MM views on PDL

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Question asked 22/03/2021

MM views on PDL

“I was after your thoughts on. A former MM recommendation on PDL I’m interested at what would be a good entry level for when the UK starts to recover from COVID” - thanks Rob Vernon

Answer

Hi Rob,

Theoretically the former BT investor group Pendal Group (PDL) should be extremely well positioned to benefit from a COVID recovery in the UK, for those not familiar with PDL it currently has ~$100bn under management (FUM) while the company has a market cap of just over $2bn. Unfortunately even while FUM grew 5% in January the stock continues to drift lower.

Fundamentally we feel the stocks relatively good value plus a part franked dividend yield of almost 6% should be catching the eye of some dividend seekers but the stock continues to struggle i.e. remember don’t fight the tape. For that reason we’re neutral here at best around $6.20, if pressed we’d be a buyer nearer $5.50

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Pendal Group (PDL)

LAST UPDATED 22/03/2021 16:34

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