ASX financial share GQG Partners Inc (ASX: GQG) closed 1.7% higher at $1.765 yesterday.
By comparison, the S&P/ASX All Ordinaries Index (ASX: XAO) lifted 0.9%.
Last month, during earnings season, the global boutique asset manager released its 1H FY25 results.
GQG Partners declared an unfranked interim dividend of 7.34 US cents per share for the half, up 14.5% on 1H FY24.
The company pays dividends quarterly. The last four dividends, converted into Aussie currency, add up to 22.73 cents.
Based on yesterday's closing value, that represents a trailing dividend yield of 12.9%.
That is almost four times the average dividend yield for the S&P/ASX 200 Index (ASX: XJO) these days.
The high dividend yield is one of the reasons Remo Greco from Sanlam Private Wealth has a buy rating on this ASX financial share.
Image source: Getty Images
ASX financial share is 'good value': expert
On The Bull this week, Greco said:
In our view, GQG offers an appealing entry into the global funds management sector.
Recently trading on a price/earnings ratio below 10 times … suggests good value.
Greco discussed highlights from the fund manager's first-half report:
Funds under management of $US172.4 billion at the end of the first half of fiscal year 2025 was up 10.8 per cent on the prior corresponding period.
Net revenue of $US403 million increased 11 per cent and net operating income of $US306.8 million was up 12.3 per cent.
GQG is known for its strong convictions, which have been reflected in a solid track record of performance.
Greco isn't the only professional analyst with a buy rating on this ASX financial share.
Macquarie has an outperform rating on GQG Partners shares
After last month's report, Macquarie maintained its outperform rating on GQG Partners shares.
It has a 12-month share price target of $2.63, implying a near-50% potential upside from here.
Macquarie noted robust performance fees and better cost controls, but disappointing base management fees during 1H FY25.
Analyst Elizabeth Miliatis spoke of "dependable dividends" from the ASX financial share.
Miliatis said potential inclusion in the ASX 300 or ASX 200 at the next rebalance would be a catalyst for GQG Partners stock.
Miliatis said:
While relative performance has deteriorated from Dec-24, with funds positioned defensively … GQG has successfully turned periods of underperformance around previously (eg., CY21 and CY23).
Notably, our analysis also suggests GQG's net flows are historically not correlated with fund performance, implying flows are a function of GQG's strong distribution footprint and reputation, and giving us comfort that recent outflows are a short-term headwind.
What does Morgans say?
Morgan says GQG Partners is "defensively positioned".
In a new note during earnings season, Morgans said:
The group's longer-term track record and risk adjusted metrics remain solid, however we do expect flows to slow materially and potentially see outflow pockets.
The August FUM update points to no major outflows post the July update.
At this point, we view it as more sentiment risk than earnings risk.
GQG Partners reported a 28% decline in inflows in 1H FY25 amid ETFs increasingly attracting investors away from traditional managed funds.
This is a global trend that is playing out on the ASX, with locals ploughing a record $5.28 billion into ASX ETFs in July.
In FY25, GQG adapted by launching its first active ETF for its US Equity strategy, which has attracted a net $200 million.
The broker maintained its hold rating, stating its fundamental valuation of the ASX finance share was $2.65 apiece — similar to Macquarie.
The broker said:
We maintain a HOLD recommendation, preferring to allow the current 'flows risk' period to reduce before taking a more positive stance.
