Last Update17 Oct 25
AGF Management’s analyst price target has moved higher, as analysts point to updated ratings and recent price target increases from C$14 up to C$17.75. These changes support a more constructive outlook for the shares.
Analyst Commentary
Recent analyst updates reflect a mixed but mostly constructive outlook on AGF Management, with several firms adjusting their price targets upwards while maintaining varied views on overall performance potential. These updates offer insight into both the opportunities and challenges facing the company.
Bullish Takeaways
- Bullish analysts have increased their target prices, signaling improved confidence in AGF Management's growth prospects and recent execution.
- Price target increases up to C$17.75 suggest that analysts expect continued momentum in the company's business fundamentals and earnings potential.
- Positive ratings such as Buy indicate that some analysts view valuation as favorable relative to expected financial performance.
- An ongoing upward trend in price targets points to optimism about AGF's position in the market and management's ability to deliver shareholder value.
Bearish Takeaways
- Despite price target increases, some analysts maintain neutral ratings such as Market Perform or Sector Perform, which signals measured expectations for outperformance.
- Cautious analysts cite possible challenges in sustaining above-market returns and warn of competitive or market risks that could limit upside.
- The magnitude of price target increases is modest in some cases, which reflects uncertainty about the pace of earnings growth.
- Ongoing market pressures and macroeconomic factors may continue to act as headwinds and constrain valuation expansion.
What's in the News
- Judy Goldring has been appointed Chief Executive Officer (CEO) of AGF Management Limited following the passing of former CEO and Chief Investment Officer Kevin McCreadie. Ms. Goldring brings over 30 years of industry experience to the role and previously served as President and Head of Global Distribution, where she led key strategic initiatives (Key Developments).
- The company completed a significant share buyback, repurchasing 621,200 shares for CAD 7.7 million between June 1 and August 31, 2025. This contributed to a total of 856,600 shares repurchased for CAD 10.1 million under the buyback program announced earlier in the year (Key Developments).
Valuation Changes
- Fair Value: Remains unchanged at CA$16.13, indicating no shift in the consensus assessment of intrinsic value.
- Discount Rate: Has risen slightly from 7.47% to 7.49%, which suggests a modest increase in the perceived risk or cost of capital.
- Revenue Growth: Holds steady at 2.03% year-over-year, reflecting a stable outlook for top-line expansion.
- Net Profit Margin: Remains virtually unchanged at 13.51%, pointing to consistent profitability expectations.
- Future P/E: Has fallen slightly from 15.64x to 15.41x, indicating a modest contraction in the implied valuation multiple for forward earnings.
Key Takeaways
- AUM growth and fund diversification in retail mutual and alternative products signal strong potential for future revenue expansion.
- Strategic acquisitions and a balanced capital allocation approach, including dividend increases, promise enhanced earnings and shareholder value.
- Volatility, shifting client preferences, and competitive pressures may challenge AGF's revenue and margin stability despite strong retail mutual fund sales.
Catalysts
About AGF Management- AGF Management Limited is one of Canada’s premier investment management companies with offices across Canada and subsidiaries around the world.
- AGF's assets under management (AUM) and fee-earning assets have grown significantly, particularly in their retail mutual fund and alternative products segments, suggesting future revenue growth as these areas continue to expand.
- The launch of new alternative products such as the AGF NHC Tactical Alpha Fund and the AGF Enhanced U.S. Income Plus Fund is expected to provide attractive risk-adjusted returns, potentially increasing AGF's future revenue and earnings through diversification and innovation in volatile markets.
- Strong investment performance, including multiple funds receiving FundGrade A+ Awards, is likely to lead to higher net margins and revenues as these funds attract more inflows by outperforming peers.
- AGF's private wealth and institutional business segments, bolstered by strategic acquisitions like the Kensington transaction, are driving AUM growth, which may enhance future earnings and revenue diversity.
- The company's commitment to a balanced capital allocation strategy, including a 9% increase in dividends and a focus on opportunistic buybacks, suggests a positive impact on earnings per share (EPS) and shareholder value, potentially supporting future stock price appreciation.
AGF Management Future Earnings and Revenue Growth
Assumptions
How have these above catalysts been quantified?- Analysts are assuming AGF Management's revenue will grow by 3.2% annually over the next 3 years.
- Analysts assume that profit margins will shrink from 17.5% today to 11.4% in 3 years time.
- Analysts expect earnings to reach CA$70.1 million (and earnings per share of CA$1.11) by about May 2028, down from CA$98.0 million today.
- In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 14.4x on those 2028 earnings, up from 6.8x today. This future PE is greater than the current PE for the CA Capital Markets industry at 10.7x.
- Analysts expect the number of shares outstanding to grow by 0.81% per year for the next 3 years.
- To value all of this in today's terms, we will use a discount rate of 7.27%, as per the Simply Wall St company report.
AGF Management Future Earnings Per Share Growth
Risks
What could happen that would invalidate this narrative?- The increased volatility in global markets due to trade wars and an uncertain macroeconomic backdrop could negatively impact AGF's revenue and overall earnings.
- The decline in segregated accounts and sub-advisory AUM by 9% due to clients shifting to passive management could lead to a decrease in revenue from these traditional investment segments.
- Although AGF reported strong net sales in retail mutual funds, the expectation of continued market volatility could dampen future sales growth, potentially affecting subsequent revenue.
- Long-term investment revenues were lower compared to the previous year, with fair value adjustments that can be inconsistent, introducing potential fluctuations in earnings.
- The possibility of ongoing basis point compression in net management fees due to changes in product mix and competition could impact AGF's net margins over time.
Valuation
How have all the factors above been brought together to estimate a fair value?- The analysts have a consensus price target of CA$12.393 for AGF Management based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of CA$17.0, and the most bearish reporting a price target of just CA$11.0.
- In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be CA$616.2 million, earnings will come to CA$70.1 million, and it would be trading on a PE ratio of 14.4x, assuming you use a discount rate of 7.3%.
- Given the current share price of CA$10.2, the analyst price target of CA$12.39 is 17.7% higher. Despite analysts expecting the underlying buisness to decline, they seem to believe it's more valuable than what the market thinks.
- We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.
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Disclaimer
AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.