Magellan Financial Group Ltd
MFG: XASX (AUS)
Morningstar Rating for Stocks | Fair Value | Economic Moat | Capital Allocation |
---|---|---|---|
A$65.60 | Ywfb | Tbjshvrz |
Magellan Earnings: Expectation for Earnings Decline Remains Unchanged
We retain our fair value estimate for no-moat Magellan at AUD 9.60 per share following release of first-half fiscal 2024 results. Operating segment pretax profits of AUD 116 million fell 8% from the prior comparable period, or pcp, which was slightly worse than we expected. This negative was offset by a reduction in the size of fund investments, which we had forecast to deliver returns below Magellan’s 9% cost of capital. Shares have rerated close to our fair value estimate and are now close to fairly valued.