re: Ann: Credit Corp Group FY13 Results Prese...
To grow earnings >15% the ROE would need to lift again. That may well be the case, but I suspect the uplift will come from additional gearing rather than operational improvement and the risk is more that the ROE moderates from here when you consider the backdrop (increased competition, US heading towards reasonable returns). I'm expecting somewhere between 73-75c of EPS or 12-15% underlying growth.
Alternatively, they have pretty consistently paid out 50% of earnings as divs. The top-end of the div range implies around 74c of EPS (Given the long runway for the US I doubt they are signalling lower growth and higher payouts going forward so I think it is OK to do this).
Is the consumer lending business bound by any capital requirement? How capital intensive is it? What are they putting aside in terms of capital and provisions for every $ lent?!?
CCP Price at posting:
$9.53 Sentiment: Buy Disclosure: Held
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