The broker describes Collins Foods’ full-year result as solid, driven by continued acceleration in KFC Australia sales growth and strong cash conversion. Delivery is becoming an important growth driver and 20 more KFC outlets were added to aggregator platforms in the second half.
KFC Europe was a little soft but promotional activity is being stepped up, while Taco Bell provides opportunities along with increasing delivery in Australia. The broker retains Buy, lifting its target to $8.75 from $8.00.
Sector: Consumer Services.
Target price is $8.75.Current Price is $8.03. Difference: $0.72 – (brackets indicate current price is over target). If CKF meets the UBS target it will return approximately 8% (excluding dividends, fees and charges – negative figures indicate an expected loss).
