Research Coverage Policy
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Research Coverage Policy
Decisions to initiate or discontinue coverage on a particular stock are made by Research management in conjunction with the analyst. Research management may consider input with respect to coverage requests from other business areas within Morgans.
There are several factors taken into consideration when an analyst initiates coverage or ceases coverage on a stock. These may include:
- Market capitalisation, index position, liquidity
- Investment attractiveness including fundamental analysis
- Potential catalysts (e.g. index inclusion)
- Merger & Acquisition activity
- New to market
- Under-covered in the market
- Rounds out sector coverage
- Well held by clients
- Available resources to cover
Gain access to shares listed on the ASX and selected global exchanges as well as personalised investment advice. Whether you're an experienced professional investor or a novice investor finding your way in the market, Morgans Port Macquarie can help. As a full service stockbroker, we pride ourselves on offering smart, personalised investment advice that is tailored to your investment style and objectives.
Our advisers are supported by an award-winning research team, as well as a leading corporate finance team that regularly provides clients with exclusive investment opportunities.
Morgans offers a comprehensive wealth management approach, focusing on defining your investment goals, tailoring financial solutions, and leveraging excess cashflow to grow your assets and wealth. With retirement planning as a key component, our experienced advisers guide you through the wealth management planning process, implementing strategies that encompass tax savings, risk minimisation, diversification, and asset accumulation for long-term financial security.
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Morgans provides an extensive range of fixed interest products and services; including income-focused share portfolios and cash management accounts with attractive interest rates, term deposits, foreign currency term deposits, flexible/structured term deposits, listed debt and hybrid investments, as well as government and corporate bonds.
We recognise the significance of constructing investment portfolios that not only maximise returns but also embrace ethical principles and ESG considerations. Our knowledgeable advisers can guide you in evaluating your investment portfolio from an ethical perspective, aligning your investments with your personal values across ESG issues.
We recognise the significance of constructing investment portfolios that not only maximise returns but also embrace ethical principles and ESG considerations. Our knowledgeable advisers can guide you in evaluating your investment portfolio from an ethical perspective, aligning your investments with your personal values across ESG issues.
We recognise the significance of constructing investment portfolios that not only maximise returns but also embrace ethical principles and ESG considerations. Our knowledgeable advisers can guide you in evaluating your investment portfolio from an ethical perspective, aligning your investments with your personal values across ESG issues.
We recognise the significance of constructing investment portfolios that not only maximise returns but also embrace ethical principles and ESG considerations. Our knowledgeable advisers can guide you in evaluating your investment portfolio from an ethical perspective, aligning your investments with your personal values across ESG issues.
We recognise the significance of constructing investment portfolios that not only maximise returns but also embrace ethical principles and ESG considerations. Our knowledgeable advisers can guide you in evaluating your investment portfolio from an ethical perspective, aligning your investments with your personal values across ESG issues.
News & Insights
![Andrew Tang](https://cdn.prod.website-files.com/654ae034352793df91aaa2ab/660babcd86605c60aa7aa0e2_Andrew-Tang.jpg)
Our 'Best Calls to Action' aim to navigate you through the current reporting season by showcasing stocks with strong buying potential. They also offer insights into stocks that might not be ideal for growth right now. These recommendations come from thorough analysis of market trends, financial health, and growth potential, ensuring you access high-value investment opportunities.
Happy to buy today
IDP Education (ASX:IEL) - Difficult test, but uniquely placed to take market share
IEL reported FY24 underlying NPATA of A$154.3m, down 1% on the pcp. 2H24 reflected the impact of policy changes, with 2H NPATA down ~34% on pcp. Tighter and uncertain policy settings saw 2H24 IELTs volumes down ~24% HOH. Student Placement was solid (2H flat on pcp), although policy hadn’t fully impacted. IEL expects the international student market (new admissions) to be down ~20-25% in FY25. IEL expect to outperform this via meaningful market share gains. We think FY25 is likely to be the trough year for ‘student flows’, impacted by tighter policies and the associated uncertainty. We expect IEL’s earnings to fall ~12%, with some benefits from pricing; market share gains; and solid cost control.
We upgrade to an ADD rating.
Airtasker (ASX:ART) - Positive cashflow the likely new norm
With the recent quarterly trading update, ART had largely pre-released key operating metrics, with the FY24 result itself largely per expectations. However, it was a resilient performance by the marketplace overall, with an improved revenue profile despite top of funnel (GMV) headwinds. The business also achieved its planned target of being free cashflow positive (+A$1.2m) for the full year.
We maintain our ADD rating.
Alliance Aviation Services (ASX:AQZ) - Just too cheap
AQZ reported another record result in FY24, with underlying NPBT up 52% on the pcp and slightly ahead of MorgansF/consensus. We forecast earnings growth momentum (PBT growth of 10%) to continue into FY25 driven by deploying more E190 aircraft and increases in utilisation. We back this founder led management team with a strong track record to continue to execute from here.
We maintain our ADD rating.
Ai-Media Technologies (ASX:AIM) - An Olympic AI effort justifying investing for growth
AIM’s FY24 result showed the business is tracking well with revenue up 7% yoy, gross profits up 15% yoy and EBITDA up 25% yoy. Revenue and gross profit were inline with our expectations while our OPEX expectations were not high enough and consequently EBITDA was below our forecast, but still up 25% yoy. The AI transition risk is largely behind AIM now and operating conditions invert from headwinds to tailwinds. This has given management confidence in long term targets and on public conference call they talked to aspirational target of $150m of revenue and $60m of EBITDA in the next five year (FY29).
We maintain our ADD rating.
Trim/Funding Source
Wesfarmers (ASX:WES) - Kmart Group momentum continues
WES’ FY24 result was slightly above our forecast but in line with market expectations. Key positives: Kmart Group delivered strong earnings growth as its value proposition continued to resonate with customers; Group EBIT margin rose 10bp to 9.0%. Key negatives: Bunnings sales growth in early FY25 remains subdued, impacted by weakness in housing activity; Management expects Catch to be loss-making again in FY25, albeit at a reduced level relative to FY24.
We maintain our HOLD rating.
Tabcorp Holdings (ASX:TAH) - FY24 earnings: Off-track with costs
TAH’s FY24 result was one to forget. While the company’s topline slightly exceeded our estimates, it was overshadowed by a cost blowout and abandonment of TAB25 strategic targets. The company reported a statutory net loss of $1.36bn, mainly due to impairments. An unfranked 0.3c dividend was announced, bringing the total to 1.3c for FY24. While no quantitative trading update was provided, the company acknowledged that conditions remain challenging.
We downgrade to a HOLD rating.
Morgans clients receive access to detailed market analysis and insights, provided by our award-winning research team. Begin your journey with Morgans today to view the exclusive coverage.
![Andrew Tang](https://cdn.prod.website-files.com/654ae034352793df91aaa2ab/660babcd86605c60aa7aa0e2_Andrew-Tang.jpg)
Our 'Best Calls to Action' aim to navigate you through the current reporting season by showcasing stocks with strong buying potential. They also offer insights into stocks that might not be ideal for growth right now. These recommendations come from thorough analysis of market trends, financial health, and growth potential, ensuring you access high-value investment opportunities.
Happy to buy today
NEXTDC (ASX:NXT) - Laying the foundations for platform growth
NXT’s FY24 result was slightly stronger than expected while FY25 guidance was slightly lower than expected due to a slower ramp-up in revenue and faster ramp-up in scale-up costs, positioning the business for significant expansion.
We maintain our ADD rating.
Flight Centre Travel (ASX:FLT) - Margin improvement will underpin strong growth
FLT’s FY24 result was in line with its recent update. The highlights were the increase in its revenue margin to 11.4% vs 10.4% in FY23, the 2H24 NPBT margin of 1.7% and strong operating cashflow up 170% on the pcp. FLT said that its outlook is positive however in line with usual practice, FY25 guidance won’t be provided until the AGM in November.
We maintain our ADD rating.
Karoon Energy (ASX:KAR) - Market confidence also needing maintenance
KAR posted a broadly steady 1H24 result, close to our estimates but appeared to come in below Visible Alpha consensus estimates. Management flagged additional maintenance planned for Bauna in an attempt to protect its flagship operation. KAR announced a maiden dividend of 4. cents per share fully franked, representing an annualised ~5% dividend yield.
We maintain our ADD rating.
Mach7 Technologies (ASX:M7T) - Better visibility prompting accelerated development
M7T posted its FY24 result which was broadly in line with expectations. With the recurring sales book now providing significantly better visibility into cashflows, we view this has given the Company the confidence to accelerate investment back into the products to improve the offering and implementation times. Key points: record sales order book (up 52%); ARR covering 72% of op costs; FY25 guidance of 15-25% revenue and CARR growth, and lower operating expenses than revenue growth. The notable omission in outlook was around operating cashflow positivity, which likely ties in with an acceleration of product development.
We maintain our ADD rating.
Camplify Holdings (ASX:CHL) - Plenty of wheels in motion for FY25
CHL’s FY24 result saw GTV increase ~13% on pcp to ~A$165m (~5% under MorgansF), however a higher than expected group take-rate (~28.9% vs MorgansF ~28%) saw revenue broadly in line with our estimate (~A$m, +~25% on pcp). Whilst the PaulCamper integration impacted bookings/revenue in the period, this is largely completed, with CHL expecting a return to a more normalised performance in FY25.
We maintain our ADD rating.
Trim/Funding Source
APA Group (ASX:APA) - Lenders and taxman to absorb FY25 EBITDA growth
The FY24 result was broadly in-line while FY25 EBITDA and DPS guidance was mildly below expectations. FY25 DPS guidance implies 7.3% cash yield. HOLD retained, given 12 month potential TSR of ~2%
We maintain our HOLD rating.
Morgans clients receive access to detailed market analysis and insights, provided by our award-winning research team. Begin your journey with Morgans today to view the exclusive coverage.
![Andrew Tang](https://cdn.prod.website-files.com/654ae034352793df91aaa2ab/660babcd86605c60aa7aa0e2_Andrew-Tang.jpg)
Our 'Best Calls to Action' aim to navigate you through the current reporting season by showcasing stocks with strong buying potential. They also offer insights into stocks that might not be ideal for growth right now. These recommendations come from thorough analysis of market trends, financial health, and growth potential, ensuring you access high-value investment opportunities.
Happy to buy today
BHP (ASX:BHP) - Copper Gains and Iron Chains: BHP’s Balanced Brains
Another strong result from BHP, posting an FY24 EBITDA margin of 54%, close to its decade-average of 55% (10 percentage points above its next closest peer). Strong opex performance, with earnings coming in slightly ahead with a final dividend of US74 cents, for an annualised dividend yield of 5.6% fully franked.
We maintain our ADD rating.
Lovisa (ASX:LOV) - FY24 result: Untarnished
There are not many global retailers achieving 17% sales growth and 21% EBIT growth in the current challenging consumer environment, but this is exactly what Lovisa did in FY24. A long period of stellar growth has trained investors to have very high expectations for the business and, while its comparable store sales growth should have been better in FY24, it has continued to deliver and will, in our opinion, continue to do so in the years ahead.
We maintain our ADD rating.
Woodside Energy (ASX:WDS) - A lot to be optimistic about
A strong 1H24 earnings and dividend result comfortably beating Visible Alpha consensus estimates. WDS maintained an 80% dividend payout ratio, for a solid 1H24 interim dividend of US69 cents. Strong inbound interest from potential partners on Driftwood LNG has given WDS confidence it can assemble a strong partnership on the project.
We maintain our ADD rating.
Worley (ASX:WOR) - Delivering margin uplift, against macro headwinds
WOR delivered a solid FY24 result, which came in broadly inline with MorgF and consensus, with EBITA of $751m (+24% YoY), driven by Aggregate revenue growth 18% and solid underlying EBITA margin expansion. The group is flagging a year of more moderate growth in FY25, with the group expecting slower revenue growth but at higher margins.
We maintain our ADD rating.
Trim/Funding Source
Coles Group (ASX:COL) - Executing well
COL’s FY24 result was ahead of expectations with the performance of Supermarkets a key highlight. Key positives: Group EBIT margin rose 10bp to 4.7%; Own Brand growth was 2x the rate of proprietary brands as customers continue to seek value; Coles 360 media income jumped 20.5% with opportunities to grow this higher margin segment over time. Key negatives: Liquor performance was weaker than expected with market conditions remaining challenging; Cash realisation ratio fell to 98% vs 102% in FY23 due to higher working capital.
We downgrade to a HOLD rating.
Guzman y Gomez (ASX:GYG) - Spec-taco-ular start to listed life
GYG’s maiden result as a listed company was strong as we were expecting and ahead of prospectus forecasts, driven by higher than expected comp sales. Importantly GYG has had a strong start to FY25, with its comp sales growth for the first 7 weeks ahead of its comp sales guidance for FY25. We note, the comps GYG has to cycle also get easier from here. Despite the strong start, GYG said it expects to achieve its prospectus forecast (Visible Alpha is already above).
We downgrade to a HOLD rating.
Helloworld (ASX:HLO) - Near term uncertainty
HLO posted a solid 4Q which saw it deliver just under the mid-point of its FY24 EBITDA guidance. The highlights of FY24 were the acquisitions exceeding their investment cases, the group EBITDA margin, materially stronger than expected cashflow and HLO’s strong net cash position. Despite this, when the acquisitions are backed out, in the 2H24, the base business went backwards vs 1H24 and the 2H23.
We downgrade to a HOLD rating.
Morgans clients receive access to detailed market analysis and insights, provided by our award-winning research team. Begin your journey with Morgans today to view the exclusive coverage.