Is Regal Partners Limited (RPL) worth a punt?
Hi guys, The RPL share price is seeing all time lows, is it worth a punt in your expert opinion?
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Answer
Hi Brian,
The alternate fund manager is trading down ~30% from recent highs set in January which presents strong value for a few reasons in our opinion.
- They have grown FUM by nearly $900m in the first 9-months of FY23, on track to exceed their $1b target for the year.
- They have launched a number of new strategies which, historically, leads to strong early inflows.
- Performance has been strong and we expect performance fees to follow suit.
- The outlook for their alternate and active investments strategies is positive with both additional interest in the space and Regal’s ability to add alpha, further increasing management fees.
- They have plenty of cash on their balance sheet which supports the potential for M&A or capital returns
Overall, we like Regal and expect conditions to support their strategy. This does rely on a solid FUM update due out next week, and subsequent earnings report next month, as they are on a high valuation based on their current FUM relative to other managers.
