Australian Broker Call

April 26, 2017

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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: 11:27 AM

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
BEN - BENDIGO AND ADELAIDE BANK Upgrade to Equal-weight from Underweight Morgan Stanley
AHG  AUTOMOTIVE HOLDINGS GROUP LIMITED

Automobiles & Components

Overnight Price: $3.90

Morgans rates AHG as Hold (3) -

Auto sales in WA, to which Auto Holdings is 35% exposed, are down -9% year to date. The NSW market has also now suffered two months of negative growth.

Cost-outs for the company's Cold Logistics are tracking to plan, the broker notes, but for the first time in a long while, a weak second half auto result is expected.

The broker expects cost-outs in auto as well but has cut forecast earnings and lowered its target to $4.10 from $4.21. Hold retained.

Target price is $4.10 Current Price is $3.90 Difference: $0.2
If AHG meets the Morgans target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $4.19, suggesting upside of 7.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Morgans forecasts a full year FY17 dividend of 22.50 cents and EPS of 29.20 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 13.36.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 29.5, implying annual growth of 0.3%.

Current consensus DPS estimate is 22.5, implying a prospective dividend yield of 5.8%.

Current consensus EPS estimate suggests the PER is 13.2.

Forecast for FY18:

Morgans forecasts a full year FY18 dividend of 23.50 cents and EPS of 31.30 cents.
At the last closing share price the estimated dividend yield is 6.03%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.46.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 32.2, implying annual growth of 9.2%.

Current consensus DPS estimate is 23.9, implying a prospective dividend yield of 6.2%.

Current consensus EPS estimate suggests the PER is 12.0.

Market Sentiment: 0.4

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

AMP  AMP LIMITED

Insurance

Overnight Price: $5.21

Morgans rates AMP as Add (1) -

The broker has marked its insurance company valuations to market. AMP forecast earnings rise 1-2%.

Target rises to $5.95 from $5.86. Add retained.

Target price is $5.95 Current Price is $5.21 Difference: $0.74
If AMP meets the Morgans target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $5.58, suggesting upside of 5.8% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY17:

Morgans forecasts a full year FY17 dividend of 30.40 cents and EPS of 36.90 cents.
At the last closing share price the estimated dividend yield is 5.83%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.12.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 35.0, implying annual growth of N/A.

Current consensus DPS estimate is 29.6, implying a prospective dividend yield of 5.6%.

Current consensus EPS estimate suggests the PER is 15.1.

Forecast for FY18:

Morgans forecasts a full year FY18 dividend of 31.50 cents and EPS of 38.70 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 13.46.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 36.2, implying annual growth of 3.4%.

Current consensus DPS estimate is 30.9, implying a prospective dividend yield of 5.9%.

Current consensus EPS estimate suggests the PER is 14.6.

Market Sentiment: 0.4

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

APE  AP EAGERS LIMITED

Automobiles & Components

Overnight Price: $8.39

Morgans rates APE as Hold (3) -

Qld new car sales continue to decline, down another -6.4% in the March Q. While the broker acknowledges AP Eagers has a track record of outperforming peers and the broader market, a 46% exposure to Qld will weigh on revenues and margins.

The broker expects cost cuts to follow but downgrades forecast earnings and lowers its target to $9.83 from $10.49. Hold retained.

Target price is $9.83 Current Price is $8.39 Difference: $1.44
If APE meets the Morgans target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $9.81, suggesting upside of 16.8% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY17:

Morgans forecasts a full year FY17 dividend of 36.00 cents and EPS of 53.10 cents.
At the last closing share price the estimated dividend yield is 4.29%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.80.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 54.8, implying annual growth of N/A.

Current consensus DPS estimate is 36.7, implying a prospective dividend yield of 4.4%.

Current consensus EPS estimate suggests the PER is 15.3.

Forecast for FY18:

Morgans forecasts a full year FY18 dividend of 37.00 cents and EPS of 55.20 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 15.20.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 56.1, implying annual growth of 2.4%.

Current consensus DPS estimate is 37.1, implying a prospective dividend yield of 4.4%.

Current consensus EPS estimate suggests the PER is 15.0.

Market Sentiment: 0.0

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

AWC  ALUMINA LIMITED

Aluminium, Bauxite & Alumina

Overnight Price: $1.81

ADDED

Ord Minnett rates AWC as Accumulate (2) -

Broadly in-line, say the analysts about partner Alcoa's trading update in the USA. Accumulate rating and $2.20 price target retained.

Target price is $2.20 Current Price is $1.81 Difference: $0.395
If AWC meets the Ord Minnett target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $1.84, suggesting downside of -1.7% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY17:

Ord Minnett forecasts a full year FY17 dividend of 15.96 cents and EPS of 15.96 cents.
At the last closing share price the estimated dividend yield is 8.84%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.31.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 12.7, implying annual growth of N/A.

Current consensus DPS estimate is 14.6, implying a prospective dividend yield of 7.8%.

Current consensus EPS estimate suggests the PER is 14.8.

Forecast for FY18:

Ord Minnett forecasts a full year FY18 dividend of 14.65 cents and EPS of 13.31 cents.
At the last closing share price the estimated dividend yield is 8.11%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.56.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 12.8, implying annual growth of 0.8%.

Current consensus DPS estimate is 13.8, implying a prospective dividend yield of 7.4%.

Current consensus EPS estimate suggests the PER is 14.6.

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

BEN  BENDIGO AND ADELAIDE BANK LIMITED

Banks

Overnight Price: $12.03

Morgan Stanley rates BEN as Upgrade to Equal-weight from Underweight (3) -

Morgan Stanley believes regional banks are relatively well placed to navigate the changing mortgage market, given more leverage to re-pricing, falling capital and less impact from lower loan growth.

This is most positive for Bendigo & Adelaide and the broker upgrades to Equal-weight  from Underweight. The stock is now the broker's preferred regional bank. Target is raised to $11.40 from $10.30. Industry view is In-Line.

The bank still needs to improve its return on equity, improve on costs, and de-risk via a partial sale of Homesafe, Morgan Stanley believes.

Target price is $11.40 Current Price is $12.03 Difference: minus $0.63 (current price is over target).
If BEN meets the Morgan Stanley target it will return approximately minus 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $11.19, suggesting downside of -9.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Morgan Stanley forecasts a full year FY17 dividend of 68.00 cents and EPS of 95.00 cents.
At the last closing share price the estimated dividend yield is 5.65%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.66.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 89.6, implying annual growth of -6.3%.

Current consensus DPS estimate is 68.0, implying a prospective dividend yield of 5.5%.

Current consensus EPS estimate suggests the PER is 13.8.

Forecast for FY18:

Morgan Stanley forecasts a full year FY18 dividend of 68.00 cents and EPS of 99.50 cents.
At the last closing share price the estimated dividend yield is 5.65%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.09.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 89.1, implying annual growth of -0.6%.

Current consensus DPS estimate is 68.3, implying a prospective dividend yield of 5.5%.

Current consensus EPS estimate suggests the PER is 13.9.

Market Sentiment: -0.9

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

CUA  CENTURIA URBAN REIT

Overnight Price: $2.24

Morgans rates CUA as Hold (3) -

An independent board committee has recommended Centuria Urban unitholders vote in favour of the proposed merger with Centuria Metropolitan REIT ((CMA)) in the absence of a superior offer and assuming the Independent Expert gives the deal the thumbs up.

The broker retains Hold and lowers its target to the implicit merger price of $2.27 from a prior $2.30.

Target price is $2.27 Current Price is $2.24 Difference: $0.03
If CUA meets the Morgans target it will return approximately 1% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY17:

Morgans forecasts a full year FY17 dividend of 16.00 cents and EPS of 16.20 cents.
At the last closing share price the estimated dividend yield is 7.14%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.83.

Forecast for FY18:

Morgans forecasts a full year FY18 dividend of 16.00 cents and EPS of 16.50 cents.
At the last closing share price the estimated dividend yield is 7.14%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.58.

Market Sentiment: 0.0

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

GHC  GENERATION HEALTHCARE REIT

Healthcare services

Overnight Price: $2.27

Macquarie rates GHC as Neutral (3) -

Canadian-listed NorthWest Healthcare has announced an all-cash takeover offer for Generation Healthcare at $2.24 a share. NorthWest owns the manager and is the largest unit holder in the company, with a 22.73% interest.

Macquarie observes the offer provides value for unit holders but, in a market short of assets, an additional control premium may be required to secure an established portfolio. Neutral  retained. Target is raised to $2.24 from $1.91.

Target price is $2.24 Current Price is $2.27 Difference: minus $0.03 (current price is over target).
If GHC meets the Macquarie target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

The company's fiscal year ends in June.

Forecast for FY17:

Macquarie forecasts a full year FY17 dividend of 9.00 cents and EPS of 9.60 cents.
At the last closing share price the estimated dividend yield is 3.96%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 23.65.

Forecast for FY18:

Macquarie forecasts a full year FY18 dividend of 9.40 cents and EPS of 11.40 cents.
At the last closing share price the estimated dividend yield is 4.14%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 19.91.

Market Sentiment: 0.0

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

IAG  INSURANCE AUSTRALIA GROUP LIMITED

Insurance

Overnight Price: $6.08

Morgans rates IAG as Hold (3) -

The broker has marked its insurance company valuations to market. IAG forecast earnings rise 1%.

Target unchanged at $5.56. Hold retained.

Target price is $5.56 Current Price is $6.08 Difference: minus $0.52 (current price is over target).
If IAG meets the Morgans target it will return approximately minus 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $6.08, suggesting downside of -0.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Morgans forecasts a full year FY17 dividend of 24.60 cents and EPS of 32.50 cents.
At the last closing share price the estimated dividend yield is 4.05%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.71.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 34.0, implying annual growth of 31.8%.

Current consensus DPS estimate is 26.0, implying a prospective dividend yield of 4.2%.

Current consensus EPS estimate suggests the PER is 18.0.

Forecast for FY18:

Morgans forecasts a full year FY18 dividend of 27.80 cents and EPS of 36.50 cents.
At the last closing share price the estimated dividend yield is 4.57%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.66.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 37.1, implying annual growth of 9.1%.

Current consensus DPS estimate is 28.5, implying a prospective dividend yield of 4.7%.

Current consensus EPS estimate suggests the PER is 16.5.

Market Sentiment: 0.1

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

KGL  KGL RESOURCES LIMITED

Gold & Silver

Overnight Price: $0.38

Morgans rates KGL as Add (1) -

Since late 2015, drilling at Rockface has good copper grades and the broker expects this will increase to an increased resource and increased grade. The Jervois pre-feasibility study indicated a robust copper-silver project.

KGL has raised $2.5m at 27cps. The broker lifts its target to 51c from 35c to incorporate resource and exploration upside, and a longer term move to a discounted cash flow valuation. Add retained.

Target price is $0.51 Current Price is $0.38 Difference: $0.13
If KGL meets the Morgans target it will return approximately 34% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

Forecast for FY16:

Morgans forecasts a full year FY16 dividend of 0.00 cents and EPS of minus 1.30 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 29.23.

Forecast for FY17:

Morgans forecasts a full year FY17 dividend of 0.00 cents and EPS of minus 1.30 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 29.23.

Market Sentiment: 1.0

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

MTO  MOTORCYCLE HOLDINGS LIMITED

Automobiles & Components

Overnight Price: $3.78

Morgans rates MTO as Add (1) -

New motorcycle sales fell -13% in the march Q, a stark reversal of the strong trend evident in the second half FY16, the broker notes. Motorcycle Holdings nevertheless has a strong track record of outperforming the broader market.

The company has also acquired three new dealerships, which should be accretive from FY18. Target falls to $4.35 from $4.67 and Add retained.

Target price is $4.35 Current Price is $3.78 Difference: $0.57
If MTO meets the Morgans target it will return approximately 15% (excluding dividends, fees and charges).

The company's fiscal year ends in July.

Forecast for FY17:

Morgans forecasts a full year FY17 dividend of 14.70 cents and EPS of 24.60 cents.
At the last closing share price the estimated dividend yield is 3.89%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.37.

Forecast for FY18:

Morgans forecasts a full year FY18 dividend of 17.20 cents and EPS of 28.60 cents.
At the last closing share price the estimated dividend yield is 4.55%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.22.

Market Sentiment: 1.0

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

NAB  NATIONAL AUSTRALIA BANK LIMITED

Banks

Overnight Price: $33.37

Morgan Stanley rates NAB as Underweight (5) -

Ahead of the first half result on May 4, Morgan Stanley observes the bank needs to deliver a positive revenue and capital surprise to support the current share price.

The bank grew below system for much of 2016 but in 2017-18, the broker believes it should be less affected by the latest macro prudential measures versus other major banks, although competition in its priority segment of home owners is likely to pick up.

Underweight rating and $28.50 target retained. Industry view is: In-Line.

Target price is $28.50 Current Price is $33.37 Difference: minus $4.87 (current price is over target).
If NAB meets the Morgan Stanley target it will return approximately minus 15% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $31.99, suggesting downside of -4.9% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY17:

Morgan Stanley forecasts a full year FY17 dividend of 198.00 cents and EPS of 238.00 cents.
At the last closing share price the estimated dividend yield is 5.93%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.02.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 239.1, implying annual growth of -2.4%.

Current consensus DPS estimate is 193.7, implying a prospective dividend yield of 5.8%.

Current consensus EPS estimate suggests the PER is 14.1.

Forecast for FY18:

Morgan Stanley forecasts a full year FY18 dividend of 198.00 cents and EPS of 241.00 cents.
At the last closing share price the estimated dividend yield is 5.93%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.85.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 242.5, implying annual growth of 1.4%.

Current consensus DPS estimate is 192.6, implying a prospective dividend yield of 5.7%.

Current consensus EPS estimate suggests the PER is 13.9.

Market Sentiment: 0.4

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

ORG  ORIGIN ENERGY LIMITED

NatGas

Overnight Price: $7.47

Macquarie rates ORG as No Rating (-1) -

The Australian Energy Market Commission has started a review of five-minute pricing versus 30-minute pricing. A draft decision is due in July and a final decision in September.

Origin Energy is a potential loser from this change, Macquarie believes, although there are many moving parts making it difficult to quantify.

 The broker observes multiple reviews across the energy sector continue to create uncertainty for investors.

Macquarie is restricted on rating and target at this stage.

Current Price is $7.47. Target price not assessed.

Current consensus price target is $7.46, suggesting downside of -1.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Macquarie forecasts a full year FY17 dividend of 0.00 cents and EPS of 32.80 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 22.77.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 18.0, implying annual growth of N/A.

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

Current consensus EPS estimate suggests the PER is 41.9.

Forecast for FY18:

Macquarie forecasts a full year FY18 dividend of 20.00 cents and EPS of 57.10 cents.
At the last closing share price the estimated dividend yield is 2.68%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.08.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 58.1, implying annual growth of 222.8%.

Current consensus DPS estimate is 9.3, implying a prospective dividend yield of 1.2%.

Current consensus EPS estimate suggests the PER is 13.0.

Market Sentiment: 0.5

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

QBE  QBE INSURANCE GROUP LIMITED

Insurance

Overnight Price: $12.62

Morgan Stanley rates QBE as Overweight (1) -

Morgan Stanley observes the challenging global cycle has been a headwind to turning the company around and a bottom may be forming in the cycle as the global economy is entering a phase of synchronous recovery for the first time since 2010.

This, in turn, is positive for sums insured and premium growth. Morgan Stanley remains cautiously optimistic on the global pricing outlook. Overweight retained. Target is $13.90. In-Line industry view.

Target price is $13.90 Current Price is $12.62 Difference: $1.28
If QBE meets the Morgan Stanley target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $13.22, suggesting upside of 1.4% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY17:

Morgan Stanley forecasts a full year FY17 dividend of 73.13 cents and EPS of 83.77 cents.
At the last closing share price the estimated dividend yield is 5.79%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.07.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 82.1, implying annual growth of N/A.

Current consensus DPS estimate is 59.4, implying a prospective dividend yield of 4.6%.

Current consensus EPS estimate suggests the PER is 15.9.

Forecast for FY18:

Morgan Stanley forecasts a full year FY18 dividend of 98.39 cents and EPS of 113.02 cents.
At the last closing share price the estimated dividend yield is 7.80%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.17.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 101.9, implying annual growth of 24.1%.

Current consensus DPS estimate is 68.8, implying a prospective dividend yield of 5.3%.

Current consensus EPS estimate suggests the PER is 12.8.

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


Morgans rates QBE as Hold (3) -

The broker has marked its insurance company valuations to market. While this would otherwise have resulted in only a small forecast increase for QBE, a more detailed review has led the broker to believe its valuation has been too conservative.

Lower reinsurance, cost-out benefits and the likelihood of further reserve releases see the broker lift FY17 forecast earnings by 20%. Target rises to $13.47 from $13.06. Hold retained.

Target price is $13.47 Current Price is $12.62 Difference: $0.85
If QBE meets the Morgans target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $13.22, suggesting upside of 1.4% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY17:

Morgans forecasts a full year FY17 dividend of 86.43 cents and EPS of 82.30 cents.
At the last closing share price the estimated dividend yield is 6.85%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.33.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 82.1, implying annual growth of N/A.

Current consensus DPS estimate is 59.4, implying a prospective dividend yield of 4.6%.

Current consensus EPS estimate suggests the PER is 15.9.

Forecast for FY18:

Morgans forecasts a full year FY18 dividend of 88.69 cents and EPS of 101.85 cents.
At the last closing share price the estimated dividend yield is 7.03%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.39.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 101.9, implying annual growth of 24.1%.

Current consensus DPS estimate is 68.8, implying a prospective dividend yield of 5.3%.

Current consensus EPS estimate suggests the PER is 12.8.

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

RRL  REGIS RESOURCES LIMITED

Gold & Silver

Overnight Price: $3.39

ADDED

Ord Minnett rates RRL as Accumulate (2) -

Lower throughput disappointed in the March quarter, but higher grades at Duketon North surprised and Ord Minnett analysts seem confident about improvement in the final quarter of FY17.

Pointing at the company’s strong free cash flow and dividend yields plus the solid production growth profile, the stockbroker maintains its Accumulate rating, as well as the $3.80 price target.

Regis Resources remains Ord Minnett's preferred ASX gold exposure. Estimates have been lowered.

Target price is $3.80 Current Price is $3.39 Difference: $0.41
If RRL meets the Ord Minnett target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $3.17, suggesting downside of -0.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Ord Minnett forecasts a full year FY17 dividend of 14.00 cents and EPS of 25.00 cents.
At the last closing share price the estimated dividend yield is 4.13%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.56.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 25.1, implying annual growth of 12.2%.

Current consensus DPS estimate is 13.9, implying a prospective dividend yield of 4.4%.

Current consensus EPS estimate suggests the PER is 12.6.

Forecast for FY18:

Ord Minnett forecasts a full year FY18 dividend of 17.00 cents and EPS of 28.00 cents.
At the last closing share price the estimated dividend yield is 5.01%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.11.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 30.5, implying annual growth of 21.5%.

Current consensus DPS estimate is 16.8, implying a prospective dividend yield of 5.3%.

Current consensus EPS estimate suggests the PER is 10.4.

Market Sentiment: -0.2

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

SPO  SPOTLESS GROUP HOLDINGS LIMITED

Industrial Sector Contractors & Engineers

Overnight Price: $1.11

Macquarie rates SPO as Underperform (5) -

The company has advised shareholders to reject the $1.15 per share bid from Downer EDI ((DOW)) on medium to long-term valuation grounds. The rejection is not a surprise to Macquarie, given prior commentary.

The company's discussions with another potential acquirer have now ended and this removes one of its main forms of defence, in the broker's opinion.

Underperform rating and $1.10 target retained. Macquarie continues to recommend investors sell into the bid as the update confirms there is a low risk of another bid emerging.

Target price is $1.10 Current Price is $1.11 Difference: minus $0.005 (current price is over target).
If SPO 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 $0.89, suggesting downside of -18.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Macquarie forecasts a full year FY17 dividend of 4.00 cents and EPS of 8.00 cents.
At the last closing share price the estimated dividend yield is 3.62%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.81.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is -1.2, implying annual growth of N/A.

Current consensus DPS estimate is 3.3, implying a prospective dividend yield of 3.0%.

Current consensus EPS estimate suggests the PER is N/A.

Forecast for FY18:

Macquarie forecasts a full year FY18 dividend of 4.50 cents and EPS of 9.10 cents.
At the last closing share price the estimated dividend yield is 4.07%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 12.14.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 7.7, implying annual growth of N/A.

Current consensus DPS estimate is 3.6, implying a prospective dividend yield of 3.3%.

Current consensus EPS estimate suggests the PER is 14.2.

Market Sentiment: -0.5

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

SRX  SIRTEX MEDICAL LIMITED

Pharmaceuticals & Biotech/Lifesciences

Overnight Price: $14.80

Morgans rates SRX as Hold (3) -

It did not surprise the broker that Sirtex' phase 3 SARAH study failed to show a survival advantage from SIR-spheres over Sorafinib in advanced liver cancer. The analyst in question is clearly of a medical background, as one would need a masters in biology to understand the rest of the report.

Suffice to say the broker had anticipated the SARAH result so makes no forecast changes. But with the probability of success for SIRveNIB now lower, the broker cuts its target to $15.60 from $16.20. Hold retained.

Target price is $15.60 Current Price is $14.80 Difference: $0.8
If SRX meets the Morgans target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $25.65, suggesting upside of 70.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Morgans forecasts a full year FY17 dividend of 26.00 cents and EPS of 81.00 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 18.27.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 81.0, implying annual growth of -13.6%.

Current consensus DPS estimate is 25.4, implying a prospective dividend yield of 1.7%.

Current consensus EPS estimate suggests the PER is 18.5.

Forecast for FY18:

Morgans forecasts a full year FY18 dividend of 31.00 cents and EPS of 104.00 cents.
At the last closing share price the estimated dividend yield is 2.09%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.23.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 101.0, implying annual growth of 24.7%.

Current consensus DPS estimate is 30.7, implying a prospective dividend yield of 2.0%.

Current consensus EPS estimate suggests the PER is 14.9.

Market Sentiment: 0.8

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


UBS rates SRX as Buy (1) -

The  SARAH study failed to meet its primary end point,  UBS observes, offering two months less in terms of life expectancy versus the standard drug in all trial patients. Still, where the study protocol was followed life expectancy was the same, with better quality.

Hence, referencing precedent trials where protocol population was the accepted data set, the company is convinced it can begin marketing and this is made more compelling by the quality-of-life data versus the significant adverse effects of the standard therapy (Sorafenib).

UBS has not taken a view on the outcome. Target is $30.30. Buy retained.

Target price is $30.30 Current Price is $14.80 Difference: $15.5
If SRX meets the UBS target it will return approximately 105% (excluding dividends, fees and charges).

Current consensus price target is $25.65, suggesting upside of 70.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

UBS forecasts a full year FY17 dividend of 24.00 cents and EPS of 78.00 cents.
At the last closing share price the estimated dividend yield is 1.62%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.97.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 81.0, implying annual growth of -13.6%.

Current consensus DPS estimate is 25.4, implying a prospective dividend yield of 1.7%.

Current consensus EPS estimate suggests the PER is 18.5.

Forecast for FY18:

UBS forecasts a full year FY18 dividend of 28.00 cents and EPS of 94.00 cents.
At the last closing share price the estimated dividend yield is 1.89%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.74.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 101.0, implying annual growth of 24.7%.

Current consensus DPS estimate is 30.7, implying a prospective dividend yield of 2.0%.

Current consensus EPS estimate suggests the PER is 14.9.

Market Sentiment: 0.8

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

SUN  SUNCORP GROUP LIMITED

Banks

Overnight Price: $13.56

Morgans rates SUN as Hold (3) -

The broker has marked its insurance company valuations to market. Suncorp forecast earnings rise 1%.

Target rises to $13.71 from $13.37. Hold retained.

Target price is $13.71 Current Price is $13.56 Difference: $0.15
If SUN meets the Morgans target it will return approximately 1% (excluding dividends, fees and charges).

Current consensus price target is $13.68, suggesting downside of -0.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Morgans forecasts a full year FY17 dividend of 73.80 cents and EPS of 92.80 cents.
At the last closing share price the estimated dividend yield is 5.44%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 14.61.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 88.9, implying annual growth of 9.2%.

Current consensus DPS estimate is 72.8, implying a prospective dividend yield of 5.3%.

Current consensus EPS estimate suggests the PER is 15.5.

Forecast for FY18:

Morgans forecasts a full year FY18 dividend of 77.50 cents and EPS of 97.50 cents.
At the last closing share price the estimated dividend yield is 5.72%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.91.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 95.5, implying annual growth of 7.4%.

Current consensus DPS estimate is 76.2, implying a prospective dividend yield of 5.5%.

Current consensus EPS estimate suggests the PER is 14.4.

Market Sentiment: 0.3

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

TTS  TATTS GROUP LIMITED

Gaming

Overnight Price: $4.45

Deutsche Bank rates TTS as Buy (1) -

Pacific Consortium has amended its revised proposal to allow the company to pay dividends, and not result in a reduction to the consideration of $4.21 a share.

The board is undertaking an assessment of the two proposals and will make an announcement when this is complete. In the interim, the board believes the proposed merger with Tabcorp ((TAH)) is in the best interests of shareholders, report the analysts.

Deutsche Bank retains a Buy rating and $4.67 target.

Target price is $4.67 Current Price is $4.45 Difference: $0.22
If TTS meets the Deutsche Bank target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $4.27, suggesting downside of -4.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Deutsche Bank forecasts a full year FY17 dividend of 17.00 cents and EPS of 16.00 cents.
At the last closing share price the estimated dividend yield is 3.82%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 27.81.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 16.9, implying annual growth of 5.6%.

Current consensus DPS estimate is 19.9, implying a prospective dividend yield of 4.5%.

Current consensus EPS estimate suggests the PER is 26.4.

Forecast for FY18:

Deutsche Bank forecasts a full year FY18 dividend of 17.00 cents and EPS of 17.00 cents.
At the last closing share price the estimated dividend yield is 3.82%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 26.18.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 17.5, implying annual growth of 3.6%.

Current consensus DPS estimate is 17.5, implying a prospective dividend yield of 3.9%.

Current consensus EPS estimate suggests the PER is 25.5.

Market Sentiment: 0.0

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

VCX  VICINITY CENTRES

REITs

Overnight Price: $2.92

ADDED

Ord Minnett rates VCX as Accumulate (2) -

Management has indicated it is largely done with the planned asset sale program but Ord Minnett analysts beg to differ. They believe selling more assets, and lifting overall quality at the same time, would make Vicinity Centres a more attractive option for investors.

Ord Minnett has identified a further 21 assets – valued at $2.05bn or around 14% of the portfolio – that in the analysts' view should be divested. Doing so, say the analysts, would leave the group’s portfolio rivalling GPT ((GPT)) and pushing it closer to Scentre Group ((SCG)) from a quality perspective.

It would also leave Vicinity less exposed to the retail industry's threats from Amazon’s entry, in Ord Minnett's view. Accumulate. Target $3.30.

Target price is $3.20 Current Price is $2.92 Difference: $0.28
If VCX meets the Ord Minnett target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $3.06, suggesting upside of 4.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Ord Minnett forecasts a full year FY17 dividend of 18.00 cents and EPS of 32.00 cents.
At the last closing share price the estimated dividend yield is 6.16%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 9.13.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 20.7, implying annual growth of -14.7%.

Current consensus DPS estimate is 17.6, implying a prospective dividend yield of 6.0%.

Current consensus EPS estimate suggests the PER is 14.1.

Forecast for FY18:

Ord Minnett forecasts a full year FY18 dividend of 18.00 cents and EPS of 19.00 cents.
At the last closing share price the estimated dividend yield is 6.16%.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.37.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 18.9, implying annual growth of -8.7%.

Current consensus DPS estimate is 18.1, implying a prospective dividend yield of 6.2%.

Current consensus EPS estimate suggests the PER is 15.4.

Market Sentiment: -0.1

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

VMY  VIMY RESOURCES LIMITED

Uranium

Overnight Price: $0.23

Morgans rates VMY as Add (1) -

Further work has commenced at Mulga Rock following federal government environmental approval. A definitive feasibility study is expected mid this year. The new WA government has indicated it won't oppose uranium mining.

Add retained on Vimy, target reduced to 42c from 47c to account for the recent placement at 26cps.

Target price is $0.42 Current Price is $0.23 Difference: $0.19
If VMY meets the Morgans target it will return approximately 83% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY16:

Morgans forecasts a full year FY16 dividend of 0.00 cents and EPS of minus 5.30 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is minus 4.34.

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 11.50.

Market Sentiment: 1.0

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

VRL  VILLAGE ROADSHOW LIMITED

Travel, Leisure & Tourism

Overnight Price: $3.75

Citi rates VRL as Neutral (3) -

Australians are less and less queuing up to visit theme parks on the Gold Coast and management has finally succumbed to market pressure about the company's debt, announcing it is investigating asset sales to lighten up the balance sheet.

Citi analysts are concerned that after Australian visitors, the next disappointment might come from international visitors. Gold Coast Hotel occupancy has now declined for the last six months, point out the analysts.

Management is now under pressure to execute asset sales, find the analysts, adding increased disclosure around bank covenants is now needed to lift investor confidence. Estimates have been sharply reduced, but price target only declines by -1% to $3.60. Neutral rating left untouched.

Target price is $3.60 Current Price is $3.75 Difference: minus $0.15 (current price is over target).
If VRL 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 $3.83, suggesting upside of 3.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Citi forecasts a full year FY17 dividend of 0.00 cents and EPS of 17.10 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 21.93.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 13.6, implying annual growth of 38.8%.

Current consensus DPS estimate is 2.5, implying a prospective dividend yield of 0.7%.

Current consensus EPS estimate suggests the PER is 27.3.

Forecast for FY18:

Citi forecasts a full year FY18 dividend of 0.00 cents and EPS of 26.80 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 13.99.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 25.5, implying annual growth of 87.5%.

Current consensus DPS estimate is 3.8, implying a prospective dividend yield of 1.0%.

Current consensus EPS estimate suggests the PER is 14.5.

Market Sentiment: 0.3

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


Deutsche Bank rates VRL as Hold (3) -

The company has issued a trading update for its theme parks, noting a significant impact from the tragedy at rival park Dreamworld, as well as unfavourable weather in March and April.

FY17 EBITDA guidance for theme parks of $55-65m is -27% below Deutsche Bank's estimates. The broker reduces earnings forecasts for FY17  and FY18 by  -14% and -5% respectively.

Target is reduced to $3.70 from $4.20. Hold retained.

Target price is $3.70 Current Price is $3.75 Difference: minus $0.05 (current price is over target).
If VRL meets the Deutsche Bank target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.83, suggesting upside of 3.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Deutsche Bank forecasts a full year FY17 dividend of 0.00 cents and EPS of 14.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 26.79.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 13.6, implying annual growth of 38.8%.

Current consensus DPS estimate is 2.5, implying a prospective dividend yield of 0.7%.

Current consensus EPS estimate suggests the PER is 27.3.

Forecast for FY18:

Deutsche Bank forecasts a full year FY18 dividend of 0.00 cents and EPS of 23.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 16.30.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 25.5, implying annual growth of 87.5%.

Current consensus DPS estimate is 3.8, implying a prospective dividend yield of 1.0%.

Current consensus EPS estimate suggests the PER is 14.5.

Market Sentiment: 0.3

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


Macquarie rates VRL as Neutral (3) -

The company has updated on its theme parks division, noting attendance continues to be affected by the tragedy at rival Dreamworld. Attendance at the company's Gold Coast parks, for the nine months to March, was down -9.4%.

The company also noted cyclonic weather in March and April affected attendance. Sydney Wet'n'Wild is also underperforming.

Macquarie does not consider valuation alone as a catalyst to buy the stock and retains a Neutral rating. The broker believes the company needs to deliver at its first half result, with its focus on reducing gearing an overdue positive. Target is reduced to $3.38 from $3.43.

Target price is $3.38 Current Price is $3.75 Difference: minus $0.37 (current price is over target).
If VRL meets the Macquarie target it will return approximately minus 10% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.83, suggesting upside of 3.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY17:

Macquarie forecasts a full year FY17 dividend of 0.00 cents and EPS of 14.70 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 25.51.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 13.6, implying annual growth of 38.8%.

Current consensus DPS estimate is 2.5, implying a prospective dividend yield of 0.7%.

Current consensus EPS estimate suggests the PER is 27.3.

Forecast for FY18:

Macquarie forecasts a full year FY18 dividend of 0.00 cents and EPS of 24.50 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 15.31.

How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 25.5, implying annual growth of 87.5%.

Current consensus DPS estimate is 3.8, implying a prospective dividend yield of 1.0%.

Current consensus EPS estimate suggests the PER is 14.5.

Market Sentiment: 0.3

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

Summaries
AHG - AUTOMOTIVE HOLDINGS Hold - Morgans Overnight Price $3.90
AMP - AMP Add - Morgans Overnight Price $5.21
APE - AP EAGERS Hold - Morgans Overnight Price $8.39
AWC - ALUMINA Accumulate - Ord Minnett Overnight Price $1.81
BEN - BENDIGO AND ADELAIDE BANK Upgrade to Equal-weight from Underweight - Morgan Stanley Overnight Price $12.03
CUA - CENTURIA URBAN REIT Hold - Morgans Overnight Price $2.24
GHC - GENERATION HEALTHCARE REIT Neutral - Macquarie Overnight Price $2.27
IAG - INSURANCE AUSTRALIA Hold - Morgans Overnight Price $6.08
KGL - KGL RESOURCES Add - Morgans Overnight Price $0.38
MTO - MOTORCYCLE HOLDINGS Add - Morgans Overnight Price $3.78
NAB - NATIONAL AUSTRALIA BANK Underweight - Morgan Stanley Overnight Price $33.37
ORG - ORIGIN ENERGY No Rating - Macquarie Overnight Price $7.47
QBE - QBE INSURANCE Overweight - Morgan Stanley Overnight Price $12.62
Hold - Morgans Overnight Price $12.62
RRL - REGIS RESOURCES Accumulate - Ord Minnett Overnight Price $3.39
SPO - SPOTLESS Underperform - Macquarie Overnight Price $1.11
SRX - SIRTEX MEDICAL Hold - Morgans Overnight Price $14.80
Buy - UBS Overnight Price $14.80
SUN - SUNCORP Hold - Morgans Overnight Price $13.56
TTS - TATTS GROUP Buy - Deutsche Bank Overnight Price $4.45
VCX - VICINITY CENTRES Accumulate - Ord Minnett Overnight Price $2.92
VMY - VIMY RESOURCES Add - Morgans Overnight Price $0.23
VRL - VILLAGE ROADSHOW Neutral - Citi Overnight Price $3.75
Hold - Deutsche Bank Overnight Price $3.75
Neutral - Macquarie Overnight Price $3.75
RATING SUMMARY
Rating No. Of Recommendations
1. Buy

7

2. Accumulate

3

3. Hold

12

5. Sell

2

Wednesday 26 April 2017

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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.