Research notes

Wide-spaced drilling at Muntanga North and Namakande continues to identify uranium mineralisation outside the existing resource base, while Muntanga East metallurgical testwork delivered uranium recoveries above 80% and exceptionally low acid consumption. >With the Mining Convention now executed, AEU has commenced resource verification and optimisation work at Madaouela, targeting both a JORC-compliant resource and Scoping Study in Q1 CY27. >Following quarter-end, major shareholder Menel exercised 35.1m options, providing A$10.9m of funding and further strengthening the balance sheet ahead of ongoing drilling and study work. >We maintain our SPECULATIVE BUY rating with an unchanged target price of A$0.80ps.

EDV’s 1Q27 sales trading update was largely in line with expectations. >Retail sales rose 3.0%, while Hotels increased 1.9%. >Management noted that promotional intensity in the Retail segment remains elevated, particularly in the online channel, while Hotels sales moderated during the quarter due to growing cost of living pressures impacting discretionary spending. >We make marginal changes to earnings forecasts with FY27-29F underlying EBIT decreasing by 1%. >Our target price remains unchanged at $2.95 and we maintain our TRIM rating. We continue to expect FY27 to be a disruptive year as EDV implements its transformation initiatives. Liquor demand also remains under pressure from higher interest rates, ongoing cost of living pressures and deteriorating consumer sentiment. Given these headwinds and the execution risk associated with the transformation program, we believe the balance of risks remains skewed to the downside.

REH’s 1Q27 trading update was ahead of expectations. >ANZ delivered a strong 1Q27 performance with revenue up 12.8%, while US revenue increased 5.6%. >Looking ahead, management expects positive momentum in ANZ to continue, while trading conditions in the US are expected to remain soft. >We increase FY27-29F underlying EBIT by 2%. >Our target price rises to $17.40 (from $17.00) and we maintain our HOLD rating. While we continue to see REH as a good business with a strong culture and long track record of growth, trading on 31.7x FY27F PE with a 1.2% yield we view the stock as fully valued.

MEK has released its 1Q27 quarterly report, restating pre-reported production of 7.2koz at an AISC of A$4,147/oz, with quarter-end cash of A$51m (including Tranche One placement proceeds). >The plant reached nameplate capacity (149kt; ~600ktpa annualised), but processing unit costs rose ~24% QoQ. Reported AISC is flattered by ore inventory adjustments, with closing stockpile tonnes up QoQ despite ore processed exceeding ore mined. We forecast a material lift in unit AISC in 2Q27. >We maintain our BUY rating with a price target of A$0.16ps (previously A$0.17ps).

PNI has released its 1Q27 update alongside its AGM. >FUM rose A$8.7bn (+4%) to A$238.1bn (+3% excluding FUM acquired by Antipodes), with market movements broadly neutral. Net inflows of A$5.9bn were solid but slightly below the run-rate implied by 1H27 consensus (A$6.45bn per Visible Alpha), and FUM (A$238bn) was just shy of the implied ~A$240bn. In our view, 1H27 consensus looks achievable but needs a stronger second quarter. Metrics remains the key watch point. >We trim our net flow and FUM forecasts and modestly lift our group cost assumptions, lowering FY27F/FY28F EPS by 2%-4%. Our target price falls to A$22.62 (from A$23.41). >Maintain BUY call with >20% upside to our price target.

COL’s 1Q27 trading update was weaker than expected. >While Supermarkets sales growth was in line with 4Q26, management noted increased competitive and promotional activity with customers remaining value-conscious. >Guidance for flat Supermarkets EBIT in 1H27 was also softer than our forecast for 6% growth (Visible Alpha consensus +6%). >We adjust FY27/28/29F group underlying EBIT by -3%/-2%/-2%. >Our target price decreases to $24.30 (from $25.40) and we maintain our ACCUMULATE rating. Despite the softer trading update and management acknowledging that sales growth has fallen short of expectations, COL has a plan to improve momentum through targeted investment in value, stronger communication of its value proposition and a continued focus on execution. Guidance for flat Supermarkets EBIT in 1H27 also follows a strong 15% increase in the pcp. In this context and against a backdrop of elevated fuel costs, we believe the performance remains reasonable, with Supermarkets 1H EBIT growth averaging 7% pa over the past three years.

CSC delivered another record EBITDA quarter, underpinned by a higher realised copper price and record low costs at Mantoverde, which more than offset lower group volumes during a heavy planned maintenance period. >MV-O is ramping up ahead of expectations. Throughput has averaged ~47ktpd in recent weeks, above the 45ktpd target, and a record 53.4ktpd day was set in October. That supports a strong 4Q26. Pinto Valley will start the quarter slowly, with crusher repairs pushing the full restart into November, but CSC expects the repairs to improve plant reliability. >Maintain BUY with an unchanged A$17ps target price.

VFY’s 1Q27 4C was a busy quarter for partnering. Versiti makes it three US civilian blood partners and Charter Medical opens a first door into cell and gene therapy (CGT). The partner network now covers ~17% of US civilian collection sites. >Attention now shifts to FDA device listing, still flagged for December. Mandatory blood product validation studies were only about to start at quarter end, so the timeline looks tight to us. This is the key near-term catalyst and risk. >Cash of A$38.3m, with spend at A$5.7m/quarter and guided higher, but broadly on track versus our expectations. No change to our Speculative Buy rating or target price of A$5.06.

In August we said the engine had been rebuilt but wasn’t yet in gear. The 1Q report confirms the rebuild was sound: OCF positive, costs locked in and cash steady. What’s still missing is the new contract flow needed to actually get moving. >Downside looks well covered. At ~A$40m EV (A$19.3m cash, no debt), the market is paying under 2x ARR for a business that’s self-funding with new product offerings aimed at re-engaging new contract growth. >Flamingo will make its public debut at the RSNA conference (29 Nov-3 Dec). With the cost base fixed, even modest contract success should flow quickly to earnings. The setup feels ripe for a rally on only a modicum of new contract win success. We think it’s worth taking another look at these levels. Buy retained.

We initiate on Conrad Asia Energy (CRD) with a SPECULATIVE BUY rating and A$1.10 target price. >Mako is funded, contracted and carried to first gas in late 2027, and returns US$145-360m of cash to CRD on its 2P alone against an A$126m market cap. >Batam’s data centres need gas Southeast Asia doesn’t have, and Mako’s existing pipeline already runs there. This adds meaningful upside potential to our investment case for CRD. >No equity needed to develop Mako, with its share of capex carried by its partner and repaid out of production.