Jefferies hikes Pensionbee target, expects rally to continue
Jefferies has hiked its target price for
The broker lifted its target for the shares from 107p to 172 and kept a 'buy' rating on the stock.
Assets under administration (AUA) came in ahead of forecasts in the first quarter, both on flows and market movement. "Costs were below our expectations too: marketing, money management and staff costs were all lower than we expected. Both higher AUA and lower costs have positive effects on our earnings forecasts," Jefferies said.
The broker now expects Pensionbee to swing into the black this year, forecasting a adjusted EBITDA of £0.4m, compared with previous projections of a £3.4m loss. What's more, Jefferies said its forecasts "remain quite conservative".
"Perhaps the biggest upside scenario is fast progress in the USA though. Pension funds there have assets of c.$27tn, or c.15x the size of the UK market [...] With support from their US-based partner, we expect little marketing cost drag from the expansion in America, and therefore a positive contribution should come quite soon," the broker said.
However, without detailed guidance and goals from the company, Jefferies has not made specific assumptions for the US business yet.
Pensionbee shares were down 0.6% at 137.12p on Friday morning, having surged by 25% over the past month and 47% since the start of the year.
Disclaimer & Declaration of Interest
The information, investment views and recommendations in this article are provided for general information purposes only. Nothing in this article should be construed as a solicitation to buy or sell any financial product relating to any companies under discussion or to engage in or refrain from doing so or engaging in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the writer but no responsibility is accepted for actions based on such opinions or comments. Vox Markets may receive payment from companies mentioned for enhanced profiling or publication presence. The writer may or may not hold investments in the companies under discussion.