AUS
NZ
UK
CA
USA
IND
Highlights
- Hub24 (ASX:HUB) reports net inflows of $5.5 billion for Q2, exceeding predictions.
- UBS and Citi raise price targets following impressive quarterly results.
- Positive market movements help boost Hub24’s funds under administration (FUA).
Shares of Hub24 (ASX:HUB) have continued to rise following the release of its Q2 financial results, showing impressive net inflows and overall growth, as confirmed by major analysts including UBS and Citi. The company reported a strong $5.5 billion in net inflows for the December quarter, surpassing analyst estimates of $5 billion. As a result, Hub24’s share price rose 4.7%, reaching $76.13 by mid-morning trading.
The net inflows marked a significant overachievement, outperforming UBS's forecast of $4.7 billion. This positive result helped the company maintain its momentum, bringing strong investor confidence. UBS raised its price target for Hub24, from $70 to $75.50, while also increasing its earnings per share (EPS) estimates by 4% for FY25 and 8% for FY26. Despite maintaining a "neutral" rating, UBS was clearly impressed by the company’s growth trajectory and strong quarter.
Similarly, Citi (ASX:CIA) reviewed its stance on Hub24, upgrading the stock’s net flow forecast for the full year. Originally set at $17.5 billion, Citi increased the projection by 8% to a robust $18.8 billion, underscoring the potential for continued success. The bank also adjusted its target price to $74.50, reflecting the positive outcome of Hub24’s quarterly performance. Excluding large migrations from Equity Trustees, Citi found underlying flows reached $4 billion, 9% higher than expected.
Additionally, Citi reported that Hub24’s total Funds Under Administration (FUA) amounted to $120.9 billion, surpassing consensus expectations by 2%. This robust performance benefitted from favorable market conditions, particularly international equities, and a more favorable exchange rate with the Australian dollar.
However, a potential challenge remains on the horizon. Citi raised concerns over Hub24’s decision to close its Xplore Wealth managed discretionary account (MDA) service, which holds about $2 billion in FUA. This move could see the funds shift away from Hub24, sparking questions about the company's ongoing mergers and acquisitions (M&A) strategy. Nevertheless, despite this, the overall outlook remains solid as Hub24 continues to expand, with advisor growth supporting its overall momentum.
Hub24's (HUB) performance in Q2 reflects the growing strength of its platform, bolstered by positive inflows, solid market conditions, and a promising future outlook.
