Broker has now fallen for the charms of the Australian super annuation system, but also for the investment outlook for AXA with a so-called lazy balance sheet and thus potential for capital management.
Target price $8.00. Recommendation lifted to Buy. Earnings forecasts raised by 4% and 6% for 2007 and 2008 respectively.
Upside to current valuation of $7.20 should be considered a given.
Target price is $8.00. Current Price is $7.33. Difference: $0.67 – (brackets indicate current price is over target). If AXA meets the Merrill Lynch target it will return approximately 8% (excluding dividends, fees and charges – negative figures indicate an expected loss).