LLC – Morgan Stanley rates the stock as Overweight

Morgan Stanley found the AGM update was a net positive with additional disclosure on underperforming Engineering projects, reconfirmation of projected sale proceeds and capacity to complete buyback all cited. But the analysts also acknowledge provisions for new engineering projects could temper re-rate with some investors fearing further losses from that one troubled division.

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LLC – Citi rates the stock as Buy

A site tour has underscored the broker’s positive outlook. Citi notes Lend Lease is exposed to attractive end markets. The sale of Bluewater is likely along with the sell down of development projects and this should support further share price gains. Lend Lease is also bidding on a number of large infrastructure projects which should drive growth from FY16.

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LLC – Citi rates the stock as Neutral

Target $9.25 (was $10.50). The FY13 net profit guidance was in line with the market, with weaker construction earnings and around $20m of restructuring costs offset by the gain from the sale of its JEM stake and a lower tax rate. On an underlying basis, the profit before tax number is actually 13% below what Citi was expecting.

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LLC – Citi rates the stock as Buy

The broker notes the company is selling its Aged Care business for $270m to Australian Aged Care Partners via $20m in cash and a $70m promissory note. Citi says the deal is being done at book and is in line with stated strategy of recycling capital out of lower returning, non core assets. The cash is to be spent on growing the Australian development pipeline.

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