ASX Fair Value Estimate Increased to AUD 57 Following Strong Result

Wide-moat rated ASX Limited reported a good fiscal 2019 result with underlying EPS up 8% on a like-for-like basis and broadly in line with our forecast. However, we have increased our fair value estimate by 10% to AUD 57 per share due to a combination of the time-value-of-money effect on our financial model and higher earnings forecasts. The largest valuation boost relates to how we recognise ASX owned cash balances in our model. We previously only recognised distributable cash, as a surplus asset available to shareholders, whereas we now also include non-distributable cash, by including the interest it generates in our EBIT forecasts.