The company has acquired 11 KFC stores in Germany. Deutsche Bank considers this to be minor positive given the accretive nature of the deal and potential for further opportunities in a new growth market.
The deal has the potential to cause a re-pricing of the growth profile, in the brokers opinion, as there have been some concerns regarding the company’s ability to expand.
Deutsche Bank increases FY17 and FY18 forecasts for earnings per share by 1% in both years. Target rises to $5.20 from $4.85 and Buy rating retained.
Sector: Consumer Services.
Target price is $5.20.Current Price is $4.99. Difference: $0.21 – (brackets indicate current price is over target). If CKF meets the Deutsche Bank target it will return approximately 4% (excluding dividends, fees and charges – negative figures indicate an expected loss).