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Praemium lives up to broker’s expectations

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As part of our broker monitoring, FinFeed advised in mid-August that Ivor Ries from Morgans CIMB had upgraded Praemium’s (ASX: PPS) share price target from 49 cents to 57 cents after the company exceeded his profit expectations. This implied share price upside of 40% at that time.

Ries also upgraded forward earnings estimates with the expectation that the company would use its relatively robust balance sheet to continue to invest in technology which would make it more competitive in the self-managed superannuation accounts segment.

Ries was on the mark with his take on the company and his price target of 57 cents, with PPS’s shares touching 53.5 cents last Friday before closing yesterday at 51 cents.

PPS listed on the ASX in 2006 and has gradually established a position in the funds management industry whereby it offers separately managed account (SMA) technology to blue-chip clients.

Consequently, it represents a play on both the financial and the technology sectors. Importantly, over the last three months PPS’s share price has outperformed both the S&P/ASX 200 information technology and financials indices by 40%.

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Paul

The author Paul