LendInvest delivers maiden gains

Maiden half-year results from specialist asset manager LendInvest (LINV) showed some promise as the booming market fuelled unprecedented demand from investors wanting a piece of the action in buy-to-let (BTL) investment. LendInvest, which raised £40m from its listing on Aim in July, takes in mandates from large institutions and funnels the money through a network of specialist mortgage brokers who have access to the company’s investment platform. LendInvest takes a matchmaker fee for the work, alongside charging traditional asset management-style fees for its investment services, as well as channelling loans.

The measure of high market demand is the 32 per cent year-on-year increase in assets under management (AUM) that the company reported at the half-year stage, driven largely by demand for buy-to-let investments. The increase in AUM translated quickly into an increase in origination and asset management fees – combined these came to over £17m for the half, out of total revenue of £50.8m. The balance of total income was made up by interest payments on BTL loans, while pandemic provisions halved to £1.7m.

The BTL market seems to be going to through a prolonged period of change, according to chief executive Rod Lockhart. “A decade ago, the buy-to-let market was amateurish, with landlords typically owning one or two properties. But with the regulatory attack on buy-to-let, the market is consolidating, and larger players are getting involved,” he said.

Broker Berenberg forecasts EPS for the full year of 7.9p, rising to 13.8p in 2023, giving a price/earnings forecast of 26 and 15, respectively. Wait to see how things develop. Hold.