Today’s Mortgage Advice Bureau (Holdings) Plc (LON:MAB1) AGM update confirms the MAB has continued to grow its network of advisers, observing:
* MAB increased its advisers to 990 on 19 May 2017 (31 Dec 2017: 950);
* Organic recruitment has been in line with the Board’s expectations;
* New business recruitment to be weighted to the second half.
The statement confirms that “current trading is in line with the Board’s expectations and [management] look forward to delivering further growth in the remainder of this financial year.”
Zeus view
Mortgage Advice Bureau (Holdings) Plc revenue and profit growth is principally driven by rising adviser numbers. With 11% annualised growth in adviser numbers year to date, we are confident organic and new business recruitment will enable management to achieve its target 15% pa.
Investors will recall that in 1H16 MAB had an average for the past 12 months of 851 advisers and for 2H16 the average rose to 920. We expect the average for 1H17e will be c 970 and we leave our forecasts unchanged.
Valuation
At 452p MAB shares are trading on 19.6x current year’s earnings and, with prospects of 21% growth in 2018, a Price-Earnings-Growth ratio of 0.9x.
MAB shares offer shareholders an attractive prospective dividend yield of 4.7%, with prospects for strong growth.
