Australian Broker Call

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

UBS upgrades its rating for Allkem to Buy from Neutral on improved lithium pricing, tightening realisations and higher valuation. First half results were a beat versus the broker's forecasts though in-line with the consensus estimates.

Management left FY22 production guidance unchanged, but lifted 2H FY22 lithium carbonate price guidance to US$25,000/t versus the prior estimate of US$23,500/t by UBS.

The target price rises to $12.40 from $11.20 after the broker lifts FY22 earnings by 3% and forecasts better pricing and higher net cash.

Target price is $12.40 Current Price is $9.70 Difference: $2.7
If AKE meets the UBS target it will return approximately 28% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY22:

Forecast for FY23:

Market Sentiment: 0.9

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

Credit Suisse rates ALQ as Outperform (1) -

ALS Ltd has boosted FY22 guidance causing Credit Suisse to raise its FY22 EPS forecast by 2.6% and increase the target price to $15.05 from $14.07.

Net profit after tax forecasts rise 8.9% in FY23 and 13.8% in FY24 to reflect the swift client adoption of increased capacity and the expectation of broad strong price rises, particularly within Geochem.

Credit Suisse expect ALS will continue to benefit from the commodity cycle for as long as it lasts. Outperform.

Target price is $15.05 Current Price is $12.38 Difference: $2.67
If ALQ meets the Credit Suisse target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $13.65, suggesting upside of 6.3% (ex-dividends)

The company's fiscal year ends in March.

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

Macquarie rates ALQ as Outperform (1) -

ALS Ltd management has upgraded FY22 guidance, a 6.3% jump on the previous midpoint, says Macquarie.

Strong pricing and sample volume growth from Geochemistry, combined with sharply higher volumes as the market saps up extra capacity from the MiniAnalytical acquisition in December plus strong pre-pandemic volumes from Life Science were behind the upgrade.

Macquarie reports positive currency movement also helped and that rising costs are being alleviated by price increases and better procurement practices.

The broker raises EPS forecasts 4% in FY22;  5% in FY23; and 5% in FY24.

Outperform rating retained but target price eases to $14 from $14.33 to reflect a global industry de-rate. The broker notes ALS is trading at a -13% discount to global peers and expects the company will benefit from covid thematics.

Target price is $14.00 Current Price is $12.38 Difference: $1.62
If ALQ meets the Macquarie target it will return approximately 13% (excluding dividends, fees and charges).

Current consensus price target is $13.65, suggesting upside of 6.3% (ex-dividends)

The company's fiscal year ends in March.

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

UBS rates ALQ as Neutral (3) -

As part of a trading update, ALS Ltd upgraded FY22 guidance by 6%, which is 3% ahead of the expectations held by consensus and UBS. Management noted pressures on input costs have been alleviated by passing through price increases and procurement savings.

After marking-to-market the company versus global peers, the analyst arrives at a $13.30 target, down from $13.50. Neutral.

The broker notes the Geochemistry segment continues to benefit from heightened mineral exploration demand, due to high gold/copper prices and increased equity raising by junior miners.

Target price is $13.30 Current Price is $12.38 Difference: $0.92
If ALQ meets the UBS target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $13.65, suggesting upside of 6.3% (ex-dividends)

The company's fiscal year ends in March.

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 ANZ as Overweight (1) -

ANZ Bank has announced the merger of its Australian Retail business and Digital Division, under one manager. Morgan Stanley believes this change is a sensible response to ANZ's ongoing market share loss in retail banking and the growing importance of a digital proposition for customers.

The bank's Australian housing loans grew below system, by 1% in FY21. The broker forecasts an improvement to 2.5% in FY22, and then expects growth to be closer to system at 3% in FY23.

Overweight and $30 target retained. Industry view: Attractive.

Target price is $30.00 Current Price is $26.18 Difference: $3.82
If ANZ meets the Morgan Stanley target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $29.68, suggesting upside of 15.8% (ex-dividends)

The company's fiscal year ends in September.

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

Ord Minnett rates ANZ as Accumulate (2) -

ANZ Banking Group has embarked on a restructure, combining its digital division (including the ANZx transformation program) with the Australian retail division in preparation for a growth campaign. 

Current digital head Maile Carnegie (formerly Google and Proctor & Gamble) will head the combined division while Mark Hand, the former head of retail and business bank, plans to leave in late 2023.

Business banking will become a separate division, and Ord Minnett welcomes the improved transparency given the division has been lagging peers on scale for years. 

Accumulate rating retained, Ord Minnett considering ANZ Bank to be its second pick of the majors and appreciating the low multiple, strong outlook for institutional and NZ divisions, cost outlook and forecast mortgage growth. Target price steady at $30.50.

Target price is $30.50 Current Price is $26.18 Difference: $4.32
If ANZ meets the Ord Minnett target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $29.68, suggesting upside of 15.8% (ex-dividends)

The company's fiscal year ends in September.

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

Credit Suisse rates APM as Outperform (1) -

APM Human Services International outperformed peers on the Australian Government Department of Social Services' December-quarter 2021 quarterly Star ratings for Disability Employment Services

Credit Suisse says the company posted a strong quarter across all states and achieved the highest Star Rating out of the top 10 largest performers in the sector, with a rating of 3.93, compared with an industry average of 3.

The broker expects this will bode well for the allocation of contracts.

Outperform rating and $4.20 target price retained. 

Target price is $4.20 Current Price is $2.98 Difference: $1.22
If APM meets the Credit Suisse target it will return approximately 41% (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 CBA as No Rating (-1) -

Commonwealth Bank is selling its 10% stake in China's Bank of Hangzhou. Morgan Stanley believes the sale makes strategic sense given the bank’s focus on Australia and NZ. CBA will receive gross proceeds of $1.8bn and expects to make a post-tax gain on sale of $340m.

While the loss of the business will reduce earnings by some -2%, the sale will add 35bps to the bank's tier one capital ratio, suggesting another buyback may follow once the current one is complete, the broker notes.

Without specifically noting so in a brief report, the broker appears to have withdrawn its rating and target for now. (Prior Underweight, $91).

Current Price is $94.82. Target price not assessed.

Current consensus price target is $91.56, suggesting downside of -3.0% (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

Ord Minnett rates CBA as Hold (3) -

Commonwealth Bank has sold a 10% stake in Bank of Hangzhou to the Hangzhou Municipal Government for $1.8bn, and Ord Minnett expects this will lift the bank's tier-one capital ratio by 35 basis points.

The bank will retain a 5.57% stake in what has proved a profitable venture.

While Ord Minnett views the sale as a mild positive, Commonwealth Bank remains its least favoured of the major banks, trading at a 42% premium.

Hold rating and $94.60 target price retained.

Target price is $94.60 Current Price is $94.82 Difference: minus $0.22 (current price is over target).
If CBA meets the Ord Minnett target it will return approximately minus 0% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $91.56, suggesting downside of -3.0% (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 CCP as Outperform (1) -

Credit Corp has increased its share of the US Purchased Debt Ledger market to 10% from 3%-4%, as US volumes and ledger pricing recover, says Macquarie.

Outperform rating and $38.30 target price retained, the broker believing the company is well placed to continue its growth.

Target price is $38.30 Current Price is $31.28 Difference: $7.02
If CCP meets the Macquarie target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $37.37, suggesting upside of 22.9% (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

Macquarie rates CHN as Outperform (1) -

Chalice Mining has, today, communicated the latest round of drilling results at Julimar with intersections confirming mineralisation circa 400m below the open pit resource at the Gonneville deposit.

Macquarie, in an early response, welcomes the results and believes an upgrade to the inferred resource at the project is in the making. In addition, the broker notes early stage work has identified a new exploration target, which has a similar lens shaped magnetic feature to Gonneville.

The new target has been named Flinders and has now been elevated to high priority for drilling.

Macquarie also points out the Hartog target in the Julimar State Forest essentially remains untested, as the company has yet to be able to establish drilling platforms that will enable drill testing of the main target areas.

Outperform rating and $10.55 target price retained.

Target price is $10.55 Current Price is $7.79 Difference: $2.76
If CHN meets the Macquarie target it will return approximately 35% (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

Ord Minnett rates CIM as Downgrade to Hold from Buy (3) -

Hochtief has announced an unconditional and final off-market takeover offer for CIMIC Group for $22 cash per share (the company already owns a 78.58% stake in CIMIC).

Ord Minnett doubts another offer will surface and moves to a Hold recommendation and $22 target price (was $17.50 on February 16).

Target price is $22.00 Current Price is $22.04 Difference: minus $0.04 (current price is over target).
If CIM meets the Ord Minnett target it will return approximately minus 0% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $19.50, suggesting downside of -11.4% (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

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

Following in-line 1H results for residential property developer Cedar Woods Properties, Morgans upgrades its rating to Add from Hold. The company is seen to be trading on low multiples with an attractive and sustainable yield. The target falls to $5.75 from $6.71.

Mind you, the analyst anticipates further (non-fundamental) share price weakness upon the company's likely removal from the ASX300 index during the March re-balance.

Management expects 'moderate' earnings growth in FY22 and strong growth over the medium term. While potential interest rate rises could curtail demand, it's thought a broad geographic and product reach, as well as an increasing number of selling projects will help.

Target price is $5.75 Current Price is $4.76 Difference: $0.99
If CWP meets the Morgans target it will return approximately 21% (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 DUB as Neutral (3) -

While 1H results for Dubber Corp were largely pre-reported, an earnings (EBIT) loss of -$30m was significantly above the -15m expected by UBS. The increased loss was considered mainly due to higher than expected share-based payments.

While growth can be funded organically following the loss, in the broker's opinion, the focus may turn away from M&A.

The target price of $1.84 is unchanged after revenue upgrades were offset by lower gross margins and materially higher share-based payments expenses, explains the analyst. Neutral.

Target price is $1.84 Current Price is $1.40 Difference: $0.44
If DUB meets the UBS target it will return approximately 31% (excluding dividends, fees and charges).

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

Morgans rates GDG as Add (1) -

First half underlying profit for diversified investment and financial services company Generation Development Group were a 40% beat versus Morgans expectations. 

There was 44% funds under management (FUM) growth, and a stable Investment Bond revenue margin, indicative of a continuing solid future growth profile, suggests the analyst.

While the broker materially raises the FY22 profit forecast, the remaining years are largely unchanged and the target is adjusted slightly to $1.81 from $1.82.

Target price is $1.81 Current Price is $1.54 Difference: $0.27
If GDG meets the Morgans target it will return approximately 18% (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

Ord Minnett rates HMY as Buy (1) -

Harmoney Corp's December first-half earnings fell well short of Ord Minnett's forecasts, despite lower cost of funds as high investment costs in marketing, people and systems overwhelmed an otherwise solid result. Revenue outpaced by a decent clip (up 75% since June 2021).

The broker expects cheap funds will continue, reducing impairments and maintaining a stable risk operating environment; and says 37% growth in the loan book suggests the company is building repeat customer business as market share and brand awareness rise.

Buy rating retained, the company trading at a significant discount. Target price falls to $2.42 from $3.11 to reflect a sector de-rating.

Target price is $2.42 Current Price is $1.50 Difference: $0.92
If HMY meets the Ord Minnett target it will return approximately 61% (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 IAG as Sell (5) -

UBS expects a major reinsurance event following recent flooding in QLD and northern NSW.

The broker notes FY22 earnings risks related to natural perils are somewhat limited by aggregate stop-loss reinsurance. Hence, no changes are made to Insurance Australia Group's forecasts. The Sell rating and $4.20 target are retained.

The market is now expected to focus on reinsurance capacity and pricing at the 1 July 2022 renewal, suggests the analyst.

Target price is $4.20 Current Price is $4.60 Difference: minus $0.4 (current price is over target).
If IAG meets the UBS target it will return approximately minus 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.98, suggesting upside of 13.1% (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

Morgans rates IME as Speculative Buy (1) -

Radiology enterprise software provider ImexHS's FY21 results were in-line with Morgans forecasts, and showed solid progress in a challenging period. Radiology service demand picked up in the 4Q and is considered to point to stronger growth in FY22.

The broker feels earnings (EBITDA) breakeven (as per guidance) on a run-rate basis in FY22 is very achievable. The Speculative Buy rating is unchanged and the target eases to $2.54 from $2.59.

Target price is $2.54 Current Price is $0.90 Difference: $1.64
If IME meets the Morgans target it will return approximately 182% (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

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

Kallium Lakes has advised its new ramp-up schedule will be much slower than management previously suggested and that the company will require further funding.

After accounting for the dilution (a raise at 6.5c a share) and a 13% to 15% rise in the weighted average cost of capital, Macquarie downgrades to Neutral from Outperform.

Target price falls nearly -60% to 9c.

Target price is $0.09 Current Price is $0.08 Difference: $0.01
If KLL meets the Macquarie target it will return approximately 12% (excluding dividends, fees and charges).

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

Morgans rates KLL as Downgrade to Hold from Speculative Buy (3) -

Morgans downgrades its rating to Hold from Speculative Buy after Kalium Lakes lowered near-term production forecasts and engages in talks with lenders over funding requirements. The target falls to $0.08 from $0.15.

There are now no sales forecast for the Beyondie Sulphate of Potash project in FY22, which suggests to the analyst funding will be required by the 3Q of 2022.

Target price is $0.08 Current Price is $0.08 Difference: $0
If KLL meets the Morgans target it will return approximately 0% (excluding dividends, fees and charges).

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

Credit Suisse rates LFG as Outperform (1) -

Liberty Financial Group's December first-half result outpaced consensus and Credit Suisse's forecasts by a decent clip, thanks to a solid rise in net interest margins, to strong growth in Secured Finance and lower funding costs.

The broker raises earnings forecasts across FY22 to FY24.

Credit Suisses considers the valuation compelling and retains an Outperform rating. Target price falls to $7 from $7.45.

Target price is $7.00 Current Price is $5.04 Difference: $1.96
If LFG meets the Credit Suisse target it will return approximately 39% (excluding dividends, fees and charges).

Current consensus price target is $6.42, suggesting upside of 23.4% (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

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

Morgan Stanley sees potential medium term growth opportunities for Link Adminstration and found recent FY22 guidance to be positive. But the broker believes Link needs to undertake a multi-year investment program to deliver on these options.

Which brings us to the takeover offer on the table -- supported by the board absent a superior proposal. The broker's $5.50 target reflects that offer. Equal-weight retained.

Industry view: Attractive.

Target price is $5.50 Current Price is $5.29 Difference: $0.21
If LNK meets the Morgan Stanley target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $5.55, suggesting upside of 6.3% (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

Ord Minnett rates MAF as Buy (1) -

MA Financial Group has moved to 100% ownership of non-bank mortgage lender MKM Capital, now adding the missing 52.5% it didn't already own.

MA Financial is paying a total consideration of $11.4m, comprised of $6.6m shares and $4.8m of shareholder loans. Ord Minnett, in a quick response to today's announcement, welcomes the move as a positive one.

The broker points out MKM was the sole underwhelming operation in the recently released financial result. Ord Minnett thus reiterates its Buy rating. Valuation: $12.50.

Target price is $12.50 Current Price is $8.04 Difference: $4.46
If MAF meets the Ord Minnett target it will return approximately 55% (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

Ord Minnett rates ORG as Upgrade to Hold from Lighten (3) -

Despite being disappointed with Origin Energy's December-half result, Ord Minnett revises its position, spying catalysts in the form of higher potential electricity prices and strength in LNG markets.

The broker also considers the recent M&A (attempt) in AGL Energy to be indicative of confidence in energy retailing.

Ord Minnett upgrades to Hold from Lighten following the recent share price retreat and retains a $5.50 target price.

Target price is $5.50 Current Price is $5.49 Difference: $0.01
If ORG meets the Ord Minnett target it will return approximately 0% (excluding dividends, fees and charges).

Current consensus price target is $6.16, suggesting upside of 9.6% (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

Macquarie rates ORI as Neutral (3) -

Orica has guided to a stronger March half, in line with Macquarie's expectations, and advises of the completion of the Minova sale.

Macquarie notes Orica is exposed to the Russia/Ukraine situation but that it is not yet material. High global energy prices have increased global nitrogen prices, and the conflict is likely to further promote this, but given contracts are typically three years in duration, this will take time to flow through, says Macquarie.

Neutral rating and $14.92 target price retained, the broker preferring Incitec Pivot ((IPL)). 

Target price is $14.92 Current Price is $14.59 Difference: $0.33
If ORI meets the Macquarie target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $15.88, suggesting upside of 10.9% (ex-dividends)

The company's fiscal year ends in September.

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

Morgans rates ORI as Hold (3) -

Orica has announced the sale of its non-core business Minova for $180m, which will reduce overall exposure to the coal industry, explains Morgans. The sale is initially seen as dilutive for company earnings, so the target slips to $14.89 from $15.26.

The Hold rating is maintained as shares are trading near the amended target target.

In a trading update, the FY22 outlook comments remain unchanged though the broker feels industry fundamentals have improved Orica's pricing power.

Target price is $14.89 Current Price is $14.59 Difference: $0.3
If ORI meets the Morgans target it will return approximately 2% (excluding dividends, fees and charges).

Current consensus price target is $15.88, suggesting upside of 10.9% (ex-dividends)

The company's fiscal year ends in September.

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

UBS rates ORI as Neutral (3) -

As part of a trading update Orica reiterated prior guidance, which remains consistent with UBS's forecasts. Hence, the $15.50 target is unchanged. A recent share price rally is thought to account for an improved earnings outlook. Neutral rating.

Nonetheless, for investors seeking leverage to the global covid-19 recovery and normalisation in mine production activity, the analyst recommends the stock.

Management also announced the completion of the Minova divestment for $180m (initial cash proceeds of $149m).

Target price is $15.50 Current Price is $14.59 Difference: $0.91
If ORI meets the UBS target it will return approximately 6% (excluding dividends, fees and charges).

Current consensus price target is $15.88, suggesting upside of 10.9% (ex-dividends)

The company's fiscal year ends in September.

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

Citi rates QAN as Neutral (3) -

Citi updates its model on Qantas Airways, driving changes to working capital and operating cash flow estimates. 

The Neutral rating and target price of $5.51 are retained. 

Target price is $5.51 Current Price is $5.16 Difference: $0.35
If QAN meets the Citi target it will return approximately 7% (excluding dividends, fees and charges).

Current consensus price target is $5.87, suggesting upside of 15.1% (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

Citi rates SFR as Buy (1) -

Citi notes outlook for the Matsa project was the big surprise of Sandfire Resources' results release, with the acquisition proving more costly than anticipated given high energy prices and a reduced production guidance.

Despite the unexpected updates on the Matsa project, Citi believes a transitional period through to early FY23 will see Sandfire Resources benefit from annual production of more than 100,000 tonnes of copper and likely re-rate.

With copper pricing strong, and expected to rally into the second high, the company is mining lower grades at Matsa to take advantage of pricing. 

The Buy rating is retained and the target price increases to $8.30 from $7.40. 

Target price is $8.30 Current Price is $5.92 Difference: $2.38
If SFR meets the Citi target it will return approximately 40% (excluding dividends, fees and charges).

Current consensus price target is $7.49, suggesting upside of 20.5% (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

Ord Minnett rates SLA as Accumulate (2) -

Silk Laser Australia's June half result sharply outpaced Ord Minnett's forecasts thanks to a strong performance from the recently acquired ASC network.

Higher customer spending, buoyed by the trend towards injectables away from laser; solid franchisee revenue; and growth in like-for-like sales, drove the beat.

The broker says ASC offers Silk Laser much-needed geographical diversification heading into the June half, which will include covid and flood impacts in Queensland and Western Australia.

Cash conversion eased to 97%. Buy recommendation retained. Target price rises to $5.30 from $5.15.

Target price is $5.30 Current Price is $3.53 Difference: $1.77
If SLA meets the Ord Minnett target it will return approximately 50% (excluding dividends, fees and charges).

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

Ord Minnett rates SLR as Buy (1) -

Silver Lake Resources' December first-half earnings outpaced Ord Minnett's forecasts.

The broker considers the Harte Gold acquisition will drive a higher share price, given the metrics are attractive.

FY23 earnings forecasts and beyond rise 15% and the net tangible asset backing increases 5%. 

Target price rises to $2.30 from $2. Buy rating retained.

Target price is $2.30 Current Price is $1.79 Difference: $0.51
If SLR meets the Ord Minnett target it will return approximately 28% (excluding dividends, fees and charges).

Current consensus price target is $2.08, suggesting upside of 11.4% (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

UBS rates SUN as Buy (1) -

UBS expects a major reinsurance event following recent flooding in QLD and northern NSW.

The broker notes FY22 earnings risks related to natural perils are somewhat limited by aggregate stop-loss reinsurance. Hence, no changes are made to Suncorp Group's forecasts. The Buy rating and $14 target are retained.

The market is now expected to focus on reinsurance capacity and pricing at the 1 July 2022 renewal, suggests the analyst.

Target price is $14.00 Current Price is $10.90 Difference: $3.1
If SUN meets the UBS target it will return approximately 28% (excluding dividends, fees and charges).

Current consensus price target is $13.70, suggesting upside of 27.5% (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

Macquarie rates TCL as Outperform (1) -

Monthly traffic data suggests the M2, M7 and M5W are already above pre-pandemic levels, suggesting a strong June half and FY23 for Transurban Group, says Macquarie.

Other states are taking longer to recover and Macquarie notes Brisbane and Melbourne have a stronger leverage to a recovery in airports. The broker also spies a potential improvement in dividend quality.

EPS forecasts fall -2.7% in FY22; and edge slightly higher in FY23 and FY24.

Target price eases -2c to $14.80.  Outperform rating retained.

Target price is $14.80 Current Price is $12.64 Difference: $2.16
If TCL meets the Macquarie target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $14.67, suggesting upside of 16.2% (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

Citi rates UMG as Buy (1) -

United Malt Group stands to benefit from apparent increasing beer volumes, which will drive malt demand. Citi notes fourth quarter results from global brewers suggest beer volumes in the quarter are up 5% on the previous comparable period and 4% ahead of pre-covid levels.

Geographically, the Americas reported 2% volume increase across major brewers, while Asia Pacific saw volumes grow 12% in a strong rebound as covid restrictions begin to ease, and with Chinese New Year providing additional benefit. 

The Buy rating and target price of $5.00 are retained.

Target price is $5.00 Current Price is $4.29 Difference: $0.71
If UMG meets the Citi target it will return approximately 17% (excluding dividends, fees and charges).

Current consensus price target is $4.82, suggesting upside of 12.3% (ex-dividends)

The company's fiscal year ends in September.

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

UBS rates VEA as Buy (1) -

In first steps for a hydrogen network strategy, Viva Energy announced it has committed to building a public hydrogen refueling station in Geelong, subject to approvals. UBS sees the announcement as a positive for earnings diversification.

A start date is projected for late 2023, and the broker doesn't expect any material earnings impact at this stage. The Buy rating and $2.70 target are unchanged.

Target price is $2.70 Current Price is $2.47 Difference: $0.23
If VEA meets the UBS target it will return approximately 9% (excluding dividends, fees and charges).

Current consensus price target is $2.67, suggesting upside of 6.1% (ex-dividends)

The company's fiscal year ends in December.

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 WTC as Overweight (1) -

Following a solid result from WiseTech Global, and an increase in FY margin guidance, Morgan Stanley holds its revenue forecasts steady but increases forecast earnings per share by 6-21% across FY22-24. Target rises to $50 from $35.

The broker expects M&A will become a key debate for investors, given management noted it is looking at and executing on tuck-in acquisitions and continues to look at larger strategically significant acquisition opportunities.

Overweight retained. Industry view: Attractive.

Target price is $50.00 Current Price is $45.64 Difference: $4.36
If WTC meets the Morgan Stanley target it will return approximately 10% (excluding dividends, fees and charges).

Current consensus price target is $48.18, suggesting upside of 4.1% (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

Citi rates Z1P as Neutral (3) -

Providing further commentary on Zip Co's acquisition of Sezzle ((SZL)), Citi notes following the purchase Zip Co remains the fourth or fifth largest player in the US space, and lacks the network strength of competitors.

The cost synergy target of $60-80m looks achievable, and Citi forecasts middle of the range synergies of $70m. Target price decline is largely attributed to higher than anticipated bed debt and operating expenditure in the first half. 

The Neutral rating is retained and the target price decreases to $2.15 from $3.65. 

Target price is $2.15 Current Price is $2.07 Difference: $0.08
If Z1P meets the Citi target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $3.49, suggesting upside of 77.8% (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

UBS rates Z1P as No Rating (-1) -

UBS points out Zip Co's 1H results were largely pre-announced and there were no surprises. However, the main talking point is the proposed merger with Sezzle ((SZL)) in an all-scrip transaction valued at $491m.

Given the complexities of the transaction, the broker proposes to do more detailed work and in the meantime places its target and rating under review.

Management expects to achieve cash earnings (EBTDA) profitabilty by FY24 following the merger.

Current Price is $2.07. Target price not assessed.

Current consensus price target is $3.49, suggesting upside of 77.8% (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