Buy, Sell, Hold – what the brokers say 14/5/15

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There was some good news out this week for CSR and Qantas. CSR announced a better than expected earnings result and Qantas indicated that cost-cutting initiatives were on track, prompting upgrades for both.

In the good books

JP Morgan upgraded ANZ (ANZ) to Overweight from Neutral. Buy/Hold/Sell 3/3/2 JP Morgan has upgraded given the current valuation gap to peers, National Australia Bank (NAB) in particular. The broker supports the bank's progressive capital strategy and considers assumptions that ANZ is short of capital relative to peers misleading.

Citi upgraded CSR (CSR) to Buy from Sell. Buy/Hold/Sell 5/3/0 Citi finds greater earnings clarity with the FY15 results and suspects the residential property cycle will be extended and aluminium will benefit from lower cost linkage to alumina. Citi incorporates enhanced opportunities and synergies under the new brick JV with Boral (BLD) and, with an elongated construction cycle, upgrades to Buy from Sell.

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