The Financial System Inquiry’s interim report provides for greater awareness of retirement planning, the broker notes, the provision of incentives and removal of barriers, all of which is positive for Challenger and its product suite.
The broker believes CGF has the potential to surprise at its FY14 result, leading to increased FY15-16 consensus forecasts. Outperform and $8 target retained.
Sector: Diversified Financials.
Target price is $8.00.Current Price is $7.49. Difference: $0.51 – (brackets indicate current price is over target). If CGF meets the Macquarie target it will return approximately 6% (excluding dividends, fees and charges – negative figures indicate an expected loss).