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Highlights

  • Pinnacle shares surge 7% following upbeat Macquarie conference update and US-China tariff easing.

  • Macquarie retains 'Outperform' rating, forecasting strong organic growth and accretive M&A potential.

  • Despite near-term EPS forecast cuts, broker sets 12-month price target at $25.10 — ~20% upside.

Pinnacle Investment Management Group Ltd (ASX:PNI) shares rallied more than 7% on Tuesday, buoyed by improving investor sentiment following the US-China tariff reduction and a positive outlook issued by Macquarie after the recent Macquarie investment conference.

The sharp rise has drawn attention to Pinnacle’s growing reputation as a diversified investment platform, with the broker reaffirming its ‘Outperform’ rating and projecting a potential 20% upside over the next 12 months.

Robust FUM Growth Across Channels

At the Macquarie conference, Pinnacle provided a comprehensive business update that impressed analysts. The fund manager, which provides distribution, marketing, business development, and infrastructure support to its affiliated boutique investment firms, reported solid funds under management (FUM) growth across key segments.

As of March 2025, Pinnacle’s affiliate FUM stood at $159.9 billion, up 2.9% from December 2024. Retail FUM increased 3.4%, international FUM rose 5.6%, and domestic institutional FUM edged up 0.8%.

Net inflows for Q3 FY25 totalled $6.2 billion, with:

  • $2.6 billion from retail investors

  • $2.2 billion from international investors

  • $1.4 billion from domestic institutional clients

Macquarie highlighted Life Cycle as the standout performer, growing FUM by $3.7 billion to $4.7 billion during the quarter.

Strong Performance Metrics and Resilience

Beyond fund flows, performance remains a cornerstone of Pinnacle’s appeal. According to Macquarie, 88% of its investment strategies with more than five years’ track record have outperformed benchmarks.

Additionally, around 28% of Pinnacle’s FUM is eligible for performance fees, with over half already above their high-water marks and 17% within 2% of earning fees.

The broker also praised Pinnacle's diversified product mix, which includes private markets and non-equity-linked strategies. 

Macquarie’s Strategic View and Target Price

While Macquarie remains bullish on Pinnacle’s structural strengths, it has tempered near-term expectations due to ongoing market fluctuations. The broker revised down its FY25 EPS forecast by 3% and made further reductions of 7–10% for FY26 through FY30.

Nevertheless, Macquarie set a 12-month price target of $25.10, indicating roughly 20% upside from the post-rally trading price. The broker stated:

“PNI has an attractive organic growth outlook and potential to add accretive M&A. Outlook for organic performance is backed by net flows, performance fees, and operating leverage.”

Pinnacle also retains $300–$325 million in capital ("dry powder") to deploy into future initiatives.