APA Group’s FY19 result met consensus and Credit Suisse forecasts and hit the top end of guidance. FY20 guidance missed the broker because of delayed project revenue and higher corporate costs.
On the upside, positive net revenue from renewals points to underlying strength and the broker expects a benign regulatory environment despite the rhetoric.
Target price rises to $10.20 from $8.75. Neutral rating retained.
Target price is $10.20.Current Price is $10.96. Difference: ($0.76) – (brackets indicate current price is over target). If APA meets the Credit Suisse target it will return approximately -7% (excluding dividends, fees and charges – negative figures indicate an expected loss).