Australian Shares Recommendations

UBS states that CBA is "not cheap". UBS has a Neutral 1 recommendation on the Commonwealth Bank of Australia (CBA) with a price target of $43.50. According to UBS, CBA is trading at PE of 14x and yield of 5.2%. Meanwhile MRE (Macquarie Research Equities) has a 12 month price target of $45.25 for CBA and maintains a Neutral recommendation. Let's see where the new CEO Ralph Norris and his team can show us in the future.

UBS has maintained its position on Goodman Fielder with a Buy 1 recommendation and a target of $2.60 based on DCF. UBS says that Goodman Fielder currently trades at a 12.9x 07E PE and hence a 20% discount to market. Examine your charts.

There are many stocks in the Australian Stock Exchange (ASX) that are related to resources and commodities like metals and oils. We examine a few of the companies that UBS notes have a 'relationship' with respect to their company price and the commodity price. Among the companies we look at are Woodside Petroleum, BHP Billiton, Rio Tintio, Alumina, Zinifex, Newcrest, Oxiana and Santos.

Time to look at what stocks some brokers are looking at...

UBS has a Buy 2 recommendation with a target of $21 for the stock of Babcock & Brown Limited (BNB). UBS notes that they "see BNB as an attractive growth stock with the potential for further upgrades as it rolls its model out. However, it is a higher risk play given transactional earnings and a volatile PE."

Citigroup Investment Research reiterates their Buy recommendation for Woodside Petroleum (WPL) and lifts their target price from $47.00 to $48.90.

Meanwhile, UBS has a BUY 2 recommendation for WorleyParsons Ltd [WOR] with a target of $19.40. On another stock, UBS has Telstra [TLS] with a NEUTRAL 2 recommendation and a price target of $4.40.

Maquarie Research Equities (MRE) thought Gold looked good technically - have a look at your charts! Besides trading the gold commodity directly you may want to consider looking at Lihir Gold (LHG) and Newcrest Mining (NCM).

Macquarie Research Equities (MRE) are bullish on Babcock and Brown Infrastructure (BBI) with price target lifting to $1.69. MRE believe the key reasons to invest in BBI are:
1. Relatively attractive tax deferred distribution. BBI has already confirmed that it will pay out an interim distribution of 6.5¢ps which is expected to be fully tax deferred.
2. Potential further growth in the distribution yield through additional yield accretive acquisitions.
3. Quality asset portfolio.
4. Growth options in some assets.
5. Low operational volatility.
6. Acquisition track record.

UBS has the following ratings for MIG, CSL, PBL and ANZ. ANZ Buy 1 rating with target of $30.00. MIG Buy 1 target $4.30, PBL with a Neutral 1 and target of $18.65 and CSL with Neutral 2 and target of $49. Check your charts!

Macquarie Research Equities (MRE) has noted that about 65% of companies now having reported their profit results to the market. Stocks in the ASX100 have recorded 22 positive surprises and 9 negative surprises for the reporting season to date. The Ex100 was more volatile and reported 29 positive and 28 negative surprises.

Macquarie Research Equities (MRE) has reiterated its 12-month price target of $11.50 for Brambles Limited (BIL) and remains their top pick of the sector. There is a growing confidence in the Brambles' ability to realise a high level of value from the sale of its non-core businesses (Cleanaway and Industrial Services) and the proposed return of $2.8bn in cash by way of capital management should help to underpin further share price appreciation. MRE forecasts a total 12 month shareholder return of 13.3%.

UBS has a Buy 1 Recommendation on [WDC] Westfield Group with a target of $19.04. The future growth of Wesfield lies with redeveloping their shopping centres and has handed down a $4.2 billion annual net profit. This 2005 result was boosted hugely by property revaluations that are now counted under the new international financial reporting standards, in the first annual result since Westfield merged its property trusts with their managing company in mid-2004. Under previous accounting standards, Westfield's annual profit would have been $1.66 billion, in line with guidance and market expectations.