Australasian Equities

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Australasian Equities

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Planting seeds of growth Nufarm (ASX:NUF) shares have fallen materially year-to-date, roiled by a challenging backdrop, including the gathering El Niño. We believe the shares have overshot to the downside, with the market underappreciating the strong growth opportunity in the seeds business and likely resilient international performance, differentiating the company from the companies with a more concentrated Australian exposure. This was displayed when Nufarm yesterday updated its guidance for the financial year ending 30 September. The forecast underlying earnings were

Telstra (ASX:TLS)

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Holding onto InfraCo The response to Telstra’s recent results has been modestly negative. This sentiment appears to stem from the company’s choice to retain the entire stake in the InfraCo Fixed business for the medium term and some cost challenges to the T25 strategy. Although the potential quick gains from selling a stake in InfraCo are off the table for now, we expect InfraCo’s value to appreciate further over time. The FY23 report showcased several positive aspects, reaffirming our core investment case.

National Storage REIT (ASX:NSR)

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Storing success National Storage REIT (NSR) delivered robust FY23 results that came in a smidgen ahead of expectations. NSR is the largest self-storage business in Australasia, although now has some company on the bourse, with Abacus Storage King recently becoming a separately traded entity. Still, beyond the top few players, the market remains fragmented, and a strong growth opportunity is ahead for a few reasons. Some headwinds remain but we see them fading in intensity (i.e., we are likely either at,

Woodside Energy (ASX:WDS)

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2Q23; prices on the nose Woodside Energy (ASX:WDS) has released its operational activities for the June 2023 quarter to reveal, in our view, a satisfactory result. The surge in production is the final play through of the BHP Petroleum acquisition, with the quarterly numbers to normalise across the comparative periods. We are pleased 2023 guidance remains unchanged. Realised prices were a drag on the result, pushing revenues lower. The following table shows June quarterly production results and revenue: (bbl – barrels,

QBE Insurance (ASX:QBE)

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Pricing power in spades Insurer QBE (ASX:QBE) recently provided an update, noting the upward pressure on catastrophe costs. Despite this, the hardening premium cycle and improving investment yields are providing firm support. Indeed, QBE (ASX:QBE) held steady on full-year earnings and so-called combined operating ratio guidance – a key insurance industry metric. Although there were a couple of unwelcome elements, the recent update, ahead of 1H23 results, does not diminish our positive view. QBE shares have been solid gainers over the past

Nufarm (ASX:NUF)

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Fishing for investments A Nufarm (ASX:NUF) product was given a tick of approval from the Norwegian Food Safety Authority (NFSA) for use in fish feed, another significant milestone for the company’s Omega-3 platform. This follows a better-than-expected 1H23 results and we are content with the solid operational execution being delivered by Nufarm. The seeds technology platform continues to be an underrated growth opportunity in our view that investors get very cheaply around current share price levels. Profits in the segment surged

Suncorp (ASX:SUN)

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Counting Down the Days Shares in financial group, Suncorp (ASX:SUN) have had a strong run as the rate hike cycle went full swing. Another tailwind for the group is the progress with the ongoing $4.9 billion ANZ deal for its regional banking arm where both parties overcame a very important hurdle: securing Queensland government support in exchange for promises of employment and a binding headquarters arrangement. Despite this development, we do believe that Members without exposure to Suncorp (ASX:SUN) would be well

Treasury Wine Estates (ASX:TWE)

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Looking forward to finer wines. Treasury Wine Estates (ASX:TWE) shares have fallen sharply over the past month, with year-to-date gains evaporating, and then some. The sharp correction seems to have been driven by a combination of factors including challenging trading conditions for lower-priced wines, margin pressure and expectations of a sharp rebound in China sales fading. Momentum in 2H23 is tracking well below 1H23. We view the recent fall as excessive, given the positive medium-term stance with the strategic pivot

About these archived stock reports

These are archived Fat Prophets equity research stock reports and share analysis. They do not constitute current investment advice, financial product advice, or a recommendation to buy, sell or hold any financial product. They are provided for historical reference only, and reflect the market conditions, company information, forecasts and opinions available at its original publication date. The information may no longer be current or applicable. Past performance is not a reliable indicator of future performance.

This is general information only and does not take into account your objectives, financial situation or needs. Before acting on anything in this report, you should consider its appropriateness to your circumstances and seek advice from a licensed financial adviser.

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