Australian Finance Group Ltd. (AFG) AI Stock Analysis

• Market Cap: AU$595.15M
• Dividend Yield: 4.16%
• Average Volume (3M): 750.83K
• Price to Earnings (P/E): 16.7
• Beta (1Y): 0.85
• Revenue Growth: 14.37%
• EPS Growth: 20.75%
• Country: AU
• Employees: 317
• Sector: Financial
• Sector Strength: 70
• Industry: Financial - Mortgages
• EPS (TTM): 0.07
• Shares Outstanding: 271,760,070
• 10 Day Avg. Volume: 626,907
• 30 Day Avg. Volume: 750,829
• PEG Ratio: 0.97
• Price to Book (P/B): 2.79
• Price to Sales (P/S): 1.54
• P/FCF Ratio: 20.60
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: AU$2.96
• Price Target Upside: 35.16% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 52 Neutral
• Price Target: AU$2.50 ▲(14.16% Upside)

The overall score reflects significant financial challenges, including declining revenue and high leverage, which weigh heavily on the stock's outlook. Technical indicators suggest a lack of bullish momentum, while valuation metrics provide some support with a moderate P/E ratio and a decent dividend yield.

Positive Factors

Revenue Diversification

AFG's diversification into business finance and financial planning enhances its earnings potential and reduces reliance on mortgage broking, providing a more stable revenue base over time.

Operational Efficiency

Positive EBIT and EBITDA margins indicate that AFG can manage its operations efficiently, which is crucial for sustaining profitability despite revenue challenges.

Cash Generation Ability

A positive free cash flow to net income ratio suggests AFG's ability to generate cash relative to its net income, supporting financial flexibility and potential reinvestment opportunities.

Negative Factors

Declining Revenue

A substantial decline in revenue growth indicates challenges in maintaining market share or demand, which can impact long-term financial health and strategic initiatives.

High Leverage

High leverage increases financial risk and can strain cash flow, limiting AFG's ability to invest in growth opportunities or weather economic downturns.

Profitability Decline

Decreasing profit margins suggest reduced profitability, which can hinder AFG's ability to reinvest in the business and maintain competitive positioning.

Australian Finance Group Ltd. Business Overview & Revenue Model

Company Description

Australian Finance Group Limited, together with its subsidiaries, engages in the mortgage broking business in Australia. It operates in two segments, Aggregation and AFG Home Loans. The company is involved in the mortgage origination and management of home and commercial loans, and consumer asset finance; and distribution of own branded home loan products. It offers business loans, such as equipment finance, inventory finance, franchisee loans, debtor finance, commercial property finance, and working capital finance. The company also offers Suite360 platform, commercial and business broking, smart marketing platform, and analytics and business data solutions. The company was formerly known as Australian Finance Group Pty Ltd. Australian Finance Group Limited was incorporated in 1994 and is headquartered in West Perth, Australia.

How the Company Makes Money

AFG generates revenue primarily through commissions and fees earned from lenders for services provided by its network of mortgage brokers. The company receives upfront commissions when brokers facilitate loans and ongoing trail commissions for the duration of the loan. Additionally, AFG earns income from its financial planning and insurance services, as well as from its proprietary technology platform that supports brokers in their operations. Significant partnerships with various financial institutions also contribute to AFG's earnings, as these relationships enhance the range of products and services available to clients, thereby increasing transaction volumes.

Australian Finance Group Ltd. Financial Statement Overview

Summary

Australian Finance Group Ltd. faces challenges with declining revenue and profitability, coupled with high leverage. While operational efficiency is present, the company must address its financial risks and improve cash conversion to enhance financial stability.

Income Statement

The income statement shows a significant decline in revenue growth, with a negative growth rate of -65.22% in the latest period. Gross profit margin and net profit margin have also decreased compared to previous years, indicating reduced profitability. However, the company maintains a positive EBIT and EBITDA margin, suggesting some operational efficiency.

Balance Sheet

The balance sheet reveals a high debt-to-equity ratio of 25.29, indicating significant leverage and potential financial risk. The equity ratio is low, reflecting limited equity financing. These factors suggest a need for careful management of financial obligations.

Cash Flow

Cash flow analysis shows a decline in free cash flow growth, but the company maintains a positive free cash flow to net income ratio of 0.84, indicating some ability to generate cash relative to net income. The operating cash flow to net income ratio is low, suggesting challenges in converting income into cash.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	1.24B	403.90M	1.10B	1.02B	949.34M	761.47M
Gross Profit	810.70M	116.40M	363.15M	338.54M	204.19M	161.29M
EBITDA	59.20M	59.20M	291.82M	262.17M	141.19M	113.86M
Net Income	35.00M	35.00M	28.98M	37.31M	38.78M	51.30M
Balance Sheet
Total Assets	7.07B	7.07B	5.98B	6.32B	6.68B	4.74B
Cash, Cash Equivalents and Short-Term Investments	223.80M	223.80M	67.40M	222.24M	268.58M	241.05M
Total Debt	5.62B	5.62B	4.57B	4.60B	4.98B	3.46B
Total Liabilities	6.85B	6.85B	5.77B	6.12B	6.47B	4.54B
Stockholders Equity	222.10M	222.10M	194.42M	179.06M	184.32M	202.98M
Cash Flow
Free Cash Flow	38.70M	30.10M	20.94M	51.23M	40.01M	52.38M
Operating Cash Flow	39.80M	35.90M	38.78M	58.26M	52.68M	59.35M
Investing Cash Flow	-1.06B	-1.05B	13.19M	303.47M	-1.46B	-506.70M
Financing Cash Flow	1.02B	1.02B	-52.59M	-408.07M	1.45B	511.86M

Australian Finance Group Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2.19
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:AFG, the sentiment is Negative. The current price of 2.19 is below the 20-day moving average (MA) of 2.28, below the 50-day MA of 2.36, and above the 200-day MA of 2.18, indicating a neutral trend. The MACD of -0.05 indicates Positive momentum. The RSI at 39.99 is Neutral, neither overbought nor oversold. The STOCH value of 25.68 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AU:AFG.

Australian Finance Group Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
MYS	66 Neutral	AU$782.26M	17.58	5.92%	4.66%	26.01%	-17.55%
PPM	65 Neutral	AU$982.38M	9.89	12.11%	11.76%	-6.49%	-5.40%
COG	55 Neutral	AU$466.09M	23.38	12.36%	2.73%	-26.30%	40.12%
AFG	52 Neutral	AU$595.15M	16.72	16.81%	4.16%	14.37%	20.75%
LFS	46 Neutral	AU$1.12B	18.73	5.01%	6.51%	14.81%	―

Australian Finance Group Ltd. Corporate Events

Australian Finance Group Ltd 2025 AGM Resolutions Passed

Australian Finance Group Ltd held its 2025 Annual General Meeting, where all resolutions were successfully passed by shareholder vote. The re-election of directors Jane Muirsmith and Annette King was confirmed, reflecting strong shareholder support and stability in the company’s governance structure.

Australian Finance Group Ltd Reports Strong Financial Growth and Strategic Advancements in FY25

Australian Finance Group Ltd’s 2025 Annual General Meeting highlighted a successful financial year with a 21% increase in Net Profit After Tax to $35 million and a 13% rise in Underlying Net Profit After Tax before Amortisation to $40.8 million. The company’s strategic focus on technology enhancements and the completion of the Fintelligence acquisition have bolstered broker productivity and engagement, contributing to significant growth in both Distribution and Manufacturing segments. The launch of the Broker Investments program further underscores AFG’s commitment to mutual growth and expanding its earnings base.

AFG Releases Q1 FY2026 Mortgage Index

Australian Finance Group Ltd. has released its Mortgage Index for the first quarter of the financial year 2026. This announcement provides insights into the mortgage market trends and AFG’s positioning within the industry, potentially impacting stakeholders by highlighting shifts in market dynamics and consumer behavior.

AFG Adjusts CEO Remuneration to Reflect Market Standards

Australian Finance Group Ltd has announced an increase in the fixed annual remuneration of its CEO, David Bailey, to $800,000, reflecting the company’s growth under his leadership since 2017. The adjustment aligns the CEO’s pay with market standards for ASX300 companies and includes provisions for short-term and long-term incentives, as well as an extended notice period and non-compete clause, indicating a strategic move to retain and motivate executive talent.

AFG Prices A$1 Billion RMBS Transaction Amid Strong Investor Demand

AFG has successfully priced a A$1 billion Residential Mortgage-Backed Securities (RMBS) transaction, which was upsized from A$500 million due to strong demand from 32 investors, including four new ones. This transaction, marking AFG’s 19th issue in the public RMBS market, highlights the company’s robust positioning as a trusted issuer and its commitment to providing competitive home loan products and sound investment opportunities.

Australian Finance Group Announces Director’s Share Disposal

Australian Finance Group Ltd announced a change in the director’s interest, specifically involving Brett McKeon, who disposed of 832,632 ordinary shares valued at approximately $2.1 million. This change in director’s interest may have implications for the company’s stockholders and market perception, as it reflects significant personal financial decisions by a key company figure.

Australian Finance Group Ltd Announces Director’s Interest Changes

Australian Finance Group Ltd has announced changes in the interests of its directors, specifically Brett McKeon and Malcolm Watkins. Brett McKeon has disposed of 500,000 ordinary shares held indirectly through MBM Investments Pty Ltd as trustee for the Brett McKeon Family Trust, at a total value of $1,279,310.50. This change in director’s interest is part of the company’s routine disclosures to the Australian Securities Exchange, ensuring transparency and compliance with corporate governance standards.

Australian Finance Group Ltd Announces 2025 AGM and Office Relocation

Australian Finance Group Ltd (AFG) has announced its 2025 Annual General Meeting (AGM) to be held on October 17, 2025, as a hybrid meeting, allowing shareholders to participate either in person or online. The AGM will cover key agenda items including financial reports, the adoption of the Remuneration Report, and the re-election of two Non-executive Directors. The company is also relocating its head office to Perth CBD effective October 1, 2025. This move and the hybrid AGM format reflect AFG’s commitment to accessibility and operational efficiency, potentially enhancing shareholder engagement and aligning with modern business practices.