Heroes vs Zeroes. The ASX stocks that have copped the biggest broker upgrades and downgrades
Broker upgrade heroes this week included JB Hi-Fi, Pro Medicus, and REA, but Aussie Broadband, IDP Education, and ANZ were downgrade zeroes.
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Mentioned
KEY POINTS
- Consumer Discretionary stocks featured heavily in broker upgrades
- REA Group (REA) and Pro Medicus (PME) were lauded by brokers after recent market updates
- Super Retail Group (SUL), Sims Group (SGM), and IDP Education (IEL) each copped big cuts to their price targets
Welcome to our weekly review of the biggest broker moves on ASX stocks for the last week.
Consumer stocks featured heavily in broker upgrades, partly due to a slew of trading updates from these companies that also contained positive FY24 guidance updates. Super Retail Group (ASX: SUL) is an interesting one here, given it's FY24 guidance wasn't well received by the market at all – it's share price plunged – but it garnered two broker upgrades (one to BUY).
There was less of a theme among the downgrades, but again, those stocks which provided disappointing trading updates generally drew the ire of the brokers. WA-based mining-tech company Imdex (ASX: IMD) copped a couple, and one of those was to a SELL.
There were also some substantial price target changes, the most notable for Integrated Research (ASX: IRI) (PT⬆️ +44%), but Pro Medicus (ASX: PME) (PT⬆️ +25%) and REA Group (ASX: REA) (PT⬆️ +24%) deserve a special mention here, and also more generally, as they featured in the upgrades list as well. They're also noteworthy as stocks which appear to have substantial upside from their current prices to the brokers' targets.
Going the other way, SUL (PT⬇️ -14%), Sims Group (ASX: SGM) (PT⬇️ -23%), and IDP Education (IEL) (PT⬇️ -30%) each copped big cuts to their price targets.
How to read broker recommendations 🔎
Typically, there are two major components of a broker’s view:
Rating: A call to action, usually along the lines of buy, hold, or sell, but depending on the broker’s ratings system, can be somewhere in between (e.g., accumulate or add is typically between a hold and a buy).
Price target (PT): The price at which the broker expects the stock will be trading at some point in the future, generally within the next 12 months.
Broker upgrades since Wednesday 8 May
Company | Broker | New Rating | Old Rating | Price Target | PT Upside% |
|---|---|---|---|---|---|
Ainsworth Game Technology (AGI) | Citi | Outperform | Underperform | $1.09 | 14.7% |
Aristocrat Leisure (ALL) | CLSA | Buy | Outperform | $46.90 | 17.4% |
ALS (ALQ) | Morgans | Add | Hold | $15.00 | 10.1% |
ARB Corporation (ARB) | Ord Minnett | Buy | Accumulate | $44.00 | 12.9% |
Bellevue Gold (BGL) | UBS | Buy | Neutral | $2.05 | 12.3% |
Credit Corp Group (CCP) | Macquarie | Outperform | Neutral | $18.32 | 19.7% |
GR Engineering Services (GNG) | Argonaut Securities | Buy | Hold | $2.50 | 11.1% |
JB HI-FI (JBH) | JP Morgan | Overweight | Neutral | $63.00 | 9.1% |
Pro Medicus (PME) | CLSA | Outperform | Underperform | $125.00 | 10.5% |
REA Group (REA) | UBS | Buy | Neutral | $214.00 | 16.5% |
REA Group (REA) | CLSA | Outperform | Sell | $204.00 | 11.0% |
Super Retail Group (SUL) | UBS | Neutral | Sell | $13.00 | -3.8% |
Super Retail Group (SUL) | CLSA | Buy | Outperform | $15.50 | 14.7% |
Broker upgrades since Wednesday 8 May
From the brokers:
Ord Minnett upgrades ARB Corporation (ASX: ARB) to BUY from ACCUMULATE
PT⬆️ $44 vs $42.50 previous
"ARB provided a positive 3Q24 trading update with sales up 6.4% in the period, compared with 1H24 sales growth of 0.2%. All segments reported growth, with Export sales up for the first time in 18 months. The outlook is improving, and favourable trading conditions are anticipated to persist through to FY25."
UBS upgrades Bellevue Gold (ASX: BGL) to BUY from NEUTRAL
PT⬆️ $2.05 vs $2.00 previous
"We upgrade BGL to Buy rated (A$2.05/sh) after updating with the 1.5mtpa plant expansion in our base case."
Macquarie upgrades Credit Corp Group (ASX: CCP) to OUTPERFORM from NEUTRAL
PT$18.32 unchanged
"The recent share price performance has seen expectations for CCP de-rate to an attractive level. Based on Macquarie FY25 forecasts, CCP is trading at a 24% discount to its long term PE multiple."
Broker downgrades since Wednesday 8 May
Company | Broker | New Rating | Old Rating | Price Target | PT Upside% |
|---|---|---|---|---|---|
Aussie Broadband (ABB) | Ord Minnett | Accumulate | Buy | $4.19 | 15.7% |
Ainsworth Game Technology (AGI) | Macquarie | Neutral | Outperform | $1.10 | 15.8% |
ANZ Group (ANZ) | Morgan Stanley | Equal-Weight | Overweight | $27.70 | -1.1% |
Fleetpartners Group (FPR) | Macquarie | Neutral | Outperform | $3.60 | 7.8% |
IDP Education (IEL) | UBS | Neutral | Buy | $17.65 | 11.1% |
Iluka Resources (ILU) | JP Morgan | Neutral | Overweight | $8.20 | 7.2% |
Imdex (IMD) | Jarden | Neutral | Overweight | $1.95 | -5.3% |
Imdex (IMD) | Bell Potter | Sell | Hold | $1.60 | -22.3% |
Lithium Energy (LEO) | Jarden | Sell | Neutral | $0.43 | -79.1% |
Orica (ORI) | Jarden | Overweight | Buy | $18.55 | 1.3% |
Sims (SGM) | RBC Capital Markets | Underperform | Sector Perform | $10.75 | 0.2% |
Broker downgrades since Wednesday 8 May
From the brokers:
Morgan Stanley downgrades ANZ Group (ASX: ANZ) to EQUAL-WEIGHT from OVERWEIGHT
PT⬇️ $27.70 vs $27.90 previous
"We downgrade to EW given ANZ has a range of strategic priorities to juggle, EPS upgrades will be hard to come by, and trading multiples are fair"
UBS downgrades IDP Education Group (ASX: IEL) to NEUTRAL from BUY
PT⬇️ $17.65 vs $25.30 previous
"While we believe a large degree of negativity is already incorporated in IEL's share price, we think recent developments extend the duration of uncertainty, which could prolong share price recovery and negatively impact earnings as students wait for better visibility on the outlook"
Biggest broker price target changes since Wednesday 8 May
Company | Broker | Rating | New PT | Old PT | PT Change% | PT Upside% |
|---|---|---|---|---|---|---|
Integrated Research (IRI) | Bell Potter | Buy | $0.95 | $0.66 | 43.9% | 20.3% |
Pro Medicus (PME) | CLSA | Outperform | $125.00 | $100.00 | 25.0% | 10.5% |
REA Group (REA) | CLSA | Outperform | $204.00 | $164.00 | 24.4% | 11.0% |
Pinnacle Investment Management (PNI) | Ord Minnett | Buy | $16.00 | $13.00 | 23.1% | 24.9% |
Fleetpartners Group (FPR) | Morgan Stanley | Overweight | $3.90 | $3.20 | 21.9% | 16.8% |
Lotus Resources (LOT) | Bell Potter | Buy | $0.60 | $0.50 | 20.0% | 33.3% |
Fleetpartners Group (FPR) | Macquarie | Neutral | $3.60 | $3.01 | 19.6% | 7.8% |
REA Group (REA) | Jefferies | Hold | $200.45 | $171.51 | 16.9% | 9.1% |
REA Group (REA) | UBS | Buy | $214.00 | $184.00 | 16.3% | 16.5% |
Goodman Group (GMG) | Ord Minnett | Sell | $24.00 | $20.85 | 15.1% | -28.3% |
Orica (ORI) | Morgan Stanley | Overweight | $21.50 | $19.00 | 13.2% | 17.4% |
Life360 (360) | Goldman Sachs | Buy | $16.05 | $14.20 | 13.0% | 7.4% |
Alpha HPA (A4N) | Bell Potter | Buy | $1.95 | $1.75 | 11.4% | 103.1% |
Orica (ORI) | Jefferies | Buy | $20.80 | $18.80 | 10.6% | 13.6% |
Wisetech Global (WTC) | UBS | Buy | $112.00 | $102.00 | 9.8% | 14.8% |
Life360 (360) | Ord Minnett | Buy | $16.68 | $15.20 | 9.7% | 11.6% |
REA Group (REA) | Macquarie | Neutral | $196.00 | $179.00 | 9.5% | 6.7% |
ALS (ALQ) | Morgans | Add | $15.00 | $13.70 | 9.5% | 10.1% |
Life360 (360) | Bell Potter | Buy | $17.75 | $16.25 | 9.2% | 18.7% |
Orica (ORI) | JP Morgan | Overweight | $20.70 | $19.00 | 8.9% | 13.1% |
Platinum Asset Management (PTM) | Bell Potter | Buy | $1.10 | $1.20 | -8.3% | 3.8% |
Imdex (IMD) | Bell Potter | Sell | $1.60 | $1.75 | -8.6% | -22.3% |
Arcadium Lithium (LTM) | Bell Potter | Buy | $9.50 | $10.40 | -8.7% | 34.4% |
Ainsworth Game Technology (AGI) | Citi | Outperform | $1.09 | $1.24 | -12.1% | 14.7% |
Seven West Media (SWM) | Goldman Sachs | Sell | $0.21 | $0.24 | -12.5% | 7.7% |
Sims (SGM) | Jarden | Neutral | $12.10 | $14.00 | -13.6% | 12.8% |
Super Retail Group (SUL) | Macquarie | Neutral | $13.80 | $16.00 | -13.8% | 2.1% |
Sims (SGM) | Morgan Stanley | Underweight | $10.00 | $12.00 | -16.7% | -6.8% |
Fletcher Building (FBU) | Goldman Sachs | Neutral | $3.05 | $3.70 | -17.6% | 10.9% |
Sims (SGM) | Macquarie | Outperform | $13.00 | $16.00 | -18.8% | 21.2% |
Baby Bunting Group (BBN) | Macquarie | Neutral | $1.40 | $1.74 | -19.5% | -1.4% |
Fletcher Building (FBU) | Macquarie | Underperform | $2.56 | $3.23 | -20.7% | -6.9% |
Fletcher Building (FBU) | Morgan Stanley | Equal-Weight | $2.84 | $3.67 | -22.6% | 3.3% |
Sims (SGM) | RBC Capital Markets | Underperform | $10.75 | $14.00 | -23.2% | 0.2% |
Ainsworth Game Technology (AGI) | Macquarie | Neutral | $1.10 | $1.45 | -24.1% | 15.8% |
Lithium Energy (LEO) | Jarden | Sell | $0.43 | $0.60 | -28.3% | -45.6% |
IDP Education (IEL) | UBS | Neutral | $17.65 | $25.30 | -30.2% | 11.1% |
Curvebeam AI (CVB) | Bell Potter | Buy | $0.33 | $0.55 | -40.0% | 73.7% |
Paradigm Biopharmaceuticals (PAR) | Bell Potter | Buy | $0.47 | $1.40 | -66.4% | 67.9% |
Biggest broker price target changes since Wednesday 8 May
From the brokers:
Bell Potter raises PT⬆️ on Integrated Research (ASX: IRI) to $0.95 from $0.68
Rating BUY
"On the back of the positive update and guidance we have increased the multiples we apply in the PE ratio and EV/EBITDA valuations...We note the outlook for the stock is positive given the solid pipeline of new opportunities, the renewal pipeline in FY25 is similar to FY24 (and includes JPMC) and the growing cash levels."
Ord Minnett raises PT⬆️ on Pinnacle Investment Management (ASX: PNI) to $16 from $13
Rating BUY
"PNI’s Apr-24 update was ahead of our expectations, with flow momentum the best in over two years. Meanwhile, the prospect of a new, wellcredentialed global equities Affiliate adds some excitement to the longer term story."
Bell Potter cuts PT⬇️ on Paradigm Biopharmaceuticals (ASX: PAR) to $0.47 from $1.40
Rating BUY (SPECULATIVE)
"The key driver of the valuation revision is the inclusion of further shareholders equity over the course of FY25/26 required for funding of the two Phase 3 trials. Following numerous delays to the commencement of these approval studies"
