0331 GMT - Brambles's cash outflows are starting to concern Morgans analyst Alexander Lu. He tells clients in a note that the pallet supplier's upgraded guidance was the key highlight of a better-than-expected 1H result, but notes that management expects a cash outflow across the full fiscal year. Lu also warns that Brambles could find it harder to push through price rises if inflation moderates, while there are signs of moderating consumer demand in the US and Europe. The stock is fully valued at a valuation of 18 times estimated FY24 earnings, he adds. Morgans maintains a hold rating and lifts its target price 13% to A$13.70. Shares are down 1.7% at A$12.755. (stuart.condie@wsj.com; @StuartLCondie)

0110 GMT - Brambles is starting to look expensive to Citi analyst Samuel Seow, but not by enough for him to cut his buy recommendation on the stock. He points out in a note to clients that the stock is trading at 17 times estimated FY 2024 earnings and looks pricey, but nonetheless sees further upside risk from operating momentum and improving free cash flow. Seow thinks elevated lumber and freight costs favor Brambles more than its smaller-scale peers, and sees the favorable operating environment continuing. Citi raises its target price by 7.1% to A$14.55. Shares are down 0.1% at A$12.96. (stuart.condie@wsj.com; @StuartLCondie)

0054 GMT - Pallet-supplier Brambles is likely to impose material price rises for the foreseeable future, say Jefferies analysts, as they raise their recommendation on the stock to hold from underperform. The Australia-listed company's significant 1H price rises support its improved guidance and the Jefferies analysts think price increases will continue for another 12-18 months. They still see some risk from major customer Costco pursuing its planned switch to plastic pallets, but they point out that there is no timeframe for the retailer to announce a solution. Jefferies raises its target price by 14% to A$11.84. Shares are down 0.3% at A$12.93. (stuart.condie@wsj.com; @StuartLCondie)

0041 GMT - Zip Co.'s 1H earnings were stronger-than-expected by Ord Minnett analysts, who are now waiting for more detail on the Australian buy-now-pay-later provider's efforts to monetize its non-core assets. The analysts say in a note to clients that Zip's 1H earnings loss was smaller than they had anticipated on both a cash and an underlying basis. They think that Zip will need to keep its credit losses at 2% or lower if it is to hit its target of earnings profitability in fiscal 2024. Marketing and salaries will have to be tightly controlled, they add. Ord Minnett maintains a hold recommendation and trims target price by 7.1% to A$0.65. Shares are down 2.9% at A$0.50. (stuart.condie@wsj.com; @StuartLCondie)

0026 GMT - Zip Co.'s 1H accounts suggest an elevated risk of a heavily discounted capital raise to boost liquidity, Macquarie analysts say in a note. They tell clients that the Australian buy-now-pay-later operator has made good progress cutting costs and that 2H additional savings from the shuttering of its rest-of-the-world unit could aid Zip in its aim of breaking even. Yet cost reductions could also hit revenue and therefore Zip's ability to break even, they add. They think that another dilutive capital raise could be on the cards and maintain an underperform rating on the stock. They cut target price 9.1% to A$0.50. Shares are down 2.9% at A$0.50. (stuart.condie@wsj.com; @StuartLCondie)

0023 GMT - Global miners had a poor earnings season, after facing falling commodity prices and rising costs in the second half of 2022, Jefferies analysts say in a note. "We believe 2H was an earnings trough," although "share price action this past week indicates that the market may not agree," they say. The analysts reckon cost inflation will slow and realized prices will move higher as China's economy recovers, improving miners' margins. "We have lifted our short-term cautious tactical view on the sector and would buy our preferred miners at current levels," say the analysts. BHP and Rio Tinto are down 3.1% and 2.9% in Sydney, at A$44.53/share and A$115.52/share, respectively. (rhiannon.hoyle@wsj.com; @RhiannonHoyle)

0003 GMT - A theme of Australia's corporate earnings season this month has been increasing caution from companies about the economic outlook, UBS strategist Richard Schellbach says in a note. "For most companies there was a clear acknowledgement that the robust economic environment we have been in, is not the one we are headed into," he says. Fears around an economic hard landing have certainly increased, and this was most apparent from companies in the building materials, steel and traditional media sectors, Schellbach says. "Discretionary Retailers noted a pull back in big ticket item sales, whilst Supermarkets and Food Producers are seeing trading down to lower value items," he adds. (david.winning@wsj.com; @dwinningWSJ)

2358 GMT - Given all the M&A happening in Western Australia's energy sector, Macquarie ponders why Strike Energy hasn't attracted a bid. One reason could be Strike's size, the bank says. With a market value of around A$815 million, it's nearly double the size of takeover targets Norwest and Warrego. Another reason could be the more expansive--but relatively under-appraised--nature of its resource base that requires more drilling, Macquarie says. Thirdly, the other assets in Strike's portfolio that have value may be of less interest to an acquirer, Macquarie says in a note. (david.winning@wsj.com; @dwinningWSJ)

2037 GMT - The latest slump in the ammonia price has Jefferies questioning whether its forecasts are too low, with implications for Incitec Pivot. The Tampa ammonia price dropped by $200/ton, or 25%, to settle at $590/ton for March. The price has now dropped by 40% in the past 2 months, and has halved since Incitec Pivot's FY 2023 began. In a note, analyst Richard Johnson says all high-level indicators suggest the floor isn't yet in sight, even with a seasonally stronger period approaching. Jefferies recently cut its FY 2023 ammonia price forecast to $880/ton, from $1,000/ton. "However, after the March settlement even this may be looking optimistic and is likely to need further negative revision, unless there is a sharp rebound in gas prices in the 2H," Jefferies says. (david.winning@wsj.com; @dwinningWSJ)

2036 GMT - Allkem gets a new bull in Jefferies after the stock was dragged lower by a 30% drop in lithium prices over the past three months. Allkem ended last week at A$11.88, some distance below Jefferies's A$15.00/share price target. "With commentary that the softening of spot prices has not resulted in corresponding softening in contracted prices, Allkem remains positioned to deliver strong margins in 2H23 and capitalize on its investments in growth projects," analyst Mitch Ryan says in a note. Jefferies now has a buy call on Jefferies, up from hold. (david.winning@wsj.com; @dwinningWSJ)

2036 GMT - Jefferies rates the likelihood of Neuren's trofinetide treatment for Rett Syndrome getting FDA approval at 90%. The FDA has already granted a priority review for trofinetide and assigned a Prescription Drug User Fee Act, or PDUFA, action date of March 12. The FDA has informed Neuren's partner on the treatment, Acadia, that it wouldn't hold an Advisory Committee meeting, which Jefferies analyst David Stanton views as positive. "We think Neuren will receive a US$40 million milestone payment from Acadia in 2H of FY23 for first commercial sale, as well as US$33 million for 1/3 the value of an FDA priority review voucher," he says. "Neuren is eligible for up to US$350 million of sales-based milestone payments as well as tiered royalties on net sales of trofinetide in the U.S." (david.winning@wsj.com; @dwinningWSJ)

(END) Dow Jones Newswires