In the good books
- Altium (ALU) was upgraded to Hold from Sell by Ord Minnett
First half results were very strong, supported by perpetual licence sales, particularly Altium Designer in China. Ord Minnett found operating leverage clearly evident. The broker notes management's confident outlook regarding the FY20 revenue target of $200m. The broker materially upgrades cash flow forecasts and lifts the rating to Hold from Sell. Target is raised to $26.51 from $17.70.
- Baby Bunting (BBN) was upgraded to Outperform from Neutral by Macquarie
Macquarie found the first half results solid and in line with expectations. The likelihood of an upgrade has been reduced, although the broker believes the upper end of guidance is achievable. FY19 EBITDA guidance of $25-27m is reiterated. Macquarie upgrades to Outperform from Neutral and considers the recent weakness a buying opportunity. Target is raised to $2.65 from $2.25.