Upgrades and Downgrades: Cochlear, Stockland and AMC

Upgrades

Accent Group (ASX: AX1)

• Morgans upgrades to Add from Hold with $2.00 target price

• Accent posted 11.3% sales growth in FY22 but a -59.1% drop in profits due to covid-related disruptions. The results were in-line with Morgans expectations. The broker expects to see sales momentum continue and selling products at full price should support higher gross margins in FY23

Downgrades

AGL Energy (ASX: AGL)

• Citi downgrades to Neutral from Outperform with $8.20 target price (from $10.80)

• The investment bank expects AGL to accelerate the move to pass on higher prices to customers which should support a forecasted 30% rise in net profit in FY23

AMC (ASX: AMC)

• UBS downgrades to Neutral from Buy with $19.40 target price

• The downgrade primarily reflects Amcor's valuation and share price performance, up almost 9% year-to-date and close to the previous price target of $20.00. Analysts note that FY23 guidance suggests earnings per share growth between -1% to 4% which suggests a rather strong level of organic growth

Cochlear (ASX: COH)

• Citi downgrades to Neutral from Buy with $225 target price (from $245)

• Cochlear's FY22 results were weaker-than-expected, with underlying earnings -3% below consensus. FY23 guidance of $209m to $305m in net profit was also slightly below consensus. As a result, the investment bank downgraded its FY23-24 earnings expectations expecting a rather sluggish rebound from covid-related disruptions

HT&E (ASX: HT1)

• Macquarie downgrades to Neutral with $1.40 target price

• The broker flagged that first-half FY22 earnings missed expectations due to higher costs and falling market share. HT&E said total radio revenues in the third quarter are pacing 6% to 8%, which was viewed as rather resilient growth. The downgrade primarily reflects a lack of valuation appeal

PWR Holdings (ASX: PWH)

• Bell Potter downgrades to Hold from Buy with $9.75 target price

• PWR posted 24% net profit growth to $20.8m in FY22, ahead of Bell Potter's expectations of $19.4m. Current share price remains close to target, therefore downgraded to hold. Broker still expects double digit growth in FY23-24

Stockland (ASX: SGP)

• Citi downgrades to Neutral from Buy with $3.96 target price (from $4.25)

• FY22 funds from operations (FFO) was 35.7 cents per share, ahead of the company's guidance range of 35.1 to 35.6 cents. The investment bank forecasts flat FFO growth in FY23 due to higher tax payables, which is the primary driver of the rating downgrade