Barclays has nudged up its price target for retail-focused broker and wealth manager Hargreaves Lansdown (LON:HL.).
The recent share price slump represents a good entry point, Barclays reckons.
The shares have lost 19% year-to-date.
Over the same period the FTSE All-Share has risen 9%.
The inflow of funds in the quarter to end-September was weaker than expected, prompting some nervousness.
There is also the perception of an increased competitive threat.
Lastly, fund managers may be mulling moving into more attractively valued sector peers.
All of those concerns are overblown, in the view of Barclays.
“The name remains well placed to continue to pick up customers turning to DIY investing to manage their long-term savings,” the Barclays team asserts.
“The launch of HL's UK Equity fund, its cash back offer and increased ISA limits should contribute to recovering flows. Raised competitive threats have been a consistent concern since 2014, yet with HL's marketing and brand it has continuously expanded market share. In a potentially higher rate environment its cash brokerage expansion should become more convincing,” Barclays said.
The bank sticks with its ‘overweight’ rating and raises its price target from 1500p to 1560p.