The Moelis (ASX:MOE) share price is up today. Here's why

The Moelis (ASX: MOE) share price is on the rise today, up almost 3% in early afternoon trade. We take a look at the company's results.

Bernd Struben

Author bio Bernd Struben earned his BA in economics from the University of Michigan in 1991, with post-graduate studies in environmental economics at the University of Connecticut. Over the years he’s written about and analysed the tourism industry in the Caribbean; Europe’s commercial real estate markets; and, since moving to Australia in 2010, global and Aussie share markets. Bernd studies geopolitical and macroeconomic trends, alongside sector and company specific data, to gauge what he believes could be tomorrow's best investments. In his free time, you might find Bernd at the beach with his family or working on his next science fiction novel. Areas of expertise Australian and global share markets Macroeconomic and geopolitical trends Real estate Education Economics, University of Michigan Favorite investment quote "The four most dangerous words in investing are: 'This time it's different." — Sir John Templeton

Published February 17, 2021 1:44 pm AEDT

The Moelis Australia Ltd (ASX: MOE) share price shot up 6.7% to $4.80 in strong trading this morning. This comes after the financial services company released its results for the full 2020 financial year.

The Moelis share price has retreated somewhat this afternoon and is trading at $4.70 at the time of writing, up 2.84%. Let's take a look.

What did Moelis Australia report?

In today's ASX release, Moelis Australia announced a 4.7% decrease in its underlying earnings before interest, tax, depreciation and amortisation (EBITDA) to $60.5 million.

The company incurred a 5% increase in expenses, including $3 million in one-off costs due to the impacts of COVID-19, and investment in platform capabilities.

Assets under management (AUM) grew by 11% to $5.4 billion, supporting asset management revenue growth of 10%.

Underlying revenue of $161.1 million represented an increase of 1.1% over the 2019 financial year. Underlying earnings per share (EPS) were 25.1 cents, down 5.3% from the 26.5 cents reported in the previous year.

The company reported it had $112 million in operating cash and $200 million in investment assets available.

Moelis will pay a dividend of 10 cents per share (cps), fully franked. That's the same dividend it paid in 2019.

Commenting on the results, Moelis' joint CEOs Julian Biggins and Chris Wyke said:

The operating performance of the business strengthened appreciably as the year progressed and this momentum has been carried into a strong start to 2021.

Going forward, our strategy remains unchanged as we continue to look to scale our investment strategies, expand our distribution channels and leverage our specialised capabilities in corporate advisory and equities.

The company said it was in a strong position heading into 2021. It forecasts a 10-20% increase in underlying EPS from the 2020 financial year.

Moelis share price snapshot

After getting hammered during the wider COVID-fuelled market panic last year – falling 79% from 21 February to 25 March –the Moelis share price has recovered strongly, up 277% from the March low.

Over the past 12 months, its shares are still down 18%. Year-to-date the Moelis share price is up 3%. That's right in line with the gains on the All Ordinaries Index (ASX: XAO).

Automatic Renewal

By taking up this offer, you will also be enrolled in our auto-renewal program, which is our way of making your ongoing subscription easier by ensuring uninterrupted service. Don't worry, though – you're not locked in, and can cancel your auto-renewal at any time before each 'anniversary' date without question or penalty.