Magellan Financial Group Ltd

MFG: XASX (AUS)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	A$82.40	Ztsby	Xrbkbcngx

Magellan Earnings: Expectation for Earnings Decline Remains Unchanged

Shaun Ler

Feb 15, 2024

We retain our fair value estimate for no-moat Magellan at AUD 9.60 per share following release of first-half fiscal 2024 results. Operating segment pretax profits of AUD 116 million fell 8% from the prior comparable period, or pcp, which was slightly worse than we expected. This negative was offset by a reduction in the size of fund investments, which we had forecast to deliver returns below Magellan’s 9% cost of capital. Shares have rerated close to our fair value estimate and are now close to fairly valued.

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