Australian Finance Group's (ASX:AFG) shares, which have de-rated about 40% since August 2025 due to rising rates and macroeconomic challenges, have created an "opportunity worth taking," Jarden said in a note on Wednesday.
The investment firm started its coverage on the mortgage broker aggregator and said the market has priced in a structural decline for the stock, which it views as temporary pressure.
Mortgage brokers account for around 81% of Australian mortgage settlement, providing the company with a foundational tailwind. Additionally, Australian Finance, which makes about 70% of its earnings from the Distribution segment, benefits from recurring broker subscription revenue, giving it a steady income stream.
The company has an edge in building scale but remains negatively exposed to the current cash rate environment and geopolitical volatility, the firm added.
Jarden initiated coverage with an overweight rating and price target of AU$2.30.