Shaw & Partners - 4Q21 result – ABOVE Shaw and Partners’ expectations on every metric, and looking to divestInternational. Minor revisions to our FY21 and FY22 earnings (<3%) and our PT increasesfrom $1.00 to $1.35.
Proposing to DIVEST international ops (brings forward the return of the dividenddiscussion?) – has received “unsolicited, strong interest from potential buyers”. In ourview a positive given since 2007 (on our calculations) PPS has lost close to A$60m inInternational EBIT (with revenues totalling just A$80m). This is on an annual cost base of~A$15m.
Total FUA (Platform FUA + non-custodial VMAAS) achieved a new high of $41.7b, fromrecord levels in all global segments - ABOVE Shaw and Partners’ $40.6b estimate, with:1. Australia platform FUA of $18.4b, up 223% on pcp and up 30% for the consolidatedPraemium and Powerwrap – ABOVE Shaw and Partners’ $17.9b estimate;2. International platform FUA of $5.0b, up 55% on pcp – ABOVE Shaw and Partners’$4.7b estimate; and3. FUA for VMAAS of $18.3b, up 61% on pcp - ABOVE Shaw and Partners’ $18.0bestimate.
Big positive was the record quarterly inflows of $1.2b - ABOVE Shaw and Partners’ $0.9bestimate (ex ANZ transition of $169m),
On the Investment Management side (Smart):1. Managed Funds FUM of $258m was flat on both pcp on pp; and2. Model Portfolios FUA of $372m was +9% on pcp and -3% on pp.
RecommendationRetain BUY on TSR of 22%. Fundamentally PPS is an attractive investment prospect as itcontinues to disrupt financial services in the wealth management sector. An attractive TAM,impressive forecast 5-year EBITDA CAGR of 17%, double-digit EPS and profit growth for eachof the next 3 years, increasing FCF, improving returns (ROIC and ROE) despite a fragmented,highly competitive and intensive industry small debt, robust FUA inflows growth quarteron-quarter (which is also the key risk if it reverses) and increasing market share – withsynergies from the PWL acquisition, opportunity to divest the loss-making Internationalbusiness, potential to re-install dividends and a significant catalyst re: valuation gap re-ratingvs. HUB/NWL. On EV/sales+1, PPS is trading at an attractive 60% discount to HUB/NWLrespectively.
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Last
47.5¢ |
Change
0.005(1.06%) |
Mkt cap ! $228.9M |
Open | High | Low | Value | Volume |
46.5¢ | 47.5¢ | 45.8¢ | $205.7K | 443.2K |
Buyers (Bids)
No. | Vol. | Price($) |
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1 | 69928 | 46.5¢ |
Sellers (Offers)
Price($) | Vol. | No. |
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47.5¢ | 31328 | 3 |
View Market Depth
No. | Vol. | Price($) |
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1 | 69928 | 0.465 |
1 | 4045 | 0.460 |
5 | 107736 | 0.450 |
2 | 24988 | 0.445 |
4 | 28572 | 0.440 |
Price($) | Vol. | No. |
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0.475 | 31328 | 3 |
0.480 | 50000 | 1 |
0.485 | 9975 | 1 |
0.490 | 250000 | 4 |
0.495 | 35433 | 2 |
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