MW has reported a y-o-y revenue increase of 3% for FY23 ending on 31 May 23 (FY22: £108.2m). While this is slightly under our previous estimated growth rate of 4%, the group has reported profits in line with market consensus (adjusted EBITDA of £33.0m) with that consensus being slightly higher than our previous forecast of £32.5m. The cash position remains strong at £45m (31 May 22: £54m), despite £7.2m of cash outlay on acquisitions.
Client assets closed on £15.3bn, up £0.4bn (3%) y-o-y (31 May 22: £14.9bn). While £0.6bn was added through the acquisition of Doherty Pension and Investment Consultancy (Doherty), a -£0.2bn (-1%) impact from market movements, investment performance and net client flows is unsurprising considering the PIMFA Private Investor Balanced Index (net) fell 2.0% over the year.
Our fundamental valuation reduces slightly from 925p to 900p as a result of lowered revenue forecasts, but still remains 45% above the last closing share price. We also highlight that MW’s PER of 13.0 is 20% below a peer group median of 16.2
