FCL – Macquarie rates the stock as Outperform

FY20 results were in line with the recent update and materially ahead of prospectus. Guidance is for revenue growth of 20% with 30% growth in subscription fees and Macquarie believes the company is positioned to deliver on its forecasts.

Importantly, if current utilisation levels are held throughout FY21, the broker calculates 15% upside to gross profit forecasts and 70% upside to EBITDA forecasts. Outperform retained. Target rises to $6.06 from $5.87.

Sector: Software & Services.

Target price is $6.06.Current Price is $5.53. Difference: $0.53 – (brackets indicate current price is over target). If FCL meets the Macquarie target it will return approximately 9% (excluding dividends, fees and charges – negative figures indicate an expected loss).

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