Credit Suisse downgraded its earnings forecasts across the diversified financials sector by an average of 1 per cent. The largest downgrades were for Henderson Group, reflecting lower inflows from individual investors and reduced performance fee forecasts, and IOOF, due to divestments.
Fund flows were a mixed bag in 2016. Platinum suffered the biggest outflows, while Henderson, Perpetual and AMP Capital also lost more customers than they won. Magellan saw the biggest net inflows, ending the year with $47 billion under management. The figure compares with $32 billion of asset under management at Perpetual and $23 billion at Platinum.
Despite suffering net outflows, Credit Suisse upgraded its earnings forecasts slightly for Perpetual in 2017 and 2018.
"Perpetual is the most leveraged asset manager to higher Australian equities and so would appear inexpensive to those investors with a more positive view on Australian equity markets," Credit Suisse's James Cordukes in a note to clients.
