The IOOF Holdings Ltd (ASX: IFL) share price has climbed 16.53% higher since the start of October.
With the Aussie wealth manager’s shares soaring higher, is now the time to buy?
Why IOOF shares are climbing higher
IOOF shares were trading as low as $6.03 per share back on October 9, before climbing higher.
Arguably the biggest catalyst was IOOF’s update on its ANZ Wealth Pension and Investments (P&I) acquisition.
IOOF agreed with Australia and New Zealand Banking Group Ltd (ASX: ANZ) to lower the purchase price to $825 million.
Shareholders look to be buoyed by lower outgoings and the potential for more long-term value.
The Aussie wealth manager is focusing on completing the acquisition by 31 December 2019, and not later than 30 June 2020.
Another big positive for the IOOF share price was a favourable decision in its Federal Court action brought by APRA.
Following the 2018 Financial Services Royal Commission, APRA applied to have several IOOF senior executives disqualified from the industry.
The Court ruled on 20 September that IOOF had not contravened the Superannuation Industry (Supervision) Act.
However, the IOOF share price received a boost when the regulator decided not to appeal the Court’s decision.
Are IOOF shareholders happy in 2019?
Prior to this month’s surge, IOOF shares had already been performing strongly.
Since the start of September, the company’s share price has rocketed 45.63% higher in good news for shareholders. However, IOOF shares remain well down on their pre-Royal Commission valuation at over $11 per share.
While shareholders are rightly disappointed with IOOF’s performance in the past 12 to 18 months, there are signs of hope.
With a renewed strategic focus and business developments, IOOF could be better value than AMP Limited (ASX: AMP).
Despite recent IOOF gains, I think Magellan Financial Group Ltd (ASX: MFG) remains the top ASX wealth manager.
The Magellan share price is up 116.65% in 2019 and has had steady share price growth in recent years.
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Motley Fool contributor Kenneth Hall has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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