Opportunity Knocks, page-2

could be a good entry.

However 2 things seems strange.

1. analysts (RBC, cannacord) halving their target price. Why would they do that unless they were aware of the specific issue? valuation is done on a DCF, not gut feel/current share price/momentum.

2. What’s been disclosed about this issue by EML should not result in a 50% share price reduction. It’s common for large complex financial services firms to have regulators identify deficiencies with aml/kyc procedures. At any given time large financial institutions will have any number of regulators reviewing things. I would guess EML is regulated by over 20 different regulators (ATO, AUSTRAC, APRA, ASIC, IRS, HMRC, CBI, FCA, MASTERCARD, VISA, etc etc ). Why go into a trading halt? It served no purpose as they revealed no new information during that trading halt that EML did not know about before the halt. The reason for the halt seem to imply the CBI were going to publicly disclose what the specific issue was during the halt and EML were going to respond - hence the halt was called. So if EML is still trading then surely it cannot be that serious? If they were assisting customers to launder money for example, then surely CBI would suspend them immediately, not give them a couple weeks to write back?