Hub24's 1H underlying earnings (EBITDA) exceeded Morgans forecast by 10% driven by higher earnings on pooled cash. Platform revenue grew by 33% on the previous corresponding period, with funds under administation (FUA) increasing by 6%.

Management reaffirmed FUA guidance for FY23 and showed confidence in the potential for larger 'transition' deals to be executed to reach the FY24 target. The analyst forecasts FY24 FUA of $77.3bn, up from $55.8bn at the end of the 1H.

Morgans notes cost growth of around 25% half-on-half, which limits 2H Platform earnings growth.

The broker raises its FY23-25 forecasts by more than 10% and the target rises to $31.90 from $27.80. Add.

Sector: Diversified Financials.

Target price is $31.90.Current Price is $29.09. Difference: $2.81 - (brackets indicate current price is over target). If HUB meets the Morgans target it will return approximately 9% (excluding dividends, fees and charges - negative figures indicate an expected loss).

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