How to buy Challenger shares | A$3.82

Challenger Limited is an insurance—life business based in Australia. Challenger shares (CGF) are listed on the Australian Securities Exchange (ASX) and all prices are listed in Australian Dollars. Its last market close was $3.82 – an increase of 2.69% over the previous week. Challenger has a trailing 12-month revenue of around $1.8 billion.

How to buy shares in Challenger

1. Compare share trading platforms. To buy shares listed in Australia, you'll need to sign up to a broker with access to the Australian Securities Exchange (ASX). Our table below can help you choose.
2. Open and fund your brokerage account. Complete an application with your personal and financial details, like your ID and tax file number. Fund your account with a bank transfer, PayPal or debit card.
3. Search for Challenger. Find the share by name or ticker symbol: CGF. Research its history to confirm it's a solid investment against your financial goals.
4. Purchase now or later. Buy today with a market order or use a limit order to delay your purchase until Challenger reaches your desired price. To spread out your risk, look into dollar-cost averaging, which smooths out buying at consistent intervals and amounts.
5. Decide on how many to buy. At today's price of $3.82, weigh your budget against a diversified portfolio that can minimise risk through the market's ups and downs.
6. Check in on your investment. Congratulations, you own a part of Challenger. Optimise your portfolio by tracking how your stock — and even the business — performs with an eye on the long term. You may be eligible for dividends and shareholder voting rights on directors and management that can affect your stock.

How has coronavirus impacted Challenger's share price?

Since the stock market crash in March caused by coronavirus, Challenger's share price has had significant negative movement.

Its last market close was $3.82, which is 62.98% down on its pre-crash value of $10.32 and 35.46% up on the lowest point reached during the March crash when the shares fell as low as $2.82.

If you had bought $1,000 worth of Challenger shares at the start of February 2020, those shares would have been worth $340.21 at the bottom of the March crash, and if you held on to them, then as of the last market close they'd be worth $437.58.

Challenger share price

Use our graph to track the performance of CGF stocks over time.

Challenger shares at a glance

• Key figures

Information last updated 2020-09-13.

Latest market close	AUDA$3.82
52-week range	AUDA$2.82 - AUDA$10.43
50-day moving average	AUDA$4.0729
200-day moving average	AUDA$4.7724
Target price	AUDA$12.06
PE ratio	5.4557
Dividend yield	AUDA$0.35 (9.54%)
Earnings per share (TTM)	AUDA$0.68

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The value of your investments can fall as well as rise and you may get back less than you invested. Past performance is no indication of future results.

Is it a good time to buy Challenger stock?

The technical analysis gauge below displays real-time ratings for the timeframes you select. This is not a recommendation, however. It represents a technical analysis based on the most popular technical indicators: Moving Averages, Oscillators and Pivots. Finder might not concur and takes no responsibility.

Technical Analysis of Challenger Limited by TradingView

Challenger price performance over time

Historical closes compared with the last close of A$3.82

1 week (2020-09-10)	1.06%
1 month (2020-08-20)	-0.78%
3 months (2020-06-19)	-28.20%
6 months (2020-03-20)	-0.78%

1 year (2019-09-20)	-49.47%
2 years (2018-09-20)	-64.79%
3 years (2017-09-20)	-69.12%
5 years (2015-09-18)	-46.57%

Is Challenger under- or over-valued?

Valuing Challenger stock is incredibly difficult, and any metric has to be viewed as part of a bigger picture of Challenger's overall performance. However, analysts commonly use some key metrics to help gauge the value of a stock.

Challenger's P/E ratio

Challenger's current share price divided by its per-share earnings (EPS) over a 12-month period gives a "trailing price/earnings ratio" of roughly 5x. In other words, Challenger shares trade at around 5x recent earnings.

That's relatively low compared to, say, the P/E ratio for the ASX over the 12 months to December 2019 (32.14). The low P/E ratio could mean that investors are pessimistic about the outlook for the shares or simply that they're under-valued.

Challenger's EBITDA

Challenger's EBITDA (earnings before interest, taxes, depreciation and amortisation) is $1 billion (£0.0 million).

The EBITDA is a measure of a Challenger's overall financial performance and is widely used to measure a its profitability.

Challenger financials

Revenue TTM	$1.8 billion
Gross profit TTM	$65.7 million
Return on assets TTM	-0.57%
Return on equity TTM	-12.26%
Profit margin	-23.09%
Book value	4.901
Market capitalisation	$2.5 billion

TTM: trailing 12 months

Challenger share dividends

Dividend payout ratio: 44.32% of net profits

Recently Challenger has paid out, on average, around 44.32% of net profits as dividends. That has enabled analysts to estimate a "forward annual dividend yield" of 9.54% of the current stock value. This means that over a year, based on recent payouts (which are sadly no guarantee of future payouts), Challenger shareholders could enjoy a 9.54% return on their shares, in the form of dividend payments. In Challenger's case, that would currently equate to about A$0.35 per share.

While Challenger's payout ratio might seem fairly standard, it's worth remembering that Challenger may be investing much of the rest of its net profits in future growth.

The latest dividend was paid out to all shareholders who bought their shares by 24 February 2020 (the "ex-dividend date").

Have Challenger's shares ever split?

Challenger's shares were split on a 1:5 basis on 25 November 2004. So if you had owned 5 shares the day before before the split, the next day you'd have owned 1 share. This wouldn't directly have changed the overall worth of your Challenger shares – just the quantity. However, indirectly, the new 400% higher share price could have impacted the market appetite for Challenger shares which in turn could have impacted Challenger's share price.

Challenger share price volatility

Over the last 12 months, Challenger's shares have ranged in value from as little as $2.82 up to $10.43. A popular way to gauge a stock's volatility is its "beta".

Beta is a measure of a share's volatility in relation to the market. The market (AU average) beta is 1, while Challenger's is 1.1572. This would suggest that Challenger's shares are a little bit more volatile than the average for this exchange and represent, relatively-speaking, a slightly higher risk (but potentially also market-beating returns).

Challenger overview

Challenger Limited is a publicly owned investment manager. The company also provides retirement services to its clients. It manages equity mutual funds. The firm invests into the public equity markets across the world. Challenger Limited was founded in 1985 and is based in Australia, Asia and United Kingdom.

Frequently asked questions

• What percentage of Challenger is owned by insiders or institutions?

  Currently 17.088% of Challenger shares are held by insiders and 41.554% by institutions.

• When does the fiscal year end for Challenger?

  Challenger's fiscal year ends in June.

• Where is Challenger based?

  Challenger's address is: 5 Martin Place, Sydney, NSW, Australia, 2000

• What is Challenger's ISIN number?

  Challenger's international securities identification number is: AU000000CGF5