Morgans updates its financial model following the completion of Qube Holdings’ $400m off-market buyback at a price of $2.59/share, which reduces shares on issue by around -8%.
The valuation increases as the buyback was undertaken at a price below the analyst’s intrinsic valuation per share. After also allowing for a valuation roll forward, the target price rises to $2.83 from $2.77.
The Hold rating is unchanged as Morgans is aware that rising interest rates will likely impact the company’s cost of capital.
Sector: Transportation.
Target price is $2.83.Current Price is $2.92. Difference: ($0.09) – (brackets indicate current price is over target). If QUB meets the Morgans target it will return approximately -3% (excluding dividends, fees and charges – negative figures indicate an expected loss).
