** Analysts at Morningstar see Australia's third-largest lender Westpac Banking Corp's earnings taking a hit as higher operating expenses in the medium term eat into its profit margins** Says regulatory and compliance spending and wages inflation are becoming increasingly difficult to offset with WBC's productivity savings** Morningstar cuts WBC's fair value estimate by 3% to A$28 per share** Brokerage slashes fiscal 2024 profit forecast by 10%** Lifts the cost-to-income ratio in fiscal 2026 to 46% from 45%** "Our fiscal 2023 profit forecast implies second-half profit is 11% below the first half"- Morningstar** Analysts at Citi say WBC's revised outlook on costs drives a 10% earnings downgrade** Citi cuts WBC price target to A$22.50 per share from a prior A$26.25 per share; downgrades rating to 'neutral' from 'buy'** Revises FY24 and FY25 cost forecasts for WBC to A$10 bln ($6.78 bln) and A$10.1 bln from A$9.4 bln and A$9.5 bln, driving significant earnings downgrades** As of last close, stock was down 6.9% so far this year ($1 = 1.4743 Australian dollars)
WBC Price at posting:
$21.63 Sentiment: None Disclosure: Not Held
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