One of the biggest movers on the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) today has been the BT Investment Management Ltd (ASX: BTT) share price.
At the time of writing the fund manager's shares are up over 4% to $11.22, bringing their week-to-date return to an impressive 10%.
One key catalyst for the buying frenzy was the release of its funds under management update yesterday.
That update revealed that as of March 31 BTIM saw a 4.8% quarter-on-quarter increase in funds under management despite foreign exchange headwinds.
Total funds under management rose to $91.2 billion from $87 billion. This would have been even higher had the British pound not depreciated significantly. Foreign exchange headwinds impacted the company by approximately $1.9 billion during the period.
The key driver of growth was once again its JO Hambro business in the United Kingdom. The business experienced $1.9 billion in net inflows thanks partly to institutional demand for its Global Opportunities strategy.
Considering many expected BTIM to struggle following the Brexit, I've been very impressed by the company's performance.
It appears as though I'm not the only one to think this. A research note out of the equities desk at Macquarie Group Ltd (ASX: MQG) today was very positive.
Its analysts have retained their outperform rating and increased their price target on BT Investment Management's shares to $11.92. Based on that target price Macquarie still sees potential upside of 6.5%.
Should you invest?
I have been very impressed by BT Investment Management post-Brexit and the way the company's products have continued to attract investors despite the economic uncertainty.
But at 20x trailing earnings I think its shares are starting to look a little expensive now, especially with the true impacts of the Brexit still largely unknown.
So for this reason I would suggest investors give the company a miss for the time being and focus elsewhere in the market at companies such as Class Ltd (ASX: CL1) and XERO FPO NZX (ASX: XRO). I believe these two companies offer investors strong growth potential at a fair price.
