Morningstar cuts Objective Corp fair value after Australian DoD contract loss
BUZZ-Morningstar cuts Objective Corp fair value after Australian DoD contract loss ** Morningstar says Australian compliance software provider Objective Corp OCL.AX loses its largest customer, the Australian Department of Defence, prompting a 20% fair value cut to A$6 as churn risk rises
** The investment research firm says annual recurring revenue in 2026 is now expected to be flat versus prior forecast of about 12% growth, wiping out a year's worth of growth
** Morningstar warns that the loss challenges OCL's historically strong switching costs and may signal tougher competition from larger software rivals
** Says "the product is becoming less competitive" and lowers its 10-year revenue growth forecast to 4% from 6% previously
** Morningstar adds that while it doesn't think one customer loss is necessarily predictive for the 2,000 other customers, the moat's valuation benefit is now nearly zero
** Objective stock down ~59%, as of last close
(Reporting by Kumar Tanishk in Bengaluru)
((Tanishk.Kumar@thomsonreuters.com; X: @thatstanishk http://www.x.com/thatstanishk;))
Recent news on Objective
See all newsAustralia's Objective Corp falls on trading ex-dividend
Brief: Objective Corporation Posts FY Revenue AUD 134.7 million
Morningstar cuts Objective Corp fair value after Australian DoD contract loss
Objective Corp sinks to six-year low on non-renewal of Australian DoD contract
Brief: Objective Corp Says Defence Digital Does Not Renew Objective ECM USP Deal