UPGRADES
January 2 – January 12
The Lottery Corporation (ASX:TLC) Upgrade to Accumulate from Hold — Ord Minnett
We’re tacking this one on despite Ord Minnett releasing the note just before the New Year.
The broker likes TLC’s consolidated, market leading position, saying it looks set to dominate local lotteries for some time. That said, sales volumes have been abnormally soft, the broker concedes.
Ord expects a fairly tame first half H1 performance, estimated -7% below last year’s performance. Oz Lotto, with sales down -20%, is the biggest drag to date, points out the broker.
Price Target remains at $5.
JB HiFi (ASX:JBH) Upgrade to Neutral from Underperform — Macquarie
Macquarie has conceded that its own assumptions for consumer spending were off the mark, following this week’s surge in retail trade data.
The broker says with this in mind, JBH remains best in class of the dual whitegoods retailers. JBH has a superior cost structure which has so far fended off the wannabes from Kogan to Harvey Norman.
The broker lifts its forecasts by between 7-8% for the long term outlook. PT also lifts to $55 from $45.
CEH – Coast Entertainment Upgrade to Accumulate from Hold — Ord Minnett
(January 3) Ord Minnett says shares in the former Ardent Leisure (ASX:ALG), (hello, Coast Entertainment!), are remaining stifled and wallow well below Ord’s Price Target of 60 cents – a rare opportunity, Ord reckons.
DOWNGRADES
January 2 – January 12
CSR (ASX:CSR) Downgrade to Sell from Hold — Ord Minnett
Insurance Australia (ASX:IAG) Downgrade to Hold from Add — Morgans
Judo Capital Holdings (ASX:JDO) Downgrade to Hold from Accumulate — Ord Minnett
Magellan Financial Group (ASX:MFG) Downgrade to Sell from Neutral — Citi
The broker is among many voices unwilling to let their guard down on MFG. Citi sees a lot of Christmas in MFG’s stock price rally, although the PT lifted $8.10 from $7 on higher forecasts, though the stock is Downgraded to Sell from Neutral.
Motorcycle Holdings (ASX:MTO) Downgrade to Hold from Add — Morgans
NextDC (ASX:NXT) Downgrade to Lighten from Hold — Ord Minnett
Probiotec (ASX:PBP) Downgrade to Hold from Add — Morgans
Challenger (ASX:CGF) Downgrade to Hold from Accumulate — Ord Minnett
Ord Minnett lowers the rating for Challenger while retaining the PT of $7.30.
The broker likes CGF’s growing boutique funds management arm, although the business depends on annuities and high sales growth to offset recurring annuity payments obligations, so it’s a little high risk.
Sims Metal Management (ASX:SGM) Downgrade to Sell from Neutral — Citi
Bendigo and Adelaide Bank (ASX:BEN) Downgrade to Sell from Neutral — Citi
Bank of Queensland (ASX:BOQ) Downgrade to Sell from Neutral — Citi
Healius (ASX:HLS) Downgrade to Underweight from Equal-weight — Morgan Stanley
Insignia Financial (ASX:IFL) Downgrade to Underweight from Equal-weight — Morgan Stanley
Alumina (ASX:AWC) Downgrade to Neutral from Buy — Citi
On Thursday AWC stock surged enough for Citi analysts to reappraise their long-held AWC position. As the stock jumps, the broker accepts the risk of higher aluminium prices and has lifted the PT by 5 cents to $1.15.
ASX (ASX:ASX) Downgrade to Neutral from Outperform — Macquarie
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