Hub24 shares extend gains as UBS upgrades to 'buy'
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The news: Hub24 shares continued its recent rally after UBS upgraded its rating on the investment platform to 'buy'.
The numbers: Shares were up 3.4% to $94.85 at 1pm AEST, having more than doubled in value over the last 12 months.
They closed 2.9% higher on Friday after Citi and Bell Potter analysts lifted their forecasts on the stock.
UBS raised Hub24's price target to $105 and hiked its earnings-per-share forecasts by 4% in FY25 and 14% in both FY26 and FY27, primarily due to stronger flows outlook.
UBS' cumulative net flows for Hub24 — totalling $122 billion from FY25 to FY30 — now lie 19% above consensus, driving its view that market share can double to 16% during that period.
UBS sees Hub24's funds under management reaching $282 billion by fiscal 2030, 20% ahead of market forecasts.
The context: UBS analyst Shreyas Patel said he expects Hub24 to outpace ASX rival Netwealth "on a number of fronts".
Patel sees Hub24 capturing higher adviser market share, achieving higher platform benchmarking scores, and taking higher operating leverage given its lower margins compared to Netwealth.
What they said: "We note [Hub24's] historical track record of doubling its market share more quickly than [Netwealth], and consider tech adjacencies as providing long-term optionality in an exclusive platform world," said Patel.
The source: UBS research
