Jefferies starts coverage on Australia's Credit Corp with 'buy'

Credit

31/07/2022 19:56

** Jefferies sees an improving outlook for Australia's
Credit Corp Group's  CCP.AX  debt-buying businesses and a
recovery in its lending activities
    ** Brokerage says the stock is "worth revisiting"; initiates
coverage with 'buy' rating and a price target of A$30.34
    ** As the largest debt-buyer in Australia, CCP has genuine
scale and purchasing capacity - Jefferies
    ** Jefferies forecasts FY22 return on equity of 14.3% for
the consumer lender
    ** Brokerage says CCP's debt-buying operations face supply
constraints in the U.S. and Australia, but there are early signs
in the Australian market of increasing credit card usage
    ** Jefferies expects that, with time, the above-mentioned
increasing credit card usage will translate into increased
balances, delinquencies and charge-offs
    ** Four out of five analysts rate the stock "buy" or higher
and one "hold"; their median PT is A$29.77 – Refinitiv Eikon
data 
    ** Stock had risen ~3% YTD, as of last close 
    


 (Reporting by Upasana Singh in Bengaluru; editing by Barbara
Lewis)
 ((Upasana.Singh@thomsonreuters.com))