In the good books
Evolution Mining (EVN) was upgraded to Neutral from Underperform by Credit Suisse and to Outperform from Neutral by Macquarie. B/H/S- 3/5/0. Credit Suisse believes the emerging high-grade underground opportunity supports the company's aspirations to increase Cowal's production to 300,000 ounces per year for 20 years. The broker also believes Evolution Mining's disciplined business development continues to improve average asset quality. Credit Suisse upgrades to Neutral from Underperform. Target is $2.65. Macquarie upgrades FY19 and FY20 earnings estimates by 8% and 3% respectively. The broker believes the company is well-positioned to execute on organic growth as well as acquisition opportunities. Target is raised to $3.30 from $3.20.
Freedom Foods Group (FNP) was upgraded to Hold from Reduce by Morgans. B/H/S – 1/1/0. Freedom Foods posted a material beat on profit due to tax but underlying earnings slightly missed consensus. New facilities are beginning to perform better than expected, leading the broker to upgrade forecasts, while noting execution risk remains. The company suffers from high capex requirements, poor cash flow generation and a low return on equity, but has a great product portfolio, strong brands, and is leveraged to healthy eating trends, rising demand from Asia and the scaling of new facilities which should drive solid earnings. Target rises to $6.01 from $5.50.