- AJ Bell
- 09 December 2024 10:14:07
Source: Sharecast
"Our earnings per share forecasts are unchanged after FY24A results, despite increasing costs as investment for long-term growth accelerates," it said.
"We were reassured by AJB’s comments around the impact to AuA from changes to pensions tax following the Budget."
Shore said it continues to expect volatility in assets under administration movements when AJB reports first-quarter trading on 30 January. However, it said the long-term imperative for individuals to save for retirement remains, regardless of tax on unused pensions.
"As a high-quality compounder, AJB is a way to play this secular theme."
Shore said: "With a largely recurring revenue profile and sticky customer base, earnings quality is high, underpinned by a scalable platform with margin expansion potential providing significant growth optionality.
"With EPS forecast to grow at a compound 10% from FY24A-27F, FY25F price-to-earnings at more than 20x, and a progressive dividend, we raise fair value to 525p (from 465p) and our recommendation to buy."
At 1000 GMT, the shares were up 2.5% at 472p.