M&G (LON:MNG) Posts Earnings Results

M&G (LON:MNG) released its quarterly earnings data on Thursday. The company reported GBX (7.10) EPS for the quarter, Digital Look Earnings reports. M&G had a return on equity of 9.49% and a net margin of 1.73%.

Here are the key takeaways from M&G’s conference call:

• Operating profit rose 15% year over year to GBP 435 million, M&G’s best first-half result since its 2019 listing. Asset management profit increased 24%, while Life profit grew 9% as capital-light with-profits earnings expanded.
• Net inflows from open business improved to GBP 2.4 billion, including GBP 2.2 billion in asset management and GBP 200 million in Life. Management highlighted GBP 1 billion of additional asset-management inflows in July, a GBP 7.8 billion private-markets capital queue, and continued international and wholesale demand.
• The new BPA+ with-profits annuity product generated GBP 1.7 billion of sales since its February launch, with management targeting GBP 3 billion–GBP 4 billion of annual BPA volumes by 2027. M&G expects with-profits solutions to attract at least GBP 50 billion of assets and contribute at least GBP 100 million of annual operating profit by 2030.
• Capital strength remained substantial, with a Solvency II ratio of 247% and a GBP 5 billion surplus, keeping M&G on track for its GBP 2.7 billion cumulative capital-generation target. Management said the strong balance sheet supports further investment in growth, although it indicated that near-term distributions are likely to remain aligned with current market expectations.
• Underlying capital generation fell GBP 27 million year over year, and annuity operating profit declined 7% to GBP 105 million because of lower returns on surplus assets. Management also maintained guidance for a modest GBP 10 million annual operating-profit impact from ground-rent reforms from the end of 2028.

M&G Stock Up 1.3%

LON MNG traded up GBX 4.60 during trading hours on Friday, reaching GBX 355.80. 14,375,778 shares of the company traded hands, compared to its average volume of 34,100,438. The company has a current ratio of 1.92, a quick ratio of 0.39 and a debt-to-equity ratio of 220.41. M&G has a 12 month low of GBX 248.60 and a 12 month high of GBX 367.10. The company has a 50 day moving average of GBX 350.40 and a two-hundred day moving average of GBX 320.62. The stock has a market capitalization of £8.48 billion, a PE ratio of 28.93, a PEG ratio of -2.76 and a beta of 0.95.

Wall Street Analyst Weigh In

Several brokerages have recently issued reports on MNG. JPMorgan Chase & Co. upped their price objective on M&G from GBX 315 to GBX 325 and gave the company a “neutral” rating in a research report on Friday, May 8th. Jefferies Financial Group reaffirmed a “buy” rating and set a GBX 215 price target on shares of M&G in a research note on Friday. Finally, Citigroup boosted their target price on M&G from GBX 2,880 to GBX 2,950 and gave the stock a “neutral” rating in a report on Tuesday, June 9th. Three equities research analysts have rated the stock with a Buy rating and four have given a Hold rating to the company’s stock. According to MarketBeat, the stock has an average rating of “Hold” and a consensus target price of GBX 677.86.

About M&G

M&G plc is a leading savings and investments business, managing investments for both individuals and for large institutional investors, such as pension funds, around the world.

We have a single corporate identity, M&G plc, and two customer-facing brands: Prudential and M&G Investments. Prudential offers savings and insurance for customers in the UK and Europe and for asset management in South Africa. M&G Investments manages assets for clients globally.

With roots stretching back more than 170 years, we have a long history of finding innovative solutions for our customers’ changing needs.