AMP half-year earns lift in Morningstar fair value | Australian Markets
Research and scores home, Morningstar has been sufficiently impressed by AMP Limited’s half-year outcomes that it has lifted its fair value estimate for the company by 3% to $1.50 per share.
In an analyst report issued on Friday, Morningstar mentioned its actions had been influenced by raising web curiosity margin (NIM) projections for AMP Bank and efforts to cut back funding prices however famous that the market “is underestimating competition risks”.
“We believe fund growth will revert to more moderate levels due to competition. Tariff uncertainty may also resume, halting the recent relief market rally, which we think propelled recent flows. Rising pension payouts as AMP’s investor base ages could also counteract flow improvements in the long term,” Morningstar senior analyst, Shaun Ler mentioned.
The evaluation additionally mentioned future margin growth is more likely to be constrained. AMP Bank’s NIM trails the foremost banks, which get pleasure from a price benefit. Greater uptake of lower-priced platform merchandise additionally contributes to this dynamic. Management additionally mentioned incremental investments are needed to grow more promising merchandise like North,” he mentioned.
“Given intense competitors in the platforms space, AMP is specializing in offering retirement-income centric merchandise by way of its platforms, whereas introducing digital advice instruments.
“We expect these initiatives to prevent further erosion in its competitive standing, evidenced by improved flow trends and active adviser numbers. However, we don’t expect these measures to help AMP regain lost share from specialty platforms like Hub24 and Netwealth,” Ler’s evaluation mentioned.
“Competing retirement income operators such as Challenger have similarly partnered with other platforms to offer their solutions. AMP’s proportion of inflows from transfers/rollovers—usually from another legacy or competing product—stands at 69% as of June 2025, below the peak of 74% in September 2023.”
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