Canaccord Genuity raises target price on Hargreaves Lansdown

Analysts at Canaccord Genuity raised their target price on financial services firm Hargreaves Lansdown from 1,493.0p to 1,695.0p on Friday following the strong market rally into the 2020 calendar year-end.

Canaccord said it opted to revisit its assumptions on Hargreaves Lansdown after the FTSE 100 picked up 16% in November and December, resulting in a 10% upgrade to its 2021 earnings per share estimates, 17% to 2022 and 10% upgrade in 2023.

The Canadian broker said strong markets will have helped drive assets under administration higher than its original forecasts and also added that the Covid-19 pandemic, lockdowns and increased market volatility had also been conducive to increased client acquisition.

"We believe this has also resulted in continued, elevated share trading activity," said Canaccord, which also maintained its 'hold' rating on the stock.

"These tailwinds more than compensate for the headwind of reduced interest income, which we have downgraded significantly in FY22 and FY23, owing to the low base rate."