Research notes

A clean sheet and guidance beat - Langer Heinrich Mine (LHM) delivered a standout 4Q, with production (+6% vs MorgansF; +6% vs consensus), sales (+16%; +12%) and costs all beating expectations, while FY26 production, sales and cost outcomes exceeded PDN's guidance targets. LHM ramp up complete - PDN has formally declared the LHM ramp-up complete, with 4Q26 seeing full mining and processing operations. We maintain our BUY rating with a reduced price target of A$12.50ps (previously A$13.05ps).

SFR delivered a strong 4Q26 result with production, revenue, EBITDA and net cash all coming in well ahead of consensus and MorgansF. Net cash of $353m materially beat expectations and was +364% qoq even after paying down $113m of debt. SFR is now debt free. FY27 production guidance was in-line with expectations, while capex is expected to be higher than original expectations. Move to an ACCUMULATE with an unchanged A$22ps target price.

Debt reset unlocks flexibility - SMR has successfully refinanced its corporate debt facilities, reducing borrowing margins by 100bp, removing ~US$70m pa of scheduled principal repayments and extending maturities. Clean sheet at the group level - SMR delivered a clean beat at the group level, with Coal Mined, Saleable Production and Coal Sales all exceeding both Morgans and consensus expectations. We move to a HOLD rating (previously BUY) due to recent share price strength. Our price target of A$2.80ps is unchanged.

ASML is the world’s leading supplier of advanced lithography systems used in the manufacturing of semiconductors, with a dominant position in deep ultraviolet (DUV) and an effective monopoly in extreme ultraviolet (EUV) technology. The company’s systems are critical to the production of sophisticated microchips. ASML’s product portfolio includes High-NA EUV and Low-NA EUV lithography systems, ArF immersion, KrF and i-line DUV systems for both advanced and mature nodes, advanced packaging lithography, and metrology, inspection, and computational lithography solutions that optimise yield and productivity. Its customers are global semiconductor foundries, logic and memory manufacturers (e.g., TSMC/Samsung/Intel), supported by long-term relationships, high switching costs and a growing installed base that underpins recurring service revenue. Headquartered in Veldhoven, Netherlands, ASML was founded in 1984 and is listed on Euronext Amsterdam and NASDAQ.

IMR achieved a major milestone with the first US commercial sale of the NorthStar mapping system to Rady Children’s hospital. This is a new vertical (cardiac interventions) which expands its addressable market on our estimates by US$250m. Management has highlighted the clinical and economic benefits undertaking these interventional procedures in an MRI environment. We expect additional sales to follow with management noting the short-term sales opportunity is likely to exceed total European sales generated in FY25 of US$0.3m. We have made no changes to forecasts or valuation (A$2.94). We maintain our SPECULATIVE BUY recommendation.

AIH has completed the acquisition of Matrix Composites & Engineering (MCE) via scheme of arrangement for ~A$90m (40c cash per share). In our view, the deal is strategically sound - AIH and MCE are #2 and #3 in the oligopoly subsea buoyancy market - with the merged entity rivalling Balmoral (#1). However, in our view, AIH has paid above full value, with MCE expected to deliver breakeven EBITDA initially and pricing synergies likely to take time. Incorporating MCE into our forecasts, we downgrade FY26/27 NPAT by 3%/12% and reduce our target price to A$1.25 (from A$1.45). In FY28, we increase our NPAT forecast by +15%.

JHX has delivered a strong set of results for 1QFY27, beating consensus (and MorgansF) EBITDA forecasts by c.9% at the mid-point and prior guidance by c.10%. The outperformance was largely attributed to execution and above-market growth, rather than an improving US housing market. The result sets our baseline expectations higher, whilst we expect the business to follow the traditional earnings seasonality (bigger Jun/Mar quarters). This result is better than expected. Higher growth in FY27 reduces the heavy lifting required in FY28 to achieve consensus’ US$1.45/sh EPS forecast. On this basis, we have increased our earnings and subsequently our valuation target to A$40/sh, upgrading to a HOLD (previously Trim).

MQG has hosted its AGM and given a 1Q27 update. Overall, MQG pointed to "satisfactory" trading conditions in 1Q27, while Greg Ward - currently Head of BFS - will replace the retiring Shemara Wikramanayake as CEO. We lift our MQG FY27F/FY28F EPS by 1%-3% on slightly stronger CGM earnings forecasts. Our price target is increased to ~A$255 (from A$248) on our earnings changes. MQG is a quality franchise and a proven performer, but with <10% upside to our target price, we maintain our Hold call.

NWH is a key pick heading into August reporting season. We expect strong FY26 earnings with our forecast ($284m) slightly ahead of VA consensus ($281m) and towards the upper end of guidance ($275-285m). For FY27, we expect NWH to guide ahead of consensus (MorgansF $315m vs consensus $308m). Importantly, the capex cycle in resources shows signs of accelerating with two major projects across gallium (Alcoa) and lithium (Covalent) approved in the last week alone, following last month’s announcement that PLS is committing pre-FID capex in anticipation of P2000. We leave our FY26 forecasts unchanged but increase FY27-28 EBITA by +4%. This comes as we assume stronger growth in EMIT and, within MET, we now assume a full replacement of revenues from the major Fimiston contract from other smaller projects. Our target price rises to $8.00 (from $6.60).