Morgan Stanley believes Platinum Asset Management faces the greatest de-rating risk as flows deteriorate. The stock is also trading at a high PE ratio of 21x on the broker’s forecasts.
The company’s active ETFs show flows have stagnated in January and there was no recovery in February, despite this being a fresh channel with few natural gross outflows.
The company has indicated there are no meaningful performance fees in FY19 and the broker suspects this will be the case in FY20 as well.
The broker maintains an Underweight rating and In-Line industry view. Target is reduced to $3.40 from $3.50.
Sector: Diversified Financials.
Target price is $3.40.Current Price is $5.04. Difference: ($1.64) – (brackets indicate current price is over target). If PTM meets the Morgan Stanley target it will return approximately -48% (excluding dividends, fees and charges – negative figures indicate an expected loss).