In the face of a struggling and volatile share market, stockbroking analysts have gone relatively quiet. Upgrades and downgrades are predominantly news-related with Cardno (profit warning) and James Hardie (better than expected result) featuring prominently.
In the good books
AGL Energy (AGL) was upgraded to Outperform from Neutral by Macquarie. Buy/Hold/Sell: 4/3/1 AGL will launch a new strategy next week. With coal a dirty word and new energy in the form of household solar and batteries growing fast, the broker expects AGL will focus on cost restructuring and efficiencies and small asset divestments. AGL's low cost coal generation provides flexibility and the company is well placed with regard to a recovery in carbon offset prices, and the broker suggests cost discipline should flow through to improved dividends.
Beach Energy was (BPT) upgraded to Neutral, High Risk from Sell by Citi. Buy/Hold/Sell: 0/4/3 Citi has upgraded oil and FX forecasts. The broker expects the low point in oil will come in the second half of 2015, with supply and demand responses improving thereafter. The sector remains attractive for the broker although the near-term oil price is a risk. The broker considers Beach fairly priced at current levels.