Shares of diversified wealth manager, AMP Limited (ASX: AMP), drifted 0.8% lower today on the back of a first quarter update this morning.
In a statement to the ASX covering the three-month period to 31 March 2015, AMP reported falling cash flows but a rise in assets under management (AUM).
AMP said an increase in cash outflows on external platforms saw its net cashflows drop 6% to $342 million during its first quarter, from $363 million a year earlier. However, cashflows from retail customers jumped 10% to $661 million.
Meanwhile positive market movements helped the company drive AUM to $116.1 billion, up 6% from the previous quarter.
"Cashflows across the business are encouraging, particularly in our contemporary products such as our North wrap platform, which is attracting good external flows," AMP CEO Craig Meller said. "Our focus on Asia continues to deliver results and the insurance business remains in line with guidance."
Is it time to buy AMP Limited shares?
With shares of AMP trading at near 22 times 2014's profit per share, its little wonder investors sold down the stock on the mixed results. Although analysts continue to forecast robust profit and dividend growth in the near-term; I think it looks fairly valued at today's prices.
Personally, I prefer to buy stocks leveraged to the market cycle – think AMP, Macquarie Group Ltd (ASX: MQG) and Platinum Asset Management Limited (ASX: PTM) – when sharemarkets are trading well below their historical averages. Given we're above our historical average and the economy is facing headwinds, I'd prefer to watch these stocks from the sideline and wait for a more compelling entry price.
