Why the Praemium (ASX:PPS) share price is rocketing 21% higher today

This fintech company's shares are rising strongly today…

| More on:
man on phone researching Fintech reports

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Praemium Ltd (ASX: PPS) share price is rocketing higher on Wednesday.

In morning trade, the investment platform provider's shares are up 21% to a multi-year high of $1.18.

Why is the Praemium share price rocketing higher?

The catalyst for the rise in the Praemium share price on Wednesday has been the release of a couple of announcements.

According to the first announcement, Praemium has finalised the strategic review of its international operations. This review has recommended the divestment of the business through a formal sale process. The Praemium Board has met and supports this recommendation.

The release notes that the proposed divestment will allow Praemium to focus its financial and leadership resources on further accelerating its growth trajectory in the Australian platform market.

Praemium also revealed that it has received unsolicited, strong interest from potential buyers. Deloitte Corporate Finance has been appointed to manage the sale process.

Quarterly update

Also giving the Praemium share price a lift was its quarterly update which revealed further strong grow inflows.

According to the release, Praemium achieved record quarterly inflows of $1.2 billion for the quarter. This took its funds under administration (FUA) to a record of $41.7 billion.

This comprises Australian platform FUA of $18.4 billion (up 223% year on year), International platform FUA of $5 billion (up 55%), and VMAAS FUA of $18.3 billion (up 61%). The former was boosted by the acquisition of Powerwrap during the financial year.

Praemium's Interim CEO, Anthony Wamsteker, was very pleased with the quarter.

He said: "We are delighted to report strong and continuing momentum in net flows this quarter. For the Australia business, it is pleasing to see a strong end to the financial year. Our platform inflows achieved a new record, with the combination of Praemium and Powerwrap platforms delivering strong results. Our noncustody solution (VMAAS) also reached a record level of FUA, as advice firms continue to seek outsourced administration for their off-platform assets."

"The International business had a standout quarter, with record inflows and FUA exceeding $5 billion for the first time. We continue to execute on our on-boarding of new clients and opportunities," he added.

The Praemium share price is up 97% since the start of the year following today's gain.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and has recommended Praemium Limited. The Motley Fool Australia has recommended Praemium Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Gainers

Young girl drinking milk showing off muscles.
Share Gainers

Here are the top 10 ASX 200 shares today

It was a great end to the trading week for ASX investors today.

Read more »

A man sits thoughtfully on the couch with a laptop on his lap.
Share Gainers

3 ASX 200 stocks smashing the benchmark this week

These three ASX 200 stocks are leading the charge this week. Here’s how.

Read more »

A young woman holding her phone smiles broadly and looks excited, after receiving good news.
Share Gainers

Why A2 Milk, EOS, GQG, and Mineral Resources shares are racing higher today

These shares are ending the week strongly. But why?

Read more »

A man wearing a red jacket and mountain hiking clothes stands at the top of a mountain peak and looks out over countless mountain ranges.
Share Gainers

Here are the top 10 ASX 200 shares today

It was another disappointing day for ASX investors this Thursday.

Read more »

two men smiling with a laptop in front of them, symbolising a rising share price.
Share Gainers

Why Pinnacle, PWR, Race Oncology, and Vulcan shares are flying today

These shares are having a good session on Thursday. But why?

Read more »

A beautiful woman holds up one finger with one hand and has her hand on her waist with the other as she smiles widely as though she is very pleased about something.
Share Gainers

Why Boss Energy, Emeco, Mineral Resources, and Plenti shares are pushing higher today

These shares are having a good time on hump day. But why?

Read more »

Three small children reach up to hold a toy rocket high above their heads in a green field with a blue sky above them.
Share Gainers

3 ASX 300 shares going gangbusters on Wednesday

Investors are bidding up these three ASX 300 shares today. But why?

Read more »

Man raising both his arms in the air with a piggy bank on his lap, symbolising a record high.
Share Gainers

Here are the top 10 ASX 200 shares today

It was a huge Tuesday for ASX shares, with the index resetting its record high.

Read more »