0102 GMT - BlueScope Steel is outperforming Australia's benchmark ASX 200 index after Prime Minister Anthony Albanese said the U.S. is considering exempting the country from tariffs on steel and aluminum. Albanese made the remarks following a call with President Trump. Albanese said Australia has a significant trade surplus with the U.S. dating back to the Truman administration and highlighted that BlueScope, which owns the North Star mill in Ohio, is the U.S.'s fifth-largest steel maker. The U.S. isn't a big destination for steel manufactured in Australia, which is mainly sold at home. BlueScope is up 1.7% today, outpacing a 0.2% rise by the ASX 200. (david.winning@wsj.com; @dwinningWSJ)

2359 GMT - Ansell's first-half result may give investors the mistaken impression that it is a growth stock, Morgans analyst Derek Jellinek says. He acknowledges that the protective garment manufacturer's performance was stronger than he had anticipated, but tells clients in a note that it was largely driven by acquisition gains, cost reductions, and one-off items. Customers have now finished restocking after running down inventory built up during the Covid-19 pandemic, he says. This spells an end to what he calls "easy gains" by Ansell's healthcare unit. With tariffs now a factor and potential of sales leakage from a change in processes, Jellinek is cautious. Morgans raises its target price by 23% to A$33.38 but keeps a hold rating on the stock, which is down 2.75% at A$36.73. (stuart.condie@wsj.com)

2339 GMT - Ansell's bull at Macquarie continues to see value in the stock despite the share-price surge that met the protective-garment maker's stronger-than-expected first-half earnings. An analyst note from the investment bank tells clients that the Australia-listed company's upgraded full-year guidance implies 4% in annual organic Ebit growth. The bank's analyst is slightly more optimistic on this metric, and forecasts 5% organic Ebit growth. The stock jumped 8.1% on release of the first-half result, but Macquarie maintains its outperform rating. Its target price rises 26% to A$40.30. Shares are down 2.6% at A$36.79. (stuart.condie@wsj.com)

2331 GMT - Macquarie takes a more bullish view of dividends from iron-ore miner Fortescue, starting from its 1H result this month. The bank raises its payout ratio to 70% of net profit, from 50%, meaning it now expects a dividend of A$0.52/share. "Fortescue will probably lever up to maintain high payout ratios as EPS declines and iron ore prices revert to long-term normalized levels," Macquarie says. That view prompts it to raise FY 2026-2028 payout expectations to 60%, which lifts its dividend forecasts by 20% over the period. "Under these assumptions (with falling EPS across FY 2025-2028), we expect Fortescue to yield 6.7%/4.5%/3.1%, respectively." The bank retains an underperform call on Fortescue. (david.winning@wsj.com; @dwinningWSJ)

2331 GMT - Australian electronics retailer JB Hi-Fi keeps its bull at Macquarie on the expectation of continued earnings resilience. A Macquarie analyst note to investors posits that JB Hi-Fi's track record indicates that it can offset higher goods costs by managing its own operating costs. That said, persistent competition could weigh on gross profit, the analysts add. They point out that JB Hi-Fi's better-than-expected first-half momentum has continued into its fiscal second half, and see potential for a capital-management announcement in August thanks to what they call a pristine balance sheet. Macquarie raises its target price by 2.8% to A$111.00 and keeps an outperform rating on the stock. Shares are down 1.75% at A$96.07. (stuart.condie@wsj.com)

2328 GMT - Mining company South32's interim dividend could disappoint investors, reckons Macquarie. While South32 is likely to maintain its payout ratio at 40% of underlying earnings, the issue is that 1H profits will be thinner than the market expects, Macquarie says. It tips South32 to declare an interim dividend of 2.3 U.S. cents per share, representing a 27% miss to consensus forecasts. "However, given the materiality of the expected FY 2025 yield (1% annualized), we expect the focus at the results to be on free cash flow," Macquarie says. South32 is due to report its 1H result on Thursday. (david.winning@wsj.com; @dwinningWSJ)

2325 GMT - SGH's shares rise 9% soon after Australia's market opens, with Jefferies calling out profit margins at building materials unit Boral as the highlight of its 1H result. SGH reported a 14.3% Ebit margin for Boral in 1H, well above consensus forecasts of 11.7%. That drove a 9% beat to market hopes for Boral's Ebit. "Margin delivery is impressive given weaker volumes and likely operating deleverage," analyst Kai Erman says. SGH reaffirmed expectations for high single-digit Ebit growth in FY 2025, which Jefferies considers to be conservative. Jefferies retains a hold call on SGH. (david.winning@wsj.com; @dwinningWSJ)

2312 GMT - CAR Group's guidance downgrade for its U.S. business doesn't worry Macquarie analysts, who see double-digit annual revenue growth as sustainable. They acknowledge that CAR's move to lower its outlook for Trader Interactive revenue growth prompted analysts to debate its significance, but ultimately decide that it was related to a delayed price rise. The Macquarie analysts tell clients in a note that it the company is sensible to align timing with the seasonal recovery of the recreational vehicle market. Macquarie raises its target price 5.1% to A$39.00 and stays neutral on the stock, which is down 3.3% at A$37.10. (stuart.condie@wsj.com)

2241 GMT - Morgan Stanley is bullish about bottle maker Orora despite tariff threats from the White House. "Though a 25% tariff on Mexican goods into the U.S. would be a net negative for Orora, we think this is well and truly in the share price at current levels," analyst Andrew G. Scott says. While the Americas region accounts for 28% of sales at Orora's Saverglass business, much of this volume is manufactured and sold within Mexico, Morgan Stanley says. Tequila is Saverglass's most significant spirits category, accounting for 23% of spirits volumes. Tequila is classified as protected designation of origin, meaning it cannot be sourced from other, tariff-free markets, Morgan Stanley says. "Orora does have the ability to serve U.S. markets from other locations, in particular from the RAK facility in Dubai," the bank adds. (david.winning@wsj.com; @dwinningWSJ)

2223 GMT - Industrial conglomerate SGH's shares could outperform Australia's benchmark ASX today after its 1H Ebit beat consensus hopes. SGH reported Ebit of A$843 million, up 10% on year and supported by better-than-expected margins at construction unit Boral. In a note, Barrenjoey says consensus forecasts had pointed to 5% Ebit growth. Still, SGH maintained guidance for high single-digit growth in annual Ebit, which implies a slower pace of improvement in 2H. "For FY 2025, consensus interest and tax forecasts will need to rise, which may drive negative EPS revisions," says analyst Brook Campbell-Crawford. "However, we think the large operational beat is enough for the shares to outperform." Barrenjoey has an overweight call on SGH, which ended Monday at A$48.66. (david.winning@wsj.com; @dwinningWSJ)

2202 GMT - Ansell's second-half earnings growth looks likely to be driven by its acquisition from Kimberly-Clark and cost benefits, Citi analyst Mathieu Chevrier writes in a note. He tells clients that about two thirds of the protective-garment manufacturer's fiscal first-half Ebit growth stemmed from the assets acquired from Kimberly-Clark on July 1. The assets are performing better than expected and their integration is ahead of schedule, which Chevrier observes will lead to some cost synergy in the June half. Citi lifts its target price 17% to A$38.00 and keeps a neutral rating on the stock, which is at A$37.77 ahead of the open. (stuart.condie@wsj.com)

2113 GMT - Ansell loses its bulls at Jefferies despite the protective-garment manufacturer's success with its US$640 million acquisition from Kimberly-Clark. Analysts Vanessa Thomson and David Stanton cut their recommendation on the stock to hold from buy, telling clients in a note that it is trading at an 11% premium to its 10-year average price-to-earnings despite the prospect of moderating sales growth. That said, they are positive on Ansell's productivity and acquisition programs, pointing out that the former Kimberly-Clark unit is on track to be fully integrated by the end of its current fiscal year. Jefferies raises its target price 7.7% to A$42.00. Shares are at A$37.77 ahead of the open. (stuart.condie@wsj.com)

(END) Dow Jones Newswires

February 10, 2025 23:00 ET (04:00 GMT)

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