Research notes

A solid Q4 production and sales result, with Orbost's continued outperformance the obvious standout. As we expected, revenue dipped on softer Victorian and South Australian spot prices through the quarter, though by less than we had allowed for. FY26 closed with records across the board. Group production of 27.6PJe (+3%), revenue of A$285.8m (+7%) and a record realised gas price of A$10.35/GJ (+4%), while net debt was slashed 85% yoy to A$37.2m. Management's outlook commentary was very positive, with the flagship Orbost plant setting fresh production records post quarter end. AEL is our top energy sector pick following recent share price weakness. We maintain our BUY rating and A$3.05 target price.

RIO posted a healthy Q2 where it matters, with Pilbara shipments beating consensus (+2%), while we see the headline Simandou miss (-68% vs consensus) as a net positive: a slower Simandou ramp supports iron ore benchmarks, and each US$10/t on the benchmark is worth ~US$2.5bn of annual EBITDA to RIO's far larger Pilbara business. The sting in the tail was Kennecott, with a late June converting furnace breach requiring a ~75-day full rebuild, hitting H2 refined copper and gold output (total copper including saleable matte unchanged). Copper C1 guidance halved to US30-50c/lb, on strong by-prod prices, a material margin tailwind into the H2 result. Trading back close to where we see fair value, RIO remains one of the highest quality global exposures to a sector enjoying a multi-year upcycle (albeit not without its volatility). We maintain our HOLD rating, A$163.00 TP (was A$165.00).

Copper production missed forecasts, but copper sales and zinc, gold and silver production made up for it, leading to a ~30% revenue beat versus forecasts. Liquidity remains sound. Cash and liquidity came in ahead of expectations. Maintain HOLD rating with a A$0.26ps target price (previously A$0.27ps).

4Q26 result and FY26 guidance were largely in line with expectations. FY27 outlook commentary flagged higher capex than previously expected and inflationary impacts to AISC, which affect FY27 cash flow forecasts. Maintain BUY with a A$14.60ps target price (previously A$16.00ps).

The late June trading update lifted the FY26 Middle East impost to $60m EBITA (from $30-40m) and quantified the 2H FX impact as $50m. Medium term, WOR should see some earnings support from Middle East repair activity and a broader uplift in global upstream hydrocarbon spending driven by renewed energy security concerns. However, consensus already embeds strong growth into FY27 (Visible Alpha EBITA +12% YoY) which is well above industry forecast growth rates. With capex expectations continuing to soften in the key Energy end-market and the order book likely to roll over at the FY26 result, we retain our conservative view. We reduce our EBITA forecasts by 8-9% across our forecast period and cut our target price to $10.80 (from $11.80). HOLD maintained.

LGI's FY26 growth update (via social media) highlighted five newly registered carbon sites (25 total, from 20 at 1H26), strong ACCU creation (FYTD May-26 +17% yoy) and in-line electricity generation (130 GWh, +33% yoy), which we expect to more than offset the delayed Mugga Lane battery commissioning (now FY27, previously 2H FY26). While we view FY26 as intact, weaker wholesale electricity and LGC prices have weighed on the medium-term earnings outlook, driving material EPS revisions (FY27 -25%, FY28 -38%) and a de-rating in the stock. Near-term earnings face ongoing headwinds from weaker commodity prices, and we expect FY27 to step back before growth resumes. Over the medium term, we continue to view LGI positively given the material development pipeline ahead (~4x FY25) as the group scales and executes its meaningful battery rollout. BUY, A$3.10ps price target.

MatrixCare will be divested for US$490m cash (c9x earnings), crystallising a disappointing financial outcome (paid US$750m (25x) in 2018) for a business that expanded software capabilities but delivered modest earnings growth. Strategically, however, we believe the transaction makes sense, as it simplifies the portfolio and retains Brightree and MEDIFOX DAN, while exiting a lower-growth, non-core software business. Importantly, net proceeds will largely be returned to shareholders via an accelerated share repurchase (ASR), which should substantially offset earnings dilution from both the MatrixCare disposal and the recently completed Noctrix acquisition, while FY26 guidance has been reaffirmed. We make modest adjustments to FY26-28 forecasts, with our target price moving to A$40.97 (from A$41.72). BUY.

EIQ has de-risked the commercial pathway since our initiation via a $110m placement at $1.45/share and a new distribution partnership with Pro Medicus, both of which sit alongside an unchanged core clinical and regulatory thesis. HF FDA clearance remains the single biggest re-rating catalyst from here, and while timing has slipped slightly from our expected 4Q26 window, we remain confident on approval and expect feedback imminently. We lift our discounted target price to $1.85 (from $1.30), driven by a medium-term acceleration of revenues. Speculative Buy rating retained.

We have identified an error in the previously published financial summary tables, where a number of figures did not pull through correctly from our underlying model. The error was presentational only. The underlying financial model is unchanged, with no impact on any forecast, assumption or valuation input. No change to our ACCUMULATE rating or A$230.00 DCF-based target price.

MFG's 4Q26 AUM update showed AUM fell ~A$1bn to A$36.7bn, driven by A$2.5bn of net outflows, partially offset by A$1.7bn of positive market movements. Overall, we view this as a softer quarter. The A$2.5bn in outflows is a step up from recent trend, running well above the A$0.3bn average outflows of the prior four quarters, and marking the largest quarterly outflow since 3Q23. We make relatively minor downgrades to FY26F/FY27F EPS on reduced AUM assumptions, following higher 4Q26 outflows than we expected. We lower our price target to A$11.26 (from A$11.29). With the recent pullback in the share price, we now have more upside (~13%) to our price target and move to an ACCUMULATE recommendation (from Hold).