Having initially retained an Underperform rating after a first galance at AMP’s result yesterday, Macquaire has now decided to upgrade to Neutral. The result was overshadowed by the back-down of Ares Management from any takeover intentions, which led to the big share price fall.
Macquarie sees it differently, suggesting the focus can now return to that within mangement’s control. That includes an unchanged cost-out target. AMP managed to get close to its FY20 cost-out target even with additional unforeseen covid costs.
No dividend was declared but the baord is committed to reinstating capital management, and a breakdown of divisional earnings has provided more clarity and led the broker to upgrade forecasts. Target rises to $1.45 from $1.30.
Target price is $1.45.Current Price is $1.37. Difference: $0.08 – (brackets indicate current price is over target). If AMP meets the Macquarie target it will return approximately 6% (excluding dividends, fees and charges – negative figures indicate an expected loss).