In the good books
UBS upgraded AWE (AWE) to Buy from Neutral. Buy/Hold/Sell 4/2/0 The company’s Sugarloaf reserves have increased by 84% and UBS increases valuation for this high quality shale play by 16%. There is more upside if the drilling rate picks up or the potential of the upper Eagle Ford is further delineated.
JP Morgan upgraded Caltex (CTX) to Overweight from Neutral. Buy/Hold/Sell 3/3/1 Rating was upgraded as further analysis has shown continued upside from cost savings and other items, while capital management remains a key driver for share price performance. The analysts emphasise there’s a significant business repositioning taking place and recent share price weakness has made entry point to gain access more attractive.
Credit Suisse upgraded NIB Holdings (NHF) to Neutral from Underperform. Buy/Hold/Sell 1/5/0 The company has acquired travel insurance distributor, World Nomads, primarily funded by debt. Credit Suisse estimates the acquisition will be 3.1% accretive in FY16 and 3.6% accretive in FY17. The acquisition fits with the company’s strategy of diversifying the earnings base and providing growth opportunities in complementary areas.
In the not-so-good books
Morgans downgraded Woodside Petroleum (WPL) to Reduce from Hold. Buy/Hold/Sell 2/2/4 Morgans is worried about retail investors not yet having caught up with the fact that Woodside’s interim dividend is about to take a dive, given lower oil prices are translating into lower profits and lower cash flows for the company. This, combined with a tepid growth profile, keeps the stockbroker at bay even though Woodside is liked as a high quality business.
The above was compiled from reports on FNArena, which tabulates the views of eight major Australian and international stock brokers: BA-Merrill Lynch, CIMB, Citi, Credit Suisse, Deutsche Bank, JP Morgan, Macquarie and UBS.
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