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Comparision between NWL and HUB

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Question asked 21/03/2025

Comparision between NWL and HUB

Hey James and Team Many thanks for your insights and ongoing commentary Both these stocks are on my watchlist, with similarly strong performance but well off their recent highs NWL is larger in terms of market cap and appears slightly cheaper in terms of a PE Ratio ( albeit both are high ) With the market sell off , both are trading below the 50 MA but above the 200 MA I notice that MM has recently bought HUB You have obviously got preference for HUB Are you able to tell me the reason(s) Many thanks General Advice only

Answer

Hi David,

Thanks for your kind words.

We prefer Hub24 (HUB) over Netwealth (NWL) for a few reasons though we are broadly positive on the platform space overall given the structural tailwinds – Superannuation Guarantee flows, perpetually rising asset prices as well as the industry trend of adviser migration to platforms, utilising technology i.e managed account solutions, to scale advice practices.

Our key reasons for liking HUB are growth, valuation, management & user experience.

Growth: Earnings and revenue expected to grow quicker than NWL between FY24-27 – HUB revenue growth around 43% pa versus NWL at 21% pa. Net inflows for the Dec-24 quarter were $9.5bn for HUB vs. $4.5bn for NWL.
Valuation: NWL inches out HUB on valuation but only ever so slightly – on a like-for-like PE now and going out a few years both businesses track more or less the same. On consensus numbers, HUB is on 49x FY26e vs. NWL at 48x. Given the better growth outlook, the valuation edge by NWL isn’t significant.
Management: HUB have a more aggressive commercial model which they have continued to execute on.
User experience: We prefer the HUB platform, it is more user friendly, and has consistently been voted “Best Platform Overall” and “Best Managed Account Functionality” in Investment Trends Platform Competitive Analysis and Benchmarking Report – a ranking it has received 8 out of the last 9 years.

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HUB24 (HUB)

LAST UPDATED 21/03/2025 15:19

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