Strong H1, AUM growth continues post-results
We knew momentum was strong on an absolute basis in H1 22 with AUM reaching £23.4bn on 30 Sep 21, 12% up over H1 (31 Mar 21: £20.9bn) and 43% up y-o-y (30 Sep 20: £16.4bn). Now, with most asset managers and platforms having reported AUM for the July-Sept quarter, growth looks impressive compared to peers too. Polar had the 4th highest organic AUM growth (out of 15) in the 6 months to 30 Sep, and the 3rd highest over 12 months. Growth has continued in H2 with AUM reaching £25.0bn on 12 Nov.We increase our fundamental value from 1305p to 1400p, 70% above the current share price. We had previously forecast AUM of £23.4bn on 31 Mar 22, but it is already £25.0bn. If we assume no growth from market movements or investment performance for the remainder of the FY, with net inflows continuing at the average of H1 (just over £100m per month), our revised estimate is £25.5bn.
We also note the continuing discount in valuation compared to peers. Polar’s PE ratio of 12.2 is less than half of the peer group median of 30.0, which seems strange given its growth and profitability profile. We maintain that there are sound reasons for a significant change in rating.
Polar Capital Holdings is an investment management company providing professional and institutional investors a range of geographical and sector funds. Co. manages 25 funds and four managed accounts across a range of long only and alternative products. Co. has one class of business, being the provision of investment management and advisory services. As of Mar 31 2017, Co. had total assets under management of £9.27 billion.
Equity Development enables companies to become better understood and supported by investors. Since our launch in 1996 we have consistently focused on helping our clients improve their communication and relationships with both existing and potential shareholders. Our clients have come from a wide variety of sectors and domiciles, are both private and quoted and range in size from micro-cap to $multi-billions. We offer free access to company research notes written by experienced analysts. These notes include detailed forecasts, financial models and a fair value. We host regular Private Investor Forums at which investors have the opportunity to hear company directors present, and to ask questions. These are free to attend. We broadcast live Webinars with company management that include active Q&A. We also make the recordings available online. We arrange face to face meetings between private investors and company management. We are active users of Twitter, commenting daily on company news, share price moves, Directors’ Dealings, Equity Development Research Notes & Events.
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