News: AMP Australia's AMP posts 53% rise in annual profit, page-26

The result certainly looks like what the doctor ordered

But just be careful of capitalising AMP Banks latest Reported Underlying NPAT number, because it includes release of a $26m credit loss provision which was raised during the onset of Covid.

So the $153m NPAT number for AMP Banks should really be considered to be $127m on a normalised basis.

But even eliminating that hollow-log, is still a very good result from AMP Bank.

I think it could be worth $1.8bn.

And more importantly, a good result from the jewel in the crown, AMP Capital, which I think is worth $3.0bn to $3.5bn

So, those two alone are worth around $5.0bn

This compares to the current Enterprise Value of the group of $4.8bn ($3.3bn Market Cap and $1.5bn Corporate Debt)

Which means that the Australian and New Zealand Wealth Management businesses (which, net of all corporate overheads report, current NPAT of ~$50m pa) are being implicitly valued between minus $200m and $750m

If one placed a modest 12x P/E multiple on that $50m number, and combined it with the ~$5.0bn value for AMP Bank and AMP Capital, you get a target price of $1.30 for the stock: