Netwealth Group's (ASX:NWL) continued strength in gross activity supports management's fiscal 2027 inflow target, Jefferies said in a Friday note.
The company's fiscal fourth quarter result was "encouraging," with funds under administration up 19% year over year and MA funds under administration jumping 30%. Its funds under administration net flows were AU$3.2 billion, slightly below consensus at AU$3.4 billion.
Custodial funds under administration reached AU$134.3 billion, up 20% on the prior corresponding period, although fee-paying custodial funds under administration declined 90 basis points year over year to more than 59%. Consequently, the revenue benefit from the market recovery will be diluted by tiered administration fees and fee caps.
Jefferies retained its buy rating and a price target of AU$30.25 on Netwealth.
Netwealth Group's shares added about 1% in recent Friday trade.