0346 GMT - The a2 Milk Company's reiterated guidance is welcomed by Wilsons analysts, who think that the dairy company is doing a decent job of navigating challenging trading conditions. They write in a note to clients that the company's Australia-listed securities are excessively discounting current trading conditions, which the Wilsons analysts think are cyclical. They point to recent data indicating an increase in marriages in China, raising the prospect of higher future birth rates and a recovery in infant-formula demand. Wilsons maintains an overweight rating and A$5.47 target price on the stock, which is up 4.5% at A$3.99. (stuart.condie@wsj.com)

0338 GMT - GrainCorp's strong balance sheet gives the Australian grain handler and marketer a buffer as it moves into period of tougher seasonal conditions, Macquarie analysts say. They maintain an outperform rating on the stock despite forecasting an earnings decline in each of next two fiscal years, pointing to a strong core cash position that also supports capital management. They write in a note that their asset-replacement cost analysis suggests a large gap between GrainCorp's intrinsic value and its share price. Macquarie trims target price 4.2% to A$9.70 and keeps an outperform rating on the stock, which is up 4.6% at A$7.90. (stuart.condie@wsj.com)

0022 GMT - AMP's bank volumes and margins are likely to fall before potentially improving from FY 2026 onwards, says UBS analyst Scott Russell in a note. AMP this week reduced its net interest margin guidance to 125 basis points from "below" 130-135 bps, which UBS sees implies a 2H FY 2023 NIM of around 113 bps. AMP's announcement of the future launch of a digital SME bank is designed to address the rising cost of funding it's facing, but UBS expects that until it reaches scale, deposit competition will remain intense, and the AMP funding mix will deteriorate further. UBS keeps its sell rating but cuts the target price by 18% to A$0.82. AMP is down 0.3% at 85.25 Australian cents a share. (alice.uribe@wsj.com)

2354 GMT - AMP's move to lower its bank net interest margin guidance for a second time in a month could be a hard pill to swallow for investors, say Citi analysts in a note. The investment bank calls out that NIM guidance is now 125 basis points, compared with a month earlier when it was "below" 130-135 bps. Citi says a full explanation for the drop, other than rising funding costs with term funding facility expiry and ongoing competition, and more specific guidance for FY 2024 hasn't been provided by AMP. This could leave "the market to fear the worst." Citi keeps its neutral call but cuts target price by 22% to A$0.90. AMP is up 0.6% to A$0.86.(alice.uribe@wsj.com)

2327 GMT -- Despite Steadfast upgrading its guidance this week, Morgan Stanley analysts reckon the insurance broking company is well placed to deliver further upgrades. It comes to this view, partly because it sees that Steadfast's upgraded FY 2024 guidance is almost entirely based on the contribution from Sure Insurance. Steadfast has agreed to acquire 70% of Sure Insurance. Additionally, while MS sees that insurance pricing is slowing in corporate lines, Steadfast's comments and other data points show property and personal home pricing remain strong. MS also thinks a structural growth in underwriting agencies, as domestic insurers don't have the appetite or the technology to write a broad range of risks profitably, will benefit insurance brokers. (alice.uribe@wsj.com)

2305 GMT -- AMP's guidance update, which included the view that net interest margin was to remain under pressure in FY 2024, looks disappointing to Morgan Stanley analysts. They say in a note that the update raises questions about AMP's bank strategy and competitive positioning. MS says AMP's new guidance implies 11%-12% downside risk to consensus AMP group operating earnings in 2H FY 2023 and FY 2024, or 22%-24% downside risk to bank division earnings, all other things being equal. AMP, in its update, guided to "nominal" bank book growth in FY 2024 as it focuses on protecting NIM and improving bank profitability, MS notes. (alice.uribe@wsj.com)

2301 GMT - Corporate Travel Management keeps its buy rating from Bell Potter, where analyst Olivia Hagglund sees uncertainty including over the global economic outlook already being priced in by the market. She writes in a note to clients that sees the stock price also reflecting uncertainty over the trajectory of the company's earnings recovery and structural industry headwinds. Given that, there appears to be upside risk given that Corporate Travel Management's recent new client wins, strong balance sheet, cash generation and strong earnings forecasts. The stock is trading at a 5% discount to peers even though the company pays a solid dividend, she adds. Bell Potter cuts target price 12% to A$21.00 following a change of analyst. Shares are at A$19.15 ahead of the open. (stuart.condie@wsj.com)

2232 GMT - GrainCorp's FY23 result is described as exceptional by Wilsons analysts, who highlight the Australian processor and marketer's large volumes, attractive margins and A$50 million share buyback. The Wilsons analysts acknowledge the drop in annual earnings and the prospect of further falls in the next couple of years, but lean positive on GrainCorp's strong balance sheet and growth strategy, which they say is clear and logical. They add in a note to clients that FY24 receivals appear to be tracking broadly in-line with those from FY16. Wilsons raises target price 0.3% to A$6.74 and retains a market-weight rating on the stock, which is at A$7.55 ahead of the open. (stuart.condie@wsj.com)

2219 ET - The a2 Milk Company secures a new bull after what Citi analyst Sam Teeger says was the somewhat unexpected reiteration of its FY24 earnings guidance. Teeger lifts his recommendation on the stock to buy from neutral, writing in a note that the dairy company's reasonably positive commentary indicates that the earnings skew toward 2H may not be as significant as previously thoughts. He notes that the stock is trading at a 33% discount to its historical valuation of 28 times earnings. Citi raises target price 1.5% to A$4.81. Shares were at A$3.82 ahead of the open. (stuart.condie@wsj.com)

0451 GMT - Life360 still looks inexpensive relative to its global peers even after shares of the company jumped following its latest update, Goldman Sachs analyst Chris Gawler says in a note. He says that the family-safety app developer's 3Q subscriber growth was stronger than expected despite recent price rises. That is the stock's most important growth metric, he adds. He sees scope for Life360 to beat its improved annual Ebitda guidance since the strong 3Q performance gives it scope to reinvest in 4Q. GS keeps a buy rating and A$10.50 target price on the stock, which is down 6.0% at A$8.35. The stock has jumped 12% across the previous two sessions. (stuart.condie@wsj.com)

0444 GMT - Nufarm gets a new bull at Citi after delivering an annual report that the investment bank's analysts say looks solid compared with global peers. Citi lifts its recommendation on the stock to buy from neutral amid what the analysts say is evidence of the crop-technology company's ability to cushion the impact of headwinds through portfolio and geographic diversity. They write in a note that the Australian company's peers have cited continued pressure from lower demand and last-minute ordering by customers. Citi lifts the stock's target price 20% to A$5.60. Shares are down 3.5% at A$4.64. (stuart.condie@wsj.com)

(END) Dow Jones Newswires

November 16, 2023 22:51 ET (03:51 GMT)