GENERATION DEVELOPMENT GROUP LIMITED (GDG)
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29/08/2025

2

Accumulate

$7.49

18.89%

Morgans points to the standout result from Lonsec as a factor underpinning the better than expected FY25 net profit after tax result for Generation Development, up 170% on FY24 and a 13% beat on consensus.

A lower tax payment of -$2m versus the analyst's forecast of -$4m also benefitted results, while investment bond and Evidentia results were broadly as expected.

Evidentia FUM missed at $14.8bn versus forecast of $18.5bn, but revenue still grew by 63% and net profit more than doubled. The integration of Lonsec and Evidentia has caused some indigestion in near term growth.

Management pointed to ongoing robust sales momentum for both Investment Bonds and Managed Accounts.

Morgans tweaks its EPS forecasts lower by -2% and -3% for FY26 and FY27, on higher interest costs. Target price moves to $7.49 from $6.25 with no change in Accumulate rating.

FORECAST
Morgans forecasts a full year FY26 dividend of 2.30 cents and EPS of 11.00 cents.
Morgans forecasts a full year FY27 dividend of 4.00 cents and EPS of 15.00 cents.

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29/07/2025

1

Buy

$6.26

-0.63%

Generation Development's FUM at the end of the June quarter of $4.4bn beat Moelis' forecast of $4.1bn. The net flow of $255m for the quarter was higher than the broker's $164m estimate.

The broker notes the quarter was a record-breaking one for sales inflow, and annual investment bond sales surpassed $1bn for the first time.

Buy. Target price $6.26.

FORECAST
Moelis forecasts a full year FY26 dividend of 4.70 cents and EPS of 11.50 cents.