0314 GMT - Monash IVF continues to look well placed to gain further share of an IVF industry that is benefiting from structural tailwinds, Macquarie analysts write in a note to clients. They point out that the number of IVF cycles recorded in Australia's state health system in November were the second highest on record, up 17% on the year. They see ASX-listed Monash growing market share by 140 basis points over fiscal 2024 thanks to acquisitions and specialist recruitment. Macquarie has an outperform rating and A$1.50 target price on the stock, which is down 1.6% at A$1.3525. (stuart.condie@wsj.com)

0236 GMT - Genesis Capital's takeover proposal for Australian dental-services provider Pacific Smiles looks both opportunistic and reasonable to RBC Capital Markets analyst Craig Wong-Pan. The A$1.40/share proposal looks timed to capitalize on a recent weak trading update and the absence of a permanent CEO, Wong-Pan writes in a note to clients. However, it also offers a 33% premium his A$1.05/share target price. He also thinks that Pacific Smiles' valuation is unlikely to return to its pre-Covid level of 11-12X Ebitda due to factors including elevated patient cancellations and higher costs. The stock was at 7-8X Ebitda prior to Genesis's proposal, he says. RBC has a sector-perform rating on the stock, which is up 18% at A$1.41. (stuart.condie@wsj.com)

0141 GMT - Santos has received environmental approval from Australia's offshore regulator to restart drilling at its Barossa natural-gas project, but it may not rush to do so. Citi notes there is a 30-day appeals process through the courts which activist groups may target. Still, the bank believes the regulator heavily scrutinized Santos's submission to reduce legal risks. "It's unclear whether Santos will wait until mid-January to drill again (further utilizing scarce contingency budget), with the risk being an injunction against drilling is granted during the appeals process," analyst James Byrne says in a note. (david.winning@wsj.com; @dwinningWSJ)

0118 GMT - Australia's metropolitan TV ad market is showing no signs of recovery, Jefferies analyst Roger Samuel says. He tells clients in a note that industry data showing a 14% annual decline in revenue through November is consistent with recent commentary from Nine Entertainment that it didn't anticipate any improvement last month. Nine led declines with a 20% fall in revenue from ad agencies, compared with Seven West Media's 14% drop. Seven West regained some TV broadcast market share, Samuel adds. (stuart.condie@wsj.com)

0043 GMT - Adbri shareholders will probably be happy to relinquish control to CRH and Barro, given the takeover premium on offer, Citi analyst Samuel Seow says. He points to the risks for the Australian building-material supplier's residential volumes through 2024 as a likely key factor in shareholders' decision-making. Seow sees little reason, other than various regulatory hurdles, why the transaction won't proceed. Barro has been creeping up Adbri's shareholder register for years, he adds in a note to clients. Citi has a last-published neutral rating and target price of A$2.50 on the stock, which is up 31% at A$2.98. (stuart.condie@wsj.com)

2355 GMT - Australian insurers Suncorp and IAG's earnings per share may get a positive bump on the likelihood of their catastrophe budgets in 1H FY 2024 coming in at or below guidance, say Morgan Stanley analysts in a note. This comes after five years of Suncorp and IAG exceeding their budgets. Still, MS reckons that insurers may be more conservative on reserving amid inflation and other uncertainties, which could partly hold back any earnings windfall. Political spotlight on insurer profits is also likely amidst concerns around affordability pressures, MS says, adding that though political risks aren't imminent they could emerge in 2024. (alice.uribe@wsj.com)

2323 GMT - Latitude's margins will likely continue to come under pressure from higher funding costs as interest rates stay higher for longer, say Morgan Stanley analysts in a note. This is partly because Latitude is unable to quickly reprice products. Still, MS thinks the impact of the March cyber incident on volumes and delinquencies is reducing. MS downgrades its cash earnings forecasts by 33% in FY 2024 and 21% in FY 2025 following Latitude's comments about the impact of elevated borrowing costs, a drop in consumer spending, and lending demand. MS cuts its target price by 6.6% to A$0.99/share. Latitude was last up 1.3% at A$1.165 Australian cents. (alice.uribe@wsj.com)

2320 GMT - With Boss Energy's shares having come off recent highs, Jefferies upgrades the uranium miner to buy from hold. It also takes a positive view of Boss's move to buy a 30% stake in Toronto-listed enCore Energy's Alta Mesa project in south Texas for US$60 million, while investing another US$10 million in the company. "We like the addition of a second production base and a longer term growth platform and valuation looks appealing," analyst Chris Drew says in a note. "However, we look for Boss to demonstrate a growth pathway to take a more positive longer term view on the transaction." Boss is up 1.2% at A$4.07 today, having traded above A$4.80 in late September. (david.winning@wsj.com; @dwinningWSJ)

2305 GMT - Australian non-bank financial institutions should see credit growth in areas outside of mortgages, say Citi analysts in a note. But these areas, which include asset financing, are likely to be accompanied by strong price competition, and may not boost revenue much, adds Citi. This comes amid positive signs for earnings of NBFIs in recent months, including resilient system growth and stabilizing cost of funds. Citi stays neutral on the sector, as mortgage competition still persists. It prefers Pepper Money, over Resimac, Liberty and Australian Finance Group. (alice.uribe@wsj.com)

(END) Dow Jones Newswires

December 17, 2023 22:58 ET (03:58 GMT)