The company has won a new account which will transition around $1bn of funds under administration. Credit Suisse upgrades flow forecasts in the outer years to capture the benefit.
A reduction in cash administration fees is likely, following the cut to the Reserve Bank’s cash rate. The earnings impact is likely to be -15% in FY21, the broker asserts.
Outperform rating maintained. Target is reduced to $10.20 from $12.80.
Sector: Diversified Financials.
Target price is $10.20.Current Price is $6.84. Difference: $3.36 – (brackets indicate current price is over target). If HUB meets the Credit Suisse target it will return approximately 33% (excluding dividends, fees and charges – negative figures indicate an expected loss).