Citi has decided to upgrade to Buy from Neutral on management’s signals that acquisitions remain very much on the agenda. The FY18 report itself was a "beat", as already established on the day of the release (see Broker Call Report yesterday).
It is the analysts view that rather modest organic growth will be supplemented by increased penetration of clients with services offerings, apart from acquisitions. Target price loses -3% to $4.18.
Citi analysts have earlier speculated about potential synergies were SG Fleet to combine with EclipX ((ECX)) and that speculation is again hinted at today.
Sector: Commercial & Professional Services.
Target price is $4.18.Current Price is $3.46. Difference: $0.72 – (brackets indicate current price is over target). If SGF meets the Citi target it will return approximately 17% (excluding dividends, fees and charges – negative figures indicate an expected loss).