Since announcing its third quarter cash flows, assets under management (AUM) and Australian wealth protection update last Friday, AMP Limited's (ASX: AMP) share price has gained over 6%. The stock is now trading at $5.70, which is just 4.3% from the 52-week high set back in August.
CEO Craig Meller in discussing the quarterly results stated that: "This continues our solid momentum across the business. Our current range of products are performing well, the focus on Asia continues to deliver results and the performance of our insurance business is in line with guidance."
Judging by the share price rally it would appear that the market was impressed by the report and agreed with Meller's view on performance; here are some of the key takeaways.
Highlights
Australian Wealth Management enjoyed net cashflows for the quarter of $476 million which was double the rate achieved in the previous corresponding period and took total AUM to $105.2 billion.
AMP Self-Managed Super Funds (SMSF) increased assets under administration by $572 million to $18.5 billion.
AMP Capital ended the quarter with AUM up 0.7% to $145.4 billion.
AMP Bank grew its mortgage book by 1.4% to $14.2 billion.
Australian Wealth Protection grew in-force premiums by 6.2% to $1.9 billion. Management noted that the division's claims experience continued to perform ahead of best estimate assumptions.
Buy, Hold, or Sell?
The time to buy AMP was back at the point of maximum pessimism when the stock was trading in the low $4 range. Back then investors were so focussed and concerned about the problems occurring within the wealth protection division that they failed to give fair weighting to the rest of AMP's businesses.
With the stock now trading on a forecast price-to-earnings ratio and yield of 16.4x and 4.5% respectively, it looks more like a hold than anything else.
