Netwealth (ASX:NWL) share price jumps 10% following record quarter

Record-breaking inflows have shone a light on Netwealth shares today…

| More on:
A group of happy office workers throw papers in the air and cheer.

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 Netwealth Group Ltd (ASX: NWL) share price is pushing higher on Thursday. This follows the financial management software company's September quarterly update.

At present, shares in Netwealth are swapping hands at $15.80, a 10.57% increase.

What's lifting the Netwealth share price today?

In an announcement released this morning, Netwealth has surpassed all previous quarterly funds under administration (FUA), setting a record in the September quarter.

At 30 September 2021, the company held $52 billion in FUA, representing an increase of 10.2% for the quarter. Notably, this indicates a significant 52.7% increase compared to the prior corresponding period.

Meanwhile, the funds under management (FUM) portion of the business also experienced reasonable growth in the latest quarter. Specifically, FUM at the end of the period stood at $12.6 billion, increasing 56.9% from the prior corresponding period. The distinct surge in funds has investors bidding up the Netwealth share price today.

However, the fastest-growing segment was Netwealth's managed account balance. At the end of September, managed accounts totalled $10.7 billion, increasing 63.6% from the prior corresponding period.

As a result, the financial platform has retained its spot as the sixth largest and fastest-growing platform provider by net funds flows in Australia. Currently, the company holds a market share of 4.9%, while Macquarie (in the fifth spot) holds an 11.2% market share.

Outlook

Shifting our gaze to the future of the company, Netwealth shared a positive outlook for its market potential. This is thanks to the ongoing structural changes within the financial services industry.

Consequently, the company believes this will support further increases in its addressable market and growth opportunities. Building on that, Netwealth mentioned its pipeline for new business remains very strong across all market segments.

Finally, as a result of the stellar record net inflows in the September quarter, the company has upgraded its FUA net inflow guidance for FY2022. Now Netwealth forecasts FUA net inflows of $12.5 billion for the financial year, as opposed to its previous $10 billion guidance.

Despite these achievements, the Netwealth share price is still down approximately 20% over the past year.

Motley Fool contributor Mitchell Lawler 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 Netwealth. The Motley Fool Australia owns shares of and has recommended Netwealth. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Financial Shares

A woman sits at her computer with her chin resting on her hand as she contemplates her next potential investment.
Financial Shares

2 rising ASX financial shares with 'meaningful upside' still left: fundie

Financials outperformed every other sector in FY25, but there are still buying opportunities left, say these experts.

Read more »

Frustrated and shocked business woman reading bad news online from phone.
Financial Shares

Macquarie shares sink 5% on Q1 update

The investment bank is having a tough start to the year.

Read more »

A man holds his baby on his lap at the dining room table while he looks at his laptop screen earnestly.
Financial Shares

After its result, does Macquarie rate AMP shares a buy, hold or sell?

The financial services company released a strong second-quarter update on Monday.

Read more »

A blockchain investor sits at his desk with a laptop computer open and a phone checking information from a booklet in a home office setting.
Broker Notes

Are non-bank lenders a lucrative alternative to the big 4 banks?

The big 4 banks are widely perceived as being fully valued or overvalued.

Read more »

Red sell button on an Apple keyboard.
Financial Shares

ASX 200 financials was the best sector of FY25. But it's time to sell these 2 stocks, say experts

The ASX 200 financials sector gave investors a near-30% total return in the 2025 financial year.

Read more »

Happy woman working on a laptop.
Financial Shares

AMP share price jumps on strong Q2 update

Let's see what the financial services company reported for the quarter.

Read more »

A woman holds up hands to compare two things with question marks above her hands.
Financial Shares

The pros and cons of buying IAG shares this month

Is this the right time to invest in the insurance giant?

Read more »

man analysing share price
Financial Shares

ASX 200 financial services rivalry: Should I buy Hub24 or Netwealth shares?

Let's compare the pair.

Read more »