Realistic Character vs Character collision with deformation

Greetings Gurus,
I believe this question is a topic of discussion since ages. (At least no engine could provide a feasable solution to me to date).

The Streetfighter scenario:

Actor A punches another Actor B deforming its mesh on impact.

Everything I found so far leads to extensive manual animation work with morph targets controled by continuous distance calculation of actor A fist to actor B collision target.

But that would imply a predifined impact point instead of realtime calculated like e.g. in a motion tracking controled fighting game.

Does UE4engine provide a feasable solution for this problem? Without having to define hundreds of morph targets?

Thanks for you advice in advance.