AZJ - Morgan Stanley rates the stock as Equal-weight
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The ACCC's decision on Aurizon's sale and closure of its intermodal business is due on March 15. Aurizon's share price has already been under pressure from uncertainty around the draft UT5 decision.
If the sale is allowed to proceed, that would be positive, the broker notes. If the regulator finds issues that need to be resolved, uncertainty will continue to prevail. If the ACCC blocks the deal the broker believes the market is potentially underestimating the downside risk.
The broker's base case is sale approval. Equal-weight and $4.88 target retained. Industry view: Cautious.
Target price is $4.88.Current Price is $4.47. Difference: $0.41 - (brackets indicate current price is over target). If AZJ meets the Morgan Stanley target it will return approximately 8% (excluding dividends, fees and charges - negative figures indicate an expected loss).
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