Challenger Ltd (ASX: CGF) shares have rocketed 6.08% higher in lunchtime trade on Wednesday. At the time of writing the shares are changing hands for $8.72 a piece in what is a stark turnaround from earlier this week.
February so far has been filled with volatility for the Australian investment management company. The share price crashed 10% between Wednesday last week to the close of the ASX yesterday afternoon. And now it is rocketing back up.
For the year-to-date Challenger shares are down 8.23% but they’re 55.91% higher over the year.
What has caused so much share price volatility recently?
There’s been ongoing deal speculation about Challenger’s advanced talks about a joint acquisition of Pepper Money Ltd (ASX: PPM) alongside Pepper Group.
The company said earlier this month that it thinks a potential acquisition could give Challenger long-term access to fixed income assets and support its strategic growth plans. The news caused a temporary share price spike to Wednesday last week. But then concerns about how the deal would be executed caused some investors to sell up their shares towards the end of the week.
Why are Challenger shares climbing higher today?
Challenger posted its first half FY26 results ahead of the ASX open yesterday morning. It revealed an enormous statutory net profit after tax (NPAT) of 369% to $339 million for the period and a 2$ increase in normalised NPAT to $229 million.
The group also announced a fully franked dividend increase of 7% to 15.5 cents per share.
The results weren’t enough to shift investor sentiment. The share price closed 0.49% lower at the end of the day on Tuesday.
There is no more price-sensitive news out of the company today, so it looks like today’s share price hike is a delayed investor reaction to yesterday’s profits and dividends announcement.
Are Challenger shares a buy, sell or hold following its results?
Analysts continue to be pretty optimistic about the outlook for Challenger shares, and this is especially supported by strong-than-anticipated financial results yesterday.
TradingView data shows that seven out of 10 analysts have a buy or strong buy rating on the shares. Another three have a hold rating.
The average target price is $9.50 which, even after today’s rally, implies a 9.07% upside at the time of writing.
Some analysts are more bullish and expect a share price hike to $10 a piece. That implies a 14.81% potential upside at the time of writing on Wednesday lunchtime.
The post Challenger shares storm 6% higher today. Is it too late to buy? appeared first on The Motley Fool Australia.
Should you invest $1,000 in Challenger Limited right now?
Before you buy Challenger Limited shares, consider this:
Motley Fool investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Challenger Limited wasn’t one of them.
The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.*
And right now, Scott thinks there are 5 stocks that may be better buys…
* Returns as of 1 Jan 2026
.custom-cta-button p {
margin-bottom: 0 !important;
}
More reading
- Challenger earnings: Statutory NPAT surges 369% in H1 FY26
- Why Bravura, CAR Group, Pepper Money, and Web Travel shares are storming higher
- Why Bougainville Copper, Brainchip, Challenger, and HMC Capital shares are falling today
- Pepper Money shares pop 25%, Challenger slips 3% on take-private deal
- Challenger flags talks on Pepper Money acquisition
Motley Fool contributor Samantha Menzies has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Challenger. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.