Our ‘Best Calls to Action’ are designed to guide you through the current reporting season landscape by highlighting stocks with compelling buying prospects. It also provides insights into those that may not be viable for growth at this time. These selections are based on rigorous analysis of market trends, financial health, and growth potential, ensuring you have access to high-value investment opportunities.

Happy to buy today

Suncorp (ASX:SUN) - Looking to the future as a pure-play General Insurer

SUN's FY24 cash NPAT (A$1,372m) was ~-5% below consensus (A$1,425m), mainly due to a softer General Insurance result than expected. FY25 guidance points to solid earnings momentum continuing into this year, and we see SUN's unveiled FY25-FY27 business strategy as uncomplicated, and focused on driving the insurance business harder (which should be well received).

We maintain our ADD rating.

Trim/Funding Source

Westpac Banking Corp (ASX:WBC) - Q3 NIM improvement

The Q3 trading update indicated WBC is tracking ahead of previous expectations, with NIM higher and costs and impairment charges lower than prior forecasts. Mid-single digit EPS upgrades for FY25-26F. 12 month target price lifts 8% to $26.11 due DCF valuation upgrades.

We maintain our HOLD rating.

IRESS (ASX:IRE) - Stability and flexibility returned to the core

IRE reported 1H24 adjusted EBITDA of A$67m, up 52% on pcp (top-end of recent guidance); and up ~8% HOH (2% HOH revenue growth on stable costs). FY24 Adjusted EBITDA guidance was provided at A$126-132m, post asset sales. Whilst the previous 'exit run-rate' guidance is no longer being provided, we expect the 2H24 drivers should see the upper-end of guidance achievable.

We adjust to a HOLD rating.

Reece (ASX:REH) - Tough housing conditions persist

REH's FY24 result was slightly weaker than our expectations but largely in line with Bloomberg consensus. Key positives: Group EBITDA margin rose 30bp to 11.1% due to good cost control despite softer housing conditions in ANZ in 2H24; ROCE increased 20bp to 15.5%; Balance sheet remains strong with ND/EBITDA falling to 0.6x vs 0.9x in FY23. Key negatives: ANZ earnings were below our forecasts as conditions continued to soften; Management expects the near term to remain challenging in both regions.

We maintain our REDUCE rating.


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Disclaimer: The information contained in this report is provided to you by Morgans Financial Limited as general advice only, and is made without consideration of an individual's relevant personal circumstances. Morgans Financial Limited ABN 49 010 669 726, its related bodies corporate, directors and officers, employees, authorised representatives and agents (“Morgans”) do not accept any liability for any loss or damage arising from or in connection with any action taken or not taken on the basis of information contained in this report, or for any errors or omissions contained within. It is recommended that any persons who wish to act upon this report consult with their Morgans investment adviser before doing so.

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Our ‘Best Calls to Action’ are designed to guide you through the current investment landscape by highlighting stocks with compelling buying prospects. It also provides insights into those that may not be viable for growth at this time. These selections are based on rigorous analysis of market trends, financial health, and growth potential, ensuring you have access to high-value investment opportunities.
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