Challenger Limited (CGF)
All research reports and stock updates for Challenger Limited.
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Four Areas of Surprise
The 15% fall in the CGF share price this year is primarily due to investor concerns that rising corporate yield spreads and potential corporate defaults will negatively impact the CGF’s investment portfolio resulting in investment losses.
A battle of sentiment
Financial contagion concerns weigh on the share price. Challenger share price has fallen ~$1.50 since early March on fears of financial contagion stemming from the US banking crisis.
Strategic review overshadows results
At an underlying level, CGF delivered an ROE of 12.5% excluding losses in the bank, above the 12.2% ROE target in FY22.
Challenging itself
Challenger is seeking to diversify its business beyond retirement solutions.
Besties
The prospect of Challenger receiving a full bid from Apollo is receding as both parties seem happy to act more like partners. This could be very good news for CGF if Apollo really wants to flex its big balance sheet muscle without a takeover being necessary.