Research notes

M7T's 4Q26 cashflow report reaffirmed FY26 guidance and delivered a third consecutive quarter of positive operating cashflow, with the first Flamingo production deployment marking a genuine milestone rather than a numbers-driven beat. Recent performance shifts the focus from cost discipline (largely proven now) to commercial execution, with new logo momentum the swing factor for whether FY27 ARR growth accelerates or stalls. Investors will likely need to see some new contracts drop before getting more positive on the name. No change to forecasts at this stage and look to the FY26 result for further outlook commentary.

LVMH Moët Hennessy Louis Vuitton SE is a multinational luxury group conglomerate based in Paris, France. It operates five business segments: Wines and Spirits; Fashion and Leather Goods; Perfume and Cosmetics; Watches & Jewelry; and Selective Retailing. Its 75 brands include Dom Pérignon, Moët & Chandon, Veuve Clicquot, Hennessy, Louis Vuitton, Christian Dior, Givenchy, Acqua di Parma, Tiffany & Co, TAG Heuer, Bulgari, DFS, and Sephora. LVMH operates around 6,300 stores worldwide. LVMH was formed by Bernard Arnault, Alain Chevalier and Henry Racamier in 1987 from the merger of Louis Vuitton and Moët Hennessy. Louis Vuitton itself was founded as a manufacturer of luggage in 1854. Moët Hennessy was formed in 1971 through the merger of the champagne house Moët & Chandon (founded 1743) and the cognac producer Hennessy (founded 1765). Some of LVMH’s more recent major acquisitions include Tiffany & Co. in 2020, Rimowa in 2016 and Loro Piana in 2013.

PNV has provided a trading update noting sales in 2H have slowed, disappointing the market. On the positive side cash generation has been strong. PNV is well positioned to deliver material EBITDA growth in FY27 and FY28 through manufacturing expansion, larger sales force and new product growth (MTX). We have adjusted our FY26 forecasts down in line with the trading update and maintain our view that PNV can deliver 20% revenue growth across the forecast period, while demonstrating cost control. We have our revised valuation to A$1.48 (was A$1.56). BUY maintained.

STO's 2Q26 came with a FY26 production guidance cut to 99-105mmboe from 101-111mmboe and delivered sales revenue 10% below consensus. However, we believe a solid 2H uplift is likely, driven by Barossa and Pikka both ramping up. At A$7.68, STO is already close to fair value on our numbers. Behind that sits the Federal east coast gas reservation process, on which STO is the most exposed gas producer in our coverage, a risk that is difficult to quantify and could easily escalate further in terms of implications for the gas industry. Maintain HOLD with A$7.90 target price (was A$8.30).

KAR's June quarter delivered what we argued for when we upgraded a month ago. Bauna is repaired and running at ~22,000 bopd, the heavy intervention spend is sunk, and we have 2H26 swinging to ~US$100m of free cash flow, a ~US$220m turnaround on the first half. The problem is the share price got there first. KAR has added 20% since we wrote on 29 June, closing almost all of the gap to our valuation, while the portfolio risk has migrated from Brazil to the Gulf of Mexico. At a price of A$1.71, vs a A$1.75 target, we see the value opportunity as having largely closed. We downgrade to HOLD (from Buy) with a A$1.75 target price.

Guidance delivered – WHC delivered in FY26 with ROM Coal production and Coal Sales coming in at the top end of guidance, while unit costs and capex tracked towards the lower end of their respective ranges. Refinanced for added flexibility – Recent refinancing has lowered funding costs and extended debt maturities, leaving WHC better placed to navigate commodity market volatility and focus on FY27 operational delivery. Queensland was firing – A strong rebound from Blackwater and Daunia drove an inline ROM Coal production result, highlighting the production leverage power of the Queensland portfolio and more than offsetting ongoing operational challenges at Narrabri. We upgrade our rating to BUY (previously ACCUMULATE) following recent share price weakness, but with a reduced price target of A$8.50ps (previously A$9.20ps).

A broadly in-line result with small beats and misses across the board despite the Cadia disruption, with the qoq earnings decline driven by a lower realised gold price rather than operating performance. NEM’s capital returns remain best in class among its gold peers, with US$1.9bn returned this quarter implying a capital return yield of around 7-8%. Maintain BUY with a A$194ps target price.

RTX Corporation is an aerospace and defence company that provides systems and services for commercial, military, and government customers worldwide.

Nestlé SA is the world’s largest food and beverage company. It engages in the manufacture, supply and production of prepared dishes and cooking aids, milk-based products, pharmaceuticals and ophthalmic goods, baby foods and cereals.

Honeywell International is a world-wide diversified technology and manufacturing company. It consists of four key segments: (1) Aerospace, (2) Performance Materials & Technologies, (3) Building Technologies, and (4) Safety & Productivity Solutions. The company was founded in 1885 and is headquartered in Charlotte, North Carolina, United States.