0418 GMT - Temple & Webster's stronger-than-expected fiscal 2024 earnings margin helps support confidence among analysts at Jarden that the company is the likely long-term scale winner in Australian online furniture and home retailing. Keeping a buy rating on the stock, they are now wondering whether Temple & Webster can become the country's largest pure-play furniture and home retailer irrespective of channel. Their base case is for Temple & Webster to generate A$1 billion of annual revenue by fiscal 2029, but they tell clients in a note that they increasingly see a bull case in which it hits A$2 billion within 10 years. Jarden lifts its target price 13% to A$14.30 and keeps a buy rating on the stock, which is up 4.2% at A$12.20. (stuart.condie@wsj.com)

0414 GMT - Temple & Webster needs to inspire more confidence that it can sustain its current sales growth to get UBS analyst Tim Piper more bullish on the stock. Piper sees a lot to like in what he calls a solid annual result and trading update from the online furniture retailer. But he thinks that strong prior-period growth makes it hard to know whether Temple & Webster can maintain its current 26% revenue growth run-rate through the December quarter. Piper is positive on the Australian company's capacity to leverage marketing spend or promotional activity to drive revenue without threatening Ebitda margin guidance. UBS lifts its target price by 8.7% to A$11.20 and stays neutral on the stock, which is up 4.5% at A$12.24. (stuart.condie@wsj.com)

0358 GMT - Computershare's stronger-than-expected FY 2025 guidance includes margin-income assumptions that look a little high to its bull at Morgan Stanley. Analyst Andrei Stadnik tells clients in a note that the share-registry provider's guidance for margin income--that is interest earned for funds held for dividends--assumes a 2.5% yield in the June half. This compares with Stadnik's 2.2% forecast for a period in which many economists expect global interest rates to be falling. MS has a last-published overweight rating and A$29.40 target price on the stock, which is down 0.2% at A$26.88. (stuart.condie@wsj.com)

0321 GMT - Commonwealth Bank's FY 2024 results, while weaker than the previous year, are in line with Moody's Ratings' expectations. In a note, Moody's says CBA's statutory profit of A$9.5 billion was down 6% from the prior year, which reflects the earnings challenges Australian banks are facing from higher costs and a contraction in net interest margins. "We expect these headwinds to persist as tight competition for both lending and deposits weighs on banks' NIMs," says Moody's. At the same time, Moody's sees CBA's operating costs increasing further due to the sticky but subsiding effects of higher inflation. "Despite these earning pressures, CBA's strong credit profile continues to be underpinned by the strength of its balance sheet," it adds. (alice.uribe@wsj.com)

0309 GMT - Commonwealth Bank should be able to maintain robust capital levels despite extending a capital buyback and offering a high dividend, S&P Global Ratings says in a note. The Australian major lender on Wednesday said it extended its previously announced capital buyback by 12 months, with A$718 million still to be completed. It also announced a dividend payout ratio at the upper end of the range at 79%. "We forecast our risk-adjusted capital ratio for CBA to remain strong at 11.5%-12.0% in the next two years," S&P says. It reckons that credit losses over the next two years are likely remain low at about prepandemic levels of 15 basis points. (alice.uribe@wsj.com)

0301 GMT - Improvement in Challenger's capital as reported in its FY 2024 results, reduces its downside risk and lower its prescribed capital requirements, say Jefferies analysts Simon Fitzgerald and William Richardson says in a note. A reduction in the combined stress scenario adjustments was the main driver in an improvement in the prescribed capital amount ratio, says Jefferies, adding that this allows Challenger "further headroom to pursue growth." On the company's funds management unit, Jefferies sees potential for an improved performance in FY 2025. (alice.uribe@wsj.com)

0253 GMT - Challenger's robust capital position gives it greater flexibility to grow, says Citi analyst Nigel Pittaway in a note. It will also give the Australian wealth company greater flexibility to grow and more protection if there is any asset fallout, such as an increase in fixed income defaults, he adds. This is coming at a time when Challenger's Life business is showing strong profit momentum and it is set to further improve efficiency, which could see it deliver on its target return on equity. "There is more work to do on Funds Management but overall we believe the stock now looks appealing," says Citi, which raises its rating to buy from neutral. (alice.uribe@wsj.com)

0249 GMT - Challenger's strong capital position, as reported in its FY 2024 results, has the potential to fund strong book growth, Goldman Sachs analysts Julian Braganza and Brian Kim say in a note. The capital position could also contribute to further earnings growth in FY 2025/26. At the same time, Challenger's improved normalized pretax return on equity and expectation to hit target in FY 2025 provide confidence on the earnings of Challenger's portfolio alongside a rerating opportunity with consistency of net profit after tax outcomes, they say. Goldman stays buy rated on the stock. (alice.uribe@wsj.com)

0207 GMT - Challenger's extremely strong capital ratios as detailed in its FY 2024 result should allay capital-raising concerns over the medium term, say Macquarie analysts in a note. The Australian wealth company's Prescribed Capital Amount for the FY was 1.67 times versus 1.50 times at end-December, which reflects a focus from management and resilience of the balance sheet, Macquarie says. Challenger believes the mid-point of their FY 2025 net profit before tax guidance will allow it to achieve its return on equity targets, Macquarie notes, adding that "the next step is to execute."(alice.uribe@wsj.com)

0203 GMT - Bravura Solutions' guidance for A$9 million in FY 2025 annualized revenue from its updated commercial partnership with Fidelity International is likely to prove conservative, E&P Capital analyst Olivier Coulon reckons. He tells clients in a note that the wealth-management software provider's projection appears to assume no ongoing professional service revenue. Coulon adds that while it is hard to be sure given the impact of lease expenses and various capex considerations, Bravura's FY 2025 Ebitda guidance looks materially higher than the average analyst forecast prior to its announcement. E&P has a positive recommendation and A$1.57 target price on the stock, which is up 3.6% at A$1.165. (stuart.condie@wsj.com)

0136 GMT - Commonwealth Bank's better than expected net interest margin provides a positive read through for the sector, says E&P analyst Azib Khan in a note. For the 2H FY 2024 result, E&P says NIM of 200 bps beat both its and Visible Alpha consensus, and estimates 4Q FY 2024 NIM of 202 bps. From this E&P sees 4-8 bps upside risk to consensus NIM of 194 bps for FY 2025 and 192 bps for FY 2026. "We see potential for FY 2025 and FY 2026 consensus cash earnings to be upgraded by 3-6% on higher NIMs," adds E&P. "However, we expect deteriorating asset quality metrics to weigh on sentiment." (alice.uribe@wsj.com)

0133 GMT - Seven West Media's trade at the start of the Australian media conglomerate's 2025 fiscal year looks slightly softer than UBS analyst Lucy Huang's full-year run-rate expectations. She tells clients that the 4%-5% decline in Seven West's September and October bookings is a little low. Prior to the trading update, she had forecast a 3% fall in fiscal 2025 TV revenue. The ASX-listed company's fiscal 2024 revenue was slightly lower than the average analyst forecast but came in ahead of Huang's expectations. UBS has a last-published sell rating and A$0.16 target price on the stock, which is up 6.5% at A$0.165. (stuart.condie@wsj.com)

0120 GMT - Commonwealth Bank's FY 2024 was clean, but Macquarie analysts still see that the stock remains very expensive, trading at a around 45%-70% premium to major Australia bank peers. The FY result was broadly in line with expectations, and could lead to minor upgrades to forecasts, Macquarie says. But with limited growth prospects in FY 2025-26, Macquarie says it can't justify the multiple, and maintains its underperform rating on CBA. (alice.uribe@wsj.com)

0116 GMT - CAR Group's bulls at Morgan Stanley reckon that its media business isn't fully appreciated by investors focused on the Australian company's core vehicle-advertising operations. Analysts Andrew McLeod and Chris Boulos point out that 20% fiscal 2024 revenue growth at CAR's media business, which sells digital display and banner ads, comfortably beats the average analyst forecast of 12% growth. They tell clients in a note that they forecast an average annual revenue growth of 12% through fiscal 2030. They see further potential upside from media at CAR's U.S. and Latin American platforms. MS raises its target price 5.0% to A$42.00 and stays overweight on the stock, which is up 1.05% at A$35.57. (stuart.condie@wsj.com)

0107 GMT - There's a lot to like in Evolution Mining's profit report, according to Citi analyst Kate McCutcheon. Underlying Ebitda was a 10% beat versus consensus while underlying profit surpassed expectations by 15%, she says. "The result is a beat, and guidance is in line to better than we'd expected," she says. Implied costs for the year ahead are better than Citi's estimates when normalizing for Evolution's copper-price assumptions, which are below consensus, says McCutcheon. Citi has a buy rating and a A$4.40 target on Evolution, which is up 8.9% at A$4.15/share. (rhiannon.hoyle@wsj.com; @RhiannonHoyle)

(MORE TO FOLLOW) Dow Jones Newswires

0105 GMT - Commonwealth Bank's FY 2024 is in line with consensus, with stronger-than-expected net interest margin, says Barrenjoey analyst Jon Mott in a note. NIM was up 1 bp from 1H, which Barrenjoey says was primarily driven by a run down in liquid assets at the end of the period. Margin trends quarter on quarter were also broadly flat, excluding liquid assets. On asset quality, Barrenjoey notes that it is deteriorating with troublesome and impaired assets rising, while 30+ delinquent mortgages are rising. Barrenjoey expects small consensus earnings per share upgrades.(alice.uribe@wsj.com)

0100 GMT - Orora's OPS business could fetch some A$1.5 billion, says Citi. Orora today said it's in talks to sell OPS and become a specialist drinks packaging business, days after fending off a takeover offer from private-equity manager Lone Star Funds. It didn't name the party interested in acquiring OPS. In a note, analyst Samuel Seow says gross proceeds of A$1.5 billion would be largely equivalent to Orora's current net debt balance. Citi has a neutral call on Orora's stock. (david.winning@wsj.com; @dwinningWSJ)

0058 GMT - Evolution Mining's FY 2024 profit result is decent overall and there are no major shocks in its FY 2025 guidance, according to RBC Capital Markets. The gold and copper miner's cost outlook is a tad higher than envisaged--about 4% above consensus--mostly because of a copper-price forecast below the market's expectations, RBC says. Its FY 2024 total dividend was also slightly below expectations, but "avoiding more-negative FY25 guidance may be seen as a positive to some in the market," RBC says. The broker has an underperform rating and a A$3.30 target on Evolution, which is up 8.5% at A$4.135/share. (rhiannon.hoyle@wsj.com; @RhiannonHoyle)

0052 GMT - Seven's earnings guidance for FY 2025 looks a tad conservative to Jefferies, which thinks it may just be an opening gambit that gets upgraded as the year progresses. Seven today pointed to high-single-digit EBIT growth, whereas analyst Simon Thackray is anticipating a 10% increase in FY 2025. "We expect a considerable step-up in earnings from Boral, given double-digit margins, as well as continued momentum in WesTrac and Coates," says Jefferies, assessing key divisions. The bank considers pre-commitments of 85% of resource machinery and orders for WesTrac to be positive, as well as working capital investment made for FY 2025. Jefferies rates Seven at hold. (david.winning@wsj.com; @dwinningWSJ)

0048 GMT - AGL Energy's earnings guidance for FY 2025 looks strong to Jefferies. AGL forecast underlying Ebitda of A$1.87 billion-A$2.17 billion, and an underlying net profit of A$530 million-A$730 million. In a note, analyst Anthony Moulder says the outlook for FY 2025 underlying Ebitda is around 1.8% better than he had forecast at the midpoint of the range. "The FY 2024 result continues to highlight the benefits of management's capex investment, particularly into greater reliability and flexibility of their coal fleet," Jefferies says. "And while earnings will slow in line with market expectations, we see current forward rates as favorable." (david.winning@wsj.com; @dwinningWSJ)

(END) Dow Jones Newswires

August 14, 2024 00:58 ET (04:58 GMT)