Magellan Financial Group Ltd (ASX: MFG) shares are in focus today after the company released important information in an ASX release yesterday.
The company is an Australian-based funds manager investing in global equities and global listed infrastructure.
The Funds Management segment provides investment research, administrative services, investment management, and sub-advisory services.
As The Motley Fool's Laura Stewart reported yesterday, the company reported that total assets under management (AUM) dropped to $37.5 billion as at 31 March 2026, down from $39.9 billion at the end of 2025.
The company announced that retail AUM declined from $15.8 billion to $14.1 billion and institutional AUM slipped to $23.4 billion, down from $24.1 billion.
It seems investors are disappointed with this news, as the stock price has opened 4% lower this morning.
Despite this drop, the share price remains up 33% over the last year.
For context, the S&P/ASX 200 Index (ASX: XJO) is up 22% in that same span.
Following yesterday's announcement, the team at Morgans provided updated guidance on Magellan Financial Group shares.
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Buy maintained despite announcement
Morgans has retained its buy recommendation on Magellan Financial Group shares despite the AUM drop.
MFG has given an end-to-March 2026 quarterly FUM update. FUM (A$37.5bn) was down 6% for the quarter due to a combination of outflows across most funds and market movements.
Overall this was a softer quarter at the headline level, albeit some impacts from market volatility are unsurprising.
As a result, it has downgraded its earnings per share forecast by 1% to 8% over FY26/FY27.
Price target reduction for Magellan Financial Group
As a result of this downgrade, Morgans has reduced its price target to $11.99 (from $12.43).
Whilst MFG's Investment Management performance remains patchy, we think the Barrenjoey merger fundamentally changes MFG's overall outlook, strengthening the business and providing additional pathways for growth. MFG also retains a strong balance sheet (~A$650m of liquidity, post deal).
From today's current stock price of approximately $9.60, this updated price target indicates a potential upside of 25%.
