Research notes

The Lottery Corporation (TLC) has secured a 40-year extension of its Victorian Public Lottery Licence to 30 June 2068, paying a $1.145bn upfront premium funded entirely by debt. The duration and timing of the renewal was a mild surprise given the licence was historically offered on 10-year terms and wasn’t expiring until June 2028. We view the deal as strategically positive, but near-term earnings absorb the cost. Higher D&A and interest from the new debt drag our FY26/27/28F EPS estimates down 3%/13%/15% respectively, partially offset by a beta reduction reflecting materially lower licence renewal risk. Near-term, lotteries performance remains the key swing factor, with sustained jackpot fatigue a backdrop that could drive further consensus downgrades. The 3 June Investor Day is the next key catalyst, where new CEO Wayne Pickup will outline refreshed strategy. Our target price lifts to $6.00 (from $5.70). We upgrade TLC from Hold to Accumulate.

JBH provided a solid 3Q26 sales trading update, showing the ongoing resilience in demand for its product categories. Management did caution going into one of the key trading periods (EOFY), that they were seeing supplier component costs increases, stock availability shortages and ongoing heightened competitive activity. We see this as likely reflecting potential margin pressure in the 4Q. We have made minor revisions to earnings (<1%), and our valuation lowers to $82.90 (from $83.50). We maintain our ACCUMULATE recommendation.

We have reviewed our FY26 and FY27 forecasts and conclude the company is set to deliver a strong 2H26 and continue that growth trajectory into FY27. We have made no changes to our FY26 forecasts and revised down our FY27/28 forecasts reflecting a higher R&D spend than we had forecast as additional products are evaluated. As a result of changes to forecasts and a higher risk-free rate (House view) our DCF based valuation has reduced to A$1.56 (was A$1.83). PNV is one of the most shorted stocks on the ASX. If PNV can demonstrate a growing profit profile the short position could be reduced materially. We maintain our BUY recommendation.

DGT is set to divest its Chicago asset (CHI1) at a 5% premium to purchase price, while also investigating the disposal of the LAX development sites (which face an increasingly uphill battle for rezoning). The sale of CHI1 should see proforma gearing decline, giving the business scope to pursue the expansion of the higher returning SYD1 asset. The announced sale and the reiteration of FY26 guidance is a positive for DGT, removing leverage concerns and providing a pathway toward the repositioning of SYD1. Whilst guidance beyond FY26 was scant, management did allude to improved earnings through FY27 and subsequently higher dividends. Today’s announcement de-risks DGT and sees us increase our target price to $3.60/sh (as we remove our risking factor), whilst retaining our BUY recommendation.

Meta Platforms, Inc. (formerly known as Facebook, Inc.) is a leading global technology platform business headquartered in Menlo Park, California, US. Co-founded in 2004 by Mark Zuckerberg, Meta's mission is to connect people and build community through its innovative technology portfolio and social networking platforms.

The 3Q update was strong with constant FX organic revenue growth of +26% YoY. While we pare back our FY26 revenue forecast slightly on FX, we make negligible changes to our EBITDA forecast ($164m +3% vs VA consensus $160m) as mix benefits offset the lower revenue. For FY27-28, we increase our earnings forecasts on confirmation of strong volume growth and recent capital markets activity. While we see capacity for a slight beat in August, in our view, outer year upgrades will be the key driver of the share price from here. FY27 VA consensus revenue is muddled due to recent break-even acquisitions, however, FY27 EBITDA of $187m implies less than +10% organic revenue growth in the base business vs FY26 consensus EBITDA of $160m (assuming incremental margins of +40-50% and an incremental +$7m EBITDA YoY contribution from ALT/MSI). We forecast FY27 EBITDA of $200m (+7% vs $160m consensus). Our target price rises to $5.00.

DBI’s share price has increased c.17% since our high conviction upgrade of the stock’s rating in March. We moderate from BUY to HOLD, given 12 month potential total return has compressed to c.3%. 12 month target price set at $5.31/sh, down -4cps from previously due to negligible forecast changes related to actual March CPI (used in the July annual escalation of TIC revenue), higher QCA-approved non-expansionary capex for inclusion in the asset base than previously indicated by DBI (also impacts July’s revenue escalation), and updated debt service forecasts. Next key event is this month’s AGM. We expect DBI to provide new DPS guidance for the next 12 months at or around that time and target 29.5cps.

PNI has released its 3Q26 update. The key highlight of the update was 3Q26 flows coming in stronger than expected amid a volatile environment, with PNI's additional 6.8% investment in Metrics acting as a further vote of confidence in the business. We make mild upgrades to PNI's FY26F/FY27F/FY28F EPS of ~1%-3%, driven by higher net flow forecasts and the earnings contribution from the increased Metrics stake. Our PT edges up to A$24.70 (from A$23.21) and we maintain our BUY call.

Apple Inc. designs, manufactures, and markets smartphones, personal computers, tablets, wearables and accessories, and sells a variety of related accessories.

CoreWeave is a US-based AI cloud provider or Neo Cloud Provider (NCP). It specialises in NVIDIA GPU clusters for training and inference workloads. Listed on Nasdaq in March 2025 with a market cap of approximately US$49bn, CoreWeave operates 43 data centres with 850 megawatts of active power and contracted access to 3.1 gigawatts of total power capacity.