IntegraFin Holding (IHP)

Sector:

Financials

Index:

FTSE 250

295.50p
   
  • Change Today:
    -4.50p
  • 52 Week High: 305.20p
  • 52 Week Low: 211.60p
  • Currency: UK Pounds
  • Shares Issued: 331.32m
  • Volume: 287,068
  • Market Cap: £979.06m
  • RiskGrade: 134

RBC Capital upgrades Transact owner IntegraFin to 'outperform'

By Michele Maatouk

Date: Thursday 15 Feb 2024

LONDON (ShareCast) - (Sharecast News) - RBC Capital Markets upgraded Transact owner IntegraFin Holdings on Thursday to 'outperform' from 'sector perform' and lifted the price target to 330p from 280p.
The bank said that amid the shifting sands of the relatively new Consumer Duty regime, IntegraFin stands out as the best positioned UK platform.

"We see IHP as the business most compatible with the spirit of the Consumer Duty regulation that continues to be a source of uncertainty for the UK wealth sector," it said.

"This is evidenced by the group's customer-centric policy of passing on interest earned on client cash, as well as the long-term commitment to reducing client charges. As a result we see IHP as facing a fundamentally lower risk profile to earnings versus listed platform peers (Hargreaves Lansdown/ and AJ Bell) that have generated material revenues and profits from interest on client cash."

RBC said peers' earnings enhancements from this source are now baked fully into consensus estimates, while the reputation benefits to IHP are likely underappreciated, but should accrue over time, and underpin its confidence in future funds under direction growth prospects.

It noted that IntegraFin's revenues are predominantly from the adviser platform - Transact - which it increasingly feels is preferable to the D2C market, where higher marketing expenditure is increasingly a feature.

RBC also said that a return to growth makes now a good time to buy.

"A complication within the IHP investment case over the last 18 months has been the contraction in EPS expected over FY22-FY24. However, with market focus likely to shift to forward earnings multiples for FY25 we believe this issue will diminish over 2024, as we expect EPS and DPS growth to restore.

"In our view, issues that have held back profit progression are now mostly behind the company - e.g. we expect Time4Advice will inflect from loss to profit by FY25.

"Moreover, guidance around group cost development has improved markedly and the impacts of the elevated tech spend have now been fully digested, meaning operational leverage and margin expansion should return after FY24. We expect an EPS CAGR of 9% over FY24-FY26."

Finally, the bank said the current valuation screens as attractive relative to peers.

"We believe IHP's superior income composition, lower regulatory risk and preferable market exposure merit a premium rating versus closest peer AJ Bell," it said.

It said the stock's underperformance and de-rating year-to-date has been unwarranted, creating an attractive entry point.

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Note 1: Prices and trades are provided by Digital Look Corporate Solutions and are delayed by at least 15 minutes.

Note 2: RiskGrade figures are provided by RiskMetrics.

 

IHP Market Data

Currency UK Pounds
Share Price 295.50p
Change Today -4.50p
% Change -1.50 %
52 Week High 305.20p
52 Week Low 211.60p
Volume 287,068
Shares Issued 331.32m
Market Cap £979.06m
RiskGrade 134

IHP Star Ratings

Compare performance with the sector and the market.
more star ratings
Key: vs Market vs Sector
Value
91.29% below the market average91.29% below the market average91.29% below the market average91.29% below the market average91.29% below the market average
96.26% below the sector average96.26% below the sector average96.26% below the sector average96.26% below the sector average96.26% below the sector average
Price Trend
48.74% above the market average48.74% above the market average48.74% above the market average48.74% above the market average48.74% above the market average
36.21% above the sector average36.21% above the sector average36.21% above the sector average36.21% above the sector average36.21% above the sector average
Income
2.76% below the market average2.76% below the market average2.76% below the market average2.76% below the market average2.76% below the market average
72.73% below the sector average72.73% below the sector average72.73% below the sector average72.73% below the sector average72.73% below the sector average
Growth
11.63% above the market average11.63% above the market average11.63% above the market average11.63% above the market average11.63% above the market average
29.63% above the sector average29.63% above the sector average29.63% above the sector average29.63% above the sector average29.63% above the sector average

What The Brokers Say

Strong Buy 3
Buy 2
Neutral 6
Sell 0
Strong Sell 0
Total 11
buy
Broker recommendations should not be taken as investment advice, and are provided by the authorised brokers listed on this page.

IHP Dividends

  Latest Previous
  2nd Interim 1st Interim
Ex-Div 21-Dec-23 08-Jun-23
Paid 26-Jan-24 30-Jun-23
Amount 7.00p 3.20p

Trades for 24-Apr-2024

Time Volume / Share Price
16:35 125,990 @ 295.50p
16:35 942 @ 295.50p
16:35 616 @ 295.50p
16:35 426 @ 295.50p
16:35 431 @ 295.50p

IHP Key Personnel

CEO Alexander Scott
Chair Richard Cranfield
CFO Euan Marshall

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