Key Highlights:

  • GDG shares fell about 14% on the day of its FY26 result (27 August) and traded around $3.00 in mid-September, down roughly half since the start of 2026.
  • Centuria guided to lower FY27 operating Earnings per security after a $300 million raise, and its shares have fallen about 45% over the past year.
  • Both stocks are exposed to the same macro pressure: expected RBA rate hikes and bond yields at multi-year highs.
  • Upcoming company updates and execution against stated plans remain central to the next phase for both stocks.

Generation Development and Centuria Capital are both losing ground because their August results showed that strong growth in funds under management will not quickly lift earnings per share. For GDG the issue is fast-rising costs and dilution from its Evidentia deal. For Centuria it is a larger share count after its June capital raising, early losses at its AI venture ResetData and worries about property credit, all while interest rates are heading higher.

A tough backdrop for rate-sensitive financials

These two stocks are not falling in isolation. Australia's cash rate stands at 4.35% after three increases earlier in 2026, and all four major banks expect a further 25 basis point rise to 4.60% when the Reserve Bank meets on 28–29 September,

the US 10-year Treasury Yield had climbed above 5.1%, its highest level since 2007. Higher discount rates tend to weigh on growth platforms and property-linked fund managers, the two groups these stocks belong to.

Generation Development Group (ASX:GDG): record inflows, flat earnings per share

Generation Development owns Investment bond provider Generation Life, research house Lonsec and, since 2025, managed accounts Business Evidentia. Operationally, FY26 was a strong year. group Revenue rose 23% to $178.7 million and underlying net profit after tax rose 21% to $40.7 million. Funds under management climbed 37% to $46.5 billion, helped by record net inflows of $9.7 billion.

The market focused on the details. expenses rose 26% to $119.5 million, faster than revenue. Management also flagged that FY27 cost growth would be broadly similar. Underlying Earnings Per Share were flat at 10.2 cents because of the shares issued to fund the Evidentia acquisition. Management said Operating Leverage should show up more clearly in FY28 and FY29, which is a longer wait than growth investors were hoping for. Statutory profit fell 10% to $31.9 million, and the full-year Dividend was held at 2 cents.

The shares fell about 14% on results day and kept sliding, closing at $2.98 on 18 September. That is a year-to-date fall of about 49% data, near the bottom of a 52-week range of roughly $2.89 to $7.77. For FY27, management expects Generation Life monthly inflows of $150–200 million and Evidentia net inflows of $5–7 billion.

Centuria Capital Group (ASX:CNI): dilution, data centres and Credit questions

Centuria is a real estate funds manager that also runs the Centuria Bass private credit platform and owns 50% of AI cloud provider ResetData. Its FY26 result, released on 27 August, included operating net profit of $113.8 million and operating EPS of 13.6 cents, up 11.5%. Distributions were 10.4 cents per security, and Assets under management reached a record $22.2 billion.

The problem is the per-security outlook. Centuria guided to FY27 operating net profit of about $130 million, up 14%, but operating EPS of 13.0 cents, lower than FY26. The main reason is the $300 million Equity raising completed in June at $2.00 per security. On the earnings call, management said the raise increased securities on issue by about 20.6%. The CFO also said forecasts assume a BBSY Base Rate of 4.7%, which helps explain why NPAT growth is expected to lag EBIT growth.

ResetData recorded an operating loss of $10.9 million in FY26, up from $4.3 million a year earlier, . Management is targeting positive EBIT in the second half of FY27. Credit is another concern: Centuria Bass funded six assets for Sydney developer Bathla Group, which entered voluntary administration in August. In its 25 August response, CNI said its own direct exposure was a $4.5 million Loan Facility and that the administration does not have a material impact on the group.

The shares fell by more than 10% on results day and traded near $1.23 on 25 September, . That is down about 8% over the past month, about 45% over the past year, and well below the $2.00 raising price.

What links the two sell-offs

The two businesses differ, but their share prices have been hit for similar reasons. Both have grown through acquisitions or capital-heavy new ventures, and in both cases headline growth did not lift earnings per share. When a company asks investors to wait until FY28 for the payoff, the share price becomes very sensitive to interest rates and sentiment.

GDG's challenge is mainly costs and execution: inflows are strong, but spending is growing just as fast. Centuria's is more about the Balance Sheet and asset quality, as it puts new capital into property funds and an early-stage AI business while its credit platform deals with a developer collapse. Centuria is also more directly exposed to rates, through property valuations and borrowing costs.

What investors could watch next

The RBA decision on 29 September: a hike to 4.60% is widely expected. Any signal of further increases could pressure both stocks again.

GDG's quarterly FUM updates: inflows can be checked against management's FY27 ranges, alongside any signs of cost discipline.

ResetData milestones: progress on the CDC Data Centres agreement, GPU deployment and the path to positive EBIT in the second half of FY27.

Bathla recoveries: any change to the "not material" assessment would matter.

AGM season: annual meetings later in the year could bring trading updates or changes to guidance from either company.

The bottom line

Both stocks are losing ground because the market is paying for earnings per share, not headline growth. GDG has record funds under management, but costs and dilution are keeping per-share earnings flat. Centuria has record AUM, but a larger share count, ResetData losses and credit concerns weigh on its outlook. With rate hikes expected, both may need to show that extra scale is improving per-share results before sentiment turns.