Afterpay Touch is required to appoint an AUSTRAC-approved external auditor to look into its compliance with the anti-money laundering regulations. The company must provide AUSTRAC with a copy of the final audit report within 120 days of the external auditor being engaged.
While the audit is a negative, Morgans finds it hard to gauge the operating or financial implications based on current disclosure. While the wording of the notice appears collaborative, the broker suggests this still needs to be viewed as an escalation of the issue.
Add rating maintained. Target is reduced to $23.43 from $25.96.
Sector: Software & Services.
Target price is $23.43.Current
Price is $20.37. Difference: $3.06 – (brackets indicate current price is over target). If APT meets the Morgans target it will return approximately 13% (excluding dividends, fees and charges – negative figures indicate an expected loss).