HUB fell -3.5% yesterday not helped by a weak market and rumours that Netwealth (NWL) make take another look at Praemium (PPS), why not its takeover target has fallen over 60% since late 2021. History tells us that speculation, a bit like takeover bids over the last 12 months often comes to nothing and at MM we would rather focus our attention on the prospects of HUB which we own in our Flagship Growth Portfolio.
We like this quality investor platform provider HUB as it continues to grow FUA faster than the opposition while expanding margins in the process which makes it our clear sector pick but as has been the dominant theme over the last 6-months what’s the fair value for this tech correlated growth company which continues to grow at a double-digit rate e.g. the 1st three months of 2022 saw inflows of $2.6bn, up over 36% year on year. MM believes it needs to keep growing to justify today’s price but it should and $30 is very realistic in a calm market that will one day stop hating high valuation names.
Selling was probably also triggered yesterday as HUB broke its 12-month low, if this follows through over the coming weeks/months MM will consider averaging our position under $18.
MM is keen on HUB under $18
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