APRA has taken action against the company for failing to act in the best interest of members. Macquarie remains concerned about the implications, given the potential for flow-on effects and civil proceedings as well as risks to the completion of the ANZ transaction.
While there remains significant value at current levels based on fundamentals, the broker is not inclined to take a positive view and downgrades to Neutral from Outperform. Target is reduced to $5.10 from $10.40.
Sector: Diversified Financials.
Target price is $5.10.Current Price is $4.28. Difference: $0.82 – (brackets indicate current price is over target). If IFL meets the Macquarie target it will return approximately 16% (excluding dividends, fees and charges – negative figures indicate an expected loss).