Seek ANZ Recovering Well but Fair Value Cut Following Zhaopin Sale

We have cut our fair value for narrow-moat Seek by 9% to AUD 18.50 per share following its first-half financial result. The fair value cut is driven by the sell-down of Seek’s investment in Zhaopin, to an equity stake of 24% from a prior 61%, at a valuation below the implied value of the investment in our financial model. Offsetting this impact to some degree is the positive effect of higher earnings forecasts for the ANZ, business, which exceeded our expectations in the first half, and lower earnings forecasts for the Asian and South American businesses, which are performing below our expectations.