Macquarie revises forecasts to reflect current housing activity and low visibility into FY21.
The business is considered well-placed to grow ahead of the market in the medium term but the speed and magnitude of recovery remains uncertain.
The broker expects some weakness in FY21 in commercial before a modest improvement in FY22. A further fall of -10% in residential completions is expected over FY21.
Neutral rating retained. Target is reduced to $2.90 from $3.90.
Sector: Capital Goods.
Target price is $2.90.Current Price is $2.65. Difference: $0.25 – (brackets indicate current price is over target). If GWA meets the Macquarie target it will return approximately 9% (excluding dividends, fees and charges – negative figures indicate an expected loss).