Citi sees stable medium-term volumes for Australia's CSR

CSR

06/11/2022 20:06

** Brokerage Citi says building products maker CSR Ltd
 CSR.AX  will likely have stable building volumes over the
medium-term due to its backlog, flood repair work and potential
government stimulus 
    ** Citi says in this market cycle of lower housing prices
due to higher interest rates, housing price have not equated to
housing activity due to the backlog and flood repair work
    ** Brokerage also says H1 2023 result was "solid"; H1 net
profit after tax, before significant items, grew 27% to A$110
million, and interim dividend announced was 16.5 Australian
cents per share, compared with 13.5 Australian cents a year ago
 urn:newsml:reuters.com:*:nL4N32006S 
    ** Citi expects Australian rates to peak in February 2023 at
3.35% (rates currently at 2.85%), but expects house price falls
to last longer and bottom only towards end-2023  urn:newsml:reuters.com:*:nL4N31W006 
    ** Says housing stocks bottom and start to outperform 6-7
months before house prices start rising, brokerage considers we
are now 3 months into what historically is a 13-14 month down
cycle
    ** Maintains A$5.80 target price and "buy" rating 
    ** Out of 11 analysts, six rate CSR "buy" or higher, five
"hold"; median PT is A$5.40 - Refinitiv Eikon data
    ** CSR finished Friday trading 3.5% higher at A$4.69; down
20.2% YTD 
 (Reporting by Harshita Swaminathan; editing by David Evans)
 ((Harshita.Swaminathan@thomsonreuters.com))