Australian Broker Call

UBS rates A2M as Upgrade to Buy from Neutral (1) -

UBS believes a2 Milk is in a unique position, with a differentiated premium brand that is well regarded yet under-penetrated in the largest and most profitable infant milk formula market globally.

The main risk is further regulation and greater disruption from changes in Chinese e-commerce laws. Still, A2 Milk is considered well positioned to mitigate the risks.

The broker upgrades to Buy from Neutral. Target is raised to NZ$17.50 from NZ$14.00.

Current Price is $15.68. Target price not assessed.

Current consensus price target is $14.49, suggesting downside of -7.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

This company reports in NZD. 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

Credit Suisse rates AHY as Outperform (1) -

Credit Suisse assesses an improving earnings profile and low PE should attract investors and the stock could re-rate. Pulp prices in Europe and the US remain very high in an historical context and, as global pulp producer margins remain positive, there is room for prices to decline before supply is reduced.

Meanwhile, retail scan data suggest sales are on track. The broker considers this scenario provides evidence supporting its Outperform rating and $1.10 target.

Target price is $1.10 Current Price is $0.95 Difference: $0.15
If AHY meets the Credit Suisse target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $1.00, suggesting upside of 4.9% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.7

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

Macquarie rates AIZ as Underperform (5) -

The FY19 outlook has softened, Macquarie notes, however the overall outlook for international capacity is benign and operating statistics in May were solid.

The stock offers a strong dividend yield and Macquarie suggests this could become increasingly of interest to investors given the low bond rate environment. As well, traditional yield sectors are priced very expensively.

Underperform rating maintained until more clarity is provided on an earnings recovery in FY20. Target is NZ$2.40.

Current Price is $2.55. Target price not assessed.

Current consensus price target is N/A

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

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

Macquarie rates AWC as Downgrade to Underperform from Neutral (5) -

Macquarie downgrades the outlook for alumina prices, which has a significant impact on its earnings outlook for Alumina Ltd. The broker now envisages downside risk to consensus expectations for both the dividend and earnings.

Rating is downgraded to Underperform from Neutral, although an 8% dividend yield should provide some downside protection. Target is $2.00.

Target price is $2.00 Current Price is $2.30 Difference: minus $0.3 (current price is over target).
If AWC meets the Macquarie target it will return approximately minus 13% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.55, suggesting upside of 10.9% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY19:

Forecast for FY20:

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

Market Sentiment: 0.2

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

Morgan Stanley rates AWC as Reinstate Coverage with Overweight (1) -

Morgan Stanley assesses the stock provides around 25% upside potential, coupled with a 7% yield. This is significantly higher than mining peers and the industrials ex banks.

The broker believes further expansion plans are accretive to value and there will be limited impact on yield. Coverage is reinstated with an Overweight rating. Industry view is Attractive and the target is $3.

Target price is $3.00 Current Price is $2.30 Difference: $0.7
If AWC meets the Morgan Stanley target it will return approximately 30% (excluding dividends, fees and charges).

Current consensus price target is $2.55, suggesting upside of 10.9% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY19:

Forecast for FY20:

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

Market Sentiment: 0.2

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

Citi rates CCX as Sell (5) -

Citi believes the retail outlook is improving for the first time in four years on the back of tax cuts, rate cuts, lower cost of living and a stabilising housing market. The broker still anticipates some weak earnings reports from the sector ahead of such improvement, and believes downside risk provides buying opportunities.

Sell retained for City Chic due to its reliance on key US department stores, which are under financial strain. Target rises to $1.65 from $1.60.

Target price is $1.65 Current Price is $1.83 Difference: minus $0.18 (current price is over target).
If CCX meets the Citi target it will return approximately minus 10% (excluding dividends, fees and charges - negative figures indicate an expected loss).

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -1.0

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

Macquarie rates CWY as Outperform (1) -

Macquarie believes Cleanaway Waste is well-positioned to invest in infrastructure as well as larger-scale opportunities in generating energy from waste.

Assuming the company can deploy around $30m in alternative waste treatment and around $430m in NSW-based energy from waste, the broker foresees a 21% in addition to FY21 earnings (EBIT) once investments mature.

Outperform maintained. Target is raised to $2.80 from $2.60.

Target price is $2.80 Current Price is $2.42 Difference: $0.38
If CWY meets the Macquarie target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $2.34, suggesting downside of -3.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.3

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

Macquarie rates EVN as Downgrade to Underperform from Neutral (5) -

Macquarie maintains its forecasts for gold prices although moderates its AUD/USD expectations, with the net result a modest upgrade for gold forecasts, to $1667/oz, in Australian dollar terms for the next five years.

The broker downgrades Evolution Mining to Neutral from Outperform, assuming a cautious view on the larger Australian gold producers. Target is raised to $4.30 from $3.90.

Target price is $4.30 Current Price is $4.30 Difference: $0
If EVN meets the Macquarie target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $3.65, suggesting downside of -15.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.4

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

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

Citi believes the retail outlook is improving for the first time in four years on the back of tax cuts, rate cuts, lower cost of living and a stabilising housing market. The broker still anticipates some weak earnings reports from the sector ahead of such improvement, and believes downside risk provides buying opportunities.

Flight Centre upgraded to Buy on an improving domestic backdrop, and strong growth in corporate and international leisure. Target rises to $49.20 from $42.30.

Target price is $49.20 Current Price is $43.49 Difference: $5.71
If FLT meets the Citi target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $46.17, suggesting upside of 6.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.5

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

Citi rates FMG as Neutral (3) -

The broker believes Fortecue's golden run will have ended by 2020 when iron ore's bull run comes to an end, forecasting US$48/t in 2021. To that end the broker believes it's time for Fortescue to use its piles of cash and diversify away from a pure iron ore play, suggesting copper is a good idea.

The broker suggests a merger with OZ Minerals ((OZL)), the only viable long-life copper play, would be accretive on many levels. Neutral and $8.00 target retained.

Target price is $8.00 Current Price is $8.90 Difference: minus $0.9 (current price is over target).
If FMG meets the Citi target it will return approximately minus 10% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $8.16, suggesting downside of -8.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

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

Market Sentiment: 0.1

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

Macquarie rates FMG as Outperform (1) -

Marking to market drives a 29% lift to Macquarie's estimates for FY19 earnings. Fortescue Metals remains the broker's preferred bulk commodity pure play after incorporating updated commodity price outlook.

Outperform rating maintained. Target is raised to $10.50 from $9.40.

Target price is $10.50 Current Price is $8.90 Difference: $1.6
If FMG meets the Macquarie target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $8.16, suggesting downside of -8.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

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

Market Sentiment: 0.1

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

UBS rates GMG as Neutral (3) -

UBS has surveyed global warehouse occupiers on their future space requirements and automation. The broker assesses the low interest rate environment and structural tailwinds mean Goodman Group is well-placed to deliver 8-10% growth over the medium term.

The survey suggested warehouse space would grow 7% in the next couple of years with e-commerce users expected to increase their usage by 13%. UBS maintains a Neutral rating and raises the target to $15.20 from $13.10.

Target price is $15.20 Current Price is $15.43 Difference: minus $0.23 (current price is over target).
If GMG meets the UBS target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $14.50, suggesting downside of -6.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.3

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

UBS rates GNC as Buy (1) -

UBS notes press speculation there is potential interest in the company's malt division. The division is currently scheduled to be de-merged after the FY19 results in November.

The broker continues to believe that either divestment or de-merger would unlock value. UBS reiterates a Buy rating and $9.65 target.

Target price is $9.65 Current Price is $8.41 Difference: $1.24
If GNC meets the UBS target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $9.59, suggesting upside of 14.0% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.7

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

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

Macquarie upgrades to Outperform from Neutral. The company recently poured its first gold at Gruyere and, despite some delays to commissioning, the broker has moved the target to the blended mix used for producers.

Target is raised to $1.40 from $1.05.

Target price is $1.40 Current Price is $1.18 Difference: $0.22
If GOR meets the Macquarie target it will return approximately 19% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 1.0

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

Macquarie rates GXY as Downgrade to Neutral from Outperform (5) -

The cost of production for spodumene producers remains important over the short to medium term, given pressure on margins created from the softer pricing environment. Macquarie now expects 6% lithium spodumene prices to fall to US$550/t towards the end of 2019.

The broker downgrades Galaxy Resources to Underperform from Neutral. Target is $1.20.

Target price is $1.20 Current Price is $1.31 Difference: minus $0.11 (current price is over target).
If GXY meets the Macquarie target it will return approximately minus 8% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.13, suggesting upside of 62.2% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY19:

Forecast for FY20:

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

Market Sentiment: 0.4

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

Citi rates HVN as Upgrade to Neutral from Sell (3) -

Citi believes the retail outlook is improving for the first time in four years on the back of tax cuts, rate cuts, lower cost of living and a stabilising housing market. The broker still anticipates some weak earnings reports from the sector ahead of such improvement, and believes downside risk provides buying opportunities.

Harvey Norman upgraded to Neutral from Sell. Target rises to $4.00 from $3.20.

Target price is $4.00 Current Price is $4.16 Difference: minus $0.16 (current price is over target).
If HVN meets the Citi target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.87, suggesting downside of -7.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.0

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

Morgans rates ING as Hold (3) -

The company will report its FY19 result on August 27. Morgans believes the company has been able to offset headwinds from high input costs and an oversupplied and competitive New Zealand market.

The broker revises forecasts to reflect a lower amount of expenditure on the buyback, given a new management team is likely to find better use for these funds. Estimates for earnings per share are reduced by around -1%.

Grain prices have weakened in recent months but, if the drought continues and affects the next grain crop, these will rise again and pose a further challenge for the company. Hold rating and $4.10 target maintained.

Target price is $4.10 Current Price is $4.13 Difference: minus $0.03 (current price is over target).
If ING meets the Morgans target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.00, suggesting downside of -3.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.3

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

Citi rates JBH as Upgrade to Neutral from Sell (3) -

Citi believes the retail outlook is improving for the first time in four years on the back of tax cuts, rate cuts, lower cost of living and a stabilising housing market. The broker still anticipates some weak earnings reports from the sector ahead of such improvement, and believes downside risk provides buying opportunities.

JH Hi-Fi upgraded to Neutral from Sell. Target rises to $27.80 from $21.10.

Target price is $27.80 Current Price is $27.94 Difference: minus $0.14 (current price is over target).
If JBH meets the Citi target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $25.45, suggesting downside of -8.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.0

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

Macquarie rates MGX as Outperform (1) -

Macquarie upgrades FY19 estimates by 19%, incorporating upgrades to its iron ore price outlook. Outperform rating maintained. Target is raised to $1.20 from $1.10.

Target price is $1.20 Current Price is $0.91 Difference: $0.29
If MGX meets the Macquarie target it will return approximately 32% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.0

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

Macquarie rates MPL as Downgrade to Underperform from Neutral (5) -

Macquarie assesses Medibank Private needs to continue outperforming industry claim trends to maintain its lofty margins. The broker believes gross margins and investment returns will be very strong in the second half.

However, the stock appears overpriced at current levels and the rating is downgraded to Underperform from Neutral. Target is raised to $3.05 from $2.85.

Target price is $3.05 Current Price is $3.56 Difference: minus $0.51 (current price is over target).
If MPL meets the Macquarie target it will return approximately minus 14% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.87, suggesting downside of -19.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.4

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

Citi rates MYR as Sell (5) -

Citi believes the retail outlook is improving for the first time in four years on the back of tax cuts, rate cuts, lower cost of living and a stabilising housing market. The broker still anticipates some weak earnings reports from the sector ahead of such improvement, and believes downside risk provides buying opportunities.

While the broker expects a material improvement in Myer's sales growth, it remains well below organic cost growth and is boosted by the closure of less productive space. Sell retained. Target rises to 49c from 44c.

Target price is $0.49 Current Price is $0.54 Difference: minus $0.05 (current price is over target).
If MYR meets the Citi target it will return approximately minus 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $0.48, suggesting downside of -10.8% (ex-dividends)

The company's fiscal year ends in July.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.5

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

Macquarie rates NST as Downgrade to Neutral from Outperform (3) -

Macquarie maintains its forecasts for gold prices although moderates its AUD/USD expectations, with the net result a modest upgrade for gold forecasts, to $1667/oz, in Australian dollar terms for the next five years.

The broker assumes a cautious view on the larger Australian gold producers and downgrades Northern Star to Neutral from Outperform. Target is raised to $11.60 from $10.30.

Target price is $11.60 Current Price is $11.62 Difference: minus $0.02 (current price is over target).
If NST meets the Macquarie target it will return approximately minus 0% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $9.21, suggesting downside of -20.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.6

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

Macquarie rates ORE as Outperform (1) -

Macquarie now prefers Orocobre over Galaxy Resources ((GXY)) and Altura Mining ((AJM)) in the lithium producer space given an established production base, low cost of lithium carbonate production and lack of exposure to the current bottleneck in spodumene conversion capacity.

The broker has an Outperform rating and $3.30 target.

Target price is $3.30 Current Price is $2.88 Difference: $0.42
If ORE meets the Macquarie target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $4.52, suggesting upside of 56.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.8

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

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

One of the two units at the company's Mortlake gas-fired power station in Victoria has been damaged and will not return to service until late December.

The lost production is not critical for the company, Morgan Stanley believes, as there are other portfolio generation options and routes to market for the gas. However, lost capacity over the 2020 summer peak could be material.

Equal-weight. Target is $7.67. Industry view is Cautious.

Target price is $7.67 Current Price is $7.44 Difference: $0.23
If ORG meets the Morgan Stanley target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $8.17, suggesting upside of 9.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.6

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

Credit Suisse rates PLS as Outperform (1) -

June quarter realised sales were at the top end of guidance, a positive, Credit Suisse acknowledges. However, it is difficult for the broker to share management's conviction in the current market amid increasing build up in inventory across spodumene producers.

The broker maintains an Outperform rating and reduces the target to $1.00 from $1.15.

Target price is $1.00 Current Price is $0.49 Difference: $0.51
If PLS meets the Credit Suisse target it will return approximately 104% (excluding dividends, fees and charges).

Current consensus price target is $0.83, suggesting upside of 70.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.7

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

Citi rates PMV as Upgrade to Neutral from Sell (3) -

Citi believes the retail outlook is improving for the first time in four years on the back of tax cuts, rate cuts, lower cost of living and a stabilising housing market. The broker still anticipates some weak earnings reports from the sector ahead of such improvement, and believes downside risk provides buying opportunities.

Premier Investments upgraded to Neutral from Sell.  To be more positive the broker needs to see evidence of success for the Smiggles wholesale rollout strategy. Target rises to $16.40 from $15.50.

Target price is $16.40 Current Price is $16.06 Difference: $0.34
If PMV meets the Citi target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $18.17, suggesting upside of 13.1% (ex-dividends)

The company's fiscal year ends in July.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.5

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

Citi rates PTM as Sell (5) -

The broker has "nudged up" its earnings forecasts for Platinum on a mix of positive mark to market offset by greater than expected fund outflows. The broker remains attracted to the fund manager's long term record, but near-term cites suboptimal fund performance and said outflows as reason to retain Sell.

Target unchanged at $4.20.

Target price is $4.20 Current Price is $5.00 Difference: minus $0.8 (current price is over target).
If PTM meets the Citi target it will return approximately minus 16% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.38, suggesting downside of -12.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.4

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

Morgans rates REH as Initiation of coverage with Add (1) -

Reece is the main distributor of plumbing, bathroom and HVAC-R products in Australasia, with over 38% market share.

Morgans notes strategically located distribution centres offer a wide range of products from premium brands, enabling the company to capture large-scale contractors with comprehensive requirements.

The broker initiates coverage with an Add rating and $11.60 target. Morgans is attracted to the impressive financial returns and earnings potential in the US.

The broker believes there is ample upside to the share price in the medium term, as US operations begin to benefit from consolidation.

Target price is $11.60 Current Price is $10.33 Difference: $1.27
If REH meets the Morgans target it will return approximately 12% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 1.0

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

Credit Suisse rates RHC as Underperform (5) -

The shares have outperformed the healthcare sector as well as the broader market since the federal election, Credit Suisse observes.

While acknowledging there is no longer a threat from a 2% cap on private health insurance premiums in the short term, the broker does not believe there is material upside to the share price at current levels, given persistent subdued operating conditions in Australia.

The broker forecasts Australian revenue growth of 5% in FY20. Credit Suisse maintains an Underperform rating and increases the target to $65.00 from $54.80.

Target price is $65.00 Current Price is $73.21 Difference: minus $8.21 (current price is over target).
If RHC meets the Credit Suisse target it will return approximately minus 11% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $66.87, suggesting downside of -8.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.0

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

Macquarie rates RRL as Downgrade to Neutral from Outperform (3) -

Macquarie maintains its forecasts for gold prices although moderates its AUD/USD expectations, with the net result a modest upgrade for gold forecasts, to $1667/oz, in Australian dollar terms for the next five years.

The broker downgrades Regis Resources to Neutral from Outperform and raises the target to $5.70 from $5.60. The broker envisages the upcoming production/earnings and FY20 guidance cycle a potentially risky period.

Target price is $5.70 Current Price is $5.47 Difference: $0.23
If RRL meets the Macquarie target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $4.73, suggesting downside of -13.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.5

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

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

Macquarie cuts alumina and base metal price forecasts which have a negative impact on the earnings outlook for South32. The broker downgrades to Underperform from Neutral.

The weaker price outlook translates to -12% and -30% reductions to FY20 and FY21 forecasts, respectively. Target is reduced to $2.70 from $3.20.

Target price is $2.70 Current Price is $3.05 Difference: minus $0.35 (current price is over target).
If S32 meets the Macquarie target it will return approximately minus 11% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.56, suggesting upside of 16.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

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

Market Sentiment: 0.5

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

Macquarie rates SAR as Downgrade to Neutral from Outperform (3) -

Macquarie maintains its forecasts for gold prices although moderates its AUD/USD expectations, with the net result a modest upgrade for gold forecasts, to $1667/oz, in Australian dollar terms for the next five years.

The broker downgrades Saracen Mineral to Neutral from Outperform and raises the target to $3.80 from $3.30. The broker envisages the upcoming production/earnings and FY20 guidance cycle a potentially risky period.

Target price is $3.80 Current Price is $3.62 Difference: $0.18
If SAR meets the Macquarie target it will return approximately 5% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.5

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

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

Macquarie maintains its forecasts for gold prices although moderates its AUD/USD expectations, with the net result a modest upgrade for gold forecasts, to $1667/oz, in Australian dollar terms for the next five years.

The broker upgrades St Barbara to Neutral from Underperform and raises the target to $3.10 from $2.50. The broker assumes a cautious view on the larger Australian gold producers.

Target price is $3.10 Current Price is $3.13 Difference: minus $0.03 (current price is over target).
If SBM meets the Macquarie target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.37, suggesting upside of 7.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.3

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

Macquarie rates SFR as Downgrade to Neutral from Outperform (3) -

Macquarie has reduced base metal price forecasts, which has driven material downgrades to the more leveraged base metal stocks. As a result the broker downgrades Sandfire Resources to Neutral from Outperform.

The stock has consistently outperformed the copper price over the past 18 months. Target is reduced to $7.10 from $8.00.

Target price is $7.10 Current Price is $6.62 Difference: $0.48
If SFR meets the Macquarie target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $7.46, suggesting upside of 12.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.2

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

Citi rates SUL as Buy (1) -

Citi believes the retail outlook is improving for the first time in four years on the back of tax cuts, rate cuts, lower cost of living and a stabilising housing market. The broker still anticipates some weak earnings reports from the sector ahead of such improvement, and believes downside risk provides buying opportunities.

Buy retained for Super Retail. Target rises to $10.00 from $9.70.

Target price is $10.00 Current Price is $9.28 Difference: $0.72
If SUL meets the Citi target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $9.18, suggesting downside of -1.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.3

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

Citi rates WES as Sell (5) -

Citi believes the retail outlook is improving for the first time in four years on the back of tax cuts, rate cuts, lower cost of living and a stabilising housing market. The broker still anticipates some weak earnings reports from the sector ahead of such improvement, and believes downside risk provides buying opportunities.

The broker believes Wesfarmers is overvalued, implying a housing market rebound for Bunnings. Sell retained. Target rises to $33.80 from $29.20.

Target price is $33.80 Current Price is $37.49 Difference: minus $3.69 (current price is over target).
If WES meets the Citi target it will return approximately minus 10% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $32.75, suggesting downside of -12.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.6

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