Australian Broker Call

Morgan Stanley rates ABY as Overweight (1) -

Morgan Stanley reviews Australia's emerging companies in face of growing macro challenges, adopting a more conservative stance to account for higher uncertainty.

Rising interest rates and inflation are set to hit margins, and consumer demand; and growth trajectories are forecast to slow, hitting cash flows in the medium and longer term, says the broker.

Consumer-facing stocks are among the most vulnerable, says the broker, and tech stocks, particularly loss-making tech-plays, are likely to see further multiple compressions as rates rise.  

Adore Beauty is one of these, and the beauty category is more competitive than the general e-commerce category.

In April, Morgan Stanley held a target price of $4. Now it stands at $1.90. But the broker retains an Overweight rating given the company is a structural growth story, leveraged to online migration, and the category is defensive, boasting high frequency purchases, which support margins and long-term unit economics.

Target price is $1.90 Current Price is $1.22 Difference: $0.68
If ABY meets the Morgan Stanley target it will return approximately 56% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 1.0

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

Credit Suisse rates AGL as Outperform (1) -

Credit Suisse expects AGL Energy will revise down guidance for FY22 and FY23 after the June station outages.

The broker notes that since May, the Bayswater and Liddell power stations have been performing poorly at a time of exorbitant electricity prices and expects this will cost AGL -$150m.

The company has also announced that the Loy Yang A unit2 outage will continue to mid September - an extra six weeks.

This is expected to result in a working capital outflow in the second half as the company meets higher AEMO margin requirements and the broker sharply downgrades FY22 earnings forecasts.

On the upside, electricity futures are signalling big price increases in FY24 and the broker's earnings forecasts sit sharply above downgraded consensus.

Target price rises to $10.40 from $9.30. Outperform rating retained.

Target price is $10.40 Current Price is $8.55 Difference: $1.85
If AGL meets the Credit Suisse target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $9.44, suggesting upside of 12.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.4

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

Macquarie rates AIA as Outperform (1) -

Macquarie notes Auckland International Airport's near-term earnings will reflect the ongoing international passenger recovery, as airlines increase capacity and travel restrictions are rolled back. The broker anticipates international passengers will match pre-covid levels in late FY24.

The broker notes Auckland International Airport is consulting on aeronautical prices for the price setting event (PSE4). Macquarie believes the airport could lift aeronautical pricing 40% in FY24, while the likely commissioning of a new Domestic Jet terminal should also support a material lift to PSE5 pricing. 

The Outperform rating is retained and the target price increases to NZ$8.57 from NZ$7.95.

Current Price is $6.70. Target price not assessed.

Current consensus price target is $7.50, suggesting upside of 13.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

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

Market Sentiment: 0.5

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

UBS rates AMC as Buy (1) -

Despite numerous challenges for consumer packaging companies, UBS points out Amcor continues to deliver both consistent earnings and stable margins. This resilience is attributed to strong commercial management of raw materials and general cost inflation.

The analyst feels the company's premium rating versus peers is justified by a superior return on capital (ROC), balance sheet and dividend yield metrics.

Following a valuation roll forward and marking-to-market of foreign exchange exposures, the broker raises its target to $20.00 from $19.20 and retains a Buy rating.

Target price is $20.00 Current Price is $17.92 Difference: $2.08
If AMC meets the UBS target it will return approximately 12% (excluding dividends, fees and charges).

Current consensus price target is $18.46, suggesting upside of 2.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

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

Market Sentiment: 0.6

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

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

Morgan Stanley expects increasing interest rates and costs of interest rate hedging will drive increased costs across its Australian property coverage.

The broker has reduced FY24-25 earnings per share forecasts by an average -8-10% across its coverage, with stocks with higher existing debt being less impacted.

For Arena REIT, the Equal-weight rating is retained and the target price decreases to $4.25 from $4.60. Industry view is In-Line.

Target price is $4.25 Current Price is $4.51 Difference: minus $0.26 (current price is over target).
If ARF meets the Morgan Stanley target it will return approximately minus 6% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.41, suggesting downside of -1.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.3

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

Morgan Stanley rates AX1 as Overweight (1) -

Morgan Stanley reviews Australia's emerging companies in face of growing macro challenges, adopting a more conservative stance to account for higher uncertainty.

Rising interest rates and inflation are set to hit margins, and consumer demand; and growth trajectories are forecast to slow, hitting cash flows in the medium and longer term, says the broker.

Consumer-facing stocks are among the most vulnerable, says the broker, and tech stocks, particularly loss-making tech-plays, are likely to see further multiple compressions as rates rise.  

Accent Group is one of these. In April, Morgan Stanley held a target price of $2.70. Now it stands at $1.65.

But the broker retains an Overweight rating, pointing to the company's store roll-out, its leverage to the covid reopening and structural growth profile expecting active-wear and lifestyle categories will benefit from the work-from-home theme.

Target price is $1.65 Current Price is $1.30 Difference: $0.35
If AX1 meets the Morgan Stanley target it will return approximately 27% (excluding dividends, fees and charges).

Current consensus price target is $1.49, suggesting upside of 20.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.3

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

Morgan Stanley rates BBN as Overweight (1) -

Morgan Stanley reviews Australia's emerging companies in face of growing macro challenges, adopting a more conservative stance to account for higher uncertainty.

Rising interest rates and inflation are set to hit margins, and consumer demand; and growth trajectories are forecast to slow, hitting cash flows in the medium and longer term, says the broker.

Consumer-facing stocks are among the most vulnerable, says the broker, and tech stocks, particularly loss-making tech-plays, are likely to see further multiple compressions as rates rise.  

Baby Bunting is one of these and while the company is well positioned to benefit from store roll-outs and possible margin improvement, weaker consumer demand is likely to weigh.

In February, Morgan Stanley held a target price of $6.90. Now, the target price is lowered to $6. Overweight rating retained.

Target price is $6.90 Current Price is $4.25 Difference: $2.65
If BBN meets the Morgan Stanley target it will return approximately 62% (excluding dividends, fees and charges).

Current consensus price target is $6.39, suggesting upside of 60.9% (ex-dividends)

The company's fiscal year ends in July.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 1.0

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

Macquarie rates BHP as Outperform (1) -

BHP Group has announced details of its new social value framework, which Macquarie notes consists of six pillars across decarbonisation, environment, Indigenous partnerships, workforce, communities and supply chains. 

The announcement included BHP Group's first biodiversity target, with the company aiming for at least 30% of its land and water to be operating under nature positive practices by 2030. Progress of its social value framework will be tracked by a new 2030 scorecard, including near-term milestones. 

Macquarie also highlights elevated energy costs may drive momentum in the energy transition across the sector. The Outperform rating and target price of $51.00 are retained.

Target price is $51.00 Current Price is $42.98 Difference: $8.02
If BHP meets the Macquarie target it will return approximately 19% (excluding dividends, fees and charges).

Current consensus price target is $46.05, suggesting upside of 7.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

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

Morgan Stanley rates BWP as Underweight (5) -

Morgan Stanley expects increasing interest rates and costs of interest rate hedging will drive increased costs across its Australian property coverage.

The broker has reduced FY24-25 earnings per share forecasts by an average -8-10% across its coverage, with stocks with higher existing debt being less impacted.

Underweight rating retained for BWP Trust. The target falls to $3.60 from 3.75. Industry view: In-Line.

Target price is $3.60 Current Price is $4.13 Difference: minus $0.53 (current price is over target).
If BWP meets the Morgan Stanley target it will return approximately minus 13% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $3.70, suggesting downside of -6.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: -0.5

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

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

Following a FY22 guidance downgrade by BWX, Citi downgrades its rating to Neutral from Buy and slashes its target price to $0.75 from $2.76 after a change in valuation methodology.

The analyst feels a turnaround will be difficult in the face of a weakening consumer environment and inflationary pressures. It's also thought the put option for the Go-To founders is an ongoing overhang for the stock.

The broker also sees potential for disappointing revenues given BWX is less likely to invest ahead of the curve.

Target price is $0.75 Current Price is $0.70 Difference: $0.05
If BWX meets the Citi target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $1.33, suggesting upside of 96.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.7

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

Macquarie rates BWX as Outperform (1) -

Having decided not to sell into certain channels, BWX highlighted a strategic review of digital channels will be a priority in the next financial year. In Macquarie's opinion, BWX is sacrificing sales for working capital and the decision is likely reflective of balance sheet concerns.

The broker notes while BWX's digital channels are expected to provide $3m in sales in FY23, maintaining channels is a drag on company resources. $23.2m in capital has been raised to accelerate debt reduction, guiding to net debt of -$58-62m by June compared to the -$82m pre-capital raising. 

The rating is downgraded to Neutral from Outperform and the target price decreases to $0.70 from $2.20.

Target price is $0.70 Current Price is $0.70 Difference: $0
If BWX meets the Macquarie target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $1.33, suggesting upside of 96.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.7

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

Morgans rates CAR as Hold (3) -

Carsales released a trading update broadly in-line with Morgans forecasts. Management also announced the exercise of a call option to acquire the remaining 51% of US-based Trader Interactive for around -$1.2bn, via an equity raise.

The broker likes the strategic rationale for the transaction which includes strong recent growth for Trader Interactive and the large total addressable market in US non-auto. Trader Interactive is the market leader in both RV and powersports.

While the transaction will be mid-single digit EPS accretive, the analyst points out this relies on positive tax impacts and other near-term offsetting items. The price target falls to $22.15 from $23.72. Hold.

Target price is $22.15 Current Price is $20.76 Difference: $1.39
If CAR meets the Morgans target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $22.82, suggesting upside of 24.9% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.5

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

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

Morgan Stanley expects increasing interest rates and costs of interest rate hedging will drive increased costs across its Australian property coverage.

The broker has reduced FY24-25 earnings per share forecasts by an average -8-10% across its coverage, with stocks with higher existing debt being less impacted.

For Charter Hall, the Equal-weight rating is retained and the target price decreases to $13.45 from $15.17.

Target price is $13.45 Current Price is $11.71 Difference: $1.74
If CHC meets the Morgan Stanley target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $16.98, suggesting upside of 50.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.8

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

Morgan Stanley rates CIP as Downgrade to Equal-weight from Overweight (3) -

Morgan Stanley expects increasing interest rates and costs of interest rate hedging will drive increased costs across its Australian property coverage.

The broker has reduced FY24-25 earnings per share forecasts by an average -8-10% across its coverage, with stocks with higher existing debt being less impacted.

For Centuria Industrial REIT, the rating is downgraded to Equal-weight from Overweight and the target price decreases to $3.25 from $4.35.

Target price is $3.25 Current Price is $3.03 Difference: $0.22
If CIP meets the Morgan Stanley target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $3.68, suggesting upside of 29.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.4

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

Macquarie rates CKF as Outperform (1) -

Collins Foods' full year result has indicated strong growth from KFC Europe, including same store sales growth of 16.8%, while KFC Australia reported minimal top line growth of 1.4% for the year.

Macquarie notes KFC Australia made some delivery market share gains as it continues to rollout Uber Eats across the store network. 

The company anticipates headwind pressures will impact across the group in the near-term, with increasing costs expected to weight on margins. 

The Outperform rating is retained and the target price decreases to $11.50 from $14.80.

Target price is $11.50 Current Price is $9.97 Difference: $1.53
If CKF meets the Macquarie target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $11.10, suggesting upside of 10.8% (ex-dividends)

The company's fiscal year ends in May.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.7

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

Morgans rates CKF as Upgrade to Add from Hold (1) -

Morgans upgrades its rating for Collins Foods to Add from Hold after FY22 results were a 5% beat for earnings (EBITDA) compared to the prior estimate. KFC Europe was considered the standout performer, and KFC Australia also performed well.

The analyst feels the current share price represents good value. It's thought consumer demand will remain resilient and the company will utilise its pricing power to help mitigate inflation.

After applying lower peer company multiples and a higher discount rate, the broker's target price falls to $11.50 from $14.70.

Target price is $11.50 Current Price is $9.97 Difference: $1.53
If CKF meets the Morgans target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $11.10, suggesting upside of 10.8% (ex-dividends)

The company's fiscal year ends in May.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.7

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

UBS rates CKF as Neutral (3) -

UBS assesses a strong FY22 result and momentum into FY23 for Collins Foods though estimates short-term risk/reward is evenly balanced and retains its Neutral rating. The target price increases to $10.30 from $9.15.

The broker's margin compression concerns eased slightly following a price increase this month. Management suggests one more is likely before the end of 2022 to help partially offset further cost inflation from the poultry contract renegotiation.

Target price is $10.30 Current Price is $9.97 Difference: $0.33
If CKF meets the UBS target it will return approximately 3% (excluding dividends, fees and charges).

Current consensus price target is $11.10, suggesting upside of 10.8% (ex-dividends)

The company's fiscal year ends in May.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 0.7

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

Morgan Stanley rates CLW as Downgrade to Equal-weight from Overweight (3) -

Morgan Stanley expects increasing interest rates and costs of interest rate hedging will drive increased costs across its Australian property coverage.

The broker has reduced FY24-25 earnings per share forecasts by an average -8-10% across its coverage, with stocks with higher existing debt being less impacted.

For Charter Hall Long WALE REIT, the rating is downgraded to Equal-weight from Overweight and the target price decreases to $4.65 from $5.85.

Target price is $4.65 Current Price is $4.64 Difference: $0.01
If CLW meets the Morgan Stanley target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $5.04, suggesting upside of 16.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.3

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

Morgan Stanley rates CNI as Overweight (1) -

Morgan Stanley expects increasing interest rates and costs of interest rate hedging will drive increased costs across its Australian property coverage.

The broker has reduced FY24-25 earnings per share forecasts by an average -8-10% across its coverage, with stocks with higher existing debt being less impacted.

For Centuria Capital, the Overweight rating is retained and the target price decreases to $2.50 from $3.45.

Target price is $2.50 Current Price is $1.99 Difference: $0.51
If CNI meets the Morgan Stanley target it will return approximately 26% (excluding dividends, fees and charges).

Current consensus price target is $2.43, suggesting upside of 27.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.7

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

Macquarie rates COE as Neutral (3) -

Cooper Energy is set to purchase Orbost Gas Plant for up to -$330m, having raised $244m in new capital. Macquarie notes while the company paid full price for the plant, the purchase should allow Cooper Energy to pursue exploration opportunities. 

The company has lifted capital expenditure guidance for both the Basker Manta Gummy and Orbost's OP3D projects, while the broker also now assumes -$200m in capital expenditure to pursue exploration at Otway.

The Neutral rating is retained and the target price decreases to $0.24 from $0.26.

Target price is $0.24 Current Price is $0.25 Difference: minus $0.01 (current price is over target).
If COE meets the Macquarie target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $0.28, suggesting upside of 10.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.1

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

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

Morgan Stanley expects increasing interest rates and costs of interest rate hedging will drive increased costs across its Australian property coverage.

The broker has reduced FY24-25 earnings per share forecasts by an average -8-10% across its coverage, with stocks with higher existing debt being less impacted.

For Centuria Office REIT, the Equal-weight rating is retained and the target price decreases to $1.95 from $2.30.

Target price is $1.95 Current Price is $1.84 Difference: $0.11
If COF meets the Morgan Stanley target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $2.13, suggesting upside of 23.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.5

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

Credit Suisse rates CPU as Outperform (1) -

Credit Suisse notes Computershare is continuing to benefit from the kick-up to its margin income from high interest rates and inflation, but says inflation comes with its own challenges outside of margins.

The broker says the underlying business benefits from low inflation and, fortunately for Computershare investors, expects inflation will return to the 3% to 4% range and help stabilise earnings (EBIT).

The broker expects the company will exceed guidance in FY22 and upgrades EPS forecasts 2% in FY22, 38% in FY23 and 34% in FY24, despite -20% downgrades to EBIT.

Outperform rating and $27 target price retained.

Target price is $27.00 Current Price is $24.45 Difference: $2.55
If CPU meets the Credit Suisse target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $26.47, suggesting upside of 7.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

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

Morgan Stanley rates CQR as Underweight (5) -

Morgan Stanley expects increasing interest rates and costs of interest rate hedging will drive increased costs across its Australian property coverage.

The broker has reduced FY24-25 earnings per share forecasts by an average -8-10% across its coverage, with stocks with higher existing debt being less impacted.

The rating for Charter Hall Retail REIT remains Underweight with a revised price target of $3.90, down from $4.12. Industry view is In-Line.

Target price is $3.90 Current Price is $4.04 Difference: minus $0.14 (current price is over target).
If CQR meets the Morgan Stanley target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.19, suggesting upside of 9.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.1

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

Morgan Stanley rates CTD as Overweight (1) -

Morgan Stanley reviews Australia's emerging companies in the face of growing macro challenges, adopting a more conservative stance to account for higher uncertainty.

Rising interest rates and inflation are set to hit margins, and consumer demand; and growth trajectories are forecast to slow, hitting cash flows in the medium and longer term, says the broker.

Consumer-facing stocks are among the most vulnerable, says the broker, and tech stocks, particularly loss-making tech-plays, are likely to see further multiple compressions as rates rise.  

Corporate Travel Management is one of these, and the broker says it has emerged leaner and more competitive and is Morgan Stanley's top reopening pick for 2022.

In May, Morgan Stanley held a target price of $30. Now it stands at $29.00. Overweight rating retained, the broker noting a more consolidated industry structure favours scale players, and the company is forecast to increase market share and benefit from lower costs.

Target price is $29.00 Current Price is $18.89 Difference: $10.11
If CTD meets the Morgan Stanley target it will return approximately 54% (excluding dividends, fees and charges).

Current consensus price target is $27.03, suggesting upside of 44.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.8

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

Morgan Stanley rates DXS as Overweight (1) -

Morgan Stanley expects increasing interest rates and costs of interest rate hedging will drive increased costs across its Australian property coverage.

The broker has reduced FY24-25 earnings per share forecasts by an average -8-10% across its coverage, with stocks with higher existing debt being less impacted.

For Dexus, the Overweight rating is retained and the target price decreases to $11.20 from $12.57.

Target price is $11.20 Current Price is $9.50 Difference: $1.7
If DXS meets the Morgan Stanley target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $11.03, suggesting upside of 21.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.4

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

Morgan Stanley rates ELO as Overweight (1) -

Morgan Stanley reviews Australia's emerging companies in the face of growing macro challenges, adopting a more conservative stance to account for higher uncertainty.

Rising interest rates and inflation are set to hit margins, and consumer demand; and growth trajectories are forecast to slow, hitting cash flows in the medium and longer term, says the broker.

Consumer-facing stocks are among the most vulnerable, says the broker, and tech stocks, particularly loss-making tech-plays, are likely to see further multiple compressions as rates rise.  

Elmo Software is one of these, and the broker believes the company can scale faster than the market anticipates and enjoys stickiness and strong upselling while being insulated from global competition. The big uncertainty is cash burn.

In May, Morgan Stanley held a target price of $6.70. Now it stands at $3.50. Overweight rating retained.

Target price is $3.50 Current Price is $2.24 Difference: $1.26
If ELO meets the Morgan Stanley target it will return approximately 56% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 1.0

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

UBS rates EVN as Buy (1) -

UBS lowers its FY23/24 production forecasts by -13 /10% for Evolution Mining following a disappointing guidance update. Forecasts for all-in sustaining costs (AISC) are also increased by 25%/5% for those same financial years.

Slower ramp-ups at Red Lake and Cowal and delays to growth at Mungari have reduced production, explains the analyst. Cost inflation has resulted from higher labour, diesel and power costs, while lower copper production from Ernest Henry has reduced copper credits.

As a result of amended forecasts, the broker's target price falls -27% to $2.95, while the Buy rating is retained.

Target price is $2.95 Current Price is $2.58 Difference: $0.37
If EVN meets the UBS target it will return approximately 14% (excluding dividends, fees and charges).

Current consensus price target is $3.39, suggesting upside of 40.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.1

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

Morgan Stanley rates GMG as Overweight (1) -

Morgan Stanley expects increasing interest rates and costs of interest rate hedging will drive increased costs across its Australian property coverage.

The broker has reduced FY24-25 earnings per share forecasts by an average -8-10% across its coverage, with stocks with higher existing debt being less impacted.

For Goodman Group, the Overweight rating is retained and the target price decreases to $23.70 from $25.98.

Target price is $23.70 Current Price is $18.99 Difference: $4.71
If GMG meets the Morgan Stanley target it will return approximately 25% (excluding dividends, fees and charges).

Current consensus price target is $23.86, suggesting upside of 30.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.7

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

Morgan Stanley rates GPT as Downgrade to Underweight from Equal-weight (5) -

Morgan Stanley expects increasing interest rates and costs of interest rate hedging will drive increased costs across its Australian property coverage.

The broker has reduced FY24-25 earnings per share forecasts by an average -8-10% across its coverage, with stocks with higher existing debt being less impacted.

Industry view is In-Line. GPT Group's rating has moved to Underweight from Equal-weight. Price target declines to $4.30 from $5.51.

Target price is $4.30 Current Price is $4.59 Difference: minus $0.29 (current price is over target).
If GPT meets the Morgan Stanley target it will return approximately minus 6% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.90, suggesting upside of 12.3% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: -0.2

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

Morgan Stanley rates HCW as Downgrade to Equal-weight from Overweight (3) -

Morgan Stanley expects increasing interest rates and costs of interest rate hedging will drive increased costs across its Australian property coverage.

The broker has reduced FY24-25 earnings per share forecasts by an average -8-10% across its coverage, with stocks with higher existing debt being less impacted.

For HealthCo Healthcare & Wellness REIT, the rating is downgraded to Equal-weight from Overweight and the target price decreases to $1.70 from $2.45.

Target price is $1.70 Current Price is $1.54 Difference: $0.16
If HCW meets the Morgan Stanley target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $2.10, suggesting upside of 48.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.7

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

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

Morgan Stanley reviews Australia's emerging companies in the face of growing macro challenges, adopting a more conservative stance to account for higher uncertainty.

Rising interest rates and inflation are set to hit margins, and consumer demand; and growth trajectories are forecast to slow, hitting cash flows in the medium and longer term, says the broker.

Consumer-facing stocks are among the most vulnerable, says the broker, and tech stocks, particularly loss-making tech-plays, are likely to see further multiple compressions as rates rise.  

Invocare is one of these. The broker appreciates the company's strong defensive profile and attractive long-term structural growth prospects. But near-term transformation risks weigh and capital expenditure is expected to drag.

In May, Morgan Stanley held a target price of $13. Now it stands at $11.25. Equal-Weight rating retained.

Target price is $11.25 Current Price is $10.69 Difference: $0.56
If IVC meets the Morgan Stanley target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $12.70, suggesting upside of 20.8% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.0

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

Macquarie rates JMS as Outperform (1) -

Macquarie has described a mixed operating performance from Jupiter Mines in the first quarter, with strong production but lower shipments, while realised prices missed the broker's expectations but were largely offset by lower costs. 

Manganese prices rallied in the quarter, and Macquarie notes a spot price scenario could drive 50% earnings upside. 

The broker highlighted earnings from Tshipi of $58.9m were a 14% beat to forecasts, and noted consolidation potential in Tshipi and the Kalahari Manganese Fields which could be a potential catalyst for the company. 

The Outperform rating and target price of $0.30 are retained.

Target price is $0.30 Current Price is $0.20 Difference: $0.1
If JMS meets the Macquarie target it will return approximately 50% (excluding dividends, fees and charges).

The company's fiscal year ends in February.

Forecast for FY23:

Forecast for FY24:

Market Sentiment: 1.0

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

Morgan Stanley rates KMD as Overweight (1) -

Morgan Stanley reviews Australia's emerging companies in the face of growing macro challenges, adopting a more conservative stance to account for higher uncertainty.

Rising interest rates and inflation are set to hit margins, and consumer demand; and growth trajectories are forecast to slow, hitting cash flows in the medium and longer term, says the broker.

Consumer-facing stocks are among the most vulnerable, says the broker, and tech stocks, particularly loss-making tech-plays, are likely to see further multiple compressions as rates rise.  

KMD Brands is one of these, but the broker notes it is leveraged to the covid reopening and shift to outdoor activities, and appreciates the repaired balance sheet and cheap valuation.

The target price is $1.35. Overweight rating retained.

Target price is $1.35 Current Price is $1.05 Difference: $0.3
If KMD meets the Morgan Stanley target it will return approximately 29% (excluding dividends, fees and charges).

The company's fiscal year ends in July.

Forecast for FY22:

Forecast for FY23:

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

Market Sentiment: 0.5

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

Credit Suisse rates LFG as Downgrade to Neutral from Outperform (3) -

Credit Suisse reviews the non-bank financial sector and spies difficult times ahead as rising funding costs hit net interest margins, the outlook for credit origination blurs, and the likelihood of loan impairments rises. 

The broker says the funding environment has deteriorated faster than expected and that loan growth forecasts are also weakening as higher interest rates and lower property prices come to bear.

Liberty Financial's EPS forecasts are downgraded -4% in FY22, -28% for FY23 and -29% for FY24, but the broker says value remains and recognises risks are already amply priced in to the current share price.

Rating downgraded to Neutral from Outperform. Target price cut to $4.55 from $7.

Target price is $4.55 Current Price is $4.30 Difference: $0.25
If LFG meets the Credit Suisse target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $5.60, suggesting upside of 39.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.7

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

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

Morgan Stanley expects increasing interest rates and costs of interest rate hedging will drive increased costs across its Australian property coverage.

The broker has reduced FY24-25 earnings per share forecasts by an average -8-10% across its coverage, with stocks with higher existing debt being less impacted.

For Lendlease Group, the Equal-weight rating is retained and the target price decreases to $11.20 from $11.40.

Target price is $11.20 Current Price is $9.32 Difference: $1.88
If LLC meets the Morgan Stanley target it will return approximately 20% (excluding dividends, fees and charges).

Current consensus price target is $12.49, suggesting upside of 34.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.8

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

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

Morgan Stanley expects increasing interest rates and costs of interest rate hedging will drive increased costs across its Australian property coverage.

The broker has reduced FY24-25 earnings per share forecasts by an average -8-10% across its coverage, with stocks with higher existing debt being less impacted.

For Mirvac Group, the Equal-weight rating is retained and the target price decreases to $2.30 from $2.60.

Target price is $2.30 Current Price is $2.12 Difference: $0.18
If MGR meets the Morgan Stanley target it will return approximately 8% (excluding dividends, fees and charges).

Current consensus price target is $2.61, suggesting upside of 28.6% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.8

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

Morgan Stanley rates MMS as Overweight (1) -

Morgan Stanley reviews Australia's emerging companies in the face of growing macro challenges, adopting a more conservative stance to account for higher uncertainty.

Rising interest rates and inflation are set to hit margins, and consumer demand; and growth trajectories are forecast to slow, hitting cash flows in the medium and longer term, says the broker.

Consumer-facing stocks are among the most vulnerable, says the broker, and tech stocks, particularly loss-making tech-plays, are likely to see further multiple compressions as rates rise.  

McMillan Shakespeare is one of these, and the broker appreciates the company's undemanding valuation, stable core business and potential for structural growth and greater operating leverage.

In February, Morgan Stanley held a target price of $14. Now it stands at $12.50. Overweight rating retained.

Target price is $12.50 Current Price is $9.74 Difference: $2.76
If MMS meets the Morgan Stanley target it will return approximately 28% (excluding dividends, fees and charges).

Current consensus price target is $13.11, suggesting upside of 36.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.5

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

Morgan Stanley rates NSR as Downgrade to Underweight from Equal-weight (5) -

Morgan Stanley expects increasing interest rates and costs of interest rate hedging will drive increased costs across its Australian property coverage.

The broker has reduced FY24-25 earnings per share forecasts by an average -8-10% across its coverage, with stocks with higher existing debt being less impacted.

National Storage REIT has been downgraded to Underweight from Equal-weight with a revised price target of $2.15 from $2.50. Industry view is In-Line.

Target price is $2.15 Current Price is $2.32 Difference: minus $0.17 (current price is over target).
If NSR meets the Morgan Stanley target it will return approximately minus 7% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.37, suggesting upside of 8.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.0

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

Citi rates NST as Buy (1) -

Citi runs the numbers on Northern Star Resources' mill expansion study (cost -$1bn) at KCGM and agrees the expansion can be funded from cash, while the dividend policy is maintained.

The company remains the broker's top pick in the Gold sector on expectations of over 10% in free cash flow for the next few years. However, cost forecasts have been raised for next year and the target price slips to $11.60 from $12.10.

Target price is $11.60 Current Price is $7.45 Difference: $4.15
If NST meets the Citi target it will return approximately 56% (excluding dividends, fees and charges).

Current consensus price target is $11.39, suggesting upside of 62.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 1.0

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

Credit Suisse rates NST as Outperform (1) -

Northern Star Resources' findings on its KCGM mill expansion reveals a preference for the 24Mtpa option, which aligns fairly well with Credit Suisse's forecast for a 22Mtpa expansion.

However, capital expenditure forecasts and an expected delay in the build lead to downgrades in the internal rate of return.

Target price falls to $11 from $11.50. Outperform rating retained. 

Target price is $11.00 Current Price is $7.45 Difference: $3.55
If NST meets the Credit Suisse target it will return approximately 48% (excluding dividends, fees and charges).

Current consensus price target is $11.39, suggesting upside of 62.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 1.0

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

Macquarie rates NST as Outperform (1) -

Northern Star Resources has revealed three expansion options for the Super Pit that Macquarie notes could see production lift by as much as 200,000 ounces per annum. 

The three options would see the mill capacity lift from a current 13m tonnes per annum capacity to 17m tonnes, 22m tonnes or 24m tonnes. Development of a new plant would facilitates the lift to 22m tonnes capacity, with both other options involving expansion of the existing facility.

Capital requirements range from $400-1,400m, but Macquarie expects expansion facilitating the largest capacity increase to be most likely, with this option likely to require $1,000m ($1bn) in capital. 

The Outperform rating and target price of $11.00 are retained.

Target price is $11.00 Current Price is $7.45 Difference: $3.55
If NST meets the Macquarie target it will return approximately 48% (excluding dividends, fees and charges).

Current consensus price target is $11.39, suggesting upside of 62.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 1.0

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

Credit Suisse rates ORG as Neutral (3) -

Credit Suisse expects earnings (EBITDA) for energy markets will fall at the bottom end of consensus after the June scandal.

The broker estimates Origin Energy's short coal/electricity position would have cost it -$61m, compares to the more normal Eraring operation, but given the coal shortage was public knowledge at the time of the last update, estimates that at least half of this has been incorporated into guidance.

On the upside, the broker expects FY24 will improve. The broker reduces FY22 estimates, and increases FY24 earnings (EBITDA) forecasts by 10%.

Target price rises to $6.30 from $6.10. Neutral rating retained.

Target price is $6.30 Current Price is $5.93 Difference: $0.37
If ORG meets the Credit Suisse target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $6.54, suggesting upside of 10.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.3

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

Credit Suisse rates PPM as Outperform (1) -

Credit Suisse reviews the non-bank financial sector and spies difficult times ahead as rising funding costs hit net interest margins, the outlook for credit origination blurs, and the likelihood of loan impairments rises. 

The broker says the funding environment has deteriorated faster than expected and that loan growth forecasts are also weakening as higher interest rates and lower property prices come to bear.

Pepper Money's EPS forecasts are downgraded -21% in 2022, -33% for FY23 and -31% for FY24.

The broker recognises the above risks are already amply priced in to the current share price and that the valuation discount is sufficiently compelling to warrant a positive investment stance.

Outperform rating retained. Target price cut to $1.85 from $2.95.

Target price is $1.85 Current Price is $1.32 Difference: $0.53
If PPM meets the Credit Suisse target it will return approximately 40% (excluding dividends, fees and charges).

The company's fiscal year ends in December.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 1.0

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

Morgan Stanley rates PWR as Overweight (1) -

Morgan Stanley reviews Australia's emerging companies in the face of growing macro challenges, adopting a more conservative stance to account for higher uncertainty.

Rising interest rates and inflation are set to hit margins, and consumer demand; and growth trajectories are forecast to slow, hitting cash flows in the medium and longer term, says the broker.

Consumer-facing stocks are among the most vulnerable, says the broker, and tech stocks, particularly loss-making tech-plays, are likely to see further multiple compressions as rates rise.  

Peter Warren Automotive is one of these, and the broker admires its organic growth profile coupled with strategic and inorganic tailwinds. 

In February, Morgan Stanley held a target price of $4.20. Now it stands at $2.90. Overweight rating retained but the broker is keeping an eye peeled to rising inflation, rates and other macro challenges.

Target price is $2.90 Current Price is $2.20 Difference: $0.7
If PWR meets the Morgan Stanley target it will return approximately 32% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 1.0

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

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

Morgan Stanley reviews Australia's emerging companies in the face of growing macro challenges, adopting a more conservative stance to account for higher uncertainty.

Rising interest rates and inflation are set to hit margins, and consumer demand; and growth trajectories are forecast to slow, hitting cash flows in the medium and longer term, says the broker.

Consumer-facing stocks are among the most vulnerable, says the broker, and tech stocks, particularly loss-making tech-plays, are likely to see further multiple compressions as rates rise.  

Redbubble is one of these. The broker admires the valuation, balance sheet and prospects, but notes pressures are mounting.

In May, Morgan Stanley held a target price of $1.30. Now it stands at $1.00. Equal-Weight rating retained, the broker awaiting further clarity on costs.

Target price is $1.00 Current Price is $0.92 Difference: $0.08
If RBL meets the Morgan Stanley target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $1.50, suggesting upside of 66.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.3

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

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

Morgan Stanley expects increasing interest rates and costs of interest rate hedging will drive increased costs across its Australian property coverage.

The broker has reduced FY24-25 earnings per share forecasts by an average -8-10% across its coverage, with stocks with higher existing debt being less impacted.

For Scentre Group, the Equal-weight rating is retained and the target price decreases to $2.90 from $3.18.

Target price is $2.90 Current Price is $2.73 Difference: $0.17
If SCG meets the Morgan Stanley target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $2.93, suggesting upside of 8.1% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.3

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

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

Morgan Stanley expects increasing interest rates and costs of interest rate hedging will drive increased costs across its Australian property coverage.

The broker has reduced FY24-25 earnings per share forecasts by an average -8-10% across its coverage, with stocks with higher existing debt being less impacted.

For Shopping Centres Australasia, the Equal-weight rating is retained and the target price decreases to $2.75 from $3.10.

Target price is $2.75 Current Price is $2.93 Difference: minus $0.18 (current price is over target).
If SCP meets the Morgan Stanley target it will return approximately minus 6% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.88, suggesting upside of 3.7% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: -0.2

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

Morgan Stanley rates SGP as Overweight (1) -

Morgan Stanley expects increasing interest rates and costs of interest rate hedging will drive increased costs across its Australian property coverage.

The broker has reduced FY24-25 earnings per share forecasts by an average -8-10% across its coverage, with stocks with higher existing debt being less impacted.

For Stockland, the Overweight rating is retained and the target price decreases to $4.75 from $5.05.

Target price is $4.75 Current Price is $3.94 Difference: $0.81
If SGP meets the Morgan Stanley target it will return approximately 21% (excluding dividends, fees and charges).

Current consensus price target is $4.63, suggesting upside of 25.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.7

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

Credit Suisse rates TAH as Outperform (1) -

Credit Suisse believes Tabcorp is well-positioned in the event of an industry restructure, noting that the company's lowest margin business is in Victoria, and about 80% of the Victorian wagering revenue is sourced digitally.

This places the company in a strong position heading into renegotiation of its Victorian licence, which expires in August 2024, says the broker, given push comes to shove, it can migrate 80% of its Victorian revenue to a lower cost jurisdiction (not 60% as the broker previously believed).

Meanwhile, wagering and media revenue are meeting second-half forecasts; a new app is forthcoming that streamlines regulatory approvals; and the media and international business is a sustainable, high margin operation, posits the broker.

FY22 EPS forecasts are lowered. Outperform rating and $1.30 target price retained.

Target price is $1.30 Current Price is $1.08 Difference: $0.22
If TAH meets the Credit Suisse target it will return approximately 20% (excluding dividends, fees and charges).

Current consensus price target is $1.12, suggesting upside of 2.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.2

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

Macquarie rates TAH as Neutral (3) -

Tabcorp Holdings has provided further detail around strategy post-demerger, with Macquarie noting the company looks to become more competitive with a new wagering app, with Tabcorp targeting a launch before the September Spring Racing carnival.

The broker also expects wagering regulatory reforms will benefit Tabcorp. Reforms should gradually address the 23% premium Tabcorp  pays in taxes, agency and industry fees above corporate bookmakers.  

The Outperform rating is retained and the target price increases to $1.20 from $1.05.

Target price is $1.20 Current Price is $1.08 Difference: $0.12
If TAH meets the Macquarie target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $1.12, suggesting upside of 2.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.2

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

Ord Minnett rates TAH as Hold (3) -

Following Tabcorp's investor day, Ord Minnett maintains its Hold rating and notes a lot needs to go right for the business. This view is based upon CEO Adam Rytenskild comments regarding the company operating in the most competitive industry in Australia.

News Corp's ((NWS)) upcoming entry into the Australian market is sure to increase competition, notes the analyst. More positively, it's thought Tabcorp may gain customers if smaller bookmakers begin consolidation.

The target price is increased to $1.15 from $1.10.

Target price is $1.15 Current Price is $1.08 Difference: $0.07
If TAH meets the Ord Minnett target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $1.12, suggesting upside of 2.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.2

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

UBS rates TGR as Buy (1) -

Cooke Inc. has made another non-binding indicative bid for Tassal Group at $4.85/share following prior bids at $4.67 and $4.80.

The Tassal Group board refuses to engage believing the proposal does not reflect the fundamental value of the business.

UBS maintains its Buy rating and $4.10 price target sustained by an improved outlook for pricing and cash flow.

Target price is $4.10 Current Price is $4.61 Difference: minus $0.51 (current price is over target).
If TGR meets the UBS target it will return approximately minus 11% (excluding dividends, fees and charges - negative figures indicate an expected loss).

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

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 Overweight (1) -

Morgan Stanley reviews Australia's emerging companies in the face of growing macro challenges, adopting a more conservative stance to account for higher uncertainty.

Rising interest rates and inflation are set to hit margins, and consumer demand; and growth trajectories are forecast to slow, hitting cash flows in the medium and longer term, says the broker.

Consumer-facing stocks are among the most vulnerable, says the broker, and tech stocks, particularly loss-making tech-plays, are likely to see further multiple compressions as rates rise.  

Reject Shop is one of these, and the broker is factoring in slower margin acceleration as inflation bites. 

In June, Morgan Stanley held a target price of $9.50. Now it stands at $5. Overweight rating retained. The broker acknowledges the risk but perceives the company to be a leader in a fragmented, attractive market, the dollar-store niche outperforming globally.

Target price is $5.00 Current Price is $3.53 Difference: $1.47
If TRS meets the Morgan Stanley target it will return approximately 42% (excluding dividends, fees and charges).

Current consensus price target is $5.17, suggesting upside of 49.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.3

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

Morgan Stanley rates TUA as Overweight (1) -

Morgan Stanley reviews Australia's emerging companies in the face of growing macro challenges, adopting a more conservative stance to account for higher uncertainty.

Rising interest rates and inflation are set to hit margins, and consumer demand; and growth trajectories are forecast to slow, hitting cash flows in the medium and longer term, says the broker.

Consumer-facing stocks are among the most vulnerable, says the broker, and tech stocks, particularly loss-making tech-plays, are likely to see further multiple compressions as rates rise.  

Tuas is one of these. The broker admires the company's disruptive nature, strong profitability and stellar margins.

In March, Morgan Stanley held a target price of $2.20. Now it stands at $1.65. Overweight rating retained.

Target price is $1.65 Current Price is $1.19 Difference: $0.46
If TUA meets the Morgan Stanley target it will return approximately 39% (excluding dividends, fees and charges).

The company's fiscal year ends in July.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 1.0

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

Morgan Stanley rates VCX as Underweight (5) -

Morgan Stanley expects increasing interest rates and costs of interest rate hedging will drive increased costs across its Australian property coverage.

The broker has reduced FY24-25 earnings per share forecasts by an average -8-10% across its coverage, with stocks with higher existing debt being less impacted.

For Vicinity Centres, the Underweight rating is retained and the target price decreases to $1.80 from $1.82.

Target price is $1.80 Current Price is $1.92 Difference: minus $0.12 (current price is over target).
If VCX meets the Morgan Stanley target it will return approximately minus 6% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $1.90, suggesting downside of -1.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.0

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

Morgan Stanley rates WPR as Underweight (5) -

Morgan Stanley expects increasing interest rates and costs of interest rate hedging will drive increased costs across its Australian property coverage.

The broker has reduced FY24-25 earnings per share forecasts by an average -8-10% across its coverage, with stocks with higher existing debt being less impacted.

Industry view is In-Line. Waypoint REIT remains on Underweight. Price target falls to $2.20 from $2.70.

Target price is $2.20 Current Price is $2.42 Difference: minus $0.22 (current price is over target).
If WPR meets the Morgan Stanley target it will return approximately minus 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.76, suggesting upside of 17.8% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.2

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