Original-Research: MLP SE - from NuWays AG

Classification of NuWays AG to MLP SE

Company Name: MLP SE
ISIN: DE0006569908

Reason for the research: Update
Recommendation: BUY
from: 08.03.2024
Target price: EUR 11.00
Target price on sight of: 12 Monaten
Last rating change:
Analyst: Henry Wendisch

Comeback of RE and performance fees around the corner; chg.

Topic: MLP released FY'23 preliminary results and suprised positively with Q4's better than expected real
estate business. MLP also looks set to record performance fees in Q1 for the first time since 2021.

Q4 sales in line with estimates: Sales rose by 5% yoy to € 289m (eNuW: € 294m) with a strong impact from Old-Age Provision (€ 90m, 31% of sales; eNuW: € 102m), but also strong growth from Interest Income (€ 20.3m, +133% yoy; eNuW: € 19.6m), Non-Life Insurance (€ 39m, +22% yoy; eNuW: € 42m) as well as Wealth Management (€ 80m, +4% yoy; eNuW: € 91m). Surprisingly, the negative trend in Real Estate could be stopped, as Q4 RE sales came in much better than expected at € 26.2m, up 19% yoy (eNuW: € 5.1m), thanks to both Brokerage (€ 11.1m, +62.4% yoy; eNuW: € 3.5m) and Development (€ 15m; flat yoy; eNuW: € 1.6m).

Q4 EBIT in line with previously released PW: The positive impact from the interest result (€ 12.8m; +64% yoy; eNuW: € 13.5m) led to an overall Q4 EBIT of € 25.4m, up 9% yoy, while it was also burdened by a one-off goodwill impairment on a real estate subsidiary of € 4m.

FY'24e guidance conservative: The company guides for an EBIT range of € 75-85m (eNuW: € 89m; eCons: € 88m) for FY'24e, based on positive outlooks in Wealth as well as Life & Health. Upside could emerge from 1) a potential rebound in Real Estate (company guides 'very positively'), which was already visible during Q4'23, and 2) highly profitable performance fees which seem to be likely in Q1'24e already. Both of FERI's largest public funds (EquityFlex & Optoflex) currently exceed the threshold to be eligible for performance fees and the record day (March 31st, last day of Q1) is close. Against this backdrop, management seems to guide conservatively, in our view.
Mid-term targets confirmed: By Y/E'25e, MLP aims to achieve an EBIT in the range of € 100-110m, based on its diversified business mix coupled with continous growth and efficiency gains. This would imply an EBIT 23-'25e CAGR of 19-25%.

Overall, MLP's stock is too cheap to ignore at current levels, trading at historically low multiples. The SDAX uplisting on March 18th should also support the stock's trading volumes and visibility. Hence, we reiterate BUY and confirm MLP in the NuWay's Alpha List with unchanged PT of € 11.00, based on FCFY'24e and SOTP.

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http://www.more-ir.de/d/29099.pdf
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