Macquarie stays defensive on Aussie telcos, media, tech names amid macro concerns

SEEK

08/03/2023 03:07

** Macquarie says latest reporting season reinforced its
defensive stance on Aussie telecom, media, entertainment & tech
stocks
    ** "We still think it is too early for stocks with
cyclically driven downgrades, prefer defensive earnings or
structural growth" - broker
    ** Says it prefers counter-cyclical names like online auto
classifieds firm Carsales.com Ltd  CAR.AX  or stocks that have
limited exposure to the cycle, like data centre provider NextDC
Ltd  NXT.AX 
    ** Expects telco firms Telstra Corp  TLS.AX  and TPG Telecom
 TPG.AX  to be beneficiaries of mobile market recovery and
repricing updates in the pipeline
    ** Prefers education services firm IDP Education  IEL.AX ,
owing to growth in both English language testing and student
placement, and NXT for strong pipeline to add more sites
    ** Adds accounting software firm Xero Ltd  XRO.AX  and
employment services provider Seek Ltd  SEK.AX  remain the most
contentious in coverage universe
    ** Says near-term earnings headwinds for XRO from subscriber
growth moderation could change from medium-term strategic
transition, if announced
    ** For SEK, the benefits from execution of its dynamic
pricing strategy in Australia, New Zealand and Asia could be
offset by risks from job ad assumptions and competitive position


($1 = 1.4663 Australian dollars)

 (Reporting by Savyata Mishra in Bengaluru)
 ((Savyata.Mishra@thomsonreuters.com))