2343 GMT - The market appears to be skeptical of Link's sure stance regarding the renewal of its AustralianSuper contract for its Retirement & Superannuation Solutions unit, say Citi analysts in a note. Link in its AGM update was confident of securing AustralianSuper's renewal, but investors may not be convinced given Link's track record and are likely unwilling to give the company much benefit of the doubt, Citi adds. More widely, Link's update provides positive aspects, and Citi sees it as an upgrade of its FY 2024 guidance. Citi remains neutral on the stock and maintains its A$1.40 target price. The stock is up 4% at A$1.29.(alice.uribe@wsj.com)

2332 GMT - Australia's major banks could release A$2 billion of provisions, after factoring in around 6% balance sheet growth over the next two years, Morgan Stanley analysts say in a note. This is reliant on total coverage ratios returning to pre-pandemic levels. According to MS analysis, the major banks had around A$21 billion of total provisions at FY 2023. This is A$3.7 billion, or 15%, below the Covid peak, but A$3.7 billion, or 20%, above pre-Covid levels. "We think it's reasonable to assume that total provision coverage will return to its pre-Covid level at each of the banks," MS says. (alice.uribe@wsj.com)

2236 ET - Aeris Resources's effort to repair its balance sheet isn't enough to persuade Ord Minnett to turn bullish on the stock. Aeris has raised A$30 million in fresh equity, which Ord Minnett expects to alleviate a trade creditors balance that stood at A$63.9 million at end-September. Still, the capital raising isn't likely to fully normalize Aeris's trade payables position, which was A$121 million at end-June, Ord Minnett says. So, the bank expects Aeris to take on A$20 million more debt in FY 2024. "Until we see consistent delivery, a refinanced debt facility or higher commodity prices we find it challenging to become more constructive with near-term risk offsetting longer-term valuation," analyst Paul Kaner says in a note. (david.winning@wsj.com; @dwinningWSJ)

2156 ET - While Kiwi Property expects to maintain its dividend this fiscal year, Jefferies thinks it will be cut in FY 2025. Analyst Rohan Koreman-Smit says this view reflects higher tax, cost pressures and lower initial returns on developments. Forsyth Barr forecasts a FY 2025 dividend of 5.2 New Zealand cents/share, down 9% from FY 2024. "In the short term there remains a number of questions around the success of build-to-rent," Forsyth Barr says. "The main one being the level of rent required to meet already low yield on cost targets." In addition, the bank doesn't believe earnings from the sale of Drury land, representing 1.5-1.8 NZ cents/share, should be distributed due to their one-off nature. (david.winning@wsj.com; @dwinningWSJ)

1652 ET - Forsyth Barr thinks health products maker Comvita is likely to hit the bottom end of its revised FY 2024 Ebitda guidance of NZ$33 million-NZ$38 million. "We believe earnings risks are weighted to the downside in the near term and this puts Comvita's FY 2025 strategic target of NZ$50 million Ebitda at risk," analyst Margaret Bei says in a note. Comvita is facing a tough macroeconomic backdrop and ongoing cost pressures, especially in labor. Forsyth Barr forecasts Comvita's FY 2025 Ebitda at NZ$46 million, falling short of its target. "Comvita may reach its goal if demand rebounds faster than anticipated and/or cost-out measures are implemented," the bank says. (david.winning@wsj.com; @dwinningWSJ)

2146 GMT - Metcash's 1H net profit likely fell 7% due to a higher interest expense, as operating conditions get tougher in grocery and hardware, Jefferies says. Metcash is due to report its 1H result on Dec. 4, and analyst Michael Simotas expects the company's outlook to point to moderating sales trends. "We expect a trading update for November to be provided and show year-over-year sales relatively flat for Food given moderating inflation, tobacco drag and share loss," says Jefferies. "Given macro headwinds, we expect Hardware sales to have somewhat deteriorated due to weakness in trade partly offset by DIY sales." (david.winning@wsj.com; @dwinningWSJ)

2141 GMT - PointsBet Holdings is an interesting bet as a possible takeover target for a bigger rival such as Tabcorp, Jefferies says. That's because Tabcorp has lagged in technology and has eyes on the younger demographic that PointsBet succeeds in, analyst Simon Thackray says in a note. "Pointbet could represent a suitable M&A target for technology and their customer list for Tabcorp," Jefferies says. There's been plenty of deals in wagering before, and the three biggest companies control more than 90% of the market. Jefferies raises PointsBet to buy, from hold, and lifts its price target by 14% to A$0.91/share. PointsBet ended Tuesday at A$0.77. (david.winning@wsj.com; @dwinningWSJ)

2120 GMT - Ramsay Health Care's 1Q business update highlighted encouraging trends, albeit with ongoing inflationary pressures, which Jefferies believes will only abate in the medium term. Ramsay said activity at its Australian private hospitals continued to improve, although wage costs remain a headwind. U.K. volumes lifted in 1Q as private patient backlogs unwound more. In a note, Jefferies analyst David Stanton also highlighted that Ramsay now expects a higher tax rate than before. The effective tax rate is now projected at 33%-34%, from 30%, mainly due to the delayed abolition of the CVAE tax in France. That contributes to Jefferies cutting its FY 2024 and FY 2025 EPS forecasts by around 10% and 8%, respectively, which also reflects the recent sale of the Ramsay Sime Darby JV. (david.winning@wsj.com; @dwinningWSJ)

(END) Dow Jones Newswires

November 29, 2023 00:11 ET (05:11 GMT)