0105 GMT - WiseTech Global looks set to benefit from DSV's US$12 billion acquisition of global freight-forwarding rival of DB Schenker, Morgan Stanley analysts say. They tell clients in a note that DSV, which uses WiseTech's logistics software, has plans to leverage scalable systems and IT infrastructure to generate efficiencies. Since DB Schenker is not yet a WiseTech customer, the MS analysts estimate that DSV's absorption of its rival's air and freight volumes will lift WiseTech's revenues by A$40 million-A$70 million. They add that the transaction increases their conviction that M&A will play a key role in WiseTech's growth. MS has a last-published overweight rating and A$120.00 target price on the stock, which is up 0.6% at A$132.20. (stuart.condie@wsj.com)

0025 GMT - Bell Potter analyst Chris Savage admits he has been wrong on Catapult for the past few months, but still doesn't change his recommendation on the stock. Savage acknowledges that his hold rating was incorrect given that the sports-tech provider's stock has been among the very best mid-cap tech performers over recent months. He attributes its surge since May to a good annual result, a positive outlook and a general re-rating of tech stocks. Savage raises his valuation multiple to 3.5 times revenue from 2.75 previously, but tells clients in a note that his Ebitda forecasts are still below the analyst average. Bell Potter raises its target price 34% to A$2.35. Shares are flat at A$2.38. (stuart.condie@wsj.com)

2343 GMT - Austal's US$450 million contract to expand submarine module production capacity at its U.S. shipyard should make the stock appear even cheaper than it already did, its bull at Citi says. Analyst Sam Teeger thinks it is reasonable to expect a long tail of submarine module work on the back of the investment. He reckons that the market was already failing to appreciate the medium- to long-term revenue benefit of the Australian shipmaker's record backlog. He estimates that the company is currently trading at a 40% discount to the value of its net tangible assets once the submarine capital expenditure is completed. Citi has a buy rating and A$4.14 target price on the stock, which is at A$2.70 ahead of the open. (stuart.condie@wsj.com)

2335 GMT - Brambles doesn't appear to be overly reliant on less-proven digital strategies to hit its medium-term targets, which appeals to Citi analyst Samuel Seow. He likes the pallet giant's focus on traditional operating efficiencies, with automation and operating-expense moderation shaping as the key drivers of margin expansion. Seow tells clients in a note that the anticipated improvement in profitability makes him wonder whether Brambles' free cashflow guidance is conservative, but observes that there could be a material spend on pallet serialization that has yet to be quantified. Citi raises its target price 6.6% to A$18.50 and stays neutral on the stock, which is at A$18.54 ahead of the open. (stuart.condie@wsj.com)

Euroz Hartleys lays out three new reasons why gold investors should include De Grey Mining shares in their portfolios. Firstly, analyst Michael Scantlebury says peers' real free cash flow after capex is deducted is "embarrassingly low" compared to projections for De Grey of at least A$1.0 billion of annual operating cash flow at current gold prices. Also, large M&A in the gold sector suggests a compelling value for De Grey, Euroz Hartleys says. Finally, a decision to approve De Grey's Hemi gold project looms with Euroz Hartleys anticipating a favorable outcome in the December quarter. "We believe that De Grey is under severe risk of a takeover, particularly in the next six months, post final approvals and before the start of construction, which is scheduled for the end of 2024," Euroz Hartleys says. (david.winning@wsj.com; @dwinningWSJ)

2255 GMT - UBS pares its earnings expectations for Woodside Energy after taking a less optimistic view of oil prices. The bank now expects Brent crude--the global benchmark--to average $75/bbl in 4Q, down from a prior expectation of $83/bbl. It also trims forecasts for 2025-2026 by $5/bbl to $75/bbl. In a note, analyst Tom Allen says these cuts to the oil-price outlook, along with higher depreciation and amortization expectations at Woodside's oil project in Senegal, result in reductions to EPS forecasts of 6%-22% over 2024-2026. (david.winning@wsj.com; @dwinningWSJ)

2241 GMT - A proposal by the Australian Prudential Regulation Authority to phase out hybrid instruments and replace them with cheaper forms of capital could increase investor appetite for real-estate stocks, Citi says. It identifies Scentre, National Storage REIT, Mirvac, Stockland and Lendlease as companies with a higher cost of debt that may benefit from a decline in financing costs. But companies with a lower cost of debt could also benefit, Citi says. "Other entities with relatively lower cost of debt such as Dexus, Abacus, Charter Hall Long WALE REIT, and Abacus Storage King could also benefit from this liquidity, allowing them to maintain lower cost of debt for longer and removing a relative potential headwind," analyst Howard Penny says. (david.winning@wsj.com; @dwinningWSJ)

(END) Dow Jones Newswires

September 17, 2024 00:59 ET (04:59 GMT)