Insignia Financial Ltd IFL

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A$2.36 −0.06 (2.48%)

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As of May 3, 2024 6:10am Delayed Price Closed

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Company Report

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Australia Asset Managers: Stabilizing but Still Weakening Against Passive Investments (Corrected)

Shaun Ler, Mathew Hodge Apr 12, 2024

This note replaces the original version that accompanied our report "Industry Pulse - Australian Asset Managers: 2024 Q1," published March 14, 2024. We were recently made aware of inaccuracies in the net flow data for certain unlisted managers in that original report. As for our investment conclusions, we stand by our key assessments: the fair value estimates, moat, uncertainty, capital allocation, and star ratings for our Asset Manager coverage.

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Price vs Fair Value

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IFL is trading at a 34% discount.

Price

A$2.36

May 3, 2024

Fair Value

A$4.30

Feb 22, 2024

Uncertainty

High

1-Star Price: A$9.86
5-Star Price: A$7.22
Economic Moat: Clkk
Capital Allocation: Bgzgkwgd

Bulls Say, Bears Say

Bulls

Insignia is well positioned to capture inflows from retail investors, notably the ageing Australian demographic.

Bears

The Royal Commission has materially reduced the competitive advantage of Insignia's vertically integrated business model.

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Trading Information

Previous Close Price: A$2.42
Day Range: A$2.34–2.43
52-Week Range: A$1.99–3.12
Bid/Ask: A$2.35 / A$2.36
Market Cap: A$1.58 Bil
Volume/Avg: 1.8 Mil / 1.7 Mil

Key Statistics

Price/Earnings (Normalized): 11.22
Price/Sales: 0.83
Dividend Yield (Trailing): 7.88%
Dividend Yield (Forward): 7.88%
Total Yield: 7.88%

Company Profile

Insignia Financial (formerly IOOF) provides wealth-management advice and products via a multibranded strategy, and a vertically integrated business model. Insignia's advice business provides financial planning services to both the mass affluent and high-net-worth clients. It also owns finance dealer groups that provide compliance and other administrative services to financial planners operating under the dealer group’s licence. Furthermore, Insignia offers platform products, which generates fees mainly from superannuation and non-superannuation investments accessed via its own platforms. It also derives revenue via some third-party platforms sourced from its aligned advisors. Lastly, the firm has an investment management segment.

Sector: Financial Services
Industry: Asset Management
Stock Style Box: Small Value
Total Number of Employees: 408
Website: https://www.ioof.com.au

Competitors

Valuation

Metric	IFL	PPT	AMP
Price/Earnings (Normalized)	11.22	11.61	52.10
Price/Book Value	0.70	1.18	0.75
Price/Sales	0.83	2.09	2.25
Price/Cash Flow	—	11.99	—

Price/Earnings

IFL

PPT

AMP

Financial Strength

Metric	IFL	PPT	AMP
Quick Ratio	5.24	0.90	6.59
Current Ratio	5.74	1.43	6.98
Interest Coverage	−0.07	2.26	−0.24

Quick Ratio

IFL

PPT

AMP

Profitability

Metric	IFL	PPT	AMP
Return on Assets (Normalized)	4.13%	3.30%	0.57%
Return on Equity (Normalized)	8.29%	5.67%	4.87%
Return on Invested Capital (Normalized)	5.40%	5.59%	0.14%

Return on Assets

IFL

PPT

AMP

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