Broker snap: Peel Hunt stays optimistic about Ashmore

12th Jul 2012 11:07

Shares in fund management Ashmore took a battering on Thursday morning after its fourth-quarter statement but Peel Hunt has maintained its 'buy' recommendation and 440p target price for stock saying that it still offers 'long-term structural growth'.Assets under management (AuM) were weaker than expected in the three months to June 30th, the broker said, as they fell 3.3% quarter-on-quarter to $63.7bn due to $1.6bn of negative market movements and $0.6bn of net outflows."Given the slightly lower period-end AuM, and recent performance, we would expect to reduce our forecasts for the next two years," said analyst Stuart Duncan.For the year to June 2012, Peel Hunt says that it will likely lower its pre-tax profit/earnings per share estimates by 4-5% from £246.2m/24,9p to £236m/23.5p, putting its forecasts more in line with consensus."For the year to June 2013, we expect the downgrade to be in the region of 6-7%, primarily reflecting lower expected performance fees."The broker said that it expects to reduce its target price but has maintained a positive view on the stock due to the "significant growth opportunity over the longer term as asset allocations to EM products continue to increase, although in the short term enthusiasm will be tempered by the current macro backdrop."Shares were trading 6.91% lower at 307.2p by 11:03.BC