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The AMP Ltd (ASX:AMP) share price has experienced a notable resurgence since late November, reaching new 52-week highs. The financial stock, which is part of the S&P/ASX 200 Index (ASX:XJO), closed the previous trading session at $1.315. In early afternoon trading on Thursday, the share price climbed to $1.34, reflecting a 1.9% increase. This performance contrasts with the ASX 200, which saw a slight rise of 0.3% amidst fluctuations influenced by the US Federal Reserve’s recent 0.50% interest rate cut.
The share price of AMP has surged by 44% year-to-date and an impressive 57% since the close on November 22. This upward trend has brought AMP shares to new 52-week highs, indicating a significant turnaround for the company.
Several factors have contributed to this remarkable growth. In November of the previous year, AMP faced challenges due to declining net interest margins. Despite this, the market reaction appeared to have been overly pessimistic. On February 14, AMP reported strong results for the full 2023 financial year (FY 2023), which marked a positive shift. The company recorded a 6.5% increase in underlying net profit after tax (NPAT) to $196 million. Additionally, AMP successfully reduced its net debt by $337 million, and its underlying earnings per share increased by 19.3% from FY 2022.
AMP's CEO, Alexis George, highlighted the progress made during 2023, noting significant achievements such as the completion of AMP Capital sales, progress in cost-cutting initiatives, and resolution of various legacy legal issues. These developments prompted a notable 10.3% increase in AMP's share price on the day of the results announcement.
The positive momentum continued into the first half of FY 2024, with AMP releasing its half-year results on August 8. Although total revenue for the six-month period decreased by 4% compared to the previous half-year, earnings before interest and tax (EBIT) rose by 4.1%, and NPAT increased by 5.4% to $118 million. A key driver of this performance was the 22.7% rise in underlying profit from AMP’s Platform business, which saw an increase of $54 million.
CEO Alexis George remarked on the progress made, emphasizing the company's strategic commitments and positive momentum leading into the latter half of the year. Following the announcement of the half-year results, AMP's share price surged by 13.3%.
The recent performance of AMP shares reflects a significant recovery and growing confidence in the company's trajectory. The increase in share price since November and the achievement of new 52-week highs underscore a strong turnaround for the financial stock.
