HMC Capital experienced a significant rebound on Wednesday, with shares surging nearly 17 per cent after Morgans upgraded its recommendation to a “buy”. This follows a substantial loss on Tuesday. At midday, shares in HMC Capital had soared 16.5 per cent to $3.81, reducing year-to-date losses to just under 60 per cent.
The surge comes after a 6.6 per cent drop on Tuesday, when HMC Capital announced to investors that it anticipates pre-tax earnings of at least 40¢ per share this year. This figure is below the 56¢ per share reported in the 2023 financial year. HMC Capital is an alternative investment manager focused on real estate, private equity, and other alternative assets. The company aims to deliver attractive risk-adjusted returns for its investors through active management and strategic asset allocation.
David Di Pilla’s HMC Capital acknowledged potential obstacles in achieving its ambitious target of $50 billion in assets under management. The company also indicated weaker earnings in the coming year, which initially led to a sharp decline in share value. However, the Morgans upgrade appears to have restored investor confidence, driving the stock upward and offsetting some of the recent losses.
The upgrade by Morgans signals a potential shift in sentiment towards HMC Capital, despite the acknowledged challenges in meeting its financial targets. Investors will be closely watching the company’s performance in the coming months to see if it can sustain this upward momentum and deliver on its revised earnings expectations.
