Jefferies cuts AJ Bell price target, retains ‘buy’ rating

Jefferies slashed its price target on AJ Bell on Friday to 370p from 450p, keeping the rating at ‘buy’.

"Our revenue margin estimates for H1 were close to accurate, although we do now increase the FY23 top line forecast somewhat," it said.

"However, our operating margin was too low given the NII contribution, so costs come down and we raise our FY23 profit before tax estimates 8%.

"The trajectory of earnings growth slows in our medium-term forecasts, bringing down our valuation to £3.70."

Still, the bank said AJ Bell justifies a premium rating versus peers, hence why it retained the buy rating.