UBS incorporates the Corporate Trust Services acquisition into its modelling. Over a five-year view, on the assumption the company is successful in delivering on synergies and the US cash rate rises, UBS believes the acquisition would be around 15% accretive.
The long dated nature of the synergies and complexities of the acquisition underscore the risk of slippage, the broker points out, in addition there is ongoing short-term earnings risk in the core business. UBS retains a Neutral rating and raises the target to $16.25 from $15.00.
Sector: Software & Services.
Target price is $16.25.Current Price is $15.08. Difference: $1.17 – (brackets indicate current price is over target). If CPU meets the UBS target it will return approximately 7% (excluding dividends, fees and charges – negative figures indicate an expected loss).
