Morgans has been busy adjusting its recommendations to reflect recent updates from a number of ASX 200 shares.
Two that have fared differently are named below. Here's why the broker has turned negative on one of them and positive on the other:
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Brambles Ltd (ASX: BXB)
Morgans was disappointed with this logistics solutions company's trading update this month.
It highlights that the ASX 200 share is facing short-term pallet repair capacity constraints, which is weighing on its performance.
In light of this and the challenging operating environment, the broker has downgraded Brambles shares to a hold rating with a heavily reduced price target of $18.70. It explains:
BXB's trading update was disappointing, reflecting short-term pallet repair capacity constraints in parts of the US. These issues were driven by subcontractor turnover at service centres, labour shortages, and elevated supply chain costs, including additional repair, handling, transportation, and storage expenses. BXB has downgraded FY26 (constant FX) revenue growth guidance to 2-3% (vs 3-4% previously) while underlying EBIT growth is now expected to be 3-5% (vs 8-11% previously). We adjust FY26/27/28F underlying EBIT by -4%/-5%/-1%.
Our target price declines to $18.70 (from $25.50) and we move to a HOLD rating (from ACCUMULATE). While management expects US pallet repair capacity constraints to be a short-term issue, with resolution targeted by the end of 1H27 and improvement initiatives already underway, risks remain given the challenging operating environment, including potential for further subcontractor turnover. With the volume outlook also uncertain, we prefer to wait for BXB's FY26 result on 20 August before reassessing our view.
TechnologyOne Ltd (ASX: TNE)
This ASX 200 tech share delivered a half-year result in line with expectations this week. In fact, the company's growth would have been ahead of expectations if it were not for foreign exchange (FX) headwinds.
So, with the company well-placed to hit the top-end of its guidance in FY 2026 and the broker seeing plenty of value in TechnologyOne's shares, it has upgraded them to an accumulate rating with a $32.30 price target. It explains:
TNE's 1H26 result came in largely as expected, albeit with some FX headwinds, which otherwise would have seen its underlying result land ahead of consensus. The group enters 2H26, with a strong pipeline of 'Plus' leads, which sees TNE well positioned to achieve the top end of its re-affirmed FY26 ARR/PBT Guidance. The pullback in TNE's share price sees our TSR lift to 18% and we therefore move to an Accumulate rating with a $32.30 price target.
