In the good books
BANK OF QUEENSLAND (BOQ) was upgraded to Buy from Neutral by Citi
Banking analysts at Citi have used their first sector update in 2021 to express ongoing confidence that bank share prices will continue their recovery on improving operational context. Citi remains convinced Net Interest Margins, or NIMs, will no longer decline while market forecasts for loan losses will prove too bearish. The analysts also believe stock picking remains key for investors and the broker’s revised ranking order now has Westpac on number one, followed by ANZ Bank, Bank of Queensland, National Australia Bank, then CommBank, with Bendalaide Bank least preferred. The broker’s price target for Bank of Queensland has lifted to 8.50 from $7.25. Buy (upgrade from Neutral).
In the not-so-good books
AMCOR (AMC) was downgraded to Neutral from Buy by Citi
With a preference for more cyclical companies for the calendar year ahead, Citi has decided to, in its own choice of words, move to the sidelines by downgrading to Neutral from Buy. Amcor’s operations have almost no exposure to industrial activity, unlike other packaging companies, and in the context of the nascent economic recovery this has now become a negative given this translates into less upside potential. Citi’s price target has fallen to $16.80 from $17.90. The analysts continue to acknowledge positives stemming from Amcor’s attractive dividend yield, balance sheet flexibility, and high-quality portfolio, plus synergies from the Bemis operations.
CREDIT CORP GROUP (CCP) was downgraded to Hold from Add by Morgans
The broker believes Credit Corp’s recent PDL acquisition (from Collection House) materially adds to the company’s domestic purchasing pipeline at a time when sector volumes are significantly down. While remaining positive on the company’s long-term outlook, including the opportunity to grow in the USA, Morgans has downgraded to Hold from Add on valuation. The price target has increased to $31.10 from $21.20.
NATIONAL AUSTRALIA BANK (NAB) was downgraded to Neutral from Buy by Citi
The broker’s price target for National Australia Bank has lifted to $24.75 from $23.75. The rating has been downgraded to Neutral from Buy. NAB was prior to today’s update the broker’s most preferred sector exposure.
The above was compiled from reports on FNArena. The FNArena database tabulates the views of seven major Australian and international stockbrokers: Citi, Credit Suisse, Macquarie, Morgan Stanley, Morgans, Ord Minnett and UBS. Important: This content has been prepared without taking account of the objectives, financial situation or needs of any particular individual. It does not constitute formal advice. Consider the appropriateness of the information in regard to your circumstances.
