HMC Capital announced an upgrade to FY24 guidance from 'no less than 33c' to 40c pre-tax EPS on the back of higher performance fees and better unrealised investment gains for HMC Capital Partners (HMCCP), notes the analyst at Morgan Stanley.

The new positions disclosed by the fund include a 40% stake in Sigma Healtcare ((SIG)), 24% in Lend Lease ((LLC)), 18% in Ingenia Communities ((INA)), 12% in Graincorp ((GNC)) and 7% undisclosed and cash.

Management also highlighted the strategic pathway to $20bn in funds under management compared to $7.8bn currently, including a $2bn new Energy Transition Fund and a doubling in HMCCP, as well as a $2bn private credit strategy.

The broker lifts FY24 EPS to 38.2c from 32.6c.

Equal Weight rating. Industry View: In-Line

The target is increased to $7.05 from $6.81. Equal-weight. Industry view: In-Line. 

Sector: Real Estate.

Target price is $7.05.Current Price is $6.90. Difference: $0.15 - (brackets indicate current price is over target). If HMC meets the Morgan Stanley target it will return approximately 2% (excluding dividends, fees and charges - negative figures indicate an expected loss).

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