Australasian Equities

Fat Prophets
Australasian Equities

Speculative

high

Hold

Production Up, Costs Down New Hope Corporation (ASX: NHC) delivered a strong 3Q26 with coal sales rising 10.4% to 3.2 million tonnes and operating profit up 22% to $130 million. Production costs at their flagship NSW mine fell 12.4% as higher output spread fixed costs across more tonnes. Coal prices rose 16.5% over the quarter, supported by Asian utilities turning back to coal amid concerns over Middle East gas supply. The company also sits on a cash hoard of $571.6 million and

Elders

Core

medium

Hold

Tech and Fuel Caused the Spook Elders (ASX: ELD) tumbled -22.9% despite a solid 1H26 with operating profit up 33% to $76.6 million and cash flow more than doubling to $67.0 million. Investors focused on a 4% decline in earnings per share and rising technology and fuel costs. The interim dividend was maintained at 18 cents but lifted to be fully franked. Proceeds from the pending sale of a cattle feedlot are expected to reduce debt in the second half. In our last

Paladin Energy

Speculative

high

Buy

Production Up and Full-Year Guidance Raised Paladin Energy’s (ASX: PDN) Namibian uranium mine produced 1.29 million pounds in the March quarter, up 5% on the prior quarter, at a production cost well below guidance. The improved performance prompted a full-year production upgrade and a return to profitability after a year of losses. The company holds US$219.5 million in cash and investments with minimal debt. Meanwhile, environmental approval for their high-grade Saskatchewan development project (Patterson Lake South) has been secured, adding a future growth option. A timing gap between revenue earned and

The Lottery Corporation

Speculative

high

Buy

Lottery Licence Locked In Until 2068 The Lottery Corporation (ASX: TLC) has secured a 40-year extension of its exclusive licence to operate public lotteries in Victoria, locking in rights until 2068 for $1.145 billion. Victoria is the company’s second-largest state by lottery sales. The deal was funded entirely through debt, with LTC’s investment-grade credit rating retained. The next major licence renewal in NSW is not until 2050, which underpins earnings. In our last tech update on the 5th of March, we noted that

APA Group

Core

medium

Buy

Pipeline Capacity to Grow 30% as Southern Gas Shortfalls Loom APA Group (ASX: APA) has committed $480 million to expand the capacity of their east coast pipeline system. The funds will be spent on increasing the volume of gas by 30% flowing southward from Queensland. The investment is backed by long-term take-or-pay contracts. The interim distribution of 27.5c was lifted 1.9% year-on-year, continuing a long track record of growing dividends. In our last tech update on the 27th of March, we noted that “APA has

CSL

Core

medium

Hold

Interim CEO Review Delivers a Hard but Necessary Reckoning CSL (ASX: CSL) plunged -16% after cutting full-year profit forecasts by around 9%-13% to approximately US$3.1 billion following a 90-day review by the interim CEO. The company also flagged around a US$5 billion in non-cash write-downs, largely tied to the 2022 acquisition of kidney disease specialist Vifor, which has not performed as originally expected. The write-downs do not affect cash flow or the dividend. Core blood plasma and vaccine operations remain firmly profitable. The shares have fallen almost

Amcor

Core

medium

Hold

Accretive Growth: Acquisition Pays Off Amcor, (ASX: AMC) delivered a sharp rise in sales and profit following their acquisition of US rival Berry, with adjusted operating profit up 72% for the quarter. Cost savings from combining the two businesses are tracking ahead of schedule, now targeting US$270 million in annual savings. Full-year earnings per share guidance of US$3.98 to US$4.03 was maintained. However, free cash flow guidance was trimmed as the company holds more inventory to manage supply chain disruptions. Net debt remains elevated at

QBE Insurance

Core

medium

Buy

A Solid Start QBE Insurance (ASX: QBE) opened 2026 with total premiums written up 11% to US$9.2 billion, supported by growth in North American crop insurance and selected international lines. Natural disaster claims for the first four months came in at around US$300 million, well below the 1H26 budget of US$517 million. Investment income reached approximately US$500 million, benefiting from higher interest rates on its bond portfolio. Full-year profitability guidance was reaffirmed. The company has also cut their exposure to large disaster losses by around 40% over two

Betashares Japan ETF

Core

medium

Buy

Going Above and Beyond When we published our February note on HJPN, we called for the Nikkei 225 to sustain its re-rating toward the 54,000–56,000 range. The index blew through both numbers. As of May 8, the Nikkei traded at 62,713, having touched a new record above 63,000 in the prior session. The Betashares Japan ETF (ASX: HJPN) is up around +16% YTD and +53% over the past year. While some of the ‘easy’ upside has arrived, we believe Japanese equities

Global X Copper Miners ETF

Speculative

medium

Buy

Another demand engine in a tight market Our last note on the Global X Copper Miners ETF (ASX: WIRE) in late January noted that the copper thesis rested on structural demand – electrification, AI data centres, the energy transition – converging with a mine supply peak. That thesis is intact. What has happened since is that demand forces are strengthening, and the supply side has signalled that it is struggling to keep up. The latter signal is the collapse in treatment

Orica

Core

medium

Hold

Strongest First-Half in Over Two Decades Orica (ASX: ORI) delivered their strongest first-half operating profit in over 20 years, rising 5% to $512 million. Underlying net profit grew 8%, and the interim dividend was lifted 14% to 28.5 cents per share. A court settlement with a US chemical supplier will result in a cash payment of around US$170 million in the second half, which weighed on the headline statutory result. The digital technology and specialty chemicals divisions both grew strongly. A cost reduction

Northern Star

Speculative

high

Hold

Why Northern Star is a medium-term play We are moving Northern Star Resources (ASX: NST) from Buy to Hold. The decision reflects a deliberate shift in the House view on the near-term gold price outlook, and a closer read that reveals a Q4 production window more exposed than the headline result suggests. The long-term investment thesis – new mill, production step-change, structural cost reset – remains intact. What has changed is the risk/reward calculus between now and that delivery. Our House view

Northern Star

Speculative

high

Hold

BWP Trust

Core

medium

Buy

First Share Raise in 13 Years BWP Trust (ASX: BWP), which owns a portfolio of large-format retail properties, including Bunnings warehouses, has raised $228 million from shareholders. The funds are earmarked for a clearly identified pipeline of property development and upgrade projects worth $163 million, where completed values are expected to exceed construction costs. The offer price represented a modest 4.3% discount to the prevailing market price. Full-year distributions of 19.41 cents per unit, up 4.1%, were reaffirmed. Wesfarmers, which holds

Qantas

Core

high

Hold

Middle East Conflict Forces a Reroute Qantas (ASX: QAN) is trimming lower-margin routes and redirecting aircraft to high-demand European destinations as a sharp rise in fuel costs, driven by Middle East conflict, pushes its second-half fuel bill up by around $800 million. Domestic capacity has been cut 5% through September and some routes suspended. Despite these pressures, travel demand remains strong, brand value has recovered to its best level since 2019, and fleet renewal continues as planned. The business is in

SGH

Core

medium

Buy

Two Big Bets Running at Once Seven Group (ASX: SGH) is pursuing two significant opportunities simultaneously. First, their consortium bid to acquire BlueScope Steel at $32.35 per share, valuing the company at around $15 billion, remains active despite the BlueScope Board rejecting the offer as insufficient. Seven Group has clarified that it will not raise its offer price without good reason. Second, the building materials subsidiary Boral has agreed to convert 630 hectares of former quarry land near Melbourne into what

Westpac

Core

medium

Buy

Business Banking Surging as the Core Franchise Strengthens Westpac’s (ASX: WBC) 1H26 profit came in slightly below market expectations, held back by higher-than-anticipated provisions set aside for potential bad debts and softer income from financial markets operations. The underlying business, however, showed genuine progress. Lending and deposits both grew 7% year-on-year, business lending rose 16%, and the home loan book grew faster than the broader market. Costs fell 6%. The dividend of 77 cents per share was maintained. Management flagged that

ANZ Banking Group

Core

medium

Buy

Expectations Beat as Simplification Programme Pays Off ANZ’s (ASX: ANZ) 1H26 cash profit of $3.78 billion came in ahead of market expectations, rising 14% once prior-period one-off items are excluded. The result was driven by tighter cost control and lower bad debt charges. The ratio of costs to income fell sharply from 65.5% to 49.4% as the bank continues to shed a lot of staff. Technology and AI will see this trend continue. Meanwhile, ANZ’s capital position strengthened further. The interim dividend of 83c

National Australia Bank

Core

medium

Buy

A One-Off Write-Down Clouds Solid Results National Australia Bank (ASX: NAB) 1H26 result was weighed down by a one-off $949 million after-tax write-down on software assets, pulling headline profit below market expectations. Strip that out, and the underlying banking business grew profit by 6.4%, with their corporate lending division up +9.9%. The net interest margin, the difference between what the bank earns on loans and pays on deposits, widened slightly to 1.81%. Capital levels remain healthy, and the interim dividend of 85

Austal

Core

medium

Hold

A $17.7 Billion Order Book That Stretches Well Past 2030 Austal (ASX: ASB) secured a contract to build two additional patrol vessels for the Australian Border Force. The shipbuilder holds a work pipeline worth more than $17.7 billion, covering over 76 vessels either under construction or scheduled for delivery out to 2038. A new $150.3 million contract to build two additional patrol boats for the Australian Border Force adds to an already full order book. First-half earnings rose 41% to $60.3

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