Citi cuts Liberty Financial FY23 profit outlook after 'modest miss' in FY22

Liberty

29/08/2022 21:55

** Citi expects FY23 earnings for Australia's Liberty
Financial Group  LFG.AX  to decline due to pressure from funding
costs and increased credit stress 
    ** Brokerage keeps price target at A$5.40 and maintains
"buy" rating
    ** Adds structural change towards secured finance and
financial services continues to provide an earnings offset for
FY23
    ** LFG reports an underlying net profit after tax and
amortization (NPATA) of A$231.1 million ($159.44 million) for
the year, which was 3%-4% below Citi's expectations due to lower
fees and commissions
    ** Citi says in absolute terms, it was a "solid result"
    ** Brokerage however cuts NPAT estimate by about 6%-8% for
FY23-FY25 
    ** Business remains well capitalised, and should be able to
sustain towards the higher end of its dividend payout ratio
through the cycle - Citi
    ** Three of six analysts rate the stock "buy" or higher and
three "hold"; their median PT is A$4.58 – Refinitiv data
    ** Stock down 22.1% this year 


($1 = 1.4495 Australian dollars)

    

 (Reporting by Rishav Chatterjee in Bengaluru)
 ((Rishav.Chatterjee@thomsonreuters.com))