Analysts lift price target on GQG after strong inflows
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The news: Analysts at Goldman Sachs and Macquarie have lifted their estimates and price targets on investment manager GQG Partners after it lifted its funds under management.
The numbers: Goldman Sachs lifted its 12-month price target on GQG to $3 a share from $2.73 previously, retaining the ‘Buy’ rating. Macquarie raised its target price to $3.05 from $2.80 previously, retaining its ‘Outperform’ rating.
Shares in the company were up 0.7% to $2.87 in early trading, and have nearly doubled over the past 12 months.
The context: GQG on Monday said its funds under management (FUM) was up 3.7% in June to USD155.6 billion ($230.06 billion), with its institutional channel seeing moderate redemption pressure which was offset by wholesale and sub-advisory channels.
Macquarie analysts also lifted their earnings estimates and said GQG was trading at a very appealing price to earnings ratio given its strong operational trends, and cited a potential sell down of shares as a positive catalyst for re-rating the stocks as it would increase liquidity significantly.
What they said: “We make earnings upgrades to reflect GQG’s June 2024 FUM position and stronger flows,” Goldman analysts said in a note, noting that funds growth in the first half of 2024 was largely driven by rising markets.
The sources: Macquarie research, Goldman Sachs research
