Research notes

IMR posted its 1H26 result which highlighted solid clinical and regulatory progress. Although revenue remains modest, we expect sales momentum to increase in 2H26 and FY27 with NorthStar, European and hopefully Middle East sales to be the highlight. We have revised down our revenue forecast for FY26. The cost across the forecast period has been revised up reflecting higher-than-forecast R&D and clinical expenses. As a result, our DCF valuation and target price moves to A$2.90 (from A$2.94). Key catalysts we are focused on include the submission of the 4th PMA module, additional NorthStar sales and orders from Europe. We maintain our SPECULATIVE BUY recommendation.

4Q26 was broadly in line, with another quarter of double-digit EPS growth, gross margin expansion and strong cash generation. FY27 guidance was introduced for the first time and, while appearing soft at the headline level, incorporates several portfolio changes and one-offs, with the underlying business driving c5-7% revenue and c12-14% EPS growth. Management reiterated confidence in the underlying sleep market, ongoing margin expansion and capital returns, while continuing to see no evidence that GLP-1 therapies are impacting patient demand. We make modest adjustments to FY27-28 forecasts to reflect updated guidance and portfolio changes, with our target moving to A$39.50. BUY.

We downgraded MND to Hold at 1H26 in February on fears it was reaching for growth in FY27 and that the November 1H27 revenue guide could underwhelm. That is now reflected in consensus and, with order book support in E&C and possibly heavy turnaround activity in Maintenance, risk is skewed to the upside. Nevertheless, a subdued 1H27 guide should be looked through given conservative full-year expectations (VA FY27 EBITDA +3% YoY), recent contract wins and the strength of the capex cycle. We leave FY26 unchanged, lift FY27 EBITDA +7%, and upgrade to BUY with a target price of $35.80 (from $33.85). This represents 25x FY27 PE, justified in our view given FY27 will not be the peak earnings year.

The FY26 result was broadly in line with expectations, with NPAT 1% above our forecast. The outlook commentary confirmed the ANZ retail environment remains challenging given the current macro backdrop, though the UK continues to progress well. We make minimal changes to our forecasts and price target but move from a BUY to an ACCUMULATE recommendation.

JHX is performing well against what remains a challenging macroeconomic backdrop. The legacy JHX division was the callout, growing organic net sales by c.20% as both price and volumes outperformed. AZEK saw a softer quarter as sales declined 5%, a trend which is expected to reverse in 2Q27. FY27 guidance was largely in line with expectations, as a strong 2Q27 guide leaves scope to accommodate a weaker market through 2H27. We retain our HOLD rating, with a A$45/sh price target.

A noisy FY26 result but still a healthy level of earnings, while FY27 guidance pointed to lower production, higher D&A and higher capex versus pre-result consensus. A new capital management framework, ranking growth amongst its highest priorities was revealed, while uncertainty remains around what will be acquired. BPT is a good business, and is enjoying higher output from Waitsia as it ramps up, but undersized oil & gas reserves reduces our view on valuation and risk. We maintain a SELL rating with A$0.82 target price (was A$0.81).

Construction has started. Capex estimates to be largely unchanged from 2024 estimates. Rook I entered construction on 8 June. Development spending is rising (C$30.7m in 2Q26 vs C$23.9m in 1Q26), and the company expects no material revisions to the capital cost estimate from August 2024. A near-term dilution overhang is approaching. From 22 September 2026, NXG can call their 2023 debentures and has signaled expectations of conversion to equity rather than repayment. That's up to 16.3m new shares on issue. We move to an ACCUMULATE rating (previously BUY) due to material valuation updates with a reduced price target of A$15.60ps (previously A$20.80ps).

Centuria Office REIT (COF) delivered a broadly in-line FY26 result. FFO of 11.2cpu and distributions of 10.1cpu were both delivered in line with guidance, with the more relevant detail in the FY27 outlook. FFO guidance of 11.3cpu marks the first year of growth since FY22, while distributions have been reset to 9.0cpu, below market expectations in what management describes as a through-cycle setting. The balance sheet remains the constraint with gearing at 43.7%. Encouragingly, leasing volumes were among the strongest in COF's history although this has yet to translate into occupancy, which was largely unchanged. COF trades at a c.46% discount to NTA and a 67% discount to replacement value, although the catalysts to close that gap remain limited in our view. We retain our Trim with a $0.88/sh price target (previously A$0.80), reflecting our revised earnings forecasts.

REA’s FY26 result continued to highlight the resilience of the franchise, particularly its ability to maintain double-digit yield growth (+13%) in its core Australia business. The result was broadly in line with our expectations. On a core operations basis it delivered ~7% topline growth and EBITDA (pre associate losses) growth of ~12%. Cost discipline was a key highlight in our view, with open jaws for the full year. Our FY27-FY29F EPS is increased by 1-3.5%. Our DCF-derived price target increases to A$203 (from A$199). BUY recommendation maintained.