FY22 profit and dividend up 13%, fundamental value rises

In July we highlighted how net FUM inflows in FY22 (+£785m), were a sign of strategic strength, and emphasised the impressiveness of Q3 and Q4 flows (+£179m and +£280m) during a period of sharp market falls, which often correlates with weakening flows for investment managers. Today, with more peer data available, we re-emphasise this, and highlight that BM has been one of the strongest performers in attracting and retaining client funds.

Also, with the release of FY22 results, BM has demonstrated that it can translate this strategic strength into financial success, with revenue, profit, profit margins, and dividends all up, despite top-line FUM being pegged back by market falls (FY21: £16.5bn; FY22: £15.7bn).

These factors, coupled with an upwards mark-to-market FUM adjustment (PIMFA Private Investor Balanced Index +2.4% quarter-to-date) lead us to increase our medium-term growth forecasts and consequently our fundamental value to 3,100p (from 2,900p), 41% above the current share price. We also highlight that BM’s PER of 14.8 is well below a peer group median of 18.6.