- AJ Bell
- 05 December 2025 11:39:45
Source: Sharecast
The company delivered record results for the 12 months to 30 September, with revenues up 18% and earnings per share up 26%, with the latter representing a 2% beat to consensus estimates. What's more, a further £50m share buyback was announced on top of a progressive dividend policy.
However, the outlook statement implied a flat profit before tax margin in FY26, held back by a planned £16m investment in distribution and technology costs. The shares fell nearly 8% during the session to settle at 484.4p, their lowest since May.
"The major news from FY25 results is an incremental £16m spend to acquire more customers at a reasonable price, causing a moment of market reflux, and downgrades to our and the market’s S/T estimates," Shore Capital said, cutting its EPS forecasts for the next two years by 7% and 4% respectively.
"It is likely that we and others will underestimate the growth which will flow from such a decision, though we have tried to estimate a marketing ROI in our new numbers."
The broker highlighted AJ Bell's 8.1% growth in organic net inflows to the platform in FY25, which is "quite a speed".
"AJ Bell is a winner in an underserved space, with high organic growth creating largely recurring revenues, and it now has the scale to carry on conquering."
Shore Capital has a 600p target price for the shares, implying 24% upside from Thursday's close.
The stock was up 0.3% at 485.8p by 1138 GMT.