First half results revealed solid margins and steady sales and Deutsche Bank observes the recently-acquired Macpac business produced a good result that reflects significant investment undertaken in the supply chain over the last 2-3 years.
BCF remains the main area of concern. While the stock is trading at a discount to the broker’s $10.20 target, with a strong yield and valuation support, given the volatile retail conditions and management changes Deutsche Bank envisages near-term risks and sticks with a Hold rating.
Target price is $10.20.Current Price is $7.84. Difference: $2.36 – (brackets indicate current price is over target). If SUL meets the Deutsche Bank target it will return approximately 23% (excluding dividends, fees and charges – negative figures indicate an expected loss).