Netwealth shares rise as quarterly inflows outstrip estimates
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More news: Netwealth shares climbed on the ASX after the investment platform recorded record net inflows in the December quarter, lifting its funds under administration.
Shares were up 2.1% to $30.03 by 11am AEDT, extending gains of more than 75% over the last 12 months.
E&P Capital analyst Olivier Coulon said he expects the market to react positively to Netwealth's "solid" net flows, and the company's confidence in pushing up its cash margin fee.
RBC Capital Markets analyst Jack Lynch noted that Netwealth's custodial net inflows came in 21% ahead of consensus expectations.
What they said: "Unsurprisingly, Netwealth are advancing investments in light of the favourable conditions to capture opportunities which we believe is already reflected in consensus operating costs," Lynch said.
"The outlook for the remainder of FY25 looks positive for [Netwealth] with management reiterating confidence for future inflows, lead indicators for net inflows in growth, and APRA [Australian Prudential Regulation Authority] changes to regulatory capital releasing cash to provide balance sheet support."
Netwealth posts record inflows in December quarter
The news: Investment platform Netwealth has reported record net inflows in the December quarter, helping lift its funds under administration.
The numbers: The company said funds under administration rose by $7.8 billion over the three-month period, led by record net inflows of $4.5 billion and another $1.7 billion increase through positive market movements. Overall FUA stood at $101.6 billion at December-end.
The context: The Melbourne-based financial services group said the growth mainly came from flows into non-custodial accounts and managed accounts, with the total number increasing by 4,272 for the quarter to 151,437 accounts.
FUA net flows for the quarter included net institutional inflows of $517 million.
The group, which has expanded through the acquisition of Xeppo and mobile app Flux, said conversion rates remains strong and diversified across client groups and segments.
While it expects flows to be seasonally lower, the fund manager said it is confident in its inflows outlook for the remainder of FY2025.
The sources: ASX announcement, RBC Capital Markets research, E&P Capital research
