Netwealth (ASX:NWL) share price jumps 10% following record quarter

Record-breaking inflows have shone a light on Netwealth shares today…

The Netwealth Group Ltd (ASX: NWL) share price is pushing higher on Thursday. This follows the financial management software company's September quarterly update.

At present, shares in Netwealth are swapping hands at $15.80, a 10.57% increase.

A group of happy office workers throw papers in the air and cheer.

Image source: Getty Images

What's lifting the Netwealth share price today?

In an announcement released this morning, Netwealth has surpassed all previous quarterly funds under administration (FUA), setting a record in the September quarter.

At 30 September 2021, the company held $52 billion in FUA, representing an increase of 10.2% for the quarter. Notably, this indicates a significant 52.7% increase compared to the prior corresponding period.

Meanwhile, the funds under management (FUM) portion of the business also experienced reasonable growth in the latest quarter. Specifically, FUM at the end of the period stood at $12.6 billion, increasing 56.9% from the prior corresponding period. The distinct surge in funds has investors bidding up the Netwealth share price today.

However, the fastest-growing segment was Netwealth's managed account balance. At the end of September, managed accounts totalled $10.7 billion, increasing 63.6% from the prior corresponding period.

As a result, the financial platform has retained its spot as the sixth largest and fastest-growing platform provider by net funds flows in Australia. Currently, the company holds a market share of 4.9%, while Macquarie (in the fifth spot) holds an 11.2% market share.

Outlook

Shifting our gaze to the future of the company, Netwealth shared a positive outlook for its market potential. This is thanks to the ongoing structural changes within the financial services industry.

Consequently, the company believes this will support further increases in its addressable market and growth opportunities. Building on that, Netwealth mentioned its pipeline for new business remains very strong across all market segments.

Finally, as a result of the stellar record net inflows in the September quarter, the company has upgraded its FUA net inflow guidance for FY2022. Now Netwealth forecasts FUA net inflows of $12.5 billion for the financial year, as opposed to its previous $10 billion guidance.

Despite these achievements, the Netwealth share price is still down approximately 20% over the past year.

Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and has recommended Netwealth. The Motley Fool Australia owns shares of and has recommended Netwealth. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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