Australian Broker Call

Credit Suisse rates A2M as Resume Coverage with Underperform (5) -

Credit Suisse resumes coverage with an Underperform rating and $7.15 target. The broker believes the infant formula industry in China may soon contract, given a declining birth rate.

The aggregate number of babies of infant formula age is expected to be around -30% lower in 2025 compared with 2018. The broker believes this trend will partly undermine the growth from increased usage of milk formula and expects FY25 net profit will approach, but not surpass, the peak of FY20.

Target price is $7.15 Current Price is $8.17 Difference: minus $1.02 (current price is over target).
If A2M meets the Credit Suisse target it will return approximately minus 12% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $8.86, suggesting upside of 11.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

This company reports in NZD. 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 AFG as Outperform (1) -

The company had around $20.6bn in lodgements in the third quarter, up 34.3%. The home loan product comprised 9.1% of lodgements.

Macquarie's analysis points to a shift to higher-margin product, while growth in investor and upgrade segments offset a moderation in first home buyers.

The broker upgrades estimates for FY21 and FY22 by 1.6% and 3.9%, respectively. Outperform and target of $3.06 are retained. 

Target price is $3.06 Current Price is $2.70 Difference: $0.36
If AFG meets the Macquarie target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $3.12, suggesting upside of 16.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 1.0

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

Credit Suisse rates AIA as Resume Coverage with Neutral (3) -

Credit Suisse resumes coverage of Auckland International Airport with a Neutral rating and $6.80 target. The broker prefers the stock over Sydney Airport ((SYD)) as it has a higher international exposure at 55% of airline seats compared with 38% for Sydney.

International activity tends to be more profitable for an airport. The broker expects first half FY22 international passengers will increase to 45% of pre-pandemic levels and domestic passengers to 85%.

The aeronautical and retail operations were severely affected by the lockdowns but the property business was not so hard hit. The main risk is further lockdowns in New Zealand, Australia or other international destinations.

Target price is $6.80 Current Price is $7.08 Difference: minus $0.28 (current price is over target).
If AIA 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 $6.80, suggesting downside of -3.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: 0.2

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

Citi rates ALU as Buy (1) -

While significant discounting on one year Time-based licenses (TBL) could see downside risk to second half earnings, Citi remains Buy rated as the company is nearing the end of the covid-19 induced downgrade cycle.

The broker explains the discounting combined with the difference in revenue recognition of TBL's over Perpetual licenses could negatively impact earnings. However, it's considered the shift to TBL's is positive in the long run.

Even more positively, website traffic data points to positive trends for Octopart growth and Altium 365 adoption and the broker retains the Buy rating and $33.50 price target.

Target price is $33.50 Current Price is $29.98 Difference: $3.52
If ALU meets the Citi target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $33.90, suggesting upside of 19.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: 0.8

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

Macquarie rates APT as Neutral (3) -

Afterpay, today, released financial metrics for the March quarter and Macquarie, upon first assessment, believes the key numbers are in line with expectations.

Macquarie does note its own projections are a little higher than market consensus, while also highlighting the company's intention to prepare for a listing in the US.

Neutral rating with a $120 price target.

Target price is $120.00 Current Price is $126.20 Difference: minus $6.2 (current price is over target).
If APT meets the Macquarie target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $121.44, suggesting downside of -3.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.3

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

UBS rates APT as Sell (5) -

To those who are familiar with UBS's position on BNPL and Afterpay in particular, it won't come as a surprise the broker's initial views post today's release of March quarter financials will always look a bit different from, say, Macquarie's.

UBS finds the face value performance in-line, but growth in A&NZ seems to be slowing and is currently well below expectations, while the US in particular is performing better.

Given the company is now considering a US listing, UBS points out US operations are still loss-making and margins over there are lower too.

Sell rating with a $36 price target.

Target price is $36.00 Current Price is $126.20 Difference: minus $90.2 (current price is over target).
If APT meets the UBS target it will return approximately minus 71% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $121.44, suggesting downside of -3.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.3

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

Morgan Stanley rates BOQ as Upgrade to Overweight from Equal-weight (1) -

Bank Of Queensland is improving the performance of its mortgage franchise without sacrificing margins, observes Morgan Stanley.

The first half result showed an earlier-than-expected return to growth in the bank's core blue housing loans. This gives the broker confidence that Bank Of Queensland can grow at circa 1.5x in FY21. FY21-22 earnings forecasts have been upgraded by circa 2-3%.

The broker thinks the proposed acquisition of ME Bank provides scale benefits and geographic diversification but is not convinced it materially improves growth prospects.

Morgan Stanley upgrades to Overweight from Equal-Weight with the target rising to $10 from $9.60. Industry view: In-line.

Target price is $10.00 Current Price is $8.91 Difference: $1.09
If BOQ meets the Morgan Stanley target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $9.67, suggesting upside of 5.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.8

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

Macquarie rates CGF as Neutral (3) -

Challenger has, today, released its quarterly market update and sales numbers were "strong", according to Macquarie, but they came with an FY21 guidance reset to the bottom of the prior range due to tightening credit spreads.

Macquarie likes the long-term growth thematic, coupled with the capital benefits of the acquisition of the bank licence, but at present level Challenger's valuation looks "fair", reports the broker.

Neutral rating with a price target of $6.30.

Target price is $6.30 Current Price is $6.60 Difference: minus $0.3 (current price is over target).
If CGF meets the Macquarie target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $6.72, suggesting upside of 20.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

Ord Minnett rates CNI as Accumulate (2) -

Centuria Capital has entered a bid implementation deed for a merger with Primewest Group ((PWG)), a Perth-based fund manager with around $5bn in assets under management.

If approved, the transaction would lift assets under management by 48% for Centuria and be 4% accretive. This transaction, once completed, will provide access to new asset classes and new investors, assures the broker.

Ord Minnett envisages strong growth potential and maintains an Accumulate rating with a target of $3.

Target price is $3.00 Current Price is $2.75 Difference: $0.25
If CNI meets the Ord Minnett target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $2.76, suggesting downside of -0.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.5

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

UBS rates CNI as Neutral (3) -

Centurial Capital Group and Primewest Group ((PWG)) have announced an agreed off-market takeover proposal to merge that will create a group with $15.5bn in assets under management.

UBS notes the transaction is expected to be 4% accretive to FY21 earnings for Centuria Captial shareholders and 19% for Primewest. 

The broker thinks the key strategic focus for investors will be steps taken to retain the Primewest team post the two-year escrow given the entry into new sectors and new wholesale capital relationships.

In the broker's view, the need to retain key staff could make achieving material cost synergies less likely, and Centuria Capital will need to keep outperforming with organic revenue growth to ensure the transaction is successful.

UBS retains a Neutral rating with a target of $2.49.

Target price is $2.49 Current Price is $2.75 Difference: minus $0.26 (current price is over target).
If CNI meets the UBS target it will return approximately minus 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.76, suggesting downside of -0.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.5

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

Macquarie rates COE as Neutral (3) -

March quarter production and revenue were in line with expectations. Macquarie notes there is growth in gas from the Otway and Gippsland Basins but the company may need more capital to fund its ambitions.

Moreover, without a solution to lifting Orbost gas plant utilisation the risk profile remains high and the broker envisages better risk/reward in Senex Energy ((SXY)) and Karoon Energy ((KAR)).

Neutral rating and $0.32 target retained.

Target price is $0.32 Current Price is $0.30 Difference: $0.02
If COE meets the Macquarie target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $0.36, suggesting upside of 20.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.2

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

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

Cooper Energy released third-quarter production results. While performance at the Sole project was in line with the company's guidance, it was below earlier forecasts, points out Morgan Stanley.

Morgan Stanley notes a lingering uncertainty as to whether Cooper will realise 68 TJ/day at the Sole project over the medium term.

Equal-weight retained. Target is 38c. Industry view: Attractive.

Target price is $0.38 Current Price is $0.30 Difference: $0.08
If COE meets the Morgan Stanley target it will return approximately 27% (excluding dividends, fees and charges).

Current consensus price target is $0.36, suggesting upside of 20.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.2

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

Morgans rates COE as Hold (3) -

Morgans hopes a good third quarter result (solid production, sales and revenue) signals future strong cash flow generation for the beginning of the fourth quarter, when seasonal gas demand strengthens. The Hold rating and target of $0.30 are maintained.

While the broker sees plenty of value on offer, short-term risks around ramping up production at Sole weigh. In addition, negotiations continue with banks to restructure a debt facility to reflect the longer ramp up.

Target price is $0.30 Current Price is $0.30 Difference: $0
If COE meets the Morgans target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $0.36, suggesting upside of 20.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.2

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

Ord Minnett rates COE as Buy (1) -

Remediation work at the Sole/Orbost project has meant significantly better plant output.

Additionally, Ord Minnett suspects the ruling on Origin Energy's ((ORG)) and Beach Energy's ((BPT)) gas contract has positive implications for Cooper Energy, given the increasing amount of uncontracted gas.

The broker believes Cooper Energy is is the cheapest exploration & production company under coverage and retains a Buy rating. Target rises to $0.46 from $0.45.

Target price is $0.46 Current Price is $0.30 Difference: $0.16
If COE meets the Ord Minnett target it will return approximately 53% (excluding dividends, fees and charges).

Current consensus price target is $0.36, suggesting upside of 20.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.2

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

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

With the pandemic receding, Morgan Stanley assumes immunoglobulin (Ig) volume will recover to almost -6% below its pre pandemic forecasts driving 30% earnings growth in FY23.

The broker notes risk to the base case remains shortage-induced demand management strategies like managing patients via priority of indication and use of alternative therapies. If such strategies are effective, Morgan Stanley sees its base case at risk as then supply may exceed demand.

CSL has underperformed the ASX200 year to date by circa -12% and for the company to outperform, plasma collection needs to recover with minimal disruption of demand recovery, points out the broker.

Equal-weight rating with the target dropping to $275 from $276. Industry view: In-Line.

Target price is $275.00 Current Price is $268.30 Difference: $6.7
If CSL meets the Morgan Stanley target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $297.11, suggesting upside of 12.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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

Credit Suisse rates EBO as Resume Coverage with Neutral (3) -

Credit Suisse assumes coverage with an Outperform rating and $30.20 target. The broker expects 16% growth in earnings per share in FY21 and believes the market is underestimating the value of the high-growth and profitable animal care division.

Furthermore, there is around $600m in capacity for acquisitions. The broker considers the business is the best-in-class wholesale distributor and its diversified portfolio provides the scale to win new contracts with high service levels.

Target price is $30.20 Current Price is $27.70 Difference: $2.5
If EBO meets the Credit Suisse target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $28.87, suggesting upside of 1.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

Credit Suisse rates FBU as Resume Coverage with Outperform (1) -

Credit Suisse resumes coverage with an Outperform rating and $7.20 target. The broker calculates there is 20-35% upside to consensus earnings expectations if the company's FY23 target is met. Australia is the key opportunity as well as steel.

The broker assesses Fletcher Building is entering the second phase of its FY19-23 plan, designated as "growth", in a strong position. A restructuring was completed in June 2020 and only NZ$400m of legacy construction projects remain.

In the near term end markets are positive and the main risk exists with the withdrawal of government support, if this means a large decrease in demand.

Target price is $7.20 Current Price is $6.60 Difference: $0.6
If FBU meets the Credit Suisse target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $7.20, suggesting upside of 10.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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

Credit Suisse rates FPH as Resume Coverage with Outperform (1) -

Credit Suisse resumes coverage with an Outperform rating and $33.50 target. A strong outlook is underpinned by a quality core hospital business, the broker suggests, with an US$11bn opportunity to expand the nasal high-flow therapy into adjacent settings.

Post the pandemic, the broker forecasts double-digit earnings growth over the medium term. Credit Suisse assesses the nasal high flow and invasive ventilation installed base has increased by more than 50% over FY21.

Target price is $33.50 Current Price is $31.11 Difference: $2.39
If FPH meets the Credit Suisse target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $33.50, suggesting upside of 8.2% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: 0.0

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

Morgan Stanley rates GPT as Underweight (5) -

GPT Group provided first-time earnings and distribution guidance for 2021 and has guided to funds from operations of 30.8c. This is slightly behind Morgan Stanley's forecast of 31.2c  and consensus of 31.6c.

GPT Group has also guided to a dividend of 25.2c per share, higher than the broker's expected 23.2c. The guidance suggests that the pace of retail rent recovery may not be as strong as market expectations, concludes the broker. 

Underweight rating and target of $4.37 are retained. Industry view is In-Line.

Target price is $4.37 Current Price is $4.66 Difference: minus $0.29 (current price is over target).
If GPT meets the Morgan Stanley target it will return approximately minus 6% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.69, suggesting upside of 2.4% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.3

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

UBS rates GPT as Neutral (3) -

UBS is factoring in GPT Group spending -$1bn on logistics over the next 5 years given the group's development pipeline expansion and recent track record. The broker believes this will see logistics increase to 28% of assets in 2025.

As of December, GPT Group's asset allocation is in line with the strategic weightings of retail 40%/office 40%/ logistics 20%, observes UBS. The broker expects this to be reset going forward with logistics up to 33%.

Neutral rating with the target rising to $4.80 from $4.55.

Target price is $4.80 Current Price is $4.66 Difference: $0.14
If GPT meets the UBS target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $4.69, suggesting upside of 2.4% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.3

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

Citi rates GXY as Neutral (3) -

While any value unlock through synergies has not been quantified yet, Citi sees many advantages of the board-endorsed $4bn merger of Orocobre ((ORE)) and Galaxy Resources. These include scale benefits on operations and marketing potential on product mix.

In addition, lower corporate overheads and a further re-rating on project execution are some likely benefits, explains the broker. On Citi's assumptions, 'MergeCo' could be 5-12% EPS accretive in FY22 and FY23 to combined shareholders.

The analyst explains an all-share deal would see Galaxy Resources shareholders receiving 0.569 Orocobre shares for every Galaxy Resources share held. Orocobre will hold 54.2% of the combined entity and Galaxy Resources shareholders the remaining 45.8%.

The Neutral  rating is unchanged and the target price increased to $4 from $3.80.

Target price is $4.00 Current Price is $3.83 Difference: $0.17
If GXY meets the Citi target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $3.38, suggesting downside of -8.6% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: 0.2

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

Macquarie rates GXY as Outperform (1) -

Mount Cattlin production was up 40% in the March quarter as the mine returns to nameplate following improvements in spodumene demand and pricing.

Galaxy Resources has also announced a merger with Orocobre ((ORE)) to bring in-country expertise for developing and operating Sal de Vida.

Galaxy shareholders will receive 0.569 Orocobre shares for every share held and will own 45.8% of the merged entity. Macquarie believes this will provide synergies as well as a stronger base from which to fund other growth projects.

Outperform maintained. Target is $4.50.

Target price is $4.50 Current Price is $3.83 Difference: $0.67
If GXY meets the Macquarie target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $3.38, suggesting downside of -8.6% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: 0.2

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

Ord Minnett rates HDN as Buy (1) -

HomeCo has announced a $265m underwritten entitlement offer with the proceeds being used to fund the purchase of seven large format retail centres and a neighbourhood shopping centre.

Ord Minnett expects this will be accretive to earnings from FY22. The broker retains a Buy rating and raises the target to $1.45 from $1.43.

Target price is $1.45 Current Price is $1.30 Difference: $0.15
If HDN meets the Ord Minnett target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $1.43, suggesting upside of 10.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 1.0

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

Macquarie rates MIN as Outperform (1) -

Mineral Resources will fast-track Wonmunna and Macquarie believes there is potential to double capacity to 10mtpa, although the company would need to secure additional approvals to expand and convert additional resources to reserves before this could occur.

Since breaking ground in September 2020, Mineral Resources was able to achieve first production in the five months and is now ramping up to 5mtpa. Outperform rating with a target of $61 retained.

Target price is $61.00 Current Price is $43.76 Difference: $17.24
If MIN meets the Macquarie target it will return approximately 39% (excluding dividends, fees and charges).

Current consensus price target is $45.32, suggesting upside of 0.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

Morgans rates MME as Add (1) -

On a full year run-rate basis Morgans calculates gross loan book growth is running above expectations, after MoneyMe provided a third quarter business update. Other highlights were considered to be the stable asset quality and $108m of originations.

The broker raises EPS forecasts for FY21 and FY22 by 3% and 5% on higher loan growth forecasts and higher earnings (EBITDA) margin estimates. The target price is increased to $2.04 from $1.97 and the Add rating is unchanged.

Morgans continues to expect the overall provisioning level to decrease with an improving macroeconomic outlook.

Target price is $2.04 Current Price is $1.39 Difference: $0.65
If MME meets the Morgans target it will return approximately 47% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 1.0

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

Ord Minnett rates MME as Buy (1) -

Ord Minnett observes the update for the March quarter was strong, with gross income of $15m, up 26% on the prior quarter, and a gross loan book of $233m, up 39%.

Ord Minnett envisages scope for the company to increase the existing warehouse facilities and support global growth into FY22.

With operating leverage likely to materialise, the broker believes the stock deserves to trade at a premium to sector peers. Buy rating retained. Target rises to $1.94 from $1.92.

Target price is $1.94 Current Price is $1.39 Difference: $0.55
If MME meets the Ord Minnett target it will return approximately 40% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 1.0

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

Ord Minnett rates MPL as Hold (3) -

Medibank Private has appointed David Koczkar as its new CEO, effective May 17. Ord Minnett believes the appointment can be viewed favourably by the market for the short term, particularly in tandem with current favourable trends on claims in health insurance.

In the medium term, the broker envisages some risk surrounding normalised claims utilisation post the pandemic. The broker is concerned about what margin trends may look like on a return to normal conditions. Hold rating and $3 target maintained.

Target price is $3.00 Current Price is $2.88 Difference: $0.12
If MPL meets the Ord Minnett target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $3.08, suggesting upside of 8.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

Morgans rates MVF as Add (1) -

Recent Medicare data illustrates to Morgans strong growth continues into the second half of FY21 and industry sources suggest this will continue for the coming months.

Morgans leaves forecasts unchanged though reduces risk assumptions which raises the target price to $0.91 from $0.86. The Add rating is maintained as a total shareholder return of over 10% is considered possible when taking into account the target and an attractive yield.

Target price is $0.91 Current Price is $0.87 Difference: $0.04
If MVF meets the Morgans target it will return approximately 5% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 1.0

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

Macquarie rates NGI as Outperform (1) -

Navigator Global has boosted funds under management in the March quarter to US$13.71bn, up 4.3% from December. Based on Macquarie's forecasts for FY22 and FY23 the company will deliver a 9% dividend yield.

The broker considers the multiple attractive and maintains an Outperform rating. Target is $2.18.

Target price is $2.18 Current Price is $1.61 Difference: $0.57
If NGI meets the Macquarie target it will return approximately 35% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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

Citi rates ORE as Buy (1) -

While any value unlock through synergies has not been quantified yet, Citi sees many advantages of the board-endorsed $4bn merger of Orocobre and Galaxy Resources ((GXY)). These include scale benefits on operations and marketing potential on product mix.

In addition, lower corporate overheads and a further re-rating on project execution are some likely benefits, explains the broker. On Citi's assumptions, 'MergeCo' could be 5-12% EPS accretive in FY22 and FY23 to combined shareholders.

The analyst explains an all-share deal would see Galaxy Resources shareholders receiving 0.569 Orocobre shares for every Galaxy Resources share held. Orocobre will hold 54.2% of the combined entity and Galaxy Resources shareholders the remaining 45.8%.

The Buy rating and $6.75 target price are maintained.

Target price is $6.75 Current Price is $6.55 Difference: $0.2
If ORE meets the Citi target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $5.79, suggesting downside of -9.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.3

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

Macquarie rates ORE as Outperform (1) -

Orocobre has announced a merger of equals with Galaxy Resources ((GXY)) to combine its expertise with the latter's large lithium brine development. The merged entity will accelerate the development of both businesses.

Macquarie believes the combination will provide synergies for the Argentinian operations as well as a stronger base from which to fund growth. The deal is supported by both boards and is subject to shareholder approval.

Importantly, the broker assesses signs of a demand and pricing recovery for lithium. Outperform rating and $7.10 target maintained.

Target price is $7.10 Current Price is $6.55 Difference: $0.55
If ORE meets the Macquarie target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $5.79, suggesting downside of -9.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.3

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

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

Galaxy Resources and Orocobre have announced a merger of equals with an expected market cap of more than $4bn. Morgan Stanley notes the merger will put the entity in the top 5 lithium producers globally.

Although Galaxy Resources trades at a greater premium to net present value than Orocobre, the broker believes a merger would benefit both parties via scale, balance sheet capacity, and the ability to better sequence growth projects.

Equal-weight rating. Industry view: Attractive. Target is $4.35.

Target price is $4.35 Current Price is $6.55 Difference: minus $2.2 (current price is over target).
If ORE meets the Morgan Stanley target it will return approximately minus 34% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $5.79, suggesting downside of -9.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.3

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

Credit Suisse rates ORG as Neutral (3) -

The company has signalled an -8% downgrade to its energy markets guidance, triggered in part by an adverse gas price review with Beach Energy ((BPT)).

The company has also called out subdued energy demand and pricing. The main positive in the update is the reduction in breakeven, to US$22-25/bbl, at APLNG for FY21, suggests the broker.

Credit Suisse updates oil price forecasts which results in a 3% increase to its FY22 operating earnings estimates. Neutral maintained. Target is reduced to $4.20 from $4.60.

Target price is $4.20 Current Price is $4.19 Difference: $0.01
If ORG meets the Credit Suisse target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $5.06, suggesting upside of 23.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

Morgans rates ORG as Add (1) -

Despite guidance for Energy Markets earnings (EBITDA) being lowered by -8% for FY21, most of the impact is offset by a strong upstream performance from the APLNG joint venture, explains Morgans. Thus, the recent share price fall is considered excessive.

The broker highlights that approximately 39% of the guidance drop was driven by an adverse ruling in a dispute with Beach Energy ((BPT)) on Victorian gas repricing and the remainder due to ongoing electricity market weakness.

The Add rating is unchanged and the target price is decreased to $5.79 from $5.91.

Target price is $5.79 Current Price is $4.19 Difference: $1.6
If ORG meets the Morgans target it will return approximately 38% (excluding dividends, fees and charges).

Current consensus price target is $5.06, suggesting upside of 23.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

UBS rates ORG as Buy (1) -

Origin Energy has downgraded its FY21 operating income guidance in the energy markets division by circa -8% post an adverse arbitration outcome from its gas price review with Beach Energy ((BPT)).

UBS estimates Origin Energy will pay $6-7/GJ for the 13PJs the company will procure from Beach Energy's Otway gas portfolio. The broker notes Origin Energy has about another 8PJs of gas supply from Beach Energy's Cooper basin portfolio facing a similar pricing risk.

A small positive from the update was higher cash distributions from APLNG, highlights UBS, with Origin Energy expecting FY21 distributions to be more than $650m.

The broker expects the company to focus on deleveraging in FY21, but if oil prices remain higher than $60/bbl into FY22, there could be some upside from possible buy-backs or infrastructure sell-downs within APLNG.

Buy rating retained with a target of $5.60.

Target price is $5.60 Current Price is $4.19 Difference: $1.41
If ORG meets the UBS target it will return approximately 34% (excluding dividends, fees and charges).

Current consensus price target is $5.06, suggesting upside of 23.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.4

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

Macquarie rates PLS as Outperform (1) -

Macquarie expects Pilbara Minerals to confirm a move to downstream processing by FY24. This is considered a positive development as POSCO will build a 43,000tpa lithium hydroxide plant in which Pilbara Minerals will hold a 21-30% equity interest.

Macquarie accelerates the timing for a downstream development and reiterates the Outperform rating. Target is raised to $1.50 from $1.30.

Target price is $1.50 Current Price is $1.33 Difference: $0.17
If PLS meets the Macquarie target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $1.09, suggesting downside of -16.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.0

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

Ord Minnett rates QAN as Buy (1) -

Ord Minnett increases domestic capacity assumptions for FY22, now expecting Qantas domestic will reach 105% of pre-pandemic levels and Jetstar 120%.

Qantas still expects to re-start international travel in late October but the broker reduces international capacity assumptions to reflect the revised timeline of vaccinations.

Balance sheet repair has begun and Qantas is making material cost savings, allowing it to be in a more favourable competitive position both domestically and offshore. Ord Minnett retains a Buy rating and $6 target.

Target price is $6.00 Current Price is $5.08 Difference: $0.92
If QAN meets the Ord Minnett target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $5.80, suggesting upside of 15.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.7

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

Macquarie rates RIO as Outperform (1) -

Rio Tinto, today, released its March quarter production report and Macquarie, upon first glance, is of the opinion it is a solid result, with iron ore production and shipments in line with the broker's estimates.

Macquarie observes 2021 guidance has been maintained. Copper production was lower and the broker finds the performance of other divisions rather "mixed", though diamonds, uranium and precious metals output were all better than expected.

Outperform rating. Target is $140.

Target price is $140.00 Current Price is $120.85 Difference: $19.15
If RIO meets the Macquarie target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $124.21, suggesting upside of 3.0% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY21:

Forecast for FY22:

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

Citi rates RMD as Neutral (3) -

Citi forecasts revenue of US$801m when ResMed reports third quarter results on Friday 30 April (Sydney time). It's expected the company will benefit from the reopening of the economy following the vaccination roll-out.

At constant currency, the broker forecasts revenue growth of 5% and an FX benefit of circa 4% due to the lower US dollar, for a reported revenue growth of 9%. Its calculated mask growth will be 12% on continued strong resupply, and Devices will grow by 7.5%

The Neutral rating is maintained with a target of $29 target.

Target price is $29.00 Current Price is $26.80 Difference: $2.2
If RMD meets the Citi target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $28.27, suggesting upside of 7.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

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

Market Sentiment: 0.3

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

Citi rates SGM as Neutral (3) -

In a trading update, management indicated that all key divisions are performing strongly. Proprietary intake of volumes for the third quarter increased to 95% of pre-covid levels and gross margin improved on higher scrap prices, explains Citi.

Additionally, fixed cost savings are now annualising at greater than $70m for FY21 and the company flagged a significant contribution from the SA Recycling division, primarily on zorba price leverage, highlights the analyst. The Neutral rating is unchanged.

The target price increases to $17 from $15 as the broker moves the FY21 earnings (EBIT) estimate to $280m from $159m. The FY22 earnings forecast also increases by 22% to $226m on a better margin assumption for Australia and the North American business.

Target price is $17.00 Current Price is $16.56 Difference: $0.44
If SGM meets the Citi target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $17.47, suggesting upside of 4.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.3

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

Credit Suisse rates SGM as Neutral (3) -

The company has provided FY21 earnings (EBIT) guidance of $260-310m, which Credit Suisse points out is around 65% above the top of the range of consensus expectations.

The company has indicated third quarter volumes are back to 95% of FY19 average monthly volumes and there is a general improvement in gross margin per tonne because of higher scrap prices and good margin management.

Meanwhile, fixed cost savings are ahead of budget. Credit Suisse notes the guidance far surpasses forecasts but warns investors not to expect a repeat, as current margins are unsustainable.

The broker retains a Neutral rating and increases the target to $16.10 from $13.35.

Target price is $16.10 Current Price is $16.56 Difference: minus $0.46 (current price is over target).
If SGM meets the Credit Suisse target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $17.47, suggesting upside of 4.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.3

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

Macquarie rates SGM as Outperform (1) -

Sims delivered a strong trading update and signalled underlying earnings guidance (EBIT) of $260-310m. Macquarie had expected the company would benefit from strong leverage to an environment of higher prices and rising demand.

With the macro backdrop favourable, the broker is more confident now in the medium-term outlook and retains an Outperform rating. Target is raised to $19.40 from $17.50.

Target price is $19.40 Current Price is $16.56 Difference: $2.84
If SGM meets the Macquarie target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $17.47, suggesting upside of 4.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.3

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

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

Sims' latest update puts expected operating income in FY21 at $260-$310m. Morgan Stanley points out this represents a substantial upgrade to prior consensus expectations.

Morgan Stanley notes the strong result is driven by improved intake volumes in the third quarter and improvement in gross margin owing to higher scrap prices and margin management.

Led by improved market conditions for Sims and a robust balance sheet that leaves the business well-positioned, Morgan Stanley retains its Equal-weight rating with the target rising to $18 from $15.50. The industry view is Cautious.

Target price is $18.00 Current Price is $16.56 Difference: $1.44
If SGM meets the Morgan Stanley target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $17.47, suggesting upside of 4.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.3

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

Ord Minnett rates SGM as Hold (3) -

Sims has guided to higher earnings expectations for FY21. Guidance implies EBIT of $229m in the second half, Ord Minnett suggests, based on a 20:80 split. The broker expects strong trading conditions will last into FY22.

The broker maintains a Hold rating and raises the target to $16.30 from $14.70. Ord Minnett remains attracted to scrap markets because of the potential for imports from China to increase. Yet the recent bounce in the share price suggest this is now factored in.

Target price is $16.30 Current Price is $16.56 Difference: minus $0.26 (current price is over target).
If SGM meets the Ord Minnett target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $17.47, suggesting upside of 4.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.3

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

UBS rates SGM as Buy (1) -

UBS highlights Sims' earnings recovery is coming through stronger than expected. The company has guided to FY21 operating income of $260-$310m versus UBS's estimated $163m. The broker notes the stronger than expected beat is from margins rather than volumes.

UBS expects Sims to earn a second-half operating income margin of $62/t versus UBS's forecast of $27/t higher margins and inventory gains driving the numbers. The broker lifts its FY21-23 earnings forecasts by 54%. 

Buy retained. Target rises to $18 from $15.

Target price is $18.00 Current Price is $16.56 Difference: $1.44
If SGM meets the UBS target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $17.47, suggesting upside of 4.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.3

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

Credit Suisse rates SPK as Resume Coverage with Outperform (1) -

Credit Suisse resumes coverage with an Outperform rating and $4.50 target. Earnings have been affected over the past year by the loss of roaming revenue in mobile and continued competition in broadband.

The broker expects this to stabilise in FY22 because of a continued shift to pay monthly subscribers from prepaid in mobile, as well as rational behaviour from competitors.

The broker believes the stock's recent de-rating presents a buying opportunity, as the weakness is primarily driven by rising bond yields.

The dividend yield for FY22 is close to 6% and remains attractive. While the near-term pay-out ratio sits above 100% the dividend is expected to be fully covered by free cash flow.

Target price is $4.50 Current Price is $4.04 Difference: $0.46
If SPK meets the Credit Suisse target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $4.50, suggesting upside of 9.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

This company reports in NZD. 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

Credit Suisse rates SVW as Outperform (1) -

Seven Group is raising up to $550m to reduce debt and preserve the flexibility of its balance sheet. Incorporating this, Credit Suisse downgrades estimates for earnings per share by -4-5% across FY22-23.

The broker believes the transaction is, in effect, a request for a blank cheque from equity markets and asserts that, as uncomfortable as this sounds, history signals investors would be well advised to participate.

The target for the funds is not clear but the broker suspects the company does have a target in mind. Outperform retained. Price target is reduced to $27.20 from $27.50.

Target price is $27.20 Current Price is $23.43 Difference: $3.77
If SVW meets the Credit Suisse target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $27.36, suggesting upside of 22.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.9

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

Ord Minnett rates SVW as Accumulate (2) -

Seven Group has launched a capital raising of up to $550m via a placement and share purchase plan. While the raising is a surprise, Ord Minnett notes the company deployed more than -$1bn in the past year to build a 23% stake in Boral ((BLD)).

The broker expects the capital raising will re-load the balance sheet to pursue other potential, as yet unidentified, growth opportunities.

Liquidity should also increase because of the dilution of the majority shareholder, which will not partake in the issue. Accumulate retained. Target is reduced to $26.50 from $27.00.

Target price is $26.50 Current Price is $23.43 Difference: $3.07
If SVW meets the Ord Minnett target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $27.36, suggesting upside of 22.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.9

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

UBS rates SVW as Buy (1) -

Seven Group Holdings will be raising $500m via new equity to provide balance sheet flexibility and reduce net debt to $2.1bn from $2.6bn. The group has reiterated its FY21 guidance that conservatively implies a 50/50 split for the two halves of the year for Coates Hire and a 52/48 split for WesTrac.

UBS thinks the second-half outlook for WesTrac will be influenced by fleet delivery scheduling and shipping while the second half for Coates is still subject to the phasing of east coast infrastructure activity.

Buy rating retained with the target dropping to $27.35 from $27.50.

Target price is $27.35 Current Price is $23.43 Difference: $3.92
If SVW meets the UBS target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $27.36, suggesting upside of 22.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.9

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

Credit Suisse rates SYD as Underperform (5) -

Credit Suisse upgrades international passenger forecasts with the commencement of the Trans-Tasman "bubble". Trans-Tasman international passenger traffic to and from Sydney Airport constituted 7% of pre-pandemic passengers and 18% of international passengers.

The broker raises international passenger forecasts but assesses there could be a risk if Australia's vaccine roll-out is not completed by early 2022. The 2021 operating earnings estimates are raised by 16%.

Underperform retained. Target is raised to $5.30 from $5.00.

Target price is $5.30 Current Price is $6.14 Difference: minus $0.84 (current price is over target).
If SYD meets the Credit Suisse target it will return approximately minus 14% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $6.25, suggesting upside of 3.5% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY21:

Forecast for FY22:

Market Sentiment: 0.1

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