Magellan Financial Group Research Papers

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Important Legal Information: The information contained in the Institutional section of this website is not intended to constitute:

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The information contained in the Institutional section of this website is intended only for institutions that are both (i) habitual investors or otherwise fall within one of the other categories set out in section 3(2)(a) of the 1978 Act and (ii) "wholesale clients" under the 2008 Act. Such persons shall be referred to as "institutional investors" herein. Persons who are not institutional investors should not review the information contained in the website. This website is supplied on the condition that it is not passed on to any person who is not an institutional investor.

Nothing on this website constitutes investment, legal, business, tax or any other type of advice. The information on this website does not take into account the particular financial and investment objectives, circumstances and needs of any person. Information on the website is not intended for investors in any jurisdiction in which distribution or purchase is not authorized.

Performance data shown represents past performance and is no guarantee of future results. Investment return and principal value fluctuate so your investment, when sold, may be worth more or less than the original cost; current performance may be lower or higher than quoted. Investors should be aware of the increased risks associated with investments in foreign/emerging markets securities, high yield securities and smaller companies.You are solely responsible for evaluating the risks and merits regarding the use of the website and any services provided within. Nothing contained in that website constitutes a solicitation, recommendation, endorsement or offer to buy or sell any securities or other financial instruments.

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Important Legal Information: By clicking "I agree," the user agrees that I have read the terms detailed below and confirm that I am an Institutional Investor and that I wish to proceed.

Information contained in the Institutional section of this website is not intended for institutional investors in any jurisdiction in which distribution or purchase is not authorised.

The information is intended for institutional investors and consultants to institutional investors and is published for informational purposes only. The information is directed at informing persons falling within one or more of the following categories:

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Important Legal Information: The information contained in the Institutional section of this website is not intended to constitute:

  • any offer for sale or subscription of securities to the public in New Zealand in terms of the Securities Act 1978 of New Zealand (the 1978 Act) (or any statutory modification or re-enactment of, or statutory substitution for, the 1978 Act). Accordingly, no prospectus or investment statement for the purposes of the 1978 Act has been produced in respect of the information contained in the website and the information does not contain all the information typically included in a registered prospectus or an investment statement under the 1978 Act; or
  • the provision of "financial advice" under the Financial Advisers Act 2008 (the 2008 Act) (or any statutory modification or re-enactment of, or statutory substitution for, the 1978 Act).

By clicking "I agree," you agree that you have read the terms detailed below and confirm that:

1) you:

(i) are an "habitual investor" for the purposes of section 3(2)(a)(ii) of the 1978 Act. "Habitual investors" are persons whose principal business is the investment of money or who, in the course of and for the purposes of their business, habitually invest money; or

(ii) otherwise fall within one of the other categories set out in section 3(2)(a) of the 1978 Act, meaning that you are not a member of the public for the purposes of the 1978 Act; or

(iii) you are acting for a person described in (i) or (ii); and

2) you are a "wholesale client" for the purposes of the 2008 Act.

The information contained in the Institutional section of this website is intended only for institutions that are both (i) habitual investors or otherwise fall within one of the other categories set out in section 3(2)(a) of the 1978 Act and (ii) "wholesale clients" under the 2008 Act. Such persons shall be referred to as "institutional investors" herein. Persons who are not institutional investors should not review the information contained in the website. This website is supplied on the condition that it is not passed on to any person who is not an institutional investor.

Nothing on this website constitutes investment, legal, business, tax or any other type of advice. The information on this website does not take into account the particular financial and investment objectives, circumstances and needs of any person. Information on the website is not intended for investors in any jurisdiction in which distribution or purchase is not authorized.

Magellan Financial Group (ASX:MFG), a diversified financials company based in Australia, See our latest analysis for MFG

What is MFG worth?

According to my valuation model, MFG seems to be fairly priced at around 8% below my intrinsic value, which means if you buy MFG today, you’d be paying a reasonable price for it. And if you believe MFG’s true value is $25.36, then there isn’t much room for the share price grow beyond what it’s currently trading. Furthermore, it seems like MFG’s share price is quite stable, which means there may be less chances to buy low in the future now that it’s fairly valued. This is because MFG’s stock is less volatile than the wider market given its low beta.

What does the future of MFG look like?

Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio.Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. MFG’s earnings over the next few years are expected to increase by 41.35%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.

What this means for you:

Are you a shareholder? MFG’s optimistic future growth appears to have been factored into the current share price, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. Have these factors changed since the last time you looked at MFG? Will you have enough confidence to invest in the company should the price drop below its fair value?

Are you a potential investor? If you’ve been keeping tabs on MFG, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the positive outlook is encouraging for MFG, which means it’s worth further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Magellan Financial Group. You can find everything you need to know about MFG in the latest infographic research report. If you are no longer interested in Magellan Financial Group, you can use our free platform to see my list of over 50 other stocks with a high growth potential.


To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned.

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