Stronger, albeit largely cyclical, cost inflation

The third-quarter results and the management’s updated guidance showed stronger-than-expected cost inflation. However, this inflation does not reflect a deterioration in efficiency as it is largely related to performance-related pay.

Recovery in profitability unlikely to calm down Ping An

The group posted a stronger-than-expected set of results driven by unexpected ongoing net interest margin widening and stronger non-interest income resilience. The RoTE upgrade comes with little surprise as new guidance is already largely factored in consensus expectations. The prolonged buy-back sends a positive signal but is unlikely to reduce Ping An’s pressure as the geopolitical risk remains intact.

UK Banks - Strong performance continues

Not enough for Ping An

The quarter enjoyed strong FICC revenues and benign asset quality trends, making the RoTE target easy to achieve this year. On the other hand, the company also confirmed that interest rate tailwinds are behind us – hence no upgrade to the short-term profitability target. Ping An immediately stated that it was not impressed by the results.

SHORE CAPITAL - Initial Trading Comments - 13 March 2023

Management more cautious than consensus

The fourth quarter results came in above expectations, driven by stronger revenues and tax gains. On the other hand, the upgraded 2023 RoTE guidance not only does not come as a surprise but stands below consensus expectations, due to higher-than-expected cost inflation. We are not in the same position as we set (too) cautious forecasts.

Ongoing Asian refocusing

The disposal of the Canadian operations makes sense not only from an industrial and a financial standpoint, but also geopolitically. The divestment and the likely reinvestment of a portion of the proceeds in Asia will please Ping An, even if it does not meet its request of making the Chinese operations Western-sanctions proof.

Downgraded 2023 guidance

The group posted a strong set of quarterly results, in line with the consensus’ full-year guidance. However, the management’s updated guidance stands below the consensus expectations, driven by the USD appreciation and, above all, cost inflation and a higher cost of risk.

Canada’s disposal will not solve the governance issue

We see the potential sale of the group’s Canadian operations as business as usual, not as a move aimed to reducing Ping An’s pressure for a separate listing of the Asian business.

Upgraded RoTE objective

The second quarter results were not that impressive in our view. However, the management’s upgraded RoTE objective signals a strong profitability improvement ahead, driven by rising yields.

HSBC’s largest shareholder supports a spinoff

The revival of the spinoff of the group’s Asian operations makes little sense from an investor standpoint in our view. On the other hand, it could make sense to prepare for the potential implications of the emergence of a bipolar world.

More confident about achieving the 2023 objectives

The group posted a reassuring set of results. Management’s reiterated guidance for both 2022 and 2023 confirms that, if central banks do not overreact, inflation will create a supportive environment making the 2023 financial objectives easier to achieve.

LIBERUM: Plus500: Strategic progress pays dividends

Tatton Asset Management (TAM LN) - Record net inflows

Tatton, the leading on-platform discretionary fund manager (DFM) and IFA support services Group has released a trading update ahead of its results to 31 March 2024, due on 18 June 2024.

Hardman & Co Insight: 2023 was an annus horribilis for Quoted UK Infrastructure and Renewable Energy

The focus of Hardman & Co Research is on the nine quoted Infrastructure Investment Companies (IICs) and on the 22 Renewable Energy Infrastructure Funds (REIFs): the stocks analysed are all members of the Association of Investment Companies (AIC). We are updating our publication of January 2023, assessing both the lacklustre share price performances during 2023 and the key issues, including interest rates, inflation and power prices. As a 31-strong group, its combined market capitalisation is no

Ondo InsurTech FY24 Trading Update

Ondo InsurTech has released a brief post-YE update revealing its good progress continued through 2H24 and consequently FY24 will be in line with market expectations.

BlackRock World Mining

BRWM’s managers: we see all the classic signs of high commodity prices...

NextEnergy Solar Fund - Attractive Refinancing

The refinancing of a £135m revolving credit facility and the extension of a similar £70m facility gives NESF firepower as development opportunities for new solar are especially attractive thanks to lower module prices in Europe. They give the fund key financial flexibility at a critical time as it pursues its capital recycling programme.

The Hardman & Co Monthly: April 2024

Feature article: Steady as she goes, but could be better: A review of investment company liquidity since 2016 Liquidity is the lifeblood of equity markets. The measurement of liquid asset availability to a market or company is a way of gauging a market’s health. This article builds on our previous work, which analysed the liquidity data for non-financial trading companies, by applying the same analytical techniques to the investment companies (IC) space. We analyse liquidity for ICs as a whol

Initial Equity Trading Comments - 19 February 2024

M Winkworth+ (WINK, House Stock at 163p) - Solid FY23A results, well placed to grow

Resilient FY24, confident long-term outlook

Vp’s full year update highlights sector-leading results, once again benefiting from the diversity of its end markets and the quality of its specialist businesses. With results expected to be broadly in line with expectations, we trim our FY24 PBT forecast by c.5% to £39.0m, a shade below the FY23 outturn (£40.2m). We consider this an impressively resilient performance set against a mixed market backdrop. Under new leadership, a strategic refresh is underway and management is confident in long

Hybridan Small Cap Feast - 16/04/2024

16th April 2024 * A corporate client of Hybridan LLP ** Arranged by type of listing and date of announcement *** Alphabetically arranged **** Potential means Intention to Float (ITF) has been announced Dish of the day Admissions: Delistings: What’s baking in the oven? ** Potential**** Initial Public Offerings: Reverse Takeovers: Electric Guitar (ELEG.L) Concurrent with its Admission to trading on AIM, Electric Guitar is proposing to acquire the entire issued share capital of 3radical Limited for

NextEnergy Solar Fund – High- and growing-income opportunity?

NextEnergy Solar Fund (NESF) is almost 10 years old. Since launch, it has built a £1.2bn, 933MW portfolio of 100 operating solar assets, powering the equivalent of over 330,000 homes, declared dividends totalling £333m, and avoided the emission of about 2.2 Mt CO2e. NESF is on track to pay 8.35p in dividends, with forecast dividend cover of about 1.3x. Share price weakness that has afflicted the whole sector means that dividend translates to a yield of 11.1%, one of the highest in its sector, a

Jupiter Green

JGC’s fundamental story continues to show resilience, but the discount remains wide…

Hybridan Research: Sector Review: Artificial intelligence in UK cybersecurity: the human uplift 17/04/2024

Artificial intelligence (AI) is a double-edged sword in cybersecurity. Whilst new AI models, architectures, and innovations are emerging to protect the security posture of organisations, attackers are also benefiting from deepfakes, sophisticated phishing, and automation of malicious codes. To ensure the impact of AI on cybersecurity to be a net-positive, we need to pit good AI against bad AI. Point solutions enhanced with machine learning: Global cybersecurity has been built with point soluti

AUM up 30% in FY24, record flows, forecasts raised

AUM jumped £3.8bn or +30% in FY24, reaching £16.6bn on 31 Mar 24, 12% above our previous forecast of £14.7bn. Including 50%-owned 8AM Global, Assets Under Influence hit £17.6bn. Investment performance provided a tailwind, adding £1.5bn to AUM. But our key takeaway from Tatton’s hugely impressive last few years, is that it has designed and implemented a superior offering in platform-MPS with net flows consistently far higher than peers. That leadership looks even more pronounced in H2-24 with net