Morningstar have an article on Magellan, confirming their target price of $50.50 and 'Buy' recommendation.
They noted that they have cut their target price by 9%.. but really, to my mind, this is just a broker trying to get their target price closer to the actual price so they are not too far from the herd. Clearly, I am a cynic, but here's the proof:
Meanwhile, an interesting set of assumptions they include. First, FUM they expect to continue to outflow but return positive. It's a linear model, and I'd focus more the trend than absolute values, but the key point is they see this as temporary.
Interestingly, they also posit that performance typically reverts to the mean. "A manager who outperforms in one year is likely to underperform subsequently" and vice versa. I don't know always how true that is, but if your portfolio is specifically trying to cut the tops/bottoms of market extremes and looking at absolute returns of 9-10% CAGR through the cycle, then yep, that's what we should be expecting.
GLTAH.
MFG Price at posting:
$33.04 Sentiment: Buy Disclosure: Held
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