The chart below shows the buy recommendations of brokers. Companies are only displayed in this table if at least 5 of the above mentioned brokers have a current position on the stock. A broker sentiment value of +1 means all brokers have a buy recommendation. The target price upside/downside is relative to the price at the time the table was updated.
The stocks with the largest target price upside this week are Alacer Gold Corp with 89.9% and NextDC with 50.9%.
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In the good books
ALACER GOLD CORP (AQG) Upgrade to Outperform from Neutral by Macquarie B/H/S: 4/1/0
Macquarie acknowledges the unforeseen plunge in the gold price post-Trump and while expecting further volatility, on a medium to long term outlook believes there’s an 80% chance US economic outcomes will be positive for gold.
The broker thus believes some miners have been sold off too far. Alacer is upgraded to Outperform. Target unchanged at $3.40.
CENTURIA METROPOLITAN REIT (CMA) Upgrade to Buy from Neutral by UBS B/H/S: 1/0/0
The responsible entity for Centuria Metropolitan, CPFL, has conditionally acquired an 8.76% stake in 360 Capital Office Fund (TOF) for $14.5m.
CPFL believes the property portfolios of CMA and TOF are highly complimentary and intends to consider a merger of the two at some time in the future.
UBS notes two issues with CMA have been liquidity and scale. Hence, a larger vehicle makes sense. The broker expects confidence in the manager to build as it leases vacancy in Canberra, executes on the residential conversion opportunity in Epping and de-risks the FY17 lease expiry in Keswick.
Rating is upgraded to Buy from Neutral. Target is raised to $2.30 from $2.20.
In the not-so-good books
SIMONDS GROUP LIMITED (SIO) Downgrade to Hold from Add by Morgans B/H/S: 0/1/0
Morgans suspects the takeover scheme is unlikely to be approved and implemented in its current form. The broker envisages the substantial holding of McDonald Jones Homes as a blocking stake, noting that the majority of this holding has been acquired above the offer price.
The broker considers Simonds to be fundamentally undervalued but recognises there are short-term price risks associated with voting against the scheme, and inherent earnings risks in the vocational division. Therefore, the company is more reliant on a turnaround in the building division.
The rating is downgraded to Hold from Add. Target is steady at 44c.
Earning forecast
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