In the week ending Friday 27 June 2025, FNArena tracked seven upgrades and 17 downgrades for ASX-listed companies from brokers monitored daily. Average target price reductions outpaced increases, though upgrades to earnings forecasts were more substantial at the upper end of the table below.
Much of the movement in broker ratings, target prices, and earnings estimates centred on the mining sector, following commodity price revisions by Citi, Ord Minnett, and Morgans.
Fortescue received two rating downgrades from Morgans and Citi to Hold (or equivalent) from Buy. Citi expects the iron ore price to remain range bound between US$90-100/t, but with downside risk tied to potential steel production cuts in China. This broker lowered its 0-3 month price forecast to US$90/t and its 6-12 month view to US$85/t, from US$100/t and US$90/t respectively.
After also adjusting for a higher Australian dollar forecast, Citi reduced its target price for Fortescue to $16.00 from $17.50. Morgans revised down its FY26 average iron ore forecast to US$89/t, while retaining its long-term estimate of US$77/t real, leading to a target price for Fortescue of $16.50, down from $18.80. Commentary noted a -US$5/t fall in iron ore prices will reduce FY26 earnings by around -14% and flagged a widening low-grade discount in weaker markets as an added risk.
Liontown Resources was downgraded to Sell by both Citi and Ord Minnett, with Citi also cutting IGO Ltd and Pilbara Minerals to Neutral. Citi’s key commodity revision last week concerned lithium, further reducing spodumene forecasts by -13% for 2025, -27% for 2026, and -20% for 2027, with chemical prices cut by similar margins.
Ord Minnett also dropped its Liontown target to 45c from 50c following across-the-board forecast downgrades for lithium spodumene, carbonate, and hydroxide out to 2027.
On the positive side of the ledger, average target prices in the FNArena database rose last week for shipbuilder Austal and grocery wholesaler and hardware supplier Metcash, by approximately 14% and 8%, respectively. Citi lifted its target for Austal to $6.10 from $4.09, citing increased US and Australian defence spending plus recent progress on the US Navy’s Towing, Salvage, and Rescue Ship (T-ATS) program. These Navajo-class ships are designed to replace the ageing T-ATF and T-ARS vessels currently in service.
In further positives for Austal, Citi also pointed to the potential near-term finalisation of the Strategic Shipbuilding Agreement and the heightened probability of a takeover by Hanwha, following approval from the Committee on Foreign Investment in the United States (CFIUS).
For Metcash, FY25 earnings landed at the top end of guidance, supported by a strong performance from Food & Liquor, despite a continued decline in tobacco sales. Hardware is expected to benefit from future interest rate cuts, although the timing and scale of any recovery remain uncertain.
On the flipside, Adairs saw its average target price fall by around -14% last week, after becoming the latest discretionary retailer to downgrade earnings guidance. Tough trading conditions after Easter prompted heavier discounting, which in turn added to margin pressure.
UBS last week raises its price target for Paladin by 3% to $9.40 reflecting improved uranium prices and cost assumptions. The uranium market outlook has strengthened, in the analysts’ view, driven by positive US nuclear policy momentum, including bipartisan support and plans to quadruple nuclear capacity by 2050. Also, Paladin’s Langer Heinrich mine restart in Namibia is progressing ahead of schedule, with June quarter production expected to beat consensus despite earlier water-related issues.
Aurizon management cited higher bad debt provisioning and lower-than-expected Network division volumes when downgrading FY25 earnings guidance. The company deferred $50m of Network income to FY27, versus the earlier estimate by UBS for $19m, which explains most of the earnings miss. The Network division manages the Central Queensland Coal Network (CQCN). While the share price now looks attractive in the short-term, Morgans downgraded Aurizon to Hold from Accumulate on medium-term concerns around the Coal division which specialises in the transport of coal from mines in Queensland and New South Wales to end customers and ports.
Collins Food is the leading stock from the Industrial sector on the earnings upgrade table after posting a strong beat against broker expectations on FY25 earnings and margins. These outcomes were due to better-than-expected results from both KFC Australia and Europe, lower corporate costs, and lower net interest. Collins Foods aside, other top increases in average earnings forecasts went to miners 29Metals and Stanmore Resources.
Citi’s target for copper-focused base and precious metals mining company 29Metals was increased to 15c from 12c after raising FY25 and FY27 earnings forecasts by between 4-6% on higher base metal forecasts.
The broker’s Sell rating was retained. Elsewhere among copper names, a Buy for Capstone Copper and a Neutral for Sandfire Resources were retained.
At Ord Minnett, where 29Metals remains a Hold, South32 (Neutral at Citi) and Capstone Copper remain this broker’s top picks for base metals exposure.
Citi’s earnings forecast for Stanmore Resources rose due to higher price forecasts for Low Volatile Pulverized Injection (PCI) coal, causing FY26 and FY27 forecasts to increase by 10% and 6%, respectively.
In the good books: upgrades
ADAIRS LIMITED ((ADH)) was upgraded to Buy from Accumulate by Morgans. B/H/S: 1/3/0
Morgans notes Adairs’ FY25 group earnings (EBIT) guidance of $53.5m – $57.0m is about -10% below the consensus expectation, though up 1.2% year-on-year, with sales expected to rise 6.2%. According to the broker, Adairs-branded sales remain solid, up 9.2%, but promotional intensity and a weaker currency have pressured margins, particularly in June. Focus sales are down -7%, with earnings falling nearly -36% due to geographic exposure and weaker conversion in large-ticket items, explain the analysts. Mocka continues to perform strongly, observes the broker, with FY25 revenue up 14.1%, supported by over 25% growth in Australia and a turnaround in New Zealand. Despite near-term earnings softness, Morgans sees valuation support and upgrades to a Buy rating from Accumulate with a $2.60 price target, down from $2.85. See also ADH downgrade.
AMCOR PLC ((AMC)) was upgraded to Buy from Neutral by UBS. B/H/S: 5/1/0
UBS raises its target for Amcor to $18.25 from $16.90 upgrades to Buy (from Neutral) for the first time in around three years. The analysts see the Berry merger as a catalyst for a forecast 12% EPS compound annual growth rate (CAGR) over FY2528. The broker expects full delivery of $650m in synergy benefits, with just 10% priced into shares and consensus assuming around 70%. Amcor’s revised capital plan, including $1.2bn in potential share buybacks and higher growth capex, is seen by UBS as supportive of earnings growth and a multiple re-rating. The broker sees a shift from stagnant EPS to sustained double-digit growth as Amcor invests more in high-growth packaging categories.
ADVERITAS LIMITED ((AV1)) was upgraded to Buy from Speculative Buy by Bell Potter. B/H/S: 1/0/0
Adveritas has completed an $8.5m capital raising via the issue of 85m shares at 10c to support US expansion, e-commerce growth, product development and new integrations, observes Bell Potter. The raise was larger than previously forecast by the broker but resulted in fewer shares issued, leading to modest EPS upgrades by the analysts of around 1% in FY26 and FY27. Bell Potter’s cash forecasts are lifted to $9.2m for FY25 and $9.9m for FY26, with the broker assuming the company remains modestly cash flow positive across FY26. The target is raised to 18c from 15c. Bell Potter upgrades to Buy from Speculative rating, citing a stronger balance sheet and reduced risk profile.
AURIZON HOLDINGS LIMITED ((AZJ)) was upgraded to Outperform from Neutral by Macquarie. B/H/S: 1/4/1
FY25 will mark Aurizon’s weakest year since 2013, observes Macquarie, with coal volumes flat and contract delays weighing on performance. Management is expecting underlying earnings (EBITDA) of around $1.575m. The broker forecasts a recovery in FY26, supported by a $100m uplift in regulated network revenue and benefits from a cost-out program. Expected earnings for FY25 were 2.1% ahead of the analyst’s expectations, but downgrades have been made to the broker’s FY25-27 earnings forecasts due to weaker coal volumes and network under-recovery. Macquarie retains its price target at $3.39 and upgrades to Outperform from Neutral. See also AZJ downgrade.
LOVISA HOLDINGS LIMITED ((LOV)) was upgraded to Neutral from Sell by UBS. B/H/S: 4/2/1
UBS upgrades Lovisa Holdings to Neutral from Sell with a higher target price of $30 from $26 due to better-than-expected store growth and upside from Jewells, UBS states. The previous ‘Sell’ rating was predicated on a slowdown in store growth since the robust FY23 at 172. Recent indications show a pick-up in store growth, notably in Europe, alongside the new Jewells format, which is expected to generate further store and sales acceleration. Visiting two new UK Jewells stores in White City and Reading, UBS highlights a more “luxurious format” and a generally larger store size with a higher price range, aiming for the “aspirational millennial” customer. The analyst revises EPS estimates down in FY25 by -2.8%, and up 2.8% for FY26 and 5.5% for FY27, and highlights the positive management changes, including Mark McInnes to Executive Deputy Chairman, to complement new CEO John Cheston.
REECE LIMITED ((REH)) was upgraded to Accumulate from Hold by Ord Minnett. B/H/S: 2/2/2
Ord Minnett revisited Reece’s outlook following share weakness in recent months, noting FY25 will likely be a cyclical low for operating earnings and return on invested capital. The broker acknowledges the near-term outlook is challenging. However, the company’s active investment through the downturn and expected modest improvement in construction activity in Australia/NZ will improve returns from here. Rating upgraded to Accumulate from Hold. Target unchanged at $20.40.
RESOLUTE MINING LIMITED ((RSG)) was upgraded to Buy from Accumulate by Ord Minnett. B/H/S: 2/0/0
Ord Minnett has updated the commodity price assumptions. The gold price forecast is up 7% in 2025 and 10% in 2026, respectively. Ord Minnett upgrades Resolute Mining to Buy from Accumulate. Target price lifts to $1 from 65c and the broker’s EPS estimates rise by 31% and 35% for FY25/FY26, respectively.
In the bad books: downgrades
ADAIRS LIMITED ((ADH)) was downgraded to Hold from Buy by Bell Potter. B/H/S: 1/3/0
Bell Potter downgrades Adairs to Hold from Buy with a decline in target price by -21% to $2.10 from $2.65. The analyst highlights FY25 guidance for revenue at $514m – $618m broadly met expectations, but earnings before interest and tax guidance was -10% below consensus forecasts at the mid-point. Notably, Adairs is performing well with year-to-date FY25 sales growth of 9% against group sales growth of 6%, with Focus on Furniture being the issue in terms of underperforming against expectations. Bell Potter downgrades EPS estimates by -20.5% for FY25 and -28.9% for FY26 due to lower Focus on Furniture sales and a weakening in margins, as well as for Adairs due to increased promotional activity. See also ADH upgrade.
ANZ GROUP HOLDINGS LIMITED ((ANZ)) was downgraded to Sell from Neutral by UBS. B/H/S: 0/4/1
UBS has done a detailed analysis of ANZ Bank, noting it has been one of the largest underperformers among its coverage in the past five years (-66%). The broker’s analysis suggests the bank’s biggest weakness is the retail division. Scenario analysis suggests up to 16% uplift to group EPS is possible, if the bank follows Macquarie Group’s ((MQG)) playbook of deposit gathering and mortgage broker-led model. The broker cut the DPS forecast for FY25 by -25%, FY26 by -12% and FY27 by -13% on the expectation the new CEO will want to manage the bank at a stronger CET1 of around 12%. The broker also trimmed FY26-27 net interest margin forecast by -2bps and slightly lifted the costs estimates. Target price cut to $26.50 from $30.00. Rating downgraded to Sell from Neutral.
AURIZON HOLDINGS LIMITED ((AZJ)) was downgraded to Hold from Accumulate by Morgans. B/H/S: 1/4/1
While the short term earnings risk has most likely been taken care of by yet another profit warning, Morgans has in addition dimmed its outlook for the coal transporting business, the highest quality part of Aurizon Holdings. The business is moving away from its legacy coal transport business, but the broker argues this is also of lower-quality and against fierce competition. Short term the shares look attractive, but it’s the medium term outlook that triggers the downgrade to Hold from Accumulate. Price target has fallen to $2.94 (was $3.10). See also AZJ upgrade.
BHP GROUP LIMITED ((BHP)) was downgraded to Accumulate from Buy by Morgans. B/H/S: 5/1/0
Morgans downgrades BHP Group to Accumulate from Buy and lowers the target price to $43.70 (from $48.70). The broker has revised down iron ore forecasts to US$89/t for FY26, with the long-term price unchanged at US$77/t, and has downgraded the sector view to Neutral from Overweight. The iron ore price is expected to slip to the mid-US$80s/t in 2H 2025, prior to a supply-side response. Morgans explains Chinese export profits are under pressure from tariffs, and Beijing is anticipated to adopt an enforcement policy on high-emission mills to cut production. For BHP, iron ore represents 55% of FY26 earnings (EBITDA) forecast, so every US$5/t price move impacts earnings by 2%, both up and down. A decline in the iron ore price below US$80/t would force a dividend cut, the analyst warns.
DRONESHIELD LIMITED ((DRO)) was downgraded to Hold from Buy by Shaw and Partners. B/H/S: 1/1/0
The June update from DroneShield showed a sharp increase in secured revenue to $161m from $100m in May, thanks to a $61.6m European handheld systems order. Shaw and Partners notes the pipeline also increased to $2.41bn from $2.34bn in May, and cash lifted to $198m. With Europe representing 46% of the pipeline due mainly to NATO defence spending, the company reiterated its plan for an EU assembly hub. The broker lifted FY25-27 forecasts significantly, leading to a rise in the target price to $2.00 from $1.20. Rating downgraded to Hold, High Risk from Buy.
FORTESCUE LIMITED ((FMG)) was downgraded to Hold from Buy by Morgans and to Neutral from Buy by Citi. B/H/S: 2/5/0
Morgans downgrades Fortescue to Hold from Buy with a target price of $16.50 (from $18.80). The broker has revised down iron ore forecasts to US$89/t for FY26, with the long-term price unchanged at US$77/t, and has downgraded the sector view to Neutral from Overweight. The iron ore price is expected to slip to the mid-US$80s/t in 2H 2025, prior to a supply-side response. Morgans explains Chinese export profits are under pressure from tariffs, and Beijing is anticipated to adopt an enforcement policy on high-emission mills to cut production. The analyst highlights Fortescue generates 100% of earnings from iron ore, giving the company greater sensitivity to every US$5/t move in the price. Taking into account the gearing to iron ore for funding Fortescue’s energy targets, the analyst points to an earnings mix (EBITDA) that is closer to 115% leveraged to iron ore. Following the latest commodity price update, Citi had downgraded the rating for Fortescue to Neutral from Buy. The target price is lowered to $16.00 from $17.50. The broker cut FY26-27 EBITDA forecast by -3% and -6%, respectively, on lower iron ore prices and higher spot AUD/USD.
GLOBAL LITHIUM RESOURCES LIMITED ((GL1)) was downgraded to Hold from Accumulate by Ord Minnett. B/H/S: 1/1/1
Ord Minnett has revised its commodity price forecasts, with the biggest downgrades made to lithium price forecasts. Rating downgraded for Global Lithium Resources to Hold from Accumulate. Target unchanged at 20c.
KELSIAN GROUP LIMITED ((KLS)) was downgraded to Accumulate from Buy by Ord Minnett. B/H/S: 2/0/0
Kelsian Group bagged a transportation contract with Woodside Energy’s ((WDS)) Lousiana LNG project, closely following the CP2 LNG contract it secured last week. Ord Minnett notes the company now has four LNG transportation contracts from November 2026 to December 2029, with the latest expected to be 5% EPS accretive over FY27-29. Another LNG contract equivalent to the current LNG contracts is also a possibility. The analyst expects the next catalyst to be a potential extension of the contract with Transport NSW, where it expects the company to negotiate a deal with a higher margin of 5-11% from 1.3% currently. Target price lifted to $3.95 from $3.80. Rating downgraded to Accumulate from Buy for valuation reasons.
LIONTOWN RESOURCES LIMITED ((LTR)) was downgraded to Sell from Neutral by Citi and Downgrade to Sell from Lighten by Ord Minnett. B/H/S: 1/1/4
In the latest quarterly commodity update for Citi, the analyst downgrades Liontown Resources to Sell from Neutral, with the key price forecast revision for lithium down by -15% to -20% over the next three years. The analyst lowers the spodumene estimates by -13% for 2025, -27% for 2026, and -20% for 2027, and chemicals by a similar amount.
Target price unchanged at 50c as the broker shifted valuation multiple to 1.0x NAV from 0.8x on production de-risking. Ord Minnett has updated the commodity price assumptions on the back of a weaker-than-expected economic macro outlook, with across-the-board downgrades for lithium spodumene, carbonate, and hydroxide out to 2027. Ord Minnett downgrades Liontown Resources to Sell from Lighten with a lower target price of 45c from 50c.
LYNAS RARE EARTHS LIMITED ((LYC)) was downgraded to Underperform from Neutral by Macquarie. B/H/S: 3/0/3
Macquarie maintains its $8.00 target for Lynas Rare Earths but downgrades to Underperform from Neutral on valuation, despite a constructive production and price outlook. In a significant milestone, according to the broker, the company delivered its first Dysprosium Oxide (Dy) and Terbium Oxide (Tb) from its heavy rare earths (HRE) separation circuit. However, the analyst sees limited near-term earnings contribution from HRE production. Macquarie warns lack of progress in China/US trade talks, and the potential release of held-up HRE products, could dampen market sentiment.
METCASH LIMITED ((MTS)) was downgraded to Neutral from Buy by Citi. B/H/S: 3/2/0
Metcash’s FY25 EBIT of $507.8m came in at the top end of guidance. While housing construction is recovering from weak levels, Citi believes the consensus is too optimistic for hardware earnings in FY26. The analyst notes the recovery in detached housing approvals is not as robust as anticipated, meaning a more substantial recovery in Metcash’s hardware business is now not expected until FY27. The benefits of negative sentiment towards the large retailers which previously benefitted the company are expected to subside as the likes of Woolworths Group ((WOW)) work to change customer perceptions. The broker lowered the FY26 EBIT forecast by -2% but left FY27 unchanged. Rating downgraded to Neutral from Buy. Target lifted to $3.90 from $3.70 on recent share outperformance.
PILBARA MINERALS LIMITED ((PLS)) was downgraded to Sell from Hold by Ord Minnett. B/H/S: 4/1/2
Ord Minnett has updated the commodity price assumptions on the back of a weaker-than-expected economic macro outlook, with across-the-board downgrades for lithium spodumene, carbonate, and hydroxide out to 2027. Ord Minnett downgrades Pilbara Minerals to Sell from Hold with a target price of $1.10 from $1.75.
REA GROUP LIMITED ((REA)) was downgraded to Hold from Buy by Bell Potter. B/H/S: 3/4/0
Bell Potter observes a soft May for REA Group, with national new listings down -9.7% year-on-year (PropTrack data) following a -10.6% decline in April, which drags financial year-to-date growth to the low end of guidance.
The broker lowers its FY25 new listings forecast to 1.3% growth from 2.0%, citing macro tailwinds and a strong June outlook as partial offsets. An ACCC investigation into REA’s pricing power presents a potential 6-9 month regulatory overhang, contrasting with Domain Holdings Australia’s ((DHG)) weaker market position. Bell Potter notes REA’s growth in FY26 may rely more heavily on yield, with flat listing volumes expected and residential revenue growth driven by higher pricing and increased penetration. The broker downgrades to Hold from Buy and cuts its target price to $262 from $267.
RIO TINTO LIMITED ((RIO)) was downgraded to Hold from Accumulate by Morgans. B/H/S: 1/5/0
Morgans downgrades Rio Tinto to Hold from Accumulate with the new target price set at $108 from $119. The broker has revised down iron ore forecasts to US$89/t for FY26, with the long-term price unchanged at US$77/t, and has downgraded the sector view to Neutral from Overweight. The iron ore price is expected to slip to the mid-US$80s/t in 2H 2025, prior to a supply-side response. Morgans explains Chinese export profits are under pressure from tariffs, and Beijing is anticipated to adopt an enforcement policy on high-emission mills to cut production. The analyst highlights that around 70% of 2025 expected earnings (EBITDA) for the company is generated from iron ore, underwriting circa 6% variance in earnings for every US$5/t move in the iron ore price, either up or down. Morgans emphasises risks around rising costs for Pilbara, execution on Simandou, Canadian tariffs, Mongolian rents, and instability in Guinea, which leaves the company with little room on earnings if the iron ore price moves lower than US$85/t.
SMARTPAY HOLDINGS LIMITED ((SMP)) was downgraded to Hold from Buy by Bell Potter. B/H/S: 1/1/0
Bell Potter downgrades SmartPay to Hold from Buy with a lower target price of $1.13, down from $1.30, following the announcement that Shift4 will acquire 100% of its capital at NZ$1.20. The offer represents a premium of 47% to the three-month weighted average price, with the board unanimously recommending that shareholders accept the offer in the absence of a superior proposal.
EARNINGS FORECAST
Listed below are the companies that have had their forecast current year earnings raised or lowered by the brokers last week. The qualification is that the stock must be covered by at least two brokers. The table shows the previous forecast on an earnings per share basis, the new forecast, and the percentage change.
