0108 GMT - Synlait Milk's outlook remains uncertain as the dairy processor tries to convince farmers to withdraw their supply cessation notices, Bell Potter analyst Jonathan Snape tells clients in a note. He points out that the dual-listed company is reliant on retaining supply past FY 2026, calling clients' attention to the one-off bonus payment Synlait has promised to some New Zealand farmers without an active cessation notice at May 31, 2025. Bell Potter trims its target price on Synlait's Australia-listed securities by 9.6% to A$0.425 and keeps a hold rating on the stock, which is flat at A$0.38. (stuart.condie@wsj.com)

0057 GMT - Rio Tinto's iron and titanium operations in Quebec may be dwarfed by other parts of the miner's business, but its "technology, expectations of improving performance and 'critical minerals' stamp keep it core," say Citi analysts Kate McCutcheon and Paul McTaggart. After a visit to Rio Tinto's Sorel-Tracy site, the analysts highlight Rio Tinto's BlueSmelting project, which they say would help the company reduce carbon emissions and costs. They also say "scandium is an interesting tangent, with Rio happy to look at smaller-scale markets to maximize value (aluminum) and train up its workforce." Rio Tinto is down 2.6% at A$125.73/share. (rhiannon.hoyle@wsj.com; @RhiannonHoyle)

0054 GMT - Tracking app developer Life360 could surpass analysts' earnings forecasts over both the short and medium term, Goldman Sachs analysts say. They observe that the company's 2024 Ebitda guidance, which significantly informs market expectations, implies a material step-up in quarterly operating expenses over the second half of the year. However, they add that Life360 has held costs relatively flat for the best part of two years. The GS analysts see Life360 hitting the upper end of its guidance range and are more optimistic than the average analyst forecast through 2026. GS lifts its target price by 11% to A$21.85 and keeps a buy rating on the stock, which is up 2.4% at A$19.40. (stuart.condie@wsj.com)

0021 GMT - Australian property advertiser REA Group could pay shareholders a special dividend following its failure to acquire U.K. counterpart Rightmove, Citi analyst Siraj Ahmed says. He thinks that REA will look for other growth options first and doesn't rule out another tilt at Rightmove, but sees potential for a special dividend some time in REA's current fiscal year. Any future approach for Rightmove is unlikely to be hostile, he adds. Citi has a buy rating and A$230.00 target price on the stock, which is up 2.8% at A$206.68. REA is controlled by News Corp, which owns Dow Jones & Co., the publisher of Dow Jones Newswires and The Wall Street Journal. (stuart.condie@wsj.com)

0009 GMT - Australian banks look likely to compete on pricing to avoid losing share of the home-loan market, Macquarie analysts write in a note. Assessing credit growth trends across Australia's four largest banks, they point out that home-loan growth at ANZ and Commonwealth is above average, and that NAB and Westpac are trailing. They tell clients that this divergence could prompt some banks to pull the price lever to avoid market-share losses. Supporting this view, they cite anecdotal evidence that banks are beginning to offer cash for some refinancing borrowers and that competition for larger mortgages is becoming more aggressive. (stuart.condie@wsj.com)

0002 GMT - Citi analyst Siraj Ahmed spies a potential opportunity for Xero to grow its small-business segment as rival Intuit focuses elsewhere. He tells clients in a note that Intuit's investor day was primarily focused on an up-market shift for its Quickbooks Advanced product and its new enterprise suite. Ahmed reckons that this could leave small businesses more open to Xero's cloud-accounting platform, especially with the development of additional capabilities and marketing investment. Citi has a buy rating and A$158.20 target price on Xero stock, which is at A$149.44 ahead of the open. (stuart.condie@wsj.com)

2342 GMT - Macquarie analysts are bullish on REA shares after the Australian real-estate advertiser abandoned its efforts to acquire U.K. counterpart Rightmove. REA shares had slipped in recent weeks, reflecting concerns about the new equity needed for the deal. But with that dynamic now removed, the Macquarie analysts tell clients there is "a more attractive entry point" for investors. Macquarie says the fundamentals are looking good: REA's listings are up 5% in the three months to September, a positive outcome relative to consensus and the company's guidance in August for flat growth. Macquarie sees REA rising to A$230/share, compared to yesterday's close of A$201. (mike.cherney@wsj.com; @Mike_Cherney)

2319 GMT -- The medium-term outlook for Seven Group will likely be influenced by growth at WesTrac, the ongoing turnaround at Boral and capital discipline at Coates, say Macquarie analysts in a note. The analysts upgrade their target on the stock to A$47.80/share from A$43.90/share, saying they've got a better appreciation of the company's outlook after conducting a deeper assessment of its key assets. They reiterate an outperform rating. "We think the growth outlook in the medium term remains compelling," the analysts say. Seven Group last traded at A$42.88/share, near a record high. (rhiannon.hoyle@wsj.com)

0953 GMT - News Corp-controlled REA Group needs to radically change the price and structure of any proposal if it stands a chance of winning over Rightmove's board, AJ Bell investment director Russ Mould writes. "Given that four proposals have been rejected, one would have thought REA had got the message by now that Rightmove shareholders want a whole lot more money," Mould writes. He adds that Rightmove's share-price fall indicates that the market doesn't think REA will come back with a good enough deal, with some shareholders banking profits. REA has until 1600 GMT to either make a formal offer or walk away under U.K. Takeover Panel rules. Shares are down 3% at 648.80 pence. News Corp is the parent company of Dow Jones & Co., publisher of The Wall Street Journal and Dow Jones Newswires. (ian.walker@wsj.com.)

(END) Dow Jones Newswires

October 01, 2024 00:58 ET (04:58 GMT)