Was wondering who was buying at the lows the last few days

Need to do some research and find out why Yarra thinks this is good value especially when one of the directors sold recently and after the last update.

Some price targets but not sure of the reco:

Pinnacle Target Price Cut 4.1% to A$11.70/Share by Wilsons

Pinnacle Investment Target Price Raised 2.2% to A$9.20/Share by Ord Minnett

Also Ethical partners reduced their holding last week.

Despite that and the recent market update shares rallied yesterday.

Hard to predict

Held

Pinnacle's share of performance fees lower than last year (just 2m short) and explains the falling share price

Pinnacle Investment Management Group Limited (Pinnacle) advises that nine Affiliates have crystallized performance fees for the financial year ended 30 June 2023 (FY23) totalling approximately $58.0 million at 100% gross in aggregate, of which $54.8 million crystallized in the second half of the financial year (2H FY23).

For the financial year ended 30 June 2022 (FY22), these fees were $57.8 million at 100% gross in aggregate, from ten Affiliates. Pinnacle’s net share of these performance fees, after tax payable by the Affiliates on this revenue, is in the order of $14.6 million, of which $13.6 million was earned in 2H FY23. For FY22, Pinnacle’s net share of performance fees, after tax payable by the Affiliates on this revenue, was $16.6 million. Within the Affiliates, there are now 24 diverse strategies with the potential to produce significant performance fees each year (up from 22 as at 31 December 2022). Of those 24, 13 strategies delivered this financial year

Fund management is a tough biz when the stocks you own doesn't entirely go your way.

[held]

Being punished today with performance fee update. Was the general market expecting more?

Held

From morningstar. I decided to copy/paste rather than just link the article as it is a generic link:

Pinnacle’s Economic Moat at Work in Fiscal 2022; Earnings Outlook Good and Shares Fairly Valued

Shaun Ler Equity Analyst

Narrow-moat Pinnacle delivered a laudable result for what was a turbulent fiscal 2022. Profit after tax, EPS, and DPS were up 14%, 8%, and 22%, respectively. Due to negative market movements, affiliate funds under management, or FUM, fell 6% from the prior year to AUD 84 billion, while performance fees also fell 33%. But we were encouraged by the positive net inflows and higher base fee margins, due to mix shift to higher-margin channels. Together with higher average affiliate FUM in fiscal 2022, it helped drive total revenue growth above growth in expenses and one-off seed investment losses.

Our fair value estimate remains AUD 11.80 per share. Evidence of Pinnacle’s economic moat was evident over the year. First, while most active managers lost mandates in fiscal 2022 from super fund consolidations, the shift to passive and industry redemptions, Pinnacle affiliates attracted new money, on aggregate. This reflects their solid long-term record, wider investment universe given their boutique structure, modest fees, and product variety. Second, Pinnacle’s asset class diversity helped cushion market losses. In fiscal 2022, aggregate portfolio losses were below 10%, less than the S&P/ASX 300 and MSCI World, which lost 10.4% and 17.1%, respectively. Third, more of Pinnacle’s products are being used in the retail market. Its top 20 wealth clients now invest with three or more affiliates on average. Around 65% of Australia’s financial advisers invest with Pinnacle.

Pinnacle’s earnings outlook is bright. We model EPS growing at a low teen CAGR through to fiscal 2027, backed by growing affiliate FUM, steady base fee margins and performance fees, and operating leverage as affiliates grow in scale. On FUM, we believe efforts to expand the sales channel (notably in retail and offshore) and distribute in-demand asset classes (such as real assets and infrastructure) can help cushion the headwinds from superannuation fund consolidations and attract continuous new mandates.

My view is that anyone that can extract performance fees during a downturn and outperform the market is definitely going to be highly regarded in the long run.

[held]

PNI released their financial results for FY22

Net profit after tax (NPAT) attributable to shareholders of $76.4million, up 14%from $67.0million in the prior financial year(FY21)

Performance fees earned by Pinnacle Affiliates, post-tax, contributed $16.6m of Pinnacle’s NPAT in FY22 ($19.5m in FY21)

Fully franked final dividend per share of 17.5 cents(up 3% from the fully franked FY21 final dividend of 17.0cents), taking total fully franked dividends for the financial year to 35.0 cents(up 22% from the fully franked FY21 total dividends of 28.7cents)

Results must have been better than expected - price was up 15% at one stage. Looks like short covering due to many brokers with lower targets than current price.

Been a good ride buying at the bottom around $8 at the price shakeout when the performance update was announced.

Held