Brooks Macdonald Share Discussion Threads

[edmonda] 12/1/2023 07:47

Another solid quarter, guidance confirmed (link to new research note: https://www.equitydevelopment.co.uk/research/another-solid-quarter-guidance-confirmed)

Brooks Macdonald (BM) continued to build momentum in Q2 of FY23 (to 31 Dec 22), with FUM increasing by 4.5% (+£0.7bn) over the quarter to £16.2bn (end of Q1: £15.5bn). BM chalked up its 7th consecutive quarter of positive net flows of £156m, an annualised rate of 4% of opening FUM. Investment performance contributed £546m to the FUM increase (3.5% of opening FUM, in line with the benchmark MSCI PIMFA Private Investor Balanced Index - capital only).

Management have confirmed that underlying profit and margin are running in line with expectations, and our forecasts remain unchanged, although our fundamental valuation ticks up to 3000p per share, which is 44% above the current share price, with the increase due to a reduction in the UK 10-year gilt yield (the risk-free rate used in our DCF valuation). We also highlight that BM’s PER of 14.0 is significantly below a peer group median of 17.3 which doesn’t look justified. We will revisit our forecasts & valuation when H1 results are released on 2 March 2023.

[kalai1] 16/9/2022 10:27

Brooks McDonald posted FY results for the year ended 30th June 2022 yesterday. Group Funds Under Management closed at £15.7 billion down 4.8% on FY21 as positive net flows were offset by the impact of declining markets on asset values. Net flows for the FY were up 4.8%, representing a £1.1 billion improvement on FY21. Group revenue was up 3.4% to £122.2 million, underlying profit margin was up by 2.3% to 28.2%, in line with the Group's commitment to deliver top quartile margin over the medium term. But investment performance across the range of services was down 9.6% for the year, driven by declining and volatile markets. FY23 underlying profitability is in line with current market expectations, the Group’s medium-term ambition is for net flows around 8-10% p.a. Valuation is average with forward PE ratio around 14.1x, PS ratio at 2.9x. Share price remains in a shallow 12 month correction and lacks momentum. BRK is another solid, small asset manager and well worth monitoring, but there is no rush to buy...

...from WealthOracle

hxxps://wealthoracle.co.uk/detailed-result-full/BRK/557

[edmonda] 31/8/2022 09:56

FY Results presentation - 20th September - sign up here!

Brooks Macdonald Group plc, the AIM-listed investment management group, will be conducting an online presentation for investors following the release of their Full Year results.

The event will take place at 12.00pm on Tuesday 20th September.

Andrew Shepherd, CEO and Ben Thorpe, CFO will be hosting the presentation and answering questions submitted by investors.

This is open to all existing and potential shareholders - you can sign up to register here: https://www.equitydevelopment.co.uk/news-and-events/brooks-macdonald-20sept2022-investor-presentation

[edmonda] 14/7/2022 07:03

Two themes jump out at us at the close of FY22 (to 30 Jun 22). First, in the first full FY of CEO Andrew Shepherd’s tenure it has been a year of strategic strengthening, characterised by a return to consistent net inflows, following the ‘restructuring’ years of FY20 and FY21, which suffered net outflows. Most impressive now are the net inflows in Q3 and Q4, periods of sharp market falls, which can coincide with net outflows for investment managers.

Second, in absolute terms, investment performance saw gains in Q1 and Q2 (+£227m & +£317m), and sharp declines in Q3 and Q4 (-£850m & -£1,271m) as markets fell.

Our fundamental value reduces from 3,200p per share to 2,900p (also impacted by a slight increase in the discount rate used in our DCF model due to the increase in the 10yr gilt yield). However, with the recent share price fall to 2,160p it stands at a discount to our fundamental value of 34%. With such a strong franchise, evidenced by consistent net inflows in turbulent markets, we think the medium to long term prospects of Brooks Macdonald remain very strong and see potential for a re-rating.

https://www.equitydevelopment.co.uk/research/net-inflows-strengthen-again-but-market-falls-reduce-fum

[edmonda] 14/4/2022 06:23

Amidst significant market volatility - which often coincides with net outflows for asset and wealth managers - Brooks Macdonald impressively recorded £0.2bn of net Funds Under Management (FUM) inflows during Q3 of FY22 (Jan - Mar 22). This was its fourth consecutive quarter of positive net flows, and indicative of continuing strong momentum in the business.

We have made a small ‘mark to market’ adjustment to our forecasts (FY22 estimate reduces from £17.2bn to £17.1bn, FY23 from £18.8bn to £18.7bn), but remain confident that BM is well placed to achieve its longer-term ambitions (reaching £26-£27bn FUM in the next 5-6 years, excluding acquisitions) and highlight that our fundamental value is 3,200p per share (29% above the current share price), while BM’s PER of 19.8 is 23% below the sector median of 25.7.

https://www.equitydevelopment.co.uk/research/fum-inflow-momentum-continues-in-turbulent-markets

[c3479z] 31/3/2022 21:26

rising on the brewin dolphin takeover?

[wad collector] 31/3/2022 12:55

Certainly been a good share price recovery since the HY figures came out.

[edmonda] 10/3/2022 08:11

#BRK We initiate today on Brooks Macdonald. Prospects for revenue and profitability growth look encouraging as we examine a number of key factors including:

Management's ambitious organic and acquisitive growth plans.
BM is operating in a huge market with substantial medium-to-long-term tailwinds.
It has a track record of delivering superior investment returns, which is one of the most important factors used by financial advisers when selecting an investment manager.
FUM growth has been solid in recent years (12% CAGR over 4-5 years), fueled mainly by investment performance and attractive-looking acquisitions, with quarterly flows accelerating sharply over the last 18 months, and expected to contribute more to FUM growth in the future.
It is in the final stages of completing a multi-year re-engineering of operational processes and technology. Benefits are already being realised but a platform for scalability has been created, with the potential to increase profit margins as the business grows.
Funds under management (FUM) totalled £17.3bn on 31 Dec 21 and in its last full financial year (FY21 to 30 Jun 21) BM’s revenue was £118m (up 8.8% on FY20: £109m) and underlying PBT was £30.6m (up 32.5% on FY20: £23.1), which is evidence of operational leverage kicking in.

Based on its growth ambitions (reaching £26-£27bn FUM in the next 5-6 years, excluding growth from acquisitions) and the potential for further operational leverage, our fundamental DCF valuation is 3,250p per share, 49% above the current price (although this gap has widened with recent equity market falls). In addition, BM’s PER of 17.4 is 30% below the sector median of 24.7.

https://www.equitydevelopment.co.uk/research/ambitious-growth-strategy-builds-on-30-year-track-record

[km18] 08/2/2022 17:19

...from a while ago...

Brooks MacDonald issued solid final results for the 12 months to 30th June, 2021. Group FUM reached a record level of £16.5 billion (up 20.3% on FY20), Group revenue was up 8.8% to £118.2 million, underlying profit margin was up by 4.7 points to 25.9%, in line with the Group's commitment to deliver top quartile margin over the medium term, investment performance was strong at 15.8% for the year and the total dividend increased by 18.9% to 63.0p (FY20: 53.0p) reflecting the Board's confidence in the Group's prospects. Generally solid all round performance. Valuation is also reasonable on a forward PE ratio of 13, top third for the sector. BRK is certainly not as dynamic as some of its competitors in the investment management arena, but it is still a solid company at a reasonable price going in the right direction and not a bad small-cap financial name to hold in a portfolio. It also pays a 3%+ dividend yield. BUY....from WealthOracleAM

https://wealthoracle.co.uk/detailed-result-full/BRK/143

[wad collector] 17/10/2021 09:05

Even bigger BUY recommendation in IC this week @ 2510 , thinks it will be a winner in the battle of the wealth managers.

[boydduk] 09/10/2021 09:06

Looking at the wider market this has been one of my performers of late

[wad collector] 28/9/2021 21:45

Buy tip in IC this week @2386 , pointing out prospective consensus EPS of 178p next year.

[boydduk] 16/9/2021 08:23

Well I can't say I didn't hope for a better reaction on the share price to those results

[wad collector] 27/8/2021 10:44

The BB certainly doesn't share enthusiasm either! Quietly growing share price

[boydduk] 11/3/2021 08:12

Still the market doesn't really share the enthusiasm it appears

[boydduk] 09/3/2021 16:05

Hopefully will get some clarity on where this is going shortly.

[boydduk] 12/11/2020 10:19

Is Mr Market finally waking up?

[boydduk] 17/9/2020 08:15

You could hear a pin drop. Still I will take a company in strong enough position to be increasing its Divi right now

[saucepan] 28/7/2020 15:32

Hi Folks. A quiet thread. I bought in here in two tranches, yesterday and today.
Some attractive fundamentals, e.g: No debt; ROCE 19.2; Forecast eps growth 177%; 2022 forecast P/E of 10.9; divi paying.

I rather like the current momentum, hoping it will take it back to test highs in fairly short order.

[spooky] 24/6/2020 19:05

Great acquisition IMO.