Shore Capital has reiterated its 'buy' rating on Curtis Banks Group PLC (AIM:CBP) with a fair value of 300p per share despite lowering its earnings per share (EPS) forecasts by 5% after rebasing Fintech revenue estimates.
The broker said the core business remains resilient, interest income is rising although Fintech has disappointed.
Shore Capital added that it likes the group’s defensive revenue profile with its inflation-linked fee model providing visibility and protection against the impact of inflation, as well as its competitive price point for savers, and transparent formula for sharing interest income with clients.
The broker noted that Curtis Banks also benefits from rising interest rates, supporting both EPS expectations and margin expansion.
A period of consolidation is now likely with a pause on M&A as the group refocuses internally with the search for a new CEO giving time to reboot the Fintech business, Shore Capital concluded.