Hub24 shares gain as Citi and Bell Potter lift forecasts
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The news: Shares in Hub24 rallied after Bell Potter and Citi both lifted their forecasts on the investment platform.
The numbers: Hub24 shares were up 3% to $91.91 at 2pm AEST, extending gains to more than 95% over the last 12 months.
Bell Potter retained its 'buy' rating on the stock and hiked its 12-month target price from $75 to $100.
Citi upgraded its forecast for Hub24's net profit after tax by 3% to 13% in FY25 to FY27, reflecting market movements and stronger flows. However, Citi downgraded Hub24 and rival platform Netwealth to 'neutral' on valuation grounds.
The context: Bell Potter analyst Hayden Nicholson said that ahead of Hub24's upcoming quarterly result, he expects improvements in retention, reflecting the company's focus on user experience and a strengthening technology proposition.
He said Hub24 has produced similar outflows over the previous three quarters while adding an incremental $18.1 billion in funds under management.
Nicholson also noted that rising net inflows per average adviser points to Hub24's success in attracting high net wealth clients, or reflects its compelling value proposition.
He believes the company could see inflows of $16 billion per year as new clients move across, growing out of FY26 guidance for $11 billion to $15 billion.
The source: Bell Potter research
