The first-quarter result disappointed UBS. Group revenue fell -9%. However, the miss was partly driven by increased revenue deferrals.
The broker reduces estimates for FY20 earnings per share by -4% and suspects the valuation framework being applied to the stock largely ignores short-term earnings volatility and, instead, anticipates listings will recover to FY16-18 levels.
UBS maintains a Neutral rating and raises the target to $105 from $95.
Target price is $105.00.Current Price is $99.15. Difference: $5.85 – (brackets indicate current price is over target). If REA meets the UBS target it will return approximately 6% (excluding dividends, fees and charges – negative figures indicate an expected loss).