Azzet reports on three ASX stocks with market-moving updates to share today.
AMP jumps after posting 2Q update
Shares in AMP (ASX: AMP) were up over 8% an hour out from the open this morning after the financial services company’s superannuation division posted its first positive net inflows since 2017, alongside strong platform growth and rising assets under management (AUM).
In today’s second quarter update AMP revealed a 63.2% jump in the platform's net cash flows over the previous period to $1.565 billion.
The market appears to have been equally impressed by Platforms' AUM, which increased 5.6% quarter on quarter to $83.2 billion.
Commenting on today’s update AMP's CEO Alexis George told the market that the standout performance in the platforms business reflected the strength of its platform proposition for advisers and their clients, supported by ongoing innovation – including our AI File Note tool and Lifetime retirement solutions.
“In our Superannuation business we've reached a significant milestone, delivering positive net cash flows for the quarter, for the first time since 2017,” said George.
This reflects our continued efforts to build a compelling member proposition which is delivering outstanding investment returns, service and education.”
To drive towards a sustainable positive cash flow position, management will continue its focus on member retention, including renewed investment to uplift its digital engagement, rolling out its digital advice offering, and the recent launch of AMP Lifetime Super to members.
But against this backdrop of this positive momentum, George also reminded the market that investment markets remain exposed to volatility and sustained competitive pressure.
Other 2Q FY highlights include:
- Managed Portfolio AUM is now $21.8 billion.
- Superannuation & Investments AUM was $58.5 billion, up slightly quarter-on-quarter.
- AMP Bank's total loan book was managed by value at $23.5 billion, up from $23.3 billion in the first quarter.
- AMP Bank's total deposits slipped to $20.5 billion, from $20.7 billion in the first quarter.
AMP’s share price has been recovering lost ground since falling from $1.78 late January to $1.04 early April and is now up 44% in one year and up 4.89% year to date.
AMP’s return to growth follows the rollout of its Lifetime Super product and a renewed focus on digital engagement and advice tools.
Wealth management has also gained momentum in NZ with improved flows into retirement and term deposit products contributing to $40 million in net inflows.
Early July Macquarie reaffirmed its outperform rating and lifted its price target on AMP's shares to $1.44 (from $1.34).
The broker noted that AMP currently trades at 11.7x 12-month forward P/E, or 16.6% below the three-year average of 14.1x. This translates into a 39% discount vs the ASX100 (compared with the three-year average discount of 10%).
While Citi has previously expressed concerns about AMP's net interest margin, the broker recently upgraded its rating to "buy" and the price target to $1.65.
AMP’s market cap is $4.2 billion; the share price is up around 14% in the last week.
The stock appears to be in a strong bullish trend confirmed by multiple indicators. Specifically, a 5-day moving average of the stock price is above the 20 and 50-day moving averages.
Consensus is Hold.
Tivan soars after revealing Japanese interest
Shares in Tivan Ltd (ASX: TVN) were up around 30% heading into lunch after the smallcap critical minerals company revealed that it had received Japanese government interest in supporting its future plans to miner and process fluorite – aka fluorspar - mineral form of calcium fluoride.
The market clearly responded favourably to Tivan’s involvement in the global push to build supply chains independent of China.
To the uninitiated, fluorite is the raw material for hydrofluoric acid used in chemical processes such as semiconductors and electric vehicle battery manufacturing, refrigerants and smelting in industries like aluminium.
Interestingly, fluorite is one of the rare earth elements (REE) that China does not dominate globally after the country’s supplies dwindled relative to its demand.
It’s understood that the Australian government’s decision to put fluorite on its critical minerals list at the end of 2023 helped to attract support from Japan’s big trading house, Sumitomo for Tivan’s proposed projects in WA and the Northern Territory.
While still in the feasibility and exploration phase of development Tivan has been able to jag a $7.5 million critical minerals grant from the Commonwealth government on the pretext that it has an international partner.
Now the Japanese Organisation for Metals and Energy Security is partnering with Sumitomo to invest a joint $11 million.
Assuming the project proceeds to its final investment decision next year, Sumitomo has the rights to 100% of production – planned to be 140,000 tonnes a year – in exchange for a further $50 million in funding from both partners.
As a result, the Japanese entity would end up with 22.5% of the company.
While Japan and an Australian family office are expected to contribute $50 million each to development costs, and an outstanding $150 million is expected to come from debt financing, and Australian government involvement.
Beyond Japan, potential customers for any future fluorite produced by Tivan could include India, followed by Taiwan, South Korea and possibly Japanese companies operating in China.
Tivan Ltd has a market cap of $228 million; the share price is up 96% in one year and up around 30% in the last week.
The stock’s shares appear to be in a near-term downtrend confirmed by its 20-day moving average.
Consensus does not cover this stock.
Insignia Financial slides after flagging takeover uncertainty
Shares in Insignia Financial (ASX: IFL) were trading over 6% lower at noon after the Australian wealth manager told the market there was no certainty that ongoing talks with $3.4 billion bidder CC Capital would lead to a formal takeover offer.
What the market was expecting mid-July was an update from CC Capital that financing and investment committee approvals were now complete.
However, while unconfirmed, it’s understood that CC Capital may have secured leveraged finance to fund its $5 a share bid.
CC Capital remains the only surviving bid offer on the table for Insignia after Bain withdrew its $5 bid after citing market uncertainty.
Prior to that a third bidder Brookfield bailed after refusing to budge on its offer of $4.60 per share valuation.
Following the withdrawal of Bain and Brookfield, Morningstar analyst Shaun Ler suspects there’s “equal probability” that the remaining Insignia takeover bid would succeed or fail.
“While we can’t rule it out, we think it’s less likely that Bain exited due to it identifying a fatal flaw in Insignia,” said Ler.
“We see the firm’s fundamentals improving, with better profitability from cost reductions, moderating net outflows and compounding of client flows.”
Meanwhile, Morningstar lowered Insignia’s fair value estimate from $5.00 in April to $4.45 noting that the firm should see slower fee compression, steadier fund flows, and scalable cost reductions going forward.
While Insignia’s share price peaked at $4.68 in March at the height of the bidding war, it fell to $3.98 after the market opened this morning.
Insignia Financial has a market cap of $2.6 billion; the share price is up 63% in one year and down 2.6% in the last week.
The stock appears to be in a strong bullish trend as confirmed by multiple indicators. Specifically, the 5-day moving average of the stock price is above the 50-day moving average.
Consensus is Moderate Buy.
This article does not constitute financial or product advice. You should consider independent advice before making financial decisions.
