Due to plunging interest rates, Computershare has downgraded FY20 management earnings guidance to “down around -15%” from a previous “down around -5%” but more importantly, the broker notes, downgraded FY21 margin income guidance by -47% on the basis that negative knock-on effects could manifest for US mortgage servicing and corporate actions through FY21.
The broker cuts earnings forecasts by -10% and -22% in FY20-21. Target falls to $12.13 from $16.25. Underperform retained.
Sector: Software & Services.
Target price is $12.13.Current Price is $11.35. Difference: $0.78 – (brackets indicate current price is over target). If CPU meets the Macquarie target it will return approximately 6% (excluding dividends, fees and charges – negative figures indicate an expected loss).
