Morningstar | Iress is benefitting from increased regulatory oversight of the wealth management sector.
We expect Iress to deliver a high-single-digit EPS CAGR over the next decade, with growth from its wealth management business more than offsetting weakness from its mature financial markets business. We expect the narrow economic moat, underpinned by customer switching costs, to help defend the dominant position in Australian financial markets software and enable the Australian wealth management software business to increase its market share to around 80% in the long term from 65% today. We expect Australian-sourced earnings to fall to 61% by fiscal 2021 from 68% in fiscal 2016 as geographic diversification continues. We forecast group EBIT margins to stabilise around 28% as margin expansion within the wealth management division offsets margin contraction within the financial markets division. The capital-light business model should enable good cash conversion, low financial leverage, and regular dividends.IRESS is engaged in the provision of information, trading, compliance, order management, portfolio and wealth management, and lending systems and related tools. Co.'s main clients are financial markets and wealth management participants in Australia, New Zealand, South East Asia, Canada, South Africa and the U.K. Co. provides solutions to clients using three core platforms: IRESS (market information and trading platform), XPLAN (wealth management and advice platform), and Mortgage Sales and Originations (lending automation and processing platform). Core business activities of Co. are carried out within three main divisions being financial markets, wealth management, and enterprise lending.
Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company offer an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors.
Morningstar provides data on approximately 530,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 18 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries and had approximately $185 billion in assets under advisement and management as of June 30, 2016.
We have operations in 27 countries.
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