Analyst Note| Gareth James, CFA |
We have increased our fair value estimate for narrow-moat-rated Computershare by 7% to AUD 19.50 per share following its first-half financial result. The fair value increase reflects slightly higher short-term earnings forecasts and the time-value-of-money boost to our financial model. Management has increased fiscal 2022 underlying EPS growth guidance to 9% from 2% and we’ve increased our forecasts accordingly. This has caused a 4% increase in our fiscal 2022 underlying EPS forecast, but our long-term forecasts haven’t materially changed. At the current market price of around AUD 22.40, we consider Computershare to be overvalued.