12.5.

Market Sentiment: 0.5

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

Summaries
A2M THE A2 MILK CO Outperform - Macquarie Overnight Price $7.61
ACK AUSTOCK Hold - Morgans Overnight Price $1.57
ALU ALTIUM Neutral - UBS Overnight Price $14.24
APO APN OUTDOOR Downgrade to Neutral from Buy - UBS Overnight Price $4.54
AZJ AURIZON HOLDINGS Neutral - UBS Overnight Price $4.63
BAT BATTERY MINERALS Add - Morgans Overnight Price $0.07
BPT BEACH ENERGY Re-instate Coverage with Neutral - Credit Suisse Overnight Price $1.30
CAJ CAPITOL HEALTH No Rating - Credit Suisse Overnight Price $0.28
GNC GRAINCORP Neutral - Macquarie Overnight Price $7.51
IDX INTEGRAL DIAGNOSTICS No Rating - Credit Suisse Overnight Price $2.29
MGX MOUNT GIBSON IRON Neutral - Citi Overnight Price $0.42
Outperform - Macquarie Overnight Price $0.42
Neutral - UBS Overnight Price $0.42
ORE OROCOBRE Hold - Deutsche Bank Overnight Price $7.17
Upgrade to Neutral from Underperform - Macquarie Overnight Price $7.17
Underweight - Morgan Stanley Overnight Price $7.17
OZL OZ MINERALS Buy - Citi Overnight Price $9.15
Neutral - Credit Suisse Overnight Price $9.15
Hold - Deutsche Bank Overnight Price $9.15
Outperform - Macquarie Overnight Price $9.15
Downgrade to Hold from Add - Morgans Overnight Price $9.15
Hold - Ord Minnett Overnight Price $9.15
Neutral - UBS Overnight Price $9.15
RMD RESMED Neutral - Credit Suisse Overnight Price $11.02
Overweight - Morgan Stanley Overnight Price $11.02
S32 SOUTH32 Downgrade to Neutral from Buy - Citi Overnight Price $3.83
Downgrade to Underperform from Neutral - Credit Suisse Overnight Price $3.83
Sell - Deutsche Bank Overnight Price $3.83
Neutral - Macquarie Overnight Price $3.83
Hold - Ord Minnett Overnight Price $3.83
Neutral - UBS Overnight Price $3.83
SAR SARACEN MINERAL Sell - Citi Overnight Price $1.56
Neutral - Macquarie Overnight Price $1.56
SKI SPARK INFRASTRUCTURE Outperform - Macquarie Overnight Price $2.41
SRX SIRTEX MEDICAL Equal-weight - Morgan Stanley Overnight Price $18.23
TWE TREASURY WINE ESTATES Overweight - Morgan Stanley Overnight Price $15.16
WBC WESTPAC BANKING Upgrade to Outperform from Neutral - Macquarie Overnight Price $31.07
RATING SUMMARY
Rating No. Of Recommendations
1. Buy

9

3. Hold

22

5. Sell

4

Thursday 18 January 2018

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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.