Morningstar trims PT on Australia's Magellan Financial post CEO exit

Magellan Financial

25/10/2023 20:37

** Morningstar cut its price target on Australia's Magellan Financial Group
Ltd  MFG.AX  to A$9.60 from A$10.20
    ** Brokerage says the immediate departure of CEO David George, announced by
the fund manager on Wednesday, is unsettling amid MGX's ongoing turnaround
efforts
    ** Broker also increases net outflows projections for FY24-25 to A$20
billion ($12.62 billion) from A$17 billion prior; FY28 funds under management
forecast falls to A$25 billion from A$28 billion 
    ** Says sudden leadership departures have historically raised concerns of
instability, leading to persistent redemptions even after new leadership is
appointed 
    ** "However, we believe any associated sense of instability is likely to be
short-lived," analysts add 
    ** One of 9 analysts rate the stock "buy", 5 "hold" and 3 "sell"; their
median PT is A$7.79– LSEG data
    ** Stock down ~27% YTD, based on last close


($1 = 1.5845 Australian dollars)

 (Reporting by Aaditya Govind Rao in Bengaluru)
 ((Aaditya.GovindRao@thomsonreuters.com;))