Solvar Ltd (ASX: SVR) has been an outstanding ASX financials stock to own over the last year.
It is a financial services company specialising in providing finance and other related services to assist consumers with the purchase of a new or used vehicle, as well as offering personal loans to consumers.
12 months ago Solvar shares were trading for roughly $1.38.
Yesterday, this ASX financials stock closed at $1.86.
That's a rise of 34%.
For context, the S&P/ASX 200 Index (ASX: XJO) is up roughly 7.9% in that same span.
On Wednesday, the company released H1 FY26 results.
Let's see what the company reported.
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Earnings growth
In Wednesday's announcement, for the half year ended 31 December 2025 (H1 FY26), the company reported:
- Normalised Net Profit After Tax (NPAT) of $20.0 million, up 5.8% on pcp;
- Statutory NPAT of $17.8 million, up 5.8% on pcp;
- Earnings Per Share (EPS) up 13.5% to 9.3 cents per share on pcp;
- Fully franked interim dividend of 6.0 cents, plus a special fully franked dividend of 2.5 cents per share, totalling 8.5 cents per share payable on 7 April 2026.
Solvar also reiterated FY26 guidance of normalised NPAT of $36.0 million (including the one-off sale of the written off loan book in New Zealand).
Speaking on the outlook, Mr Scott Baldwin, CEO and Managing Director of Solvar said:
Solvar continues to invest in the development of new products and establishing a dedicated commercial lending team, with the commercial loan book now at ~$67.0 million and growing. Solvar anticipates continued growth in commercial lending as Bennji establishes itself in the market.
Investors were clearly pleased with the results as its share price is up 5.6% since the announcement.
Morgans gives it an upgrade
Following the result, the team at Morgans increased its target price on this ASX financials stock.
The broker said the company's 1H26 result continued to illustrate the ongoing shift in the business as management work through the windup of New Zealand and refocus attention back towards domestic growth.
Normalised NPAT was ahead of estimates, while net interest income was behind.
FY26 Normalised NPAT guidance of ~$36m (i.e. NPAT of $34m plus ~$2m from one-off sale of NZ Arrears) was reiterated (implying 2H NPAT of $16m), with SVR expecting book growth momentum to improve into 2H26 lead by Bennji & AFS. Our FY26-28F Underlying NPAT forecasts lift by +5%/+1%/+1%.
Following this forecast upgrade, the broker increased the price target to $2.00 (previously $1.85).
Morgans maintained its Accumulate rating.
Based on yesterday's closing price of $1.86, the new price target indicates an upside of 7.53%
