Berenberg upgrades AJ Bell to 'hold'
AJ Bell
302.40p
16:40 28/03/24
Berenberg upgraded its stance on shares of investment platform AJ Bell on Tuesday to ‘hold’ from ‘sell’, hiking the price target to 400p from 230p.
Financial Services
14,827.91
17:14 28/03/24
FTSE 250
19,884.73
17:14 28/03/24
FTSE 350
4,383.21
17:14 28/03/24
FTSE All-Share
4,338.05
16:50 28/03/24
The bank noted AJ Bell’s momentum from both macro and structural drivers helped the company to beat FY20 expectations, posting results in December that were up by 27% year-on-year at the earnings per share level.
"That is a remarkable performance during a year that was heavily affected by Covid-19 and associated market volatility," it said. "We continue to believe that interest rate cuts in FY20 will create headwinds; however, we now view the FY21 headwinds as manageable in the context of the group’s overall profitability."
Berenberg said it is forecasting flat EPS in FY21 before a resumption of growth in FY22-23, driven by inherent operating leverage and long-term structural growth drivers.
"However, with shares currently trading on circa 50x CY21, we view the company as perfectly priced; hence our hold recommendation."
At 1105 GMT, the shares were up 2.4% at 461.50p.