Why did the AMP (ASX:AMP) share price fall 35% in 2021?

The AMP share price continued its downward spiral in 2021.

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The AMP Ltd (ASX: AMP) share price kept tumbling in 2021, continuing a long term downward spiral for the wealth management company.

Shares in the company fell 35.36% between 31 December 2020 and the same date in 2021, plunging from $1.56 to $1.01. To put this in perspective, the S&P/ASX 200 Index (ASX: XJO) gained 13% over the same period.

Let’s take a look at some of the company’s highs and lows in 2021.

What impacted AMP last year? The lows…

The AMP share price may have had a shocker of a year in 2021, but this is not unusual for the company these days. In fact, AMP shares have dropped a whopping 81% over the past 5 years.

Starting with some of the lows in 2021, 11 February was a shocker for the AMP share price, which dropped 11% in a day. On this day, the company released an investor report on its financial performance in 2020. Investors did not respond well to news the company’s underlying net profit after tax declined 33% on the previous year.

Shares were also in freefall in April, dropping 11% for the month. During this month, the company announced it was looking to spin off its private markets business while keeping a retail wealth management group within AMP.

However, news then emerged that 93% of investors in AMP’s $5 billion AMP Capital Diversified Property Fund had voted to merge with a wholesale fund managed by DEXUS Property Group (ASX: DXS). Finally, AMP only just avoided its remuneration report being voted down at its annual general meeting.

November and December also saw the share price suffer some massive free falls. Between 8 November and 7 December 7, shares in AMP fell a massive 23%. In late November, the company provided an update on its demerger from PrivateMarketsCo. The company advised it was making strong progress on this separation.

However, despite this release providing short-term relief to the share price with a gain of 3%, it fell 10% the next two days. UBS also released a broker note cutting the price target on the company’s shares to 90 cents.

And the highs…

Moving on to the highs, February saw the company’s share price surge on the back of news of the potential joint venture with Ares Management Corp. However, news that the 30-day exclusivity period on the transaction had concluded in late March sent shares sliding nearly 4%. March concluded with the AMP share price recovering nearly 6% after the appointment of new CEO Alexis George.

June also saw some highs for the company, with the appointment of Michael Hirst to the board. Shares spiked 3.45% in the company on the day of this announcement.

Late September and early October was a positive time for AMP investors, with the share price skyrocketing 27% between September 22 and the same date in October.

A trading update from the company revealed positive financial performance in the third quarter of the year. This release also updated investors that its demerger program was on track for completion by mid-2022.

In a positive end to the year, the AMP share price surged 6.38% on Christmas Eve after the company announced PrivateMarketsCo will sell its infrastructure debt platform to Ares Management Corporation for $428 million.

AMP share price snapshot

While 2021 may not have been AMP’s year, the new year has started in a better light. At the time of writing, the company’s share price is trading at $1.01, up 1.51 on yesterday.

In the past month, the AMP share price is up 6.3%, while it has gained 0.5 this week. AMP has a market capitalisation of more than $3 billion.

The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. 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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