0126 GMT - Fortescue's creeping operating and capital expenses are among factors keeping UBS analyst Lachlan Shaw cautious on the Australian iron-ore miner. With an unchanged neutral rating on the stock, Shaw says in a note that Fortescue's June-quarter update shows its core hematite business is still performing well. However, he notes it flagged FY 2027 capex growth of 17% at the guidance midpoint, while operating expenses will rise due to the lagged impact of inflation. He lowers his earnings forecasts on the costs and the slower ramp up of its lower-margin Iron Bridge project. With price realizations softening and general caution toward iron ore, he says risk/reward is balanced. UBS cuts its target price 3.3% to 19.05 Australian dollars. Shares are down 2.7% at A$18.02.
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