March quarter retail annuity sales fell 7.0% and, while the ongoing suspension of CARE was a major factor, the quarter was softer than Deutsche Bank expected.
While FY15 guidance was reiterated the broker envisages downside risks given the ambitious sales growth implied for the June quarter.
A Sell rating is retained on valuation. Target is raised to $6.50 from $6.05.
Sector: Diversified Financials.
Target price is $6.50.Current Price is $7.13. Difference: ($0.63) – (brackets indicate current price is over target). If CGF meets the Deutsche Bank target it will return approximately -10% (excluding dividends, fees and charges – negative figures indicate an expected loss).