0400 GMT - While QBE's 1H FY 2024 result had many moving parts, Morgan Stanley analysts still see the ASX-listed insurer's combined operating ratio on track to being under 92.5% in FY 2026. In a note, MS says, it sees a likely re-rating from the current FY 2025 price-to-earnings of around eight times, if QBE delivers more consistently. For the 1H result, MS says the North America unit's 91% COR beat expectations, but non-core improvement was short of expectations with a US$125 million loss. Still, the investment bank adds that it was better than the US$350 million FY 2023 loss. QBE is guiding for a US$75 million 2H loss andUS$100 million loss in FY 2025.(alice.uribe@wsj.com)

0325 GMT - QBE's 1H FY 2024 results look reasonable, says Justin Koonin, an investment analyst at fund manager Allan Gray. He reckons that it's clear the remediation efforts over recent years are having an impact, with the ASX-listed global insurer reporting more stable earnings. "While growth was a little lower than previously guided, the company gave good reasons for this - exits from the North American mid-market business are happening more quickly than expected," Koonin tells Dow Jones Newswires. While QBE has provided investors with negative surprises over a number of years, Koonin says a longer track record of consistently delivering on earnings guidance should help to give the market confidence in the company. (alice.uribe@wsj.com)

0144 GMT - QBE's North America unit is executing well, recording a less than 95% combined operating ratio in 1H FY 2024, and the unit is set for growth and earnings resilience in FY 2025, say Jarden analysts Daniel Bui and Dan Bounpraseuth in a note. Still, they reckon the gross written premium outlook in general appears softer and the scope for further short-term COR improvements looks less likely. Despite these headwinds, Jarden sees that QBE trades at a "compelling" level and keeps its buy rating. (alice.uribe@wsj.com)

0133 GMT - CAR Group's non-specific guidance for good growth in FY 2025 revenue, earnings and profit looks more or less in line with expectations, Jarden analyst Tom Beadle says. He tells clients that he sees the Australia-listed vehicle advertiser's qualitative outlook pointing to Ebitda of between A$640 million and A$660 million. Beadle writes in a note that his expectation ahead of CAR's latest update had been for A$640 million, just shy of the average analyst forecast of A$650 million. He is a bit surprised that CAR has guided for a flat Ebitda margin, rather than some expansion. Jarden has a last-published underweight rating and A$28.00 target price on the stock, which is up 3.9% A$34.94. (stuart.condie@wsj.com)

0127 GMT - Macquarie pares its targets on some Australian producers of copper after downgrading its price forecasts for the industrial metal on expectations of weaker demand. The bank cut its copper price forecasts by 4.9% for 2024, 4.2% for 2025 and 2.4% for 2026. Pure-play copper producers are the most impacted, says Macquarie, trimming its target on Sandfire by 6% to A$9.40 and Capstone by 5% to A$12.40. It also trims its targets on BHP, by 2% to A$42.00, and on Rio Tinto, by 1% to A$117.00. Macquarie says it prefers South32 among the larger cap miners, despite also trimming its target on that stock by 1% to A$3.95. (rhiannon.hoyle@wsj.com; @RhiannonHoyle)

0108 GMT - Remediating its North America unit is the number one stock driver for ASX-listed general insurer QBE, says UBS analyst Scott Russell in a note. He reckons that doing this will likely make the business less reliant on the industry cycle. "Going forward, market focus will be squarely on the runoff of non-core portfolios, which comprise gross written premium of around $1.2 billion (around 15% of North America segment GWP) including Middle Markets," says UBS. Still, QBE's 1H results missed UBS' forecasts and it sees that while repricing is moderating, competition may be intensifying. UBS cuts the stock's target price 2.4% to A$20.00. QBE falls 1.0% to A$15.89. (alice.uribe@wsj.com)

0107 GMT - It's difficult to build a bullish case for Beach Energy right now, says Citi, after the company reported a bigger-than-expected impairment to its oil and gas reserves. Beach said revenue pressure at its Enterprise natural gas field has declined more than anticipated, indicating a smaller reservoir. Beach cut its proven and probable reserves by 20% to 205 million barrels of oil equivalent compared with a year ago. "The implication of the result is that the reinvestment treadmill is another notch higher," analyst James Byrne says. "We expect the rapid degradation of portfolio quality would require substantial M&A to dilute the poor performing assets." Beach's share price drops 9.5% to A$1.29. Citi retains a sell call. (david.winning@wsj.com; @dwinningWSJ)

0104 GMT - Tracking-app provider Life360 is likely to show record paid-user growth for a second straight quarter in 3Q, Goldman Sachs analyst Chris Gawler says. Maintaining a buy rating on the stock, Gawler tells clients in a note that Life360's addition of a record 132,000 so-called paying circles was the highlight of its June-quarter result. The start of the U.S. school year in September means that there is reason to believe that Life360 could surpass this in 3Q, he adds. The company's US$6.0 million of incremental marketing expenditure also adds to his confidence. GS lifts its target price on the stock by 23% to A$19.75. Shares are down 1.25% at A$17.34. (stuart.condie@wsj.com)

0055 GMT - Beach Energy's share price dives 10% to A$1.285 after shocking investors with more bad news. This time, Beach has cut reserves at the Enterprise natural-gas field by some 34%, contributing to its group reserves estimate falling by 20% to 205 million barrels of oil equivalent at end-June. "We had assumed all material reserves adjustments/downgrades had been pre-announced in June but the downgrade of Enterprise gas volumes by 11.5 million BOE (versus initial reserve estimate of 34 million BOE) is disappointing," says analyst Nik Burns in a note. (david.winning@wsj.com; @dwinningWSJ)

0052 GMT - Electronics retailer JB Hi-Fi's share price jumps 10% to A$74.32 after its annual result points to consensus upgrades to FY 2025 earnings. JB Hi-Fi said July sales at its JB Hi-Fi Australia unit are up around 5.2%. It also reported growth of 2.7% at The Good Guys business last month. That means both are running well ahead of market expectations for 1H, says Jarden analyst Ben Gilbert. "Overall, another quality result and will likely support the share price, with ongoing market share gains and margin control," Jarden says. (david.winning@wsj.com; @dwinningWSJ)

0048 GMT - Although QBE's 1H FY 2024 result was somewhat negative, Macquarie analysts see that the details give it more confidence on the underlying trends. In a note they say the lower gross written premium guide for the full year is explained by the faster run-off of North America middle-market, which accelerates the de-risking of the portfolio. This, Macquarie reckons, "should be applauded." As to the dividend miss, Macquarie says this partly reflects seasonality, optimistic investment income in consensus and incorporation of restructuring costs. The investment bank cuts its target price 8.2% to A$16.90. QBE falls 0.8% to A$15.93.(alice.uribe@wsj.com)

0047 GMT - Investors will still have questions about Aurizon's bulk arm and strategy, given limited growth and returns in the business, says Citi analyst Samuel Seow. Annual bulk revenue fell 4% short of consensus and bulk volumes were down by 2% year over year despite additional trading months in Bulk Central, Seow says. Bulk Ebitda of A$229 million, up 7% year over year, "was largely in line on good cost control," while Ebit declined roughly 5% as depreciation and amortization increased, he says. The FY 2024 numbers imply that, "despite FY25 guidance of positive growth at the Ebitda line, operating profit could be flatter," says Seow. Citi has a neutral rating and A$4.00 target on the stock, which is down by 6.6% at A$3.38.(rhiannon.hoyle@wsj.com; @RhiannonHoyle)

0032 GMT - REA Group's bull at Goldman Sachs would have liked to see the real-estate advertiser explicitly target double-digit buy yield growth in fiscal 2025. Analyst Kane Hannan tells clients in a note that he sees the absence of such a target as a negative in an otherwise solid fiscal 2024 result, but that REA could still hit that particular mark. He thinks that REA, which raised the price of its Premier Plus product by 10% on July 1, is being conservative given the potential for headwinds from its exposure to the Sydney and Melbourne city markets. GS keeps a buy rating on the stock and trims the target price 1% to A$221.00. Shares are down 1.3% at A$199.81. REA is 61% owned by News Corp., which owns Dow Jones & Co., publisher of this newswire and The Wall Street Journal. (stuart.condie@wsj.com)

0024 GMT - Aurizon's FY 2025 guidance looks soft, according to RBC Capital Markets, which adds that the rail-freight company's FY 2024 underlying Ebitda, net profit and dividend also all missed market estimates. The misses were in big part due to higher depreciation and amortization, and higher interest, RBC says. The FY 2025 guidance for Ebitda between A$1.66 billion and A$1.74 billion is 4% below RBC's expectation and 3% below consensus, RBC says. It has an underperform rating and A$3.80 target on the stock, which is down by 5.0% at A$3.44/share.(rhiannon.hoyle@wsj.com; @RhiannonHoyle)

0011 GMT - REA Group's bull at UBS still sees listings growth in fiscal 2025 despite the Australian real-estate advertiser guiding for flat volumes. Analyst Lucy Huang writes in a note that, with UBS economists not expecting any change in Australian interest rates until May 2025, elevated borrowing costs are likely to lead to incremental pressure that drives selling activity. She tells clients that REA could pull back on discretionary costs if activity moderates in the large Sydney and Melbourne markets relative to other cities. UBS trims target price 0.6% to A$232.20 and keeps a buy rating on the stock, which is up 0.2% at A$202.68. REA is 61% owned by News Corp., which owns Dow Jones & Co., publisher of this newswire and The Wall Street Journal. (stuart.condie@wsj.com)

2351 GMT - Life360's improved annual guidance keeps its bull at Bell Potter confident ahead of what is typically the tracking-app developer's strongest quarter for paid user growth. Analyst Chris Savage increases his valuation multiple to 6.25 times revenue from 6.0 times revenue, while lifting his revenue forecasts by about 1% for each of the three years through 2026. His adjusted Ebitda forecasts for the same period rise by 15%, 12% and 8%, respectively, reflecting the company's confidence it will soon be earnings positive on a quarterly basis. Bell Potter lifts its target price 7.9% to A$20.50 and keeps a buy rating on the stock, which is at A$17.56 ahead of the open. (stuart.condie@wsj.com)

2350 GMT - QBE's 1H result came in largely as Morgans analyst Richard Coles was expecting, with gross written premium and net profit broadly in-line. In a note he says, a negative of the result was slightly lowered FY 2024 top-line guidance but views the improved overall North America business performance as a key positive. While new GWP guidance for FY 2024 was lower, Morgans doesn't think it's all "doom and gloom" for the outlook, with QBE saying the pricing environment in most key business classes still remains broadly favorable. Morgan sees the ASX-listed general insurer on track to deliver around 20% FY 2024 earnings per share growth and a strong balance sheet.(alice.uribe@wsj.com)

2330 GMT - Australian SME lender Judo is on track to report lower FY 2024 earnings when it reports this month, says Goldman Sachs. Ahead of the result, GS forecasts FY 2024 cash earnings to fall by 5.5% to A$69.3 million, compared to Visible Alpha consensus estimates of A$72 million. Analysts Andrew Lyons and John Li expect no final dividend, in line with VA. GS expects a A$102 million pretax profit, which equates to A$109 million when non-recurring items are excluded. That is consistent with Judo's guidance of between A$107 million and A$112 million. (alice.uribe@wsj.com)

2328 GMT - There's lots to like in JB Hi-Fi's annual result and latest M&A move, according to Jefferies. JB Hi-Fi declared a special dividend of A$0.80/share on top of a A$1.03/share ordinary payout, which was of itself stronger than analyst Michael Simotas was expecting. July sales in Australia were slightly better than forecast, while gross margins improved in the JB Hi-Fi Australia business. JB Hi-Fi's acquisition of E&S Trading also looks strategically sound. "We expect stock to outperform but valuation is elevated," says Jefferies. It has an underperform call on JB Hi-Fi, which ended last week at A$67.37. (david.winning@wsj.com; @dwinningWSJ)

2317 GMT - REA's attractive growth trajectory for the next 3-5 years keeps bull Macquarie interested despite what appears to be a reasonably full valuation. Macquarie thinks that management's softer-than-expected operating-expenses guidance reflects potential revenue headwinds in NSW and Victoria states. However, they see positive signs from REA's new Lux product and from its India business. The analysts tell clients in a note that relative valuation among marketplace stocks is starting to look supportive for REA, which has traded at record highs in 2024. They raise their target price 4.3% to A$219.00 and maintain an outperform rating on the stock, which is at A$202.36 ahead of the open. REA is 61% owned by News Corp., which owns Dow Jones & Co., publisher of this newswire and The Wall Street Journal. (stuart.condie@wsj.com)

2315 GMT - QBE's 1H result was noisy, but on balance looks positive to Goldman Sachs analysts Julian Braganza and Brian Kim. In a note, they call the noise a distraction to QBE's strong underlying combined operating ratio when non-core elements are excluded. GS sees a moderation in the rate cycle, but that rate levels remain adequate with QBE's remediation effort to benefit FY 2025-2026 COR. Also positive is that management appears to have concluded its restructuring and portfolio optimization initiatives and is refocusing on future growth. GS has a buy call on QBE's stock. (alice.uribe@wsj.com)

2254 GMT - While investors were disappointed with QBE's 1H result, Citi analyst Nigel Pittaway believes underlying trends remain solid. In a note, he says the pathway to fixing the problematic North America business looks a little clearer even if the drag from poor performing segments will continue. For 1H, NA's combined operating ratio of 97.5% is a significant improvement, says Citi, while the acceleration in mid-market run-off is also a positive. Into the near future, the investment bank reckons there may be only modest further improvement in North America COR in FY 2025, even if the run-off goes as planned. Still, reflecting underlying trends, Citi keeps its buy call, but lowers its target price 3.5% to A$19.30. QBE ended last week at A$16.05. (alice.uribe@wsj.com)

(END) Dow Jones Newswires

August 12, 2024 01:02 ET (05:02 GMT)