Analysts at Jefferies have increased the price target on Australia’s share registry company, Computershare (ASX:CPU), from A$24.02/share to A$27.22/share.

Computershare announced it is planning to sell its U.S.

mortgage services division to asset manager Rithm Capital for $720 million.

Both Morningstar and Jefferies view the sale as a favourable progression considering it simplifies the business while getting rid of an underperforming, capital-heavy asset.

Morningstar suggests the sale will free up capital for higher-return investments and bolster core business operations.

The sale of the unit is projected to bolster Computershare’s operating margins to 38% per year, on average, up to FY28.

While Morningstar sees potential for more acquisitions, Jefferies reveals mergers and acquisitions are now a key focus for the group.

Computershare’s stock value had dropped 1.5% this year up till the last closing.

Computershare (ASX:CPU) is an Australian share registry company.