Generation Development Earnings: Growth at the Expense of Profitability
Generation Development's underlying fiscal 2026 NPAT rose 21% as the business continued to gain market share across all business lines. Shares fell 16% following the result.
Generation Development Group Ltd GDG
Bulls Say, Bears Say
Bulls
Generation currently benefits from various tailwinds, including favorable tax treatment for investment bonds, growing importance of third-party product research, and contemporary managed account offerings that outshine traditional managed funds.
Bears
Generation’s acquisitive strategy introduces risks of indigestion, including potential underperformance and failure to realize synergies, equity dilution, and excessive leverage.
Trading Information
- Previous Close Price
- A$2.74
- Day Range
- A$2.70–2.78
- 52-Week Range
- A$2.66–7.77
- Bid/Ask
- A$2.70 / A$2.78
- Shares Outstanding
- 401.26M
- Market Cap
- A$1.09B
- Volume/Avg
- 1M / 2M
Key Statistics
- Price/Earnings (Normalized)
- 25.90
- Price/Sales
- 1.91
- Dividend Yield (Trailing)
- 0.74%
- Dividend Yield (Forward)
- 0.74%
- Dividend Payment Schedule
- Apr, Oct
- Total Yield
- 0.74%
Company Profile
Founded in 1991, Generation originally operated as a pooled development fund, focusing on providing capital to businesses in financial services. Today, the firm is structured across three key business lines within wealth management. The first is through Generation Life, the market leader in investment bonds by inflows, which offers tax-effective products, including investment bonds and annuities. The second business line is Lonsec, a prominent research and ratings provider to the Australian financial-services sector, competing against Morningstar and Zenith. The third division provides managed account solutions, a result of the merger between Evidentia and Lonsec Investment Solutions, offering individually owned accounts professionally managed by experienced portfolio managers.
- Sector
- Financial Services
- Industry
- Asset Management
- Stock Style Box
- Small Core
- Total Number of Employees
- —
Competitors
Valuation
|
Metric
|
GDG
|
PNI
|
PPT
|
|---|---|---|---|
Price/Earnings (Normalized) | 25.90 | 17.03 | 10.11 |
Price/Book Value | 1.49 | 2.71 | 1.27 |
Price/Sales | 1.91 | 20.60 | 1.78 |
Price/Cash Flow | 31.72 | 8.72 | 7.24 |
Price/Earnings
GDG
PNI
PPT
Financial Strength
|
Metric
|
GDG
|
PNI
|
PPT
|
|---|---|---|---|
Quick Ratio | — | — | 0.75 |
Current Ratio | — | — | 1.58 |
Interest Coverage | 148.74 | — | 1.31 |
Quick Ratio
GDG
PNI
PPT
Profitability
|
Metric
|
GDG
|
PNI
|
PPT
|
|---|---|---|---|
Return on Assets (Normalized) | 0.65% | 14.69% | 5.56% |
Return on Equity (Normalized) | 5.70% | 17.63% | 11.64% |
Return on Invested Capital (Normalized) | 4.54% | — | 7.69% |
Return on Assets
GDG
PNI
PPT
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United States