Shares in superannuation focused investment platform business Hub24 Ltd (ASX: HUB) climbed 6.5% to a record high of $6.80 today after the group revealed a strong quarter of net fund inflows.
For the quarter ending June 30 2017 net fund inflows were $841 million, with retail funds under administration (FUA) now $5.5 billion, which represents an increase of $2.2 billion or 66% for the full year.
For financial year 2017 net fund inflows are expected to be a record $1,953 million as the investment platform business continues to increase its market share via a wider distribution reach mainly amongst financial advisers.
The company’s software helps provide portfolio management, transaction and administration services for advisers or investors and for the half-year ending December 31 2016 it posted a maiden net profit of $1.3 million.
The company is now valued around $350 million, which means that plenty of profit growth is baked into the valuation. Others on big valuations in this space exploiting the ballooning superannuation cash balances of baby boomers include Class Ltd (ASX: CL1) and Praemium Ltd (ASX: PPS).
All three businesses are worth a place on the watch lists of investors, but none of them are mature enough to deliver the wealth-compounding effects of big dividends just yet…