HUB24 (ASX:HUB) - Share price, News & Analysis

Q: What is the Fair Price of HUB when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

HUB (A$24.85) is trading above our estimate of [[fair value]] (A$18.77)

HUB fundamental analysis
Snowflake Score
Valuation	0/6
Future Growth	4/6
Past Performance	2/6
Financial Health	4/6
Dividends	0/6

HUB Stock Overview

HUB24 Limited, a financial services company, provides wealth management superannuation investment platforms, technology, and data solutions in Australia.

Rewards

Earnings are forecast to grow 40.75% per year

Risk Analysis

Profit margins (7.6%) are lower than last year (12.3%)

Shareholders have been diluted in the past year

HUB24 Competitors

Bell Financial Group

ASX:BFG

AU$367.3m

COG Financial Services

ASX:COG

AU$342.2m

Euroz Hartleys Group

ASX:EZL

AU$312.3m

E&P Financial Group

ASX:EP1

AU$113.8m

Price History & Performance

Summary of all time highs, changes and price drops for HUB24
Historical stock prices
Current Share Price	AU$24.85
52 Week High	AU$34.72
52 Week Low	AU$17.65
Beta	0.94
1 Month Change	7.53%
3 Month Change	1.06%
1 Year Change	-4.64%
3 Year Change	139.63%
5 Year Change	295.07%
Change since IPO	107.08%

Shareholder Returns

	HUB	AU Capital Markets	AU Market
7D	1.0%	0.08%	0.7%
1Y	-4.6%	-6.7%	-8.5%

Return vs Industry: HUB exceeded the Australian Capital Markets industry which returned -6.7% over the past year.

Return vs Market: HUB exceeded the Australian Market which returned -8.5% over the past year.

Price Volatility

Is HUB's price volatile compared to industry and market?
HUB volatility
HUB Average Weekly Movement	6.8%
Capital Markets Industry Average Movement	5.9%
Market Average Movement	10.6%
10% most volatile stocks in AU Market	18.1%
10% least volatile stocks in AU Market	4.6%

Stable Share Price: HUB is not significantly more volatile than the rest of Australian stocks over the past 3 months, typically moving +/- 7% a week.

Volatility Over Time: HUB's weekly volatility (7%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
2007	460	Andrew Alcock	https://www.hub24.com.au

HUB24 Limited, a financial services company, provides wealth management superannuation investment platforms, technology, and data solutions in Australia. It operates through Platform and Tech Solutions segments. The company develops and operates HUB24, an investment and superannuation platform, which is a portfolio administration services for financial advisers, stockbrokers, accountants and their clients, and direct consumers.

HUB24 Fundamentals Summary

How do HUB24's earnings and revenue compare to its market cap?
HUB fundamental statistics
Market Cap	AU$1.99b
Earnings (TTM)	AU$10.82m
Revenue (TTM)	AU$143.07m

183.6x

P/E Ratio

13.9x

P/S Ratio

Is HUB overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
HUB income statement (TTM)
Revenue	AU$143.07m
Cost of Revenue	AU$15.16m
Gross Profit	AU$127.91m
Other Expenses	AU$117.09m
Earnings	AU$10.82m

Last Reported Earnings

Dec 31, 2021

Next Earnings Date

Aug 23, 2022

Earnings per share (EPS)	0.14
Gross Margin	89.41%
Net Profit Margin	7.56%
Debt/Equity Ratio	6.7%

How did HUB perform over the long term?

See historical performance and comparison

Dividends

0.6%

Current Dividend Yield

82%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is HUB undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

0/6

Valuation Score 0/6

Price-To-Book vs Peers
Price-To-Book vs Industry
Price-To-Book vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for HUB?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for HUB. This is calculated by dividing HUB's market cap by their current preferred multiple.
What is HUB's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	AU$1.99b

HUB key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	n/a
Enterprise Value/EBITDA	n/a
PEG Ratio	4.5x

Price to Book Ratio vs Peers

How does HUB's PB Ratio compare to its peers?

HUB PB Ratio vs Peers

The above table shows the PB ratio for HUB vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PB	Estimated Growth	Market Cap
Peer Average	1.5x
BFG Bell Financial Group	1.6x	n/a	AU$367.3m
COG COG Financial Services	2.1x	24.9%	AU$342.2m
EZL Euroz Hartleys Group	1.6x	n/a	AU$312.3m
EP1 E&P Financial Group	0.7x	n/a	AU$113.8m
HUB HUB24	10.6x	40.7%	AU$2.0b

Price-To-Book vs Peers: HUB is expensive based on its Price-To-Book Ratio (10.6x) compared to the peer average (1.5x).

Price to Earnings Ratio vs Industry

How does HUB's PE Ratio compare vs other companies in the AU Capital Markets Industry?

Price-To-Book vs Industry: HUB is expensive based on its Price-To-Book Ratio (10.6x) compared to the Australian Capital Markets industry average (1.2x)

Price to Book Ratio vs Fair Ratio

What is HUB's PB Ratio compared to its Fair PB Ratio? This is the expected PB Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

HUB PB Ratio vs Fair Ratio.
Fair Ratio
Current PB Ratio	10.6x
Fair PB Ratio	n/a

Price-To-Book vs Fair Ratio: Insufficient data to calculate HUB's Price-To-Book Fair Ratio for valuation analysis.

Share Price vs Fair Value

What is the Fair Price of HUB when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: HUB (A$24.85) is trading above our estimate of fair value (A$18.77)

Significantly Below Fair Value: HUB is trading above our estimate of fair value.

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is less than 20% higher than the current share price.

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Future Growth

How is HUB24 forecast to perform in the next 1 to 3 years based on estimates from 10 analysts?

Future Growth Score

4/6

Future Growth Score 4/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

40.7%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: HUB's forecast earnings growth (40.7% per year) is above the savings rate (1.8%).

Earnings vs Market: HUB's earnings (40.7% per year) are forecast to grow faster than the Australian market (6.1% per year).

High Growth Earnings: HUB's earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: HUB's revenue (19.6% per year) is forecast to grow faster than the Australian market (5.6% per year).

High Growth Revenue: HUB's revenue (19.6% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: HUB's Return on Equity is forecast to be low in 3 years time (13.4%).

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Past Performance

How has HUB24 performed over the past 5 years?

Past Performance Score

2/6

Past Performance Score 2/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-7.0%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: HUB has high quality earnings.

Growing Profit Margin: HUB's current net profit margins (7.6%) are lower than last year (12.3%).

Past Earnings Growth Analysis

Earnings Trend: HUB's earnings have declined by 7% per year over the past 5 years.

Accelerating Growth: HUB's earnings growth over the past year (16.3%) exceeds its 5-year average (-7% per year).

Earnings vs Industry: HUB earnings growth over the past year (16.3%) underperformed the Capital Markets industry 21.3%.

Return on Equity

High ROE: HUB's Return on Equity (5.8%) is considered low.

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Financial Health

How is HUB24's financial position?

Financial Health Score

4/6

Financial Health Score 4/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: HUB's short term assets (A$86.0M) exceed its short term liabilities (A$32.2M).

Long Term Liabilities: HUB's short term assets (A$86.0M) exceed its long term liabilities (A$15.9M).

Debt to Equity History and Analysis

Debt Level: HUB has more cash than its total debt.

Reducing Debt: Insufficient data to determine if HUB's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: HUB's debt is well covered by operating cash flow (190.1%).

Interest Coverage: Insufficient data to determine if HUB's interest payments on its debt are well covered by EBIT.

Balance Sheet

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Dividend

What is HUB24 current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

0.60%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: HUB's dividend (0.6%) isn’t notable compared to the bottom 25% of dividend payers in the Australian market (2.56%).

High Dividend: HUB's dividend (0.6%) is low compared to the top 25% of dividend payers in the Australian market (6.36%).

Stability and Growth of Payments

Stable Dividend: HUB is not paying a notable dividend for the Australian market, therefore no need to check if payments are stable.

Growing Dividend: HUB is not paying a notable dividend for the Australian market, therefore no need to check if payments are increasing.

Earnings Payout to Shareholders

Earnings Coverage: HUB is not paying a notable dividend for the Australian market.

Cash Payout to Shareholders

Cash Flow Coverage: HUB is not paying a notable dividend for the Australian market.

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Management

How experienced are the management team and are they aligned to shareholders interests?

4.3yrs

Average management tenure

CEO

Andrew Alcock

9.08yrs

Tenure

AU$1,825,804

Compensation

Mr. Andrew Alcock, B BUS, GAICD has been the Managing Director of HUB24 Limited since July 29, 2013 and serves as its Executive Director. Mr. Alcock served as Chief Executive Officer of HUB24 Limited from...

CEO Compensation Analysis

Compensation vs Market: Andrew's total compensation ($USD1.30M) is about average for companies of similar size in the Australian market ($USD1.54M).

Compensation vs Earnings: Andrew's compensation has increased by more than 20% in the past year.

Leadership Team

Experienced Management: HUB's management team is considered experienced (4.3 years average tenure).

Board Members

Experienced Board: HUB's board of directors are considered experienced (5.8 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: HUB insiders have bought more shares than they have sold in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 17%.

Data	Last Updated (UTC time)
Company Analysis	2022/08/14 00:00
End of Day Share Price	2022/08/12 00:00
Earnings	2021/12/31
Annual Earnings	2021/06/30