Hargreaves shrugs off end of the GameStop share meme boom


ARGREAVES Lansdown is defying the end of the stock market trading boom that saw new punters flock to buy shares during lockdown.

That boom now appears to be over, with rivals such as CMC Markets issuing crushing profit warnings.

Today HL said it had pulled in another £1.3 billion of new business in the last three months taking funds under administration to £138 billion, up from £107 billion a year ago.

It added another 23,000 clients, taking the total to 1.667 million.

For a while at the height of the pandemic, a new breed of investor raced to bet on markets, with “meme” stocks such as GameStop proving popular on both sides of the Atlantic.

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That fad seems to have passed.

HL chief executive Chris Hill said: “These results are against the backdrop of an easing out of lockdown and ongoing market uncertainty and highlight the importance of a resilient business and the strength of our proposition. The normalisation of revenues post pandemic is in line with our expectations and our focus, as always, remains on our clients, and their lifelong needs.”

The firm enjoys tasty profit margins which make its own shares much beloved by the City.

Today the stock was steady at 1496p, which values HL at more than £7 billion.

Peel Hunt, the broker, has a price target of 1835p for the shares. It said in a note: “we remain of the view that HL is well positioned to continue to win new clients and assets, whilst there are signs that interest rates are moving higher which would benefit profitability”.

Meanwhile Jupiter, the fund manager, gave evidence of the difficulty in much of the rest of the sector.

It saw clients sell £570 million worth of funds in the three months to September.

Jupiter, lambasted in a recent survey of fund customers for “woke” virtue signalling, said there was weaker demand for its UK and European equities.

Clients have instead developed a taste for fixed income, gold & silver and other bond funds.