News SummaryDJ Australian Equities Roundup -- Market Talk18 Mar 2022 15:57:481 View2246 GMT - With Macquarie's stock falling from an early Jan. high, the company looks to be a buying opportunity, says Jefferies. The investment bank notes the Australian financial company's shares peaked at A$217.32 on Jan. 5 and has now de-rated given fears including concerns that rising interest rates will crimp real asset values. But, conversely Macquarie closed its Russia office and infrastructure funds in 2017/18, Jefferies says. The investment bank's FY 2022-2024 forecasts are above consensus, with a buy recommendation. (alice.uribe@wsj.com)

2239 GMT - Seek keeps its overweight rating from Morgan Stanley despite its 15% share-price surge this month, with the investment bank seeing the jobs advertiser as a better alternative to U.S. peer ZipRecruiter. ZipRecruiter has lifted guidance three times in six months, and Morgan Stanley sees sufficient similarities between the companies and countries to believe there could be further upside to Seek's improved annual guidance. It also notes that Seek shares are about 10% cheaper than ZipRecruiter's in terms of FY23 earnings multiples. It raises its target price by 71% to A$36. Shares last traded at A$30.69. (stuart.condie@wsj.com; @StuartLCondie)

2237 GMT - Abacus Property's A$200 million equity raise will weigh on earnings initially, but will lead to elevated returns over time, Macquarie says. It estimates the raise will reduce funds from operations/security by 5.8% on an annual basis initially, as Abacus has earmarked most proceeds for its A$266 million development pipeline of self-storage assets over 2H of FY2022-FY2025. "We estimate that these developments could drive earnings growth of 1.5% per annum and net tangible assets/security growth of 0.5% per annum once stabilized, resulting in a net positive outcome for our funds from operations forecasts long term," Macquarie says. "However, we note these returns are relatively longer-dated, with build-times for self storage assets 1 year followed by 3-4 years of stabilization, along with carrying additional risk." ( david.winning@wsj.com; @dwinningWSJ )

2234 GMT - The margin benefit Aussie banks may feel from central bank interest rate hikes is likely to be partly offset by higher funding costs, more intense mortgage competition and modestly higher loan losses, says Morgan Stanley. The investment bank has now upgraded its major bank FY 2024 earnings per share estimates by 1%-3%. Still, MS reckons that the headwinds from shifts in mortgage mix and fixed rate mortgage pricing will ease in 2H FY2022, but also that the boost to margins from higher cash rates will prolong competition for variable-rate mortgages. MS assumes an average margin headwind of minus 3 basis points per half in FY 2023 and FY 2024. ( alice.uribe@wsj.com )

2224 GMT - Westgold's plans to use its recent A$100 million equity raise to accelerate gold production to 400,000 troy ounces stokes cost concerns. Macquarie pinpoints labor as a key risk of Westgold's plan to lift output of current mines, bring new pits online and expand processing capacity. "However, we note that there is time for the labor market to normalize, given most of the projects are due to be delivered in FY 2023 and FY 2024," Macquarie says. The equity raise effectively decouples Westgold's aspirations from its prior dependence on operational cash flow, Macquarie says, with the result that "we have a reaffirmed confidence in production growth." (david.winning@wsj.com; @dwinningWSJ)

2221 GMT - Life360's 1Q revenue from its Jiobit and Tile units will likely be broadly flat on-year, which Bell Potter thinks would be a decent result given headwinds. The broker anticipates continued hardware supply constraints and some potential temporary easing of demand for Tile products given privacy concerns related to rival Apple's AirTags. Yet the stock keeps its buy rating, with Bell Potter tipping strong continued momentum in Life360's core family safety offering. It sees core revenue rising 38% in FY22 and 28% in FY23. The broker maintains its A$10 target price on the stock, which last traded at A$5.23. (stuart.condie@wsj.com; @StuartLCondie)

(END) Dow Jones Newswires