Buy, Hold, Sell – what the brokers say

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In the good books

CSR Limited was upgraded to Equal-weight from Underweight by Morgan Stanley. B/H/S: 1/4/0. Housing construction is more robust than previously anticipated, which coincides with favourable aluminium pricing. The broker considers the valuation fair and would look for evidence the company is trading at a meaningful discount to its historical multiple, or showing value through the cycle, before adopting a more positive stance.Target is raised to $5.00 from $4.25. Industry view: Cautious.

IOOF Holdings (IFL) was upgraded to Buy from Neutral by UBS. B/H/S: 5/0/0. UBS notes the shares have fallen 11% since the October announcement of the acquisition of ANZ Wealth and suggests this reflects concerns regarding earnings attrition from the acquisition. Nevertheless, the broker expects earnings prospects are better going forward, supported by re-pricing opportunities. Rating is upgraded to Buy from Neutral, as the broker considers the stock trading at an unwarranted 12% discount to the market by FY21, with an average dividend yield of 6.4% over the interim. Target is raised to $11.50 from $10.75.

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