Research notes

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Research Notes

Exciting year ahead as trial progress

EMvision Medical Devices
3:27pm
September 11, 2025
EMV’s first commercial product (emuTM) has all six clinical sites engaged to undertake the pivotal trial of up to 300 suspected stroke patients. The trial is expected to complete recruitment in 1HCY26, which will be a major milestone. EMV’s second product, the (First Responder) has been awarded grant funding of $5m to accelerate the clinical and commercial pathway. The regulatory path will be easier and follow the 510(k) path using the emuTM device as a predicate. EMV is an emerging healthcare play with meaningful catalysts over the next six to 12 months.

International Spotlight

Inditex
3:27pm
September 11, 2025
Founded in Spain, Inditex (ITX.MAD) began in 1963 when AmancioOrtega opened a small dressmaking workshop. Twelve years later, the first Zara store was opened in Spain, signalling Ortega’s transition from maker to retailer. In 1985, Inditex brought all its companies together under the one banner, making it an official retail conglomerate. The brand continued to grow by expanding worldwide, adding new brands to the group and going public on the Madrid Stock Exchange. Now, the group features seven brands, operating over 5,800 stores in 213 markets worldwide.

A sustainable platform destined for growth

Infragreen Group
3:27pm
September 11, 2025
Infragreen Group provides exposure to the sustainability transition through essential service businesses in waste recovery, metal recycling, renewable energy and peaking power. Each business operates in fragmented markets with high regulatory and relationship barriers and supportive industry tailwinds. IFN’s near-term growth profile (+15% EBITDA CAGR FY25-28) will be led by strong organic growth in the group’s solar panel installation business (FY26F incremental EBITDA +A$4.5m), with the remaining portfolio also solidly contributing (+A$2m). We expect earnings upside remains from inorganic initiatives in the near term. We initiate coverage with a A$1.30ps price target and BUY rating, reflecting IFN's diversified portfolio assets and active ownership value creation model.

Site visit inspires confidence

Aeris Resources
3:27pm
September 10, 2025
We recently attended a site visit to AIS’ Tritton operations following our Cracow site visit in July. Morgans has now visited every operating AIS mine. We have adjusted several assumptions relating to Tritton, primarily pertaining to the commencement of Constellation in FY27, which is expected to deliver higher copper and gold grades as well as greater gold recoveries than initially forecast. Incorporating our adjustments following our site visit, along with a stronger understanding of the operational outlook, has lifted our valuation. We maintain our SPECULATIVE BUY rating and a price target of A$0.43ps (previously A$0.31ps), with the increase reflecting greater leverage to improvements due to its higher cost profile.

International Spotlight

salesforce.com, inc.
3:27pm
September 10, 2025
Salesforce was founded in 1999 in San Francisco, California. It is the leading Customer Relationship Management (CRM) software provider and pioneered Software as a Service (SaaS). Salesforce’s pioneering SaaS model meant it was the first company to have all its software and customer data hosted on the internet and made available via monthly subscription.

New CEO makes a $560m bet on cost-out

ANZ Banking Group
3:27pm
September 9, 2025
ANZ announced a headcount reduction that it says will eliminate duplication and complexity, stop work that doesn’t support its priorities, and sharpen its focus on improving non-financial risk management. The market may be cynical that the cost-out will be reinvested back into the business, and the headcount reduction will reduce the ability of the bank to compete for revenue and/or undertake business improvements. Perhaps these concerns will be discussed with ANZ’s strategy update to investors on 13 October. Our target price lifts to $29.24/sh. We upgrade from SELL to TRIM, with 12 month potential TSR of -6%.

More gold, additional metres

Minerals 260
3:27pm
September 9, 2025
MI6 has released a series of high-grade results from its flagship 2.3Moz Bullabulling Gold Project. Latest assays reinforce significant resource growth potential, with infill drilling confirming high-grade gold within the existing Mineral Resource Estimate (MRE) and solid extensional results. The initial 80,000m drill program has been expanded to 110,000m. We now estimate that the December Bullabulling MRE update will likely surpass 3Moz and could surprise to the upside, contingent on additional high-grade results, extensions and cut-off grade parameters. We maintain our SPECULATIVE BUY rating, with a price target of A$0.38ps (previously 0.35ps) noting MI6 remains our preferred Australian pre-development gold play.

Guidance nuances and outlook adjustments

Nanosonics
3:27pm
September 9, 2025
We have updated our forecasts following a deeper review of guidance provided and management commentary, particularly around tariff impacts and CORIS commercialisation timing. While near-term earnings are trimmed, these changes are immaterial to the long-term investment thesis, which remains anchored by recurring revenue growth, installed base expansion, and CORIS’ medium-term potential. Our valuation and target price moderates to A$5.00 (from A$5.50) and we retain our BUY recommendation.

Continuing to execute well

Orica
3:27pm
September 6, 2025
ORI’s trading update was slightly stronger than we expected. ORI is on track to deliver another year of strong earnings growth, improved margins and returns. We have made minor upgrades to our forecasts. With leverage to attractive industry fundamentals, market leading positions, strong earnings growth, proven management team and strong balance sheet, we reiterate our BUY rating with a new price target of A$24.76.

Cessation of coverage

Adriatic Metals
3:27pm
September 4, 2025
Following the acquisition of all the issued share capital in ADT by Dundee Precious Metals, we discontinue coverage of Adriatic Metals (ADT AU) Our forecasts, target price and recommendation should no longer be relied upon for investment decisions.

News & insights

The Wall Street Journal of 21 August 2025 carried an article which noted that Ether, a cryptocurrency long overshadowed by Bitcoin has surged in price in August

The Wall Street  Journal of 21 August 2025 carried an article which noted that Ether, a cryptocurrency long overshadowed by Bitcoin has surged in price in August.

The article noted that unlike Bitcoin, there was not a hard cap on Ether supply, but the digital token is increasingly used for transactions on Ethereum , a platform where developers build and operate applications that can be used to trade, lend and borrow digital currencies.

This is important  because of the passage on 18 July 2025 of the GENIUS act which creates the first regulatory framework for Stablecoins. Stablecoins are US Dollar pegged digital tokens. The Act requires  that  Stablecoins , are to be to be fully  backed by US Treasury Instruments  or other  US dollar assets .

The idea is that if Ethereum becomes part of the infrastructure of Stablecoins , Ether would then benefit from increased activity on the Ethereum platform.

Tokenized money market funds from Blackrock and other institutions already operate on the Ethereum network.

The Wall Street journal  article  goes on to note that activity on the Ethereum platform has already amounted to more than $US1.2  trillion this year ,compared with $960 million to the same period last year.

So today ,we thought it might be a good idea to try and work out what makes Bitcoin and Ether  go up and down.

As Nobel Prize winning economist  Paul Krugman once said "  Economists don't care if a Model works in practice ,as long as it works in theory" .  Our theoretical model might be thought as a "Margin Lending Model" . In such a model variations in Bitcoin are a function of variation in the value of the US stock market .

As the US stock market rises, then the amount of cash at margin available to buy Bitcoin also rises .

The reverse occurs when the US stock market goes down .

Our model of Bitcoin based on this theory is shown in Figure 1  .  We are surprised that this simple model explains 88% of monthly variation  in Bitcoin since the beginning of 2019.

Figure 1 - BTC

At the end of August  our model  told us that when Bitcoin was then valued at $US112,491 , that it was then overvalued by $US15,785 per token.

Modeling Ether is not so simple . Ether is a token but Ethereum is a business.  this makes the price of Either sensitive to variations in conditions in the US Corporate Debt Market.

Taking that into account as well as stock market strength, gives us a model for Ether which is shown in figure 2.


Figure 2- Ethereum


This model explains 70.1% of monthly variation since the beginning of 2019. Our model tells us that at the end of August, Ether at $US 4,378per token was $US 560 above our model estimate of $US3,818.00 . Ether is moderately overvalued.

So neither  Bitcoin nor Ether are cheap right now.

ETFs for each of Bitcoin and Ether are now available from your friendly local stockbroker .

But right now , our models tell us that neither of them is cheap!

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Uncover insights from Jackson Hole: Jay Powell’s rate cut hints, Fed’s soft landing concerns, and dire demographic trends. Analysis by Morgans’ Chief Economist.


There is more to what happened at Jackson Hole than just the speech by Jay Powell.

In my talk last week ,I said that our model of the Fed funds rate stood at 3.65%. This is actually 70 basis points lower than the actual  level of 4.35%.

I also said that the Fed was successfully achieving a "soft landing" with employment growing at 1%. This was below the median level of employment growth  since 2004 of 1.6%.

Still , as I listened to Jay Powell Speak , I noted a sense of concern in his voice when he said that "The July employment report released earlier this month slowed to an average pace of only 35,000 average per month over the past three months, down from 168,000 per month during 2024. This slowdown is much larger than assessed just a month ago."

My interpretation of this is that Chair Powell may be concerned that the "soft landing " achieved by the Fed may be in danger of turning into a "hard landing". This suggested a rate cut of 25 basis points by the Fed at the next meeting on 17-18 September.

This would leave the Fed Funds rate at 4.1%. This would mean that the Fed Funds rate would still be 45 basis points higher than our model estimate of 3.65%. Hence the Fed Funds rate would remain "modestly restrictive."

Dire Demography?

Jackson Hole was actually a Fed Strategy meeting with many speakers in addition to Jay Powell.

Two speakers who followed on the  afternoon of his speech were Claudia Goldin, Professor at Harvard

and Chad Janis of Stanford Graduate Business School. They each gave foreboding presentations on the demography of developed economies.

Claudia Goldin spoke on "The Downside of Fertility".  She noted that birth rates in the Developed World are now generally  below replacement level. The Total Fertility rate is below 2 in France , the US and the UK.

It is dangerously low below 1.5 in Italy and Spain and below 1 in Korea. She observes that the age of first marriage of couples  in the US is now 7 years later than it was in the 1960's. This reduces  their child bearing years.

This paper was then followed by a discussion of it by Chad Janis of Stanford Graduate Business School. He noted that there is a profound difference between a future with a replacement rate of 2.2 kids per family , which he called  the "Expanding Cosmos"  with

•   Growing population leading to a growing number of researchers, leading to rising living standards  and Exponential growth in both living standards and population AND a replacement level of 1.9 kids per family which leads to  

•   Negative population growth , which he called "an Empty Planet " and the end of humanity

 as numbers of researchers declines and economic growth ceases.

Of course this seems all  very serious indeed .  Perhaps what this really means ,is that  if  we want to save the world , we should just relax and start having a lot more fun!!

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Michael Knox, Chief Economist explains how the RBA sets interest rates to achieve its 2.5% inflation target, predicting a cash rate reduction to 3.35% by November when inflation is expected to reach 2.5%, based on a historical average real rate of 0.85%.

Today, we’re diving into how the Reserve Bank of Australia (RBA) sets interest rates as it nears its target of 2.5% inflation, and what happens when that target is reached. Back in 1898, Swedish economist Knut Wicksell  published *Money, Interest and Commodity Prices*, introducing the concept of the natural rate of interest. This is the real interest rate that maintains price stability. Unlike Wicksell’s time, modern central banks, including the RBA, focus on stabilising the rate of inflation rather than the price level itself.

In Australia, the RBA aims to keep inflation at 2.5%. To achieve this, it sets a real interest rate, known as the neutral rate, which can only be determined in practice by observing what rate stabilises inflation at 2.5%. Looking at data from January 2000, we see significant fluctuations in Australia’s real cash rate, but over the long term, the average real rate has been 0.85%. This suggests that the RBA can maintain its 2.5% inflation target with an average real cash rate of 0.85%. This is a valuable insight as the RBA approaches this target.

Australian Real Cash Rate -July 2025

As inflation nears 2.5%, we can estimate that the cash rate will settle at 2.5% (the inflation target) plus the long-term real rate of 0.85%, resulting in a cash rate of 3.35%. At the RBA meeting on Tuesday, 12 August, when the trimmed mean inflation rate for June had already  dropped to 2.7%, the RBA reduced the real cash rate to 0.9%, resulting in a cash rate of 3.6%.

We anticipate that when the trimmed mean inflation for September falls to 2.5%, as expected, the cash rate will adjust to 2.5% plus the long-term real rate of 0.85%, bringing it to 3.35%. The September quarter trimmed mean will be published at the end of October, just before the RBA’s November meeting. We expect the RBA to hold the cash rate steady at its September meeting, but when it meets in November, with the trimmed mean likely at 2.5%, the cash rate is projected to fall to 3.35%.

Australian Real Cash Rate - August 2025
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