The Navigator Global Investments Ltd (ASX: NGI) share price was one of the best performers on the All Ordinaries on Friday.
The shares of the provider of investment management products and services to investors globally finished the day almost 8% higher at $3.64.
This means the Navigator Global's shares have gained almost 16% over the last couple of days.
Why did the Navigator Global Investments share price surge higher?
Investors have been buying the company's shares following the release of its full year results on Thursday.
In FY 2019 the company posted a 28% increase in revenue to US$114.9 million, a 10% lift in EBITDA to US$37.65 million, and a whopping 306% jump in net profit to US$25.85 million.
The latter was boosted by the US Tax Cuts and Jobs Act, which included a reduction in the US Federal tax rate from 35% to 21%.
The release explains that the application of this change in tax rate resulted in a reduction in the carrying value of the company's deferred tax assets by $35.5 million, with a corresponding increase to income tax expense in the income statement.
Broker response.
One broker that was pleased with the company's result was Macquarie Group Ltd (ASX: MQG).
According to a note out of the Macquarie equities desk, its analysts note that Navigator Global's outlook has started to stabilise and things are looking a lot more positive.
It also sees an opportunity for the company's proprietary platform. This platform aims to "to replace a number of existing off-the-shelf products with more customised tools for use by our portfolio managers that provides improved scalability, workflow transparency and better information security than our existing arrangements."
In light of this, the broker has upgraded Navigator Global's shares to an outperform rating with an increased price target of $3.63.
A broker that is even more bullish on the company is Ord Minnett. It held firm with its buy rating and lifted the price target on its shares up to $4.10. This price target implies potential upside of almost 13% over the next 12 months even after the post-results gains.
