Australian Broker Call

Citi rates A2M as Buy (1) -

Citi reaffirms a positive view on the near-term outlook for the infant formula market following today's 1H25 earnings result from infant formula ingredient supplier Clover ((CLV)).

The analyst points to a recovery in the European and A&NZ infant formula businesses, including improved demand from Western manufacturers.

Citi explains momentum in 1H25 is expected to carry into a typically stronger second half, aligning with consensus estimates for a2 Milk Co.

The analyst emphasises a2 Milk Co has demonstrated strong execution in recent years, even when birth rates were declining and domestic brands were gaining market share. These conditions have now turned into tailwinds, Citi explains.

The Clover result gives Citi greater confidence in its Buy rating for a2 Milk Co. Target price remains at $8.20.

Target price is $8.20 Current Price is $8.53 Difference: minus $0.33 (current price is over target).
If A2M meets the Citi target it will return approximately minus 4% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $7.30, suggesting downside of -12.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

This company reports in NZD. 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

Ord Minnett rates A2M as Downgrade to Hold from Accumulate (3) -

Ord Minnett retains its $7.70 target for a2 Milk Co and downgrades to Hold from Accumulate on valuation after an 11% share price surge in the last week.

The stock has outperformed the broader market by approximately 60% since February, with the recent 11% rally driven by speculation around Chinese birth stimulus measures, explains the broker.

The broker remains cautious on the long-term impact of government policies to reverse declining birth rates, citing historical challenges in similar markets.

The analyst highlights A2 Milk’s strong market position, supported by share gains in the consolidating Chinese infant milk formula market and the launch of its Genesis product.

Ord Minnett sees the shift to English labelling and upcoming supply chain efficiencies as potential catalysts for capital returns to shareholders.

Target price is $7.70 Current Price is $8.53 Difference: minus $0.83 (current price is over target).
If A2M meets the Ord Minnett target it will return approximately minus 10% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $7.30, suggesting downside of -12.1% (ex-dividends)

Forecast for FY25:

Forecast for FY26:

This company reports in NZD. 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

Bell Potter rates ALC as Upgrade to Buy from Hold (1) -

Bell Potter notes Alcidion Group's biggest contract to date with North Cumbria Integrated Care NHS Foundation Trust signed in February has now been finalised.

With the company delivering a modest $0.3m EBITDA in 1H25, the broker estimates a full-year EBITDA profit is likely due to $8m revenue from the contract in 2H. The broker also sees potential for a modest net profit after tax.

Target price unchanged at 11c. Rating upgraded to Buy from Hold.

Target price is $0.11 Current Price is $0.08 Difference: $0.03
If ALC meets the Bell Potter target it will return approximately 38% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 1.0

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

Citi rates ASB as Neutral (3) -

Citi notes South Korea's Hanwha Group has resumed its pursuit of Austal, acquiring a 9.9% stake after a prior attempt in April 2024 was hindered by regulatory concerns.

The broker points to potential challenges in securing FIRB and CFIUS approvals, particularly given Hanwha’s previous exclusion from Australia’s frigate program and its status as a competitor to shortlisted shipbuilders from Germany and Japan.

Austal’s record order book of $14.2bn as of 1H25 underpins long-term revenue visibility, highlight the analysts, with future US Navy contract wins seen as a key opportunity.

The timing of the strategic shipbuilding agreement remains a near-term catalyst, though the broker sees a risk of delays due to the upcoming Federal election.

Citi retains a Neutral rating on Austal, citing execution risks on new programs, including OPC, LCU, and T-AGOS later in 2025. The $4.09 target is unchanged.

This summary is based upon research released yesterday (Tuesday) by Citi.

Target price is $4.09 Current Price is $4.12 Difference: minus $0.03 (current price is over target).
If ASB meets the Citi target it will return approximately minus 1% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $4.43, suggesting upside of 11.0% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.7

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

Citi rates CAR as Buy (1) -

Citi notes a higher-than-expected price increase for CAR Group’s Trader Interactive business is offset by a decline in dealer numbers.

The broker raises concerns about the potential impact of weaker consumer confidence on demand for RVs, powersports, and related segments in the US (where Trader Interactive operates).

Target of $43.40 and Buy rating are unchanged.

Target price is $43.40 Current Price is $33.38 Difference: $10.02
If CAR meets the Citi target it will return approximately 30% (excluding dividends, fees and charges).

Current consensus price target is $41.63, suggesting upside of 25.4% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.8

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

Ord Minnett rates CCL as Buy (1) -

Ord Minnett highlights Cuscal’s exposure to potential client loss, with SmartPay’s ((SMP)) potential takeover creating a risk that processing volumes may shift to a competitor.

The broker estimates the impact at approximately -4% of FY27 profit, though it remains confident in Cuscal’s ability to offset volume changes.

Smartpay represents 1.6% of Cuscal’s net revenue, and while there are no firm offers yet, a takeover by a competitor such as Tyro Payments ((TYR)) could lead to a loss of revenue, explains the analyst.

Ord Minnett makes no changes to its earnings forecasts and maintains a Buy rating and $3.61 target for Cuscal.

Target price is $3.61 Current Price is $2.64 Difference: $0.97
If CCL meets the Ord Minnett target it will return approximately 37% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 1.0

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

Ord Minnett rates CMM as Accumulate (2) -

Ord Minnett highlights Capricorn Metals’ strong production growth outlook, supported by low costs and long mine life.

Management’s premium reputation is noted for consistent operational and financial performance at the Karlawinda mine in Western Australia.

Recent upgrades to resources and reserves, along with a stronger gold price and stabilising labour markets, have reinforced confidence in mill expansion and production growth, explains the broker.

The analyst notes the Mt Gibson project, currently stalled in permitting, is expected to progress toward approval in 2025, setting the stage for a final investment decision, 

Largely due to a closed-out hedge book, Ord Minnett's earnings (EBITDA) forecasts for FY26 have been increased by 35% to $352m, while FY27 forecasts rise by 6% to $456m.

The $9.30 target and Accumulate rating are maintained.

Target price is $9.30 Current Price is $8.37 Difference: $0.93
If CMM meets the Ord Minnett target it will return approximately 11% (excluding dividends, fees and charges).

Current consensus price target is $8.15, suggesting upside of 1.8% (ex-dividends)

Forecast for FY25:

Forecast for FY26:

Market Sentiment: -0.2

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

UBS rates DGL as Neutral (3) -

In further analysis of interim results released on February 28, UBS notes DGL Group’s revenue grew 10% year-on-year to $239m in 1H25, though earnings (EBITDA) declined -13% due to cost inflation and weak performance in the Environmental segment.

The broker sees potential for cost reductions through site consolidation and operational efficiencies, with a focus shifting towards organic growth over acquisitions.

The company reported net debt of $102m, with plans to reduce leverage over the next eighteen months to lower interest costs.

UBS lowers FY25 and FY26 earnings (EBITDA) forecasts by -15% and -12%, respectively, driven by lower gross margin expectations. The target price falls to 53c from 59c. Neutral rating maintained..

Target price is $0.53 Current Price is $0.49 Difference: $0.045
If DGL meets the UBS target it will return approximately 9% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.0

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

Macquarie rates DYL as Outperform (1) -

Macquarie observes that Deep Yellow appears to be meeting expectations for a Tumas final investment decision in the next few weeks, which the analyst views as a major "milestone."

This would put the company on track to achieve initial production in early 2027.

At current share price levels, Macquarie highlights the market is imputing a US$57/lb uranium price for Tumas and Mulga Rock's valuation and US$49/lb if some value is included for additional assets such as Alligator River (NT), Omahola, and Tubas (Namibia).

The broker estimates greenfield incentive pricing in the US$80-US$85/lb range. Currently the in-house price forecast is US$85/lb.

Outperform rating unchanged. Target price slips to $1.90, down -5%.

Target price is $1.90 Current Price is $1.00 Difference: $0.895
If DYL meets the Macquarie target it will return approximately 89% (excluding dividends, fees and charges).

Current consensus price target is $1.78, suggesting upside of 69.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 1.0

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

Morgans rates GDG as Add (1) -

Morgans highlights the strong 1H25 result from Generation Development and the announced acquisition of Evidentia as indicative of a positive two months for the company.

The acquisition will boost the company's exposure in the managed account sector, while first-half net profit after tax came in above expectations for both investment bonds and Lonsec.

Morgans emphasises the Evidentia deal makes Generation Development the market leader in managed accounts, with around a 20% market share against the next competitor at approximately 5%.

The analyst forecasts EPS accretion from Evidentia of 10% in FY26 and lifts EPS forecasts by 3% to 7% for FY25/FY26, respectively.

Target price rises to $5.59 from $4.75. No change to Add rating.

Target price is $5.59 Current Price is $4.85 Difference: $0.74
If GDG meets the Morgans target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $5.90, suggesting upside of 22.3% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 1.0

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

Bell Potter rates GOR as Buy (1) -

Gold Road Resources announced crusher maintenance and failure of two conveyor belts will lead to 1Q25 production coming lower than expected, but maintained the FY25 gold production guidance of 325-355koz.

Bell Potter sees some scope for the 1Q shortfall to be compensated for in the remainder of the year from higher ore grades from the pit and processing plant upgrades.

Still, the broker cut the FY25 production forecast by -2.5% but also raised the near-term gold price forecast.

Target price unchanged at $2.95 and Buy rating retained.

Target price is $2.95 Current Price is $2.51 Difference: $0.44
If GOR meets the Bell Potter target it will return approximately 18% (excluding dividends, fees and charges).

Current consensus price target is $2.85, suggesting upside of 18.3% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.7

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

Macquarie rates GOR as No Rating (-1) -

Gold Road Resources announced a preliminary update on 1Q 2025 production, guiding to 70-73koz, which is below Macquarie's estimate and consensus by -18% and -16%, respectively. No cost update was provided.

Maintenance issues with the primary crusher and the failure of two conveyor belts were cited as the main reasons for the production miss, the broker highlights.

Management has retained 2025 guidance, with the analyst stressing that a robust 2Q-4Q production performance will be needed to achieve the current midpoint of guidance.

Macquarie lowers the midpoint forecast for 2025 production by -4% to 325koz and lowers EPS estimates by -18% for 2025.

The broker remains on research restriction

Current Price is $2.51. Target price not assessed.

Current consensus price target is $2.85, suggesting upside of 18.3% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.7

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

Shaw and Partners rates HLO as Buy, High Risk (1) -

Shaw and Partners highlights Helloworld Travel’s valuation discount relative to its ASX-listed peers, trading on an FY26 price-to-earnings multiple of 8.2 times. The stock also offers an attractive fully franked dividend yield, according to the analyst.

The broker notes a favourable outlook for the travel sector, supported by positive Australian Bureau of Statistics data indicating a 12.3% year-on-year increase in total arrivals in January.

Shaw sees potential benefits from pent-up travel demand, increased international arrivals, and further expansion in key markets.

The Buy, High Risk rating and $2.70 target are maintained.

Target price is $2.70 Current Price is $1.48 Difference: $1.22
If HLO meets the Shaw and Partners target it will return approximately 82% (excluding dividends, fees and charges).

Current consensus price target is $2.30, suggesting upside of 55.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.7

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

Bell Potter rates IGL as Buy (1) -

Bell Potter believes IVE Group's 1H25 result was one of the highlights of the half-yearly reporting season but the share price only rose modestly since then.

The broker reckons there's a possibility of the company upgrading its FY25 guidance and, if correct, it might happen around the investor strategy session in June.

The broker's forecast is for $51.8m net profit in FY25, above the company's guidance range of $47-50m

Target price of $2.80 and Buy rating are unchanged.

Target price is $2.80 Current Price is $2.29 Difference: $0.51
If IGL meets the Bell Potter target it will return approximately 22% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 1.0

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

Citi rates IMD as Neutral (3) -

Relevant to Imdex, February saw a broad improvement in drilling and junior financing metrics, notes Citi, though it remains uncertain whether this signals a sustained recovery or a short-term fluctuation.

While exploration activity has increased, the broker explains meaningful gains in Australia and Canada (key exploration drivers) are still needed to confirm an inflexion point.

Junior financings exceeded US$1bn in February after a weak January, which the analysts see as encouraging for exploration-linked activity, though continued momentum is required before turning more positive. 

Neutral rated. Target $2.85.

This summary is based upon research released yesterday (Tuesday) by Citi.

Target price is $2.85 Current Price is $2.93 Difference: minus $0.08 (current price is over target).
If IMD meets the Citi target it will return approximately minus 3% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $2.93, suggesting upside of 3.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.2

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

Shaw and Partners rates LM8 as Buy, High Risk (1) -

Shaw and Partners notes Lunnon Metals has identified stacked gold structures at the Hustler prospect along the Foster Gold and Nickel Belt, increasing near-surface gold potential.

The broker highlights multiple high-grade gold intercepts at shallow depths, supporting the prospect’s potential as a key exploration target.

Lunnon continues to test its 100% owned gold rights at the Kambalda Gold and Nickel Project, observe the analysts, with the proximity to the 4.8mt Lefroy Gold Plant providing a potential processing advantage.

Cash reserves of $19.5m at the end of December support further exploration and development activities, highlights Shaw.

The Buy, High Risk rating and 60 cent target are maintained.

Target price is $0.60 Current Price is $0.21 Difference: $0.39
If LM8 meets the Shaw and Partners target it will return approximately 186% (excluding dividends, fees and charges).

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 1.0

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

Bell Potter rates LOT as Speculative Buy (1) -

Lotus Resources announced a binding offtake agreement for 600klbs of Kayelekara uranium with a large North American power utility for 2026-29.

The pricing is fixed US$ based on the long-term price minus a discount, with a fixed price escalation in line with RBA's inflation target.

Bell Potter reckons base-escalated contract pricing is prudent given spot prices are trading at a -23% discount to the historical average. 

The broker notes the company reiterated the timeline for production start for 3Q2025 (Bell Potter 4Q2025) but believes any material delay would put pressure on funding.

The broker suggests additional working capital facilities may be an option. Target price cut to 35c from 45c. Speculative Buy.

Target price is $0.35 Current Price is $0.17 Difference: $0.18
If LOT meets the Bell Potter target it will return approximately 106% (excluding dividends, fees and charges).

Current consensus price target is $0.45, suggesting upside of 136.8% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 1.0

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

Bell Potter rates NHC as Hold (3) -

New Hope's 1H25 net profit of $340m beat Bell Potter's forecast of $318m mainly due to impairment reversal of legal action, offset by impairment of Bridgeport energy business.

The company announced a $100m on-market share buyback. The broker views it as an optionality, expecting the company's preference would be to preserve cash due to weaker thermal coal markets and for growth.

The broker remains cautious about the outlook for coal prices and doesn't expect material improvement until 2H2025.

EPS forecasts for FY25 and FY26 were lifted by 4% and 1% respectively. Target price of $4.30 and Hold rating are unchanged.

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

Current consensus price target is $4.69, suggesting upside of 11.6% (ex-dividends)

The company's fiscal year ends in July.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.5

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

Citi rates NHC as Buy (1) -

New Hope’s interim earnings (EBITDA) rose 22% year-on-year to $517.3m, driven by the New Acland ramp-up and a -31% reduction in free on rail (FOR) cash costs to $55.5/t.

The fully franked interim dividend of 19c per share was in line with consensus but -1c below the broker’s estimate.

The company announced a $100m on-market share buyback, citing a material undervaluation of its shares, while net cash, including liquid investments, stands at $446m.

FY25 guidance remains unchanged, apart from a downward revision in Bengalla’s sustaining capex to -$185m-$225m from -$200m-$245m.

Citi lowers FY25 and FY26 earnings forecasts by -6% and -15%, respectively, due to lower thermal coal prices. The target falls to $5.30 from $5.80 and the Buy rating is unchanged.

Target price is $5.30 Current Price is $4.03 Difference: $1.27
If NHC meets the Citi target it will return approximately 32% (excluding dividends, fees and charges).

Current consensus price target is $4.69, suggesting upside of 11.6% (ex-dividends)

The company's fiscal year ends in July.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.5

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

Macquarie rates NHC as Neutral (3) -

New Hope reported 1H25 revenue and earnings (EBITDA) within 2% of consensus forecasts, Macquarie explains, with net profit after tax boosted by a one-off item.

The first-half dividend of 19c met expectations for both the broker and consensus, while the announcement of a $100m on-market buyback was a positive surprise for the broker.

Macquarie lowers EPS estimates by -4% to -6% for FY25 and FY26 due to higher dilution from shares on issue from convertibles and the first-half results.

The discontinuance of the legal challenge is seen offering greater certainty for the ramp-up of New Acland mine. Target price of $4.25 and Neutral rating retained.

Target price is $4.25 Current Price is $4.03 Difference: $0.22
If NHC meets the Macquarie target it will return approximately 5% (excluding dividends, fees and charges).

Current consensus price target is $4.69, suggesting upside of 11.6% (ex-dividends)

The company's fiscal year ends in July.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.5

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

Morgans rates NHC as Add (1) -

New Hope pre-reported 1H25 earnings (EBITDA), Morgans notes, while highlighting first-half cash flow as softer than anticipated at $317m due to a non-cash impairment reversal and a settlement of provision pricing, the broker explains.

The 19c dividend per share was slightly above expectations, with Morgans emphasising the surprise $100m share buyback announcement.

Management made no changes to FY25 guidance apart from lowering Bengalla sustaining capex by around -$18m.

Target slips to $4.90 from $5.15. No change to Add rating.

Target price is $4.90 Current Price is $4.03 Difference: $0.87
If NHC meets the Morgans target it will return approximately 22% (excluding dividends, fees and charges).

Current consensus price target is $4.69, suggesting upside of 11.6% (ex-dividends)

The company's fiscal year ends in July.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.5

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

Citi rates PMV as Neutral (3) -

The mix of sales growth between Peter Alexander and Smiggle will be of most interest to Citi when Premier Investments releases interim results on March 21. An update on the international rollout strategy is also keenly awaited.

The broker will also be looking at how the company's significant currency exposure has been managed.

In January, management guided to pre-AASB 16 retail EBIT of circa $160-165m.

Neutral rating and $26 target retained.

Target price is $26.00 Current Price is $21.00 Difference: $5
If PMV meets the Citi target it will return approximately 24% (excluding dividends, fees and charges).

Current consensus price target is $27.63, suggesting upside of 33.1% (ex-dividends)

The company's fiscal year ends in July.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.5

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

Bell Potter rates PNV as Buy (1) -

Bell Potter considers the departure of PolyNovo's CEO Swami Raote as unfortunate but not unusual, attributing it to a change of culture from a large pharma to a smaller organisation.

The broker notes governance is being reviewed following the CEO's leaving.

No change to forecasts. Target price of $2.80 and Buy rating are unchanged.

Target price is $2.80 Current Price is $1.27 Difference: $1.525
If PNV meets the Bell Potter target it will return approximately 120% (excluding dividends, fees and charges).

Current consensus price target is $2.82, suggesting upside of 127.2% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 1.0

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

Bell Potter rates REA as Buy (1) -

Bell Potter estimates REA Group's listings are tracking -3% lower so far in 2H25 and reckons 4Q will also be soft. This poses a downside risk to the company's flat-to-marginal increase guided for FY25 listings (1H was +5%).

The broker also believes REA will face increased competition following Nasdaq-listed CoStar emerging as a bidder for Domain Holdings ((DHG)), a contrast to the ideal environment it operated in in recent years.

The broker revised down the multiples for the blended valuation, resulting in the target price dropping to $264 from $281. No changes were made to earnings forecasts.

Rating remains at Buy.

Target price is $264.00 Current Price is $230.30 Difference: $33.7
If REA meets the Bell Potter target it will return approximately 15% (excluding dividends, fees and charges).

Current consensus price target is $263.00, suggesting upside of 15.1% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 0.6

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

UBS rates RIO as Neutral (3) -

UBS notes Rio Tinto has advanced its Pacific Aluminium (PacAl) decarbonisation strategy with new solar and battery hybrid service agreements, securing a total of 2.7GW of renewable power.

The broker highlights that repowering PacAl remains value accretive, with an estimated 17% internal rate of return (IRR) and a net present value (NPV) uplift of US$2.3bn.

The Australian Government’s $2bn Green Production Credit provides additional support for decarbonisation, explain the analysts, offering approximately US$105 per tonne of low-carbon aluminium produced. 

UBS analysts have maintained a Neutral rating on Rio Tinto, keeping the price target unchanged at $124. 

Target price is $124.00 Current Price is $119.53 Difference: $4.47
If RIO meets the UBS target it will return approximately 4% (excluding dividends, fees and charges).

Current consensus price target is $126.42, suggesting upside of 6.5% (ex-dividends)

The company's fiscal year ends in December.

Forecast for FY25:

Forecast for FY26:

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

Citi rates RMD as Buy (1) -

Citi notes ResMed’s US myAir app downloads grew 3.4% year-on-year in January and February, tracking below Q3 consensus expectations for US device sales growth of 7%.

The broker points out prior-year comparisons were strong, particularly in March, which saw 21% growth.

Also, ex-US app downloads declined -4% year-on-year, lagging the consensus forecast of 5.2% growth for ex-US device sales.

Despite softer downloads, the analysts note US monthly active users rose 19%, with 12-month utilisation improving to 90% from 83%.

ResMed is set to report Q3 results in late April, with Citi forecasting EPS of US241c, 1% ahead of consensus.

Buy. Target $44.

Target price is $44.00 Current Price is $34.74 Difference: $9.26
If RMD meets the Citi target it will return approximately 27% (excluding dividends, fees and charges).

Current consensus price target is $44.38, suggesting upside of 28.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

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

Market Sentiment: 1.0

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

Morgan Stanley rates TWE as Overweight (1) -

Morgan Stanley explains the proposed 200% tariffs on wine, cognac, and other alcohol imports by President Trump could significantly disrupt the US market.

Treasury Wine Estates generates around 38% of earnings from the Treasury Americas division and could potentially benefit, the analyst notes, but there are also redistribution risks as EU inventory is rechannelled into other markets and countries.

Imports represent around 30% of US wine consumption, with the EU making up around 80% of imports to the US. France and Italy account for approximately 70% of EU imports, while A&NZ represents 11%.

The target price remains at $12.90. Overweight rating. Industry View: In-line.

Target price is $12.90 Current Price is $10.08 Difference: $2.82
If TWE meets the Morgan Stanley target it will return approximately 28% (excluding dividends, fees and charges).

Current consensus price target is $12.98, suggesting upside of 30.5% (ex-dividends)

The company's fiscal year ends in June.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: 1.0

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

Morgan Stanley rates WBC as Underweight (5) -

Ongoing below-system mortgage growth from Westpac is expected to weigh on the bank's earnings outlook, Morgan Stanley highlights.

Westpac's mortgage portfolio has grown below the average rate of its peers for the last five years due to management's focus on non-financial risk issues and mortgage origination since the start of covid, the broker explains.

The decision to close RAMS to new business underpins ongoing sub-system mortgage growth expectations by Morgan Stanley for the next three years.

Target price of $27.30. Underweight. Industry View: In-Line.

Target price is $27.30 Current Price is $30.18 Difference: minus $2.88 (current price is over target).
If WBC meets the Morgan Stanley target it will return approximately minus 10% (excluding dividends, fees and charges - negative figures indicate an expected loss).

Current consensus price target is $29.40, suggesting downside of -2.4% (ex-dividends)

The company's fiscal year ends in September.

Forecast for FY25:

Forecast for FY26:

Market Sentiment: -0.5

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