Genworth Mortgage Insurance Australia has flagged unchanged guidance for FY22, with a normalisation of long-term claims experience expected in FY23.
Nonetheless, Macquarie updates forecasts to include a more bearish economic environment, accounting for a 60% probability of a US recession and a “near miss” in Australia in 2023.
The broker does not include the additional 60m share buyback because of the deteriorating economic outlook. Target is reduced to $1.95 from $3.50 and the rating is downgraded to Underperform from Outperform.
Sector: Banks.
Target price is $1.95.Current Price is $2.17. Difference: ($0.22) – (brackets indicate current price is over target). If GMA meets the Macquarie target it will return approximately -11% (excluding dividends, fees and charges – negative figures indicate an expected loss).
