Wee piece in the AFR "Tech stocks the fund managers like" a snip...

Wee piece in the AFR

"Tech stocks the fund managers like"

a snip

"Hub 24 and Netwealth Group
Pengana Emerging Companies Fund lowered its weighting in Altium and WiseTech as prices rallied and took a bullish view on financial technology stocks. Investment management platforms Hub24 and Netwealth are Pengana's preferred plays.
Fund co-manager Steve Black says Hub24 and Netwealth are among the few winners from the banking and financial services royal commission. "The push towards independent financial advice will quicken following the royal commission. More advisers will use online platforms such as Hub24 and Netwealth that provide a range of investment products and services and help financial advisers grow their business."
Both stocks have soared this year. Netwealth (co-founded by Matt Heine and his father Michael Heine) has more than doubled its $3.70 issue price since its November 2017 float as its funds under advice expand. Netwealth and Hub24 together are attracting about 30 per cent of all new net fund flows into investment platforms in Australia.
Black says: "On our modelling, Hub24 could grow from a current market share of less than 1 per cent for funds under advice through investment platforms, to 5 per cent by 2025. That implies it will have $40 billion of funds under advice by 2025, which makes Hub24 look undervalued at the current price, taking a long-term view. But you need high conviction that Hub24 will continue to grow its market share rapidly."
Black adds: "Hub24's operating leverage is enormous. Like other online businesses, most of the investment is expensed upfront when the platform is built. The marginal cost of adding new advisers to the platform is small and the business is highly scalable. Rapid growth in funds under advice and revenues should translate to rapid profit growth."

should be free view

https://t.co/uJW23nXs43