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Canaccord Genuity raises target price on Charles Stanley
3rd Jun 2021 12:40
(Sharecast News) - Analysts at Canaccord Genuity raised their target price on investment management firm Charles Stanley from 352.0p to 406.0p on Thursday following the group's full-year results.
Canaccord upped its adjusted pre-tax profit forecasts for Charles Stanley by 4% and 2% in 2022 and 2023, respectively, and added that marking-to-market also drove its average funds under management and administration and revenue forecasts higher, although it also noted this was partially offset by increased expectations for operating expenses, per company guidance.
Alongside its 2021 results, CS management also announced the creation of a new operating division, Central Financial Services, with which it aims to address the market for simplified advice and will include model portfolios, foundation financial planning and execution-only services.
"Importantly, the division will refocus efforts in existing, under-developed services already provided by the company and does not comprise start-up business lines," said Canaccord.
"While the Discretionary managed business faces challenges common with peers in terms of generating net inflows, the new CFS division holds promise in our view."
Canaccord also stated that if CS can leverage its existing capabilities to establish a net inflow trend, this "may present upside risk" to its forecasts for the 'buy' rated stock.
Canaccord upped its adjusted pre-tax profit forecasts for Charles Stanley by 4% and 2% in 2022 and 2023, respectively, and added that marking-to-market also drove its average funds under management and administration and revenue forecasts higher, although it also noted this was partially offset by increased expectations for operating expenses, per company guidance.
Alongside its 2021 results, CS management also announced the creation of a new operating division, Central Financial Services, with which it aims to address the market for simplified advice and will include model portfolios, foundation financial planning and execution-only services.
"Importantly, the division will refocus efforts in existing, under-developed services already provided by the company and does not comprise start-up business lines," said Canaccord.
"While the Discretionary managed business faces challenges common with peers in terms of generating net inflows, the new CFS division holds promise in our view."
Canaccord also stated that if CS can leverage its existing capabilities to establish a net inflow trend, this "may present upside risk" to its forecasts for the 'buy' rated stock.