November was a rollercoaster month for the AMP (ASX:AMP) share price. Here's why

What's happened to the company's shares last month?

| More on:
A man in a business suit scratches his head looking at a graph that started high then dips, then starts to go up again like a rollercoaster.

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 AMP Ltd (ASX: AMP) share price continued its downward trend last month, falling to a low of 97 cents. Investors dumped the financial services company's shares following a busy month of announcements from the company.

For the month of November, the AMP share price recorded a loss of around 4.17%.

In comparison, the S&P/ASX 200 Index (ASX: XJO) also ended November in the red, shedding 1.56% over the same timeframe.

At market close on Tuesday, AMP shares finished flat for the day at 92 cents apiece. It's worth noting the company's share price is nearing its multi-decade low of 88.5 cents reached in September.

What's happened to AMP recently?

Last month, AMP provided an update regarding its planned demerger for AMP Limited and AMP Capital's Private Markets business (PrivateMarketsCo).

The company noted that it is making strong progress on the operational separation of PrivateMarketsCo. The demerger is expected to occur during the first half of 2022.

Furthermore, AMP advised that a clear perimeter has been set with the agreed sale of the Global Equities and Fixed Income (GEFI) business. This will see the transfer of the Multi-Asset Group (MAG) to AMP Limited.

Creating a more simplified company is expected to improve efficiency, as both businesses operate in very different markets. The demerger will enable AMP to accelerate the growth strategies for each and focus on servicing the diverse customer base.

On the back of the release, investors pushed up the AMP share price by 3% to $1.035 on the day. However, this was short-lived as the company's shares fell by 10% over the following two days.

Investment house Macquarie believes AMP shares are trading at attractive levels. While cutting its outlook by 1.8% to $1.10, the broker still sees value in the company.

Swiss investment bank UBS had a different approach though, reducing its rating by a sizeable 21% to 90 cents. UBS also downgraded its view to "sell" from the previous "neutral" stance. The broker appears reserved on AMP demerger plans. It believes the company won't unlock any near-term value for shareholders.

It appears investors are taking on UBS's advice, leaving the company's shares to hover around the 90-cent mark.

AMP share price snapshot

Over the last 12 months, the AMP share price has moved almost 50% lower with year-to-date down by more than 40%.

On the other hand, the S&P/ASX 200 Financials Index (ASX: XFJ) has gained 15% from this time last year and is up 18% year-to-date. The sector also registered a 52-week high of 6,956.4 points in late October.

Undoubtedly, AMP shares are lagging the Financial Index which has continued to accelerate since March 2020.

On valuation grounds, AMP presides a market capitalisation of roughly $3 billion, and has approximately 3.27 billion shares outstanding.

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. 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

young woman reviewing financial reports at desk with multiple computer screens
Opinions

Brokers' verdict on 4 popular ASX 200 financial stocks

Financials outperformed every other sector in FY25. What should you do now with these 4 stocks?

Read more »

a man in a business suit sits at his laptop computer at his desk and smiles broadly in an office setting, giving an air of optimism and confidence.
Dividend Investing

Up 25% since April, are Macquarie shares still a good buy for passive income?

A leading expert gives his verdict on Macquarie shares and the passive income on offer.

Read more »

A green-caped superhero reveals their identity with a big dollar sign on their chest.
Financial Shares

Own Soul Patts shares? Here's its latest investment for diversification

The company has added further energy exposure to its portfolio.

Read more »

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 »