Iress Remains Undervalued Following Solid Full-Year Result

We have maintained our fair value estimate for narrow-moat-rated Iress at AUD 11.00 per share following its full-year result. The result was broadly in line with our expectations, although 2021 earnings guidance was slightly weaker than we expected. Despite a reduction in our short-term earnings forecasts, our long-term forecasts are largely maintained and, at the current price of AUD 10.08, the stock remains slightly undervalued. The market reacted positively to the result, pushing Iress’ share price up 5% following the announcement, which we surmise was due to the result exceeding guidance and the additional disclosure regarding likely long-term revenue growth and profit margins.