Berenberg argues that Standard Life Aberdeen (LON:SLA) is ‘not that cheap,’ WebFG News reports. The comments came as the analysts lowered their valuation on the blue-chip asset manager.
Standard Life Aberdeen’s share price has fallen into the red in today’s session, having given up 0.81 percent to 317.50p as of 09:50 BST. The stock is underperforming the broader UK market, with the benchmark FTSE 100 index having climbed into positive territory and currently standing 0.12 percent higher at 7,612.38 points. The group’s shares have lost more than 21 percent of their value over the past year, as compared with a near four-percent rise in the Footsie.
Berenberg sees SLA as ‘not that cheap’
Berenberg trimmed its price target on Standard Life Aberdeen yesterday from 460p to 360p, while maintaining its ‘hold’ rating on the shares. WebFG News reports that while the broker had acknowledged that the shares were a consensus ‘buy’, with 80-percent of sell-side analysts believing the group to be ‘too cheap,’ it felt that the asset manager was ‘not that cheap’ in terms of earnings.
Even allowing for the planned B-share issue and buyback, the FTSE 100 group’s shares were trading in line with those of its peers, something Berenberg argues was ‘generous’ given SLA’s large execution risks and its lower growth expectations of eight percent versus the 11 percent predicted at its peers.
“With greater upside seen elsewhere in the sector we remain ‘hold’ rated; our price target is cut to 360p,” the broker pointed out.
Other analysts on blue-chip group
The 16 analysts offering 12-month price targets for Standard Life Aberdeen for the Financial Times have a median target of 437.50p on the shares, with a high estimate of 490.00p and a low estimate of 360.00p. As of June 29, the consensus forecast amongst 19 polled investment analysts covering the blue-chip group has it that the company will outperform the market.