SG Fleet's September-quarter qualitative update reveals strong demand and a solid pipeline (nearly double that at June 30).

Customer numbers rose across fleet, novated and UK businesses, placing SGF in a good position when fleets are refreshed in the medium term, says Morgan Stanley.

The LeasePlan integration is outpacing forecasts.

Management provides no specific trading update or guidance and Morgan Stanley spies supply challenges, which it expects will ease in the June quarter.

Overweight rating and $3.60 target price retained.

Sector: Commercial & Professional Services.

Target price is $3.60.Current Price is $2.67. Difference: $0.93 - (brackets indicate current price is over target). If SGF meets the Morgan Stanley target it will return approximately 26% (excluding dividends, fees and charges - negative figures indicate an expected loss).

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