Australian Broker Call

UBS rates ABC as Reinstate Coverage with Sell (5) -

UBS reinstates coverage with a Sell rating and $4.40 target. The broker estimates that around 30% of revenue is derived from residential activity and is forecasting, in 2019, for detached housing commencements to decline by -6% and multi-dwelling commencements by -13%.

This leads to a forecast -11% decline in the company's residential cement volumes infrastructure and non-residential activity should lift and offset the decline, but only just in the broker's opinion.

Target price is $4.40 Current Price is $5.13 Difference: minus $0.73 (current price is over target).
If ABC meets the UBS target it will return approximately minus 14% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $5.81, suggesting upside of 13.2% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: -0.6

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

Deutsche Bank rates ANN as Hold (3) -

The company will close three of its production facilities, two in Mexico and one in South Korea. The rationalisation is part of the transformation program, previously announced.

Meanwhile, significant investment will occur in Vietnam, Sri Lanka and Malaysia. Management considers the transformation program on track to realise at least $30m in annual savings by FY20.

Deutsche Bank maintains a Hold rating and $27.25 target.

Target price is $27.25 Current Price is $22.88 Difference: $4.37
If ANN meets the Deutsche Bank target it will return approximately 19% (excluding dividends, fees and charges).

Current consensus price target is $26.13, suggesting upside of 14.2% (ex-dividends)

Forecast for FY19:

Forecast for FY20:

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

Market Sentiment: 0.3

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

Morgan Stanley rates ANN as Overweight (1) -

The company will close three production facilities - 2 in Mexico and one in South Korea - to streamline its manufacturing footprint and generate more cost savings, expected to be more than US$20m per annum.

The transformation program is now expected to generate over US$30m in cost savings by FY20. Morgan Stanley believes there is downside risk to FY19 guidance if there is no let up of the elevated raw material costs and import tariffs.

Rating is Overweight. Target is $28.56. Sector view is In-Line.

Target price is $28.56 Current Price is $22.88 Difference: $5.68
If ANN meets the Morgan Stanley target it will return approximately 25% (excluding dividends, fees and charges).

Current consensus price target is $26.13, suggesting upside of 14.2% (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: 0.3

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

UBS rates ANN as Neutral (3) -

The company has now closed two manufacturing facilities in Mexico and one in South Korea. This is expected to provide a more efficient and effective manufacturing base and will yield over US$20m in annual savings.

UBS also points out that the decision by the US government to hold tariffs at 10%, amid renegotiations with China, de-risks the company's FY19 guidance.

Neutral rating maintained. Target is reduced to $23.80 from $25.50.

Target price is $23.80 Current Price is $22.88 Difference: $0.92
If ANN meets the UBS target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $26.13, suggesting upside of 14.2% (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: 0.3

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

Morgan Stanley rates APA as Resume Coverage with Equal-weight (3) -

Morgan Stanley resumes coverage with an Equal-weight rating. Defensive earnings, with incremental or offshore growth potential, provide the appeal but policy risk is elevated for utilities and the regulatory cycle causes the broker to temper its enthusiasm.

The broker suspects the company's dominant market share of Australian gas transmission means that growth avenues will continue to evolve. Industry view is Cautious. Price target is $8.88.

Target price is $8.88 Current Price is $8.70 Difference: $0.18
If APA meets the Morgan Stanley target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $9.96, suggesting upside of 14.5% (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

UBS rates BSL as Buy (1) -

UBS observes, since a recent high of RMB1000/t in August, margins for hot rolled coil have collapsed to RMB100/t. The drop has been sparked by poor demand for steel and high input prices.

While UBS envisages limited downside, as the Chinese government does not intend to let the steel industry become unprofitable, something needs to give.

BlueScope's share price implies that Chinese steel production will be loss-making and, while possible in the short term, the broker does not believe this is sustainable.

Buy rating maintained, as the company is still generating significant cash flow and the broker believes this is not the time to sell. Target is reduced to $16.80 from $21.00.

Target price is $16.80 Current Price is $12.09 Difference: $4.71
If BSL meets the UBS target it will return approximately 39% (excluding dividends, fees and charges).

Current consensus price target is $17.29, suggesting upside of 43.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.6

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

Credit Suisse rates CCL as Neutral (3) -

The company has indicated 2019 will be another year of transition. Credit Suisse believes interpretation of the briefing is a matter of semantics, because the company has formally announced the divestment of SPC.

The accounting of the operating losses can move earnings per share by 2%. Hence, downgrades to 2019 and 2020 forecasts are less than -2%.

The broker believes the share price has overreacted to the challenged outlook and retains a Neutral rating and $9.80 target.

Target price is $9.80 Current Price is $8.71 Difference: $1.09
If CCL meets the Credit Suisse target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $8.61, suggesting downside of -1.2% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: -0.4

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

UBS rates CCL as Sell (5) -

Cost pressures and increasing investment are driving a downgrade to expectations, UBS observes. The macro outlook remains weak and is not expected to improve in 2019 and there is a need to increase marketing expenditure.

UBS reduces 2018-20 estimates for earnings per share by -2-6%. The company has made progress stabilising Australian beverages volumes but this has cost around $40m in 2018.

UBS maintains a Sell rating and reduces the target to $7.85 from $8.30.

Target price is $7.85 Current Price is $8.71 Difference: minus $0.86 (current price is over target).
If CCL meets the UBS target it will return approximately minus 10% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $8.61, suggesting downside of -1.2% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: -0.4

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

Ord Minnett rates CSR as Hold (3) -

The company will sell its Viridian Glass business to Crescent Capital Partners. Total cash consideration, including Dandenong but not the Ingleburn site, is around $155m.

After completion of the transaction the company will begin the sale process for Ingleburn with the proceeds expected to be around $60m.

Ord Minnett notes the company has struggled to generate sufficient returns from the business and believes a sale is the correct decision. Ord Minnett now envisages a net cash position by FY20, providing options for capital management or acquisitions.

Hold rating maintained and the target is lowered to $3.45 from $3.70.

Target price is $3.45 Current Price is $2.97 Difference: $0.48
If CSR meets the Ord Minnett target it will return approximately 16% (excluding dividends, fees and charges).

Current consensus price target is $3.63, suggesting upside of 22.1% (ex-dividends)

The company's fiscal year ends in March.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.2

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

Credit Suisse rates GNC as Outperform (1) -

Graincorp has received a non-binding, indicative proposal at $10.42 a share. Credit Suisse finds it difficult to assess value, given the asset rationalisation in which the company is engaged takes a long time to effect.

The broker has previously estimated $30m in benefits from a reduction in the scale of the logistics network. New rail contracts, meanwhile, improve profit outcomes from FY20. Initiatives in Canada and the Black Sea are also in the early stages.

Credit Suisse maintains an Outperform rating and $9.04 target.

Target price is $9.04 Current Price is $9.26 Difference: minus $0.22 (current price is over target).
If GNC meets the Credit Suisse target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $9.27, suggesting upside of 0.1% (ex-dividends)

The company's fiscal year ends in September.

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

Deutsche Bank rates GNC as Buy (1) -

Deutsche Bank believes the all-in cash takeover offer from Long-Term Asset Partners at $10.42 a share is both well timed and a first step in realising the underlying value in the business.

The broker does not rule out other interested parties, which may lead to a higher takeover price. The company has also announced a portfolio review, aimed at unlocking value for shareholders through capital management and portfolio optimisation.

Buy rating maintained, supported by the takeover price, a return to more normal east coast cropping conditions and the restructuring benefit from grains & oils. Target is raised to $10.42 from $9.40.

Target price is $10.42 Current Price is $9.26 Difference: $1.16
If GNC meets the Deutsche Bank target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $9.27, suggesting upside of 0.1% (ex-dividends)

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

Macquarie rates GNC as No Rating (-1) -

Graincorp will push ahead with its capital management and portfolio review, an update on which is expected before the AGM in February, given the takeover bid from Long Term Asset Partners is at this stage indicative and non-binding.

The broker is advising thus is currently restricted from providing a recommendation or target.

Current Price is $9.26. Target price not assessed.

Current consensus price target is $9.27, suggesting upside of 0.1% (ex-dividends)

The company's fiscal year ends in September.

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

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

The company has received an indicative all-in cash takeover bid of $10.42 per share. The board has recommended no action be taken and continues to review its asset portfolio.

UBS believes the company's grain division on Australia's east coast will be the most valuable aspect for an international grain trader. However, ADM was blocked from taking over the company in 2013 by the Foreign Investment Review Board, which suggests a change in federal government may be needed before a successful bid from offshore.

The broker also notes, as most of the major grain traders are not interested in, or are divesting, malt assets, an Asian food company or the WA co-op, CBH, could be interested in some of the assets.

Rating is upgraded to Buy from Neutral. Target is raised to $10.42 from $8.40.

Target price is $10.42 Current Price is $9.26 Difference: $1.16
If GNC meets the UBS target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $9.27, suggesting upside of 0.1% (ex-dividends)

The company's fiscal year ends in September.

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

Macquarie rates KLA as Outperform (1) -

The broker has revised its estimates and has lifted Foresterville life-of-mine and grade expectations given consistent outperformance and new discoveries. New estimates may yet prove conservative, the broker suggests.

Positive catalysts may on the horizon from Swan/Harrier drill results and a resource update. Kirkland remains a top pick in the space for the broker. Outperform retained, target rises to $41 from $37.

Target price is $41.00 Current Price is $29.25 Difference: $11.75
If KLA meets the Macquarie target it will return approximately 40% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 1.0

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

Citi rates MTS as Sell (5) -

Citi found the first half results weak on an underlying basis. Improved momentum in food sales, ex tobacco, was driven by inflation. The broker reduces forecasts for the second half by -5%. In March, the company will outline its strategy to return to growth.

Citi believes, in order to return to growth and offset organic earnings declines, a $50-100m investment program is likely. The company faces challenges in moving to a growth strategy from a cost-reduction strategy and the pressure to perform is increasing, the broker notes.

Sell rating retained. Target is reduced to $2.45 from $2.55.

Target price is $2.45 Current Price is $2.44 Difference: $0.01
If MTS meets the Citi target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $2.74, suggesting upside of 12.2% (ex-dividends)

The company's fiscal year ends in April.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.1

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

Credit Suisse rates MTS as Upgrade to Neutral from Underperform (3) -

First half results were broadly in line with expectations. Credit Suisse downgrades earnings, given the weighting to the second half of implementation costs from food distribution growth initiatives, and assumes no sales growth in hardware in FY20.

The broker continues to assume, as yet undefined, cost reductions will continue, which partly mitigate the impact of declining sales revenue in outer years.

Rating is upgraded to Neutral from Underperform. Target is raised to $2.60 from $2.51.

Target price is $2.60 Current Price is $2.44 Difference: $0.16
If MTS meets the Credit Suisse target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $2.74, suggesting upside of 12.2% (ex-dividends)

The company's fiscal year ends in April.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.1

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

Deutsche Bank rates MTS as Sell (5) -

First half margins in food declined, despite some improvement in sales. This suggests to Deutsche Bank that cost reductions are no longer sufficient to offset cost inflation.

Structural challenges continue and the broker does not expect sales to improve to a level where operating leverage can be avoided.

Hardware did well but sales are also expected to decline in this segment once the current construction pipeline ends.

The broker predicts a very tough FY20. Sell rating maintained. Target is $2.40.

Target price is $2.40 Current Price is $2.44 Difference: minus $0.04 (current price is over target).
If MTS meets the Deutsche Bank target it will return approximately minus 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.74, suggesting upside of 12.2% (ex-dividends)

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.1

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

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

In the wake of Metcash's result, Macquarie downgrades to Underperform. The company has done a good job, the broker suggests, in controlling cost increases via its Working Smarter initiative. But that has largely run its course, as has the synergy benefits from the Hardware acquisition.

The company is still feeling the impact of the lost Drakes contract, and supermarket competition remains fierce. Nor has there been any improvement in conditions in WA or SA, Macquarie notes. More investment is needed to offset these threats. Target falls to $2.41 from $3.17.

Target price is $2.41 Current Price is $2.44 Difference: minus $0.03 (current price is over target).
If MTS 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 $2.74, suggesting upside of 12.2% (ex-dividends)

The company's fiscal year ends in April.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.1

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

Morgan Stanley rates MTS as Overweight (1) -

The company's first half trading performance continue to improve but Morgan Stanley observes earnings quality was low. Going forward, the broker believes benign supermarket competition and the turnaround in hardware will remain value drivers.

Wholesale food sales, ex tobacco, improved in the first half but the underlying profit performance was countered by an incremental onerous lease provision release, cost investment and credit card profit reclassification.

Morgan Stanley estimates the underlying food & grocery earnings (EBIT) decline was -4.1%. This is disappointing, but the broker finds it understandable given deflation in the supermarket industry.

The broker retains an Overweight rating and reduces the target to $3.40 from $3.50. Industry view: Cautious.

Target price is $3.40 Current Price is $2.44 Difference: $0.96
If MTS meets the Morgan Stanley target it will return approximately 39% (excluding dividends, fees and charges).

Current consensus price target is $2.74, suggesting upside of 12.2% (ex-dividends)

The company's fiscal year ends in April.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.1

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

Ord Minnett rates MTS as Accumulate (2) -

First half net profit was ahead of expectations with earnings growth driven by synergies from the hardware business and a write-back of provisions, amid improving sales and the food division.

Ord Minnett maintains an Accumulate rating, noting the company's confidence in hardware and an improving environment for food.

The broker brushes aside the revelation that lease settlements and write-back of provisions bolstered food & grocery earnings in recent times. Deflation has eased and the east coast is in a growth phase.

Ord Minnett reduces the target to $3.00 from $3.25.

Target price is $3.00 Current Price is $2.44 Difference: $0.56
If MTS meets the Ord Minnett target it will return approximately 23% (excluding dividends, fees and charges).

Current consensus price target is $2.74, suggesting upside of 12.2% (ex-dividends)

The company's fiscal year ends in April.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.1

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

UBS rates MTS as Buy (1) -

UBS found the first half result mixed, noting the rate of decline in wholesale sales eased while the company has flagged early signs of improvement in Western Australia. Hardware stood out, driven by synergies and cost efficiencies.

The broker believes the outlook for the supermarket sector is improving as deflation is easing and there is reduced promotional intensity.

The broker considers the stock attractive at current levels and retains a Buy rating. Target is reduced to $2.90 from $3.00.

Target price is $2.90 Current Price is $2.44 Difference: $0.46
If MTS meets the UBS target it will return approximately 19% (excluding dividends, fees and charges).

Current consensus price target is $2.74, suggesting upside of 12.2% (ex-dividends)

The company's fiscal year ends in April.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.1

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

Ord Minnett rates NGI as Buy (1) -

The recent sell-off in equity markets has provided an attractive entry point, in Ord Minnett's view. The broker considers the investment case compelling with over 90% recurring revenue and a solid track record of growth in assets under management.

The broker believes the recent Mesirow acquisition is where the opportunity presents. Buy rating maintained. Target is reduced to $5.50 from $5.60.

Target price is $5.50 Current Price is $4.29 Difference: $1.21
If NGI meets the Ord Minnett target it will return approximately 28% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

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

Market Sentiment: 1.0

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

Macquarie rates NHF as Neutral (3) -

The methodology of the government's private health insurance premium calculation is under question and a review is underway. Presently, a policy holder switching to a new insurer rates as a -100% price reduction. Given the extent of such switching recently, this would imply a low premium setting for 2019.

Nib enjoyed low claims growth against premium rate increase in the third quarter but forecast premium rate increases may prove insufficient to cover claims growth ahead, the broker warns. FY20-21 forecasts are unclear. The government will announce its premium decision late this year, and next year brings an election.

The broker remains Neutral at this stage. Target falls to $5.22 from $6.40 on premium risk.

Target price is $5.22 Current Price is $4.99 Difference: $0.23
If NHF meets the Macquarie target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $6.20, suggesting upside of 24.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: 0.1

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

Ord Minnett rates PNI as Buy (1) -

The company is considered well-positioned to grow its earnings at over 20% in FY18 19-21, thanks to net inflows and acquisitions.

Ord Minnett continues to envisage a solid relative performance across a number of affiliates which reinforces its confidence in the medium-longer term.

Nevertheless, recent market volatility has taken around -12% off funds under management estimates and -22-23% off forecasts for earnings per share.

Buy rating maintained. Target is reduced to $6.78 from $8.00.

Target price is $6.78 Current Price is $5.74 Difference: $1.04
If PNI meets the Ord Minnett target it will return approximately 18% (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

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

Morgans reduces forecasts to reflect near-term challenges being caused by changes to Google search engine algorithms. The broker also includes forecasts for the TeePublic business that was recently acquired.

While this is mildly accretive to earnings the broker now factors in slower top-line growth and a higher proportion of paid traffic.

As the stock is trading in line with the revised target, reduced to $1.19 from $1.91, the rating is downgraded to Hold from Add.

Target price is $1.19 Current Price is $1.19 Difference: $0
If RBL meets the Morgans target it will return approximately 0% (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

Morgan Stanley rates SCG as Upgrade to Overweight from Underweight (1) -

The stock has underperformed its retail peer Vicinity Centres ((VCX)), Morgan Stanley observes, since the announcement it was fast approaching the debt ratio required by ratings agencies to maintain an A1 credit rating.

The broker's analysis suggests the company could minimise dilution by redeploying around 25% of sales proceeds into its ongoing buyback and maintain debt/EBITDA below 6.5x.

The broker's forecast for growth in a tough retail environment is boosted by developments. The broker envisages 10.3% upside to its $4.30 target and upgrades to Overweight from Underweight. Industry view is Cautious.

Target price is $4.30 Current Price is $4.03 Difference: $0.27
If SCG meets the Morgan Stanley target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $4.40, suggesting upside of 9.1% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY18:

Forecast for FY19:

Market Sentiment: 0.4

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

Ord Minnett rates SSM as Buy (1) -

The company will acquire Comdain Infrastructure, which provides critical utility infrastructure across Australia's east coast. Ord Minnett observes the business has all the required M&A criteria including scale, diversification, adjacent markets and a low-risk contracting model.

The broker estimates accretion to earnings per share of 4.6% in FY19 and 11.7% in FY20. Ord Minnett reiterates a Buy rating and $2.00 target.

Target price is $2.00 Current Price is $1.75 Difference: $0.25
If SSM meets the Ord Minnett target it will return approximately 14% (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

Morgan Stanley rates TRS as Underweight (5) -

The company has rejected the takeover offer and reiterated first half net profit guidance of $10-11m. The latter is based on the assumption that negative comparable sales trends will slightly improve in December.

Extracting the latest comparable sales, estimated to be down -3.1% in the year to date, Morgan Stanley believes there will be a follow-on impact to gross margins and this implies a further -10-15% downside to the mid range of the net profit guidance.

The takeover offer remains unconditional at the cash price of $2.70. Underweight rating, $2.10 target and In-Line industry view.

Target price is $2.10 Current Price is $2.78 Difference: minus $0.68 (current price is over target).
If TRS meets the Morgan Stanley target it will return approximately minus 24% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.46, suggesting downside of -11.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY19:

Forecast for FY20:

Market Sentiment: -0.5

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

Macquarie rates VOC as Underperform (5) -

New management's strategy is centred on driving growth from Enterprise & Wholesale while rationalising costs. The broker sees these internal ambitions as aggressive, and notes there are risks to implementation and cost-out objectives.

Capex will be required, and the broker is taking a more conservative approach. Target rises to $3.10 from $2.50 but the recent run for Vocus means Underperform retained.

Target price is $3.10 Current Price is $3.49 Difference: minus $0.39 (current price is over target).
If VOC 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 $2.96, suggesting downside of -15.2% (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

Morgans rates Z1P as Add (1) -

Morgans observes the company is on track to beat its FY19 goal of $1bn in annualised transaction volumes. Meanwhile, credit quality continues to improve.

The broker believes the performance continues to show considerable momentum with large merchants signing up, such as Wesfarmers' ((WES)) Target and Bunnings, which further adds to sales growth.

Morgans maintains a speculative Add rating and believes upside potential will emerge over the next few years. Target is raised to $1.20 from $1.09.

Target price is $1.20 Current Price is $1.09 Difference: $0.11
If Z1P meets the Morgans target it will return approximately 10% (excluding dividends, fees and charges).

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