Generation Development Group shares gain after Morgan Stanley upgrade
Make us a preferred source
Make us a preferred source on Google
More news: Shares in Generation Development Group (GDG) advanced after the investment company completed its equity raising to part-fund the acquisition of Evidentia Group.
The stock was also boosted as Morgan Stanley raised its price target on the stock, with analysts impressed by GDG's better-than-expected first-half result, and optimistic on the company's new acquisition.
GDG shares were up 2.1% to $5.29 at 12:25pm AEDT, having closed 4.9% higher on Friday.
Morgan Stanley increased its price target by 28.5% from $4.90 to $6.30. On the Evidentia acquisition, analysts said that it makes "strategic sense" to deploy capital in the managed accounts category, with the total addressable market forecast to double to $500 billion in funds under management over the next five years.
Reiterating its 'overweight' rating on the stock, Morgan Stanley revised its earnings-per-share forecasts by -5% in FY25, 13% in FY26 and 15% in FY27, with possible upside driven by ASX 300 inclusion, net inflow acceleration or further mergers and acquisitions.
Generation Development Group completes $54.8m retail offer
The news: Investment company Generation Development Group (GDG) has completed the retail component of its equity raising to support the $320 million acquisition of Evidentia Group.
The numbers: GDG raised $54.8 million through a retail entitlement offer, concluding its equity raising which also included a $233.3 million institutional component.
The context: Proceeds from the raise are being used to fund the acquisition of investment manager Evidentia, plus associated transaction costs, synergy implementation costs and future growth initiatives.
The sources: ASX, Morgan Stanley research
