Australian wealth platforms fall, Citi downgrades rating

Hub24

03/07/2025 03:48

** Shares of wealth platforms Netwealth Group NWL.AX and Hub24 HUB.AX slip 1% and 2%, respectively

** Citi downgrades both firms to "Neutral" from "Buy" but raises PT on NWL to A$33.65 from A$27.30 and HUB to A$89.80 from A$71.50

** Says that although both firms have shown strong growth, their valuations make the stocks look expensive

** Upgrades HUB's NPAT by 3% to 13% and NWL's by 2% to 7% in FY25 to FY27 to reflect stronger fund inflows, other factors

** Foresees potential upside in medium-term flows as platforms expand into adjacent markets, but flags that the current risk-reward lacks appeal

** YTD, NWL is up 16.5% while HUB has climbed 26.4%

(Reporting by Kumar Tanishk in Bengaluru)

((Tanishk.Kumar@thomsonreuters.com; X: @thatstanishk http://www.x.com/thatstanishk;))