0027 GMT - Orica CEO Sanjeev Gandhi says the company is reviewing its capital-management framework, prompting Jarden to assess the moves that it could make. Orica ended FY 2024 with gearing of 26%. That is below its 30-40% target range. "We would see scope for Orica to undertake a buyback of A$400 million-plus in FY 2025, providing a positive catalyst, and downside share price support for the stock," analyst James Wilson says. Jarden has a neutral call on Orica's stock. Gandhi told The Wall Street Journal yesterday that Orica could explore options to raise its dividend payout ratio further and may discuss a share buyback program as part of the review. ([email protected]; @dwinningWSJ)

2349 GMT - Xero's quality and growth prospects keep Jarden analysts Tom Beadle and Liam Robertson bullish on the stock though its valuation is starting to look stretched. The pair tell clients in a note that the cloud-accounting software provider's strong 1H cost performance and revenue momentum prompt them to raise their FY 2025 underlying EPS forecast by 3%. The company's full-year cost outlook is seen as conservative given its lower-than-expected 1H expense ratio. The pair forecast a full-year ratio of 72.1%, up from 71.2% in 1H but below Xero's 73% guidance. Jarden raises its target price 17% to A$177.00 and keeps an overweight rating on the stock. Shares are down 0.5% at A$170.21. ([email protected])

2337 GMT - A new long-duration energy storage target set by Australia's most populous state helps keep Shaw & Partners analysts bullish on battery metals miner Australian Vanadium. The New South Wales state government has introduced legislation to add an additional 12GWh of long-duration storage by 2034, on top of its existing 2030 target of 16GWh. With the last of the state's four coal-powered generators scheduled to close around 2034, the announcement adds to what the analysts call a battery bonanza. They add in a note to clients that mining giant Rio Tinto recently said that vanadium-flow batteries will be crucial to Australia's renewables sector. Shaw & Partners keep a buy rating and A$0.08 target price on the stock, which is flat at A$0.014. ([email protected])

2325 GMT - Computershare could beat its annual earnings-per-share guidance due to favorable trends across its issuer-services, employee share-plan, and corporate trust businesses, Goldman Sachs analysts say. They tell clients in a note that, while the share-registry provider did not mention its corporate trust business in its recent trading update, external data suggests that Computershare is holding onto its market share in U.S. debt issuance. The company has also reiterated its full-year margin-income guidance despite central banks globally having started lowering rates. Goldman Sachs lifts its target price 3.3% to A$31.00 and keeps a buy rating on the stock. Shares are up 1.5% at A$30.02. ([email protected])

2306 GMT - Computershare is likely to launch and complete a fresh A$350 million share buyback in its 2026 fiscal year, Jefferies analysts reckon. They see free cashflow in Computershare's current fiscal year rising 14% to US$1.12 billion. They point out in a note to clients that the share-registry provider's current A$600 million buyback is 60% complete and scheduled to continue until the end of fiscal 2025. The company is benefiting from higher-than-anticipated average customer balances, prompting the Jefferies analysts to raise their balance forecasts in outer years. Jefferies lifts its target price 12% to A$34.00 and keeps a buy rating on the stock, which is at A$29.58 ahead of the open. ([email protected])

2259 GMT - Xero's growth investment is unlikely to increase to lift operating expenses to the level suggested by the cloud-accounting software provider's guidance, Goldman Sachs analysts say in a note. They think that the Australia-listed company's increased focus on the U.S. market will lead to higher investment over its fiscal second half, they don't see it reaching the level necessary for operating expenses to account for 73% of revenue. This would require what they call a material acceleration in expenses. They forecast a 72.4% ratio over the whole of fiscal 2025. Goldman Sachs keeps a buy rating and outperform rating on the stock, which is at A$171.00 ahead of the open. ([email protected])

2254 GMT - Donald Trump's presidential election victory prompts Jefferies to cut its valuation of Infratil's Longroad Energy business by 8%. Analyst Roger Samuel says the election outcome introduces uncertainty to the Inflation Reduction Act in terms of tax credits for renewable energy projects. "Positively, Longroad has safe-harbored most of the development projects in FY 2025-2026," Jefferies says. Any changes to the IRA will likely take several years to play out. "Although projects in FY 2027 onwards may be at risk in terms of costs, Longroad is likely to get higher Power Purchase Agreement prices given insatiable demand for energy in the U.S. from hyperscalers," Jefferies adds. It retains a buy call on Infratil. ([email protected]; @dwinningWSJ)

2248 GMT - Xero's first-half result is seen by Macquarie analysts as evidence that the cloud-accounting software provider is making good capital-allocation decisions. They tell clients in a note that management is making data-driven decisions on capital, with benefits from new products still to come. They point out that the company's reiterated guidance for a full-year operating-expense ratio of 73% assumes further growth reinvestment. Xero's discipline and rule-of-40 performance gives the Macquarie analysts that Xero will hit its expense targets. Macquarie lifts it target price 1.8% to A$191.90 and keeps an outperform rating on the stock, which is at A$171.00 ahead of the open. ([email protected])

2243 GMT - Jefferies takes a less rosy view of GrainCorp's earnings over the next two years, after the grain handler's management signaled profit margins are being squeezed by strong crop production world-wide. GrainCorp's commentary overshadowed its FY 2024 earnings that were in line with guidance and a stronger dividend payout than Jefferies was expecting. "It's difficult for us to gauge the extent of margin pressure this early in the new year," says analyst John Campbell. "Nonetheless, we've cut FY 2025-2026 EPS -12%, -13%." GrainCorp intends to provide earnings guidance at its annual meeting of shareholders in February. ([email protected]; @dwinningWSJ)

2239 GMT - Catapult's improving margins and better-than-expected cost control keeps Jefferies analysts bullish on the sports-tech provider. They trim their annual revenue forecast by about 1% to US$116 million to reflect a stronger-than-normal skew toward the just-completed fiscal first half, but this is offset by the prospect of a stronger Ebitda margin. They tell clients in a note that Catapult's cost management supports an Ebitda margin forecast of 13% for fiscal 2025, up from 12% previously. They see Catapult's recent deal with England's national rugby body as evidence that it is displacing incumbent providers. Jefferies lifts its target price 38% to A$3.30 and keeps a buy rating on the stock. Shares are at A$2.87 ahead of the open. ([email protected])

2235 GMT - Investors should keep a watchful eye on fish oil prices, which have fallen substantially over the past six months. Citi analyst William Park says a time could come where Omega-3 production doesn't meet Nufarm's return threshold if prices keep dropping. "We think risk of prices remaining subdued remains elevated," says Citi, highlighting the recent influence on prices of a heightened anchovy fishing quota in Peru. Still, Citi notes that Nufarm is upbeat for now. Nufarm expects revenue from Omega-3 to double to around A$100 million in FY 2025. Citi retains a sell call on Nufarm. ([email protected]; @dwinningWSJ)

2218 GMT - The 30% drop in Flight Centre's shares that followed its latest trading update looks like an overreaction to Citi. The bank assumes that volatility in booking patterns should smooth out over the course of a year. That's because consumers are still travelling and Flight Centre doesn't appear to be losing market share. Citi notes that its volumes are ahead of market growth rates. "As a result, we remain cautiously optimistic," analyst Samuel Seow says. Citi retains its buy call, but lowers its price target by 20% to A$20.35/share. Flight Centre ended Thursday at A$17.39. ([email protected]; @dwinningWSJ)

2207 GMT - Xero's pricing power and tight control of spending help the cloud-accounting software provider keep its bull at Jefferies. The Australia-listed company's lower-than-expected first-half cost ratio move analyst Roger Samuel to raise his Ebitda forecast for the current fiscal year by 9%, and for fiscal 2026 by 4%. He tells clients in a note that Xero's full-year cost outlook appears very conservative. The company's low customer churn rate is seen positively, especially given an 11% on-year rise in first-half average revenue per user. There is more price growth to come, he adds. Jefferies raises its target price 12% to A$196.10 and keeps a buy rating on the stock, which is at A$171.00 ahead of the open. ([email protected])

2204 GMT - Orica's FY 2024 result should help to build confidence that the mining explosives maker remains in the early stages of a multi-year earnings upcycle, Jefferies says. "Whilst it is disappointing that guidance points to a jump in depreciation and amortization in FY 2025, it doesn't detract from the very positive FY 2025 and FY 2026 outlook," analyst Henry Copley says. The outcome of the U.S. is also a boon. Jefferies sees Orica benefiting from the incoming Trump administration as natural-gas prices are expected to fall and the Quarrying and Construction market is likely to recover. It retains a buy call on Orica's stock. ([email protected]; @dwinningWSJ)

(END) Dow Jones Newswires