Computershare lifts share Email Print Normal font Large font David McIntyre November 16, 2006
Advertisement AdvertisementSHARES in Computershare, the world's biggest share registrar, rose the most in two years after the company increased its profit forecast.
The shares surged 10 per cent, the biggest gain since October 2004, after Melbourne-based Computershare said earnings per share would rise more than 35 per cent this year.
A record $3 trillion of global mergers and acquisitions announced this year has boosted demand for the share registries.
Computershare has also bought rivals, including Equiserve, a registrar that counts more than half of the 30 companies in the Dow Jones Industrial Average among its 1300 clients.
"The activity in the market, especially mergers and acquisition, has been very favourable to Computershare," said Angus Gluskie from White Funds Management in Sydney.
"With the volume of private equity out there and the potential for corporate moves, we think there's at least another 12 months to run."
Earnings in the July-October period, usually the slowest time of the year for Computershare, doubled from a year earlier, the company said in a statement yesterday.
"It will lead to immediate upgrades," said Marcus Padley, author of trading newsletter Marcus Today.
Analysts had expected earnings to rise 20 per cent to 25 per cent, Padley wrote.
Shares in Computershare rose 79¢ to close at $8.50 yesterday, their highest since January 2001. The shares have gained 25 per cent this year, outpacing the S&P/ASX 200 Index's 14 per cent rise.
Chris Morris, who will step down as chief executive today, bought Massachusetts-based Equiserve in October 2004 for $331 million. North America accounts for 61 per cent of Computershare's earnings.
He also added Germany's SLS Group, Sun Trust of Atlanta, and Montreal-based National Bank Trust to the company during the six months through June.
Morris will be succeeded by chief operating officer Stuart Crosby, the company said in August.
Computershare also said it will buy back 25 million shares, or about 4 per cent of its outstanding stock, during the next six months.
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