Hearts and Minds Investments Ltd (HM1) AI Stock Analysis

• Market Cap: N/A
• Dividend Yield: 5.33%
• Average Volume (3M): 144.31K
• Price to Earnings (P/E): 40.8
• Beta (1Y): 1.18
• Revenue Growth: 175.90%
• EPS Growth: 109.57%
• Country: AU
• Employees: 4
• Sector: Financial
• Sector Strength: 70
• Industry: Asset Management
• EPS (TTM): 0.02
• Shares Outstanding: 228,982,160
• 10 Day Avg. Volume: 190,555
• 30 Day Avg. Volume: 144,308
• PEG Ratio: 0.06
• Price to Book (P/B): 0.88
• Price to Sales (P/S): 4.22
• P/FCF Ratio: -272.66
• 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: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 69 Neutral
• Price Target: AU$3.00 ▼(-5.36% Downside)
• Action: Downgraded Date: 12/30/25
• Date: Action: Downgraded 12/30/25

The score is driven primarily by strong profitability and a debt-free balance sheet, alongside attractive valuation (low P/E and high dividend yield). Offsetting these positives are weak cash flow conversion (negative operating cash flow in FY2024–FY2025) and only neutral technical signals.

Positive Factors

Conservative, debt-free balance sheet

A zero-debt, large-equity capital structure gives lasting financial flexibility: it supports resilience through market downturns, enables opportunistic capital deployment (buybacks/dividends/acquisitions) without refinancing risk, and reduces insolvency risk over 2–6 months.

Improved profitability and ROE

Substantially higher net income and very high margins indicate durable operating leverage in the asset-management model; the meaningful ROE improvement (FY2025 ~13.6% vs FY2024 ~7.3%) suggests management is generating stronger returns on capital, supporting future distributions if sustained.

Lean operating structure scalable for asset management

A very small headcount signals a low fixed-cost base and a scalable asset-management platform: with limited overhead the firm can maintain high margins as AUM grows, preserving profitability over months and enabling rapid margin expansion if investment performance and flows improve.

Negative Factors

Weak operating cash flow conversion

Persistent negative operating cash flow despite high reported profits undermines sustainable capital return capacity: it forces reliance on non-cash valuation gains or balance-sheet adjustments, constrains reinvestment or distributions, and raises funding risk if conditions persist over months.

Revenue decline and earnings sensitivity to markets

Revenue and earnings are materially driven by market outcomes; a 13.7% revenue decline and prior multi-year losses show business performance can swing widely. That cyclicality reduces predictability of fee income and investor returns, raising execution risk over the medium term.

Historic EPS instability

A very large negative EPS growth metric reflects sharp earnings variability historically, which signals high operational and market cyclicality. This undermines confidence in earnings durability and complicates planning for distributions or strategic investments over the next several months.

Hearts and Minds Investments Ltd Business Overview & Revenue Model

Company Description

Hearts and Minds Investments Limited is an Australia-based listed investment company. The Company's investment objective is to provide a concentrated securities portfolio of the highest conviction ideas from fund managers, whilst also supporting Australian medical research organizations. It seeks to provide shareholders with an investment proposition by creating a concentrated portfolio of long positions in approximately 25 to 30 Australian and international listed securities based on the highest conviction ideas. It allocates about 35% of its investment portfolio based on the annual recommendations of fund managers who present at their Sohn Hearts & Minds Investment Leaders Conference (known as Conference Fund Managers). It allocates about 65% of its investment portfolio based on the highest conviction ideas of six fund managers (known as Core Fund Managers). These fund managers are Caledonia (Private) Investments, Cooper Investors, and Magellan Asset Management, among others.

How the Company Makes Money

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Hearts and Minds Investments Ltd Financial Statement Overview

Summary

Strong reported profitability in FY2024–FY2025 and a very conservative balance sheet (no debt, large equity base) support resilience. However, operating cash flow was negative in FY2024 and FY2025 despite high profits, and results have been volatile across the cycle with revenue declining in FY2025, which lowers confidence in earnings durability.

Income Statement

Profitability is strong in the last few years, with very high profit conversion in FY2024–FY2025 (net profit margin ~60–65%) and solid earnings levels (FY2025 net income ~A$106.8m vs FY2024 ~A$50.9m). However, results are volatile across the cycle (losses in FY2020–FY2022 and negative/unstable revenue in earlier years), and FY2025 revenue declined (-13.7% year-over-year), highlighting sensitivity to market-driven investment income.

Balance Sheet

Balance sheet is conservatively positioned with minimal leverage (debt-to-equity near zero; FY2025 total debt is zero) and a large equity base (~A$786.7m in FY2025). Returns on equity have improved meaningfully (FY2025 ~13.6% vs FY2024 ~7.3%), though the history includes negative returns in FY2021–FY2022, indicating performance can swing with markets despite the low-debt structure.

Cash Flow

Cash generation is the weakest area: operating cash flow has been negative in FY2024 and FY2025 (about -A$3.3m and -A$2.6m, respectively) despite strong reported profits, implying earnings have not recently translated into cash. Cash flow was positive in FY2023 (~A$7.6m) but highly inconsistent over time, including very large outflows in FY2021–FY2022.

Breakdown	TTM	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement
Total Revenue	111.18M	165.14M	84.39M	-64.09M	-6.62M	-5.36M
Gross Profit	111.18M	165.14M	84.39M	-64.09M	-6.67M	-5.37M
EBITDA	6.40M	152.08M	71.68M	45.66M	-136.31M	-19.10M
Net Income	19.35M	106.82M	50.93M	32.73M	-94.84M	-12.46M
Balance Sheet
Total Assets	836.83M	857.95M	730.51M	681.35M	647.09M	987.05M
Cash, Cash Equivalents and Short-Term Investments	781.93M	36.01M	619.48M	539.20M	309.58M	123.59M
Total Debt	0.00	0.00	6.99M	0.00	0.00	0.00
Total Liabilities	67.78M	71.25M	33.10M	5.83M	5.96M	101.05M
Stockholders Equity	769.05M	786.70M	697.41M	675.52M	641.13M	886.00M
Cash Flow
Free Cash Flow	-12.52M	-2.55M	-3.30M	7.60M	-94.84M	-56.91M
Operating Cash Flow	-12.52M	-2.55M	-3.30M	7.60M	-94.84M	-56.91M
Investing Cash Flow	40.68M	4.32M	42.57M	-43.86M	73.57M	161.32M
Financing Cash Flow	-38.93M	-35.49M	-31.57M	-28.56M	-25.28M	-22.46M

Hearts and Minds Investments Ltd Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 3.17
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:HM1, the sentiment is Negative. The current price of 3.17 is above the 20-day moving average (MA) of 2.80, above the 50-day MA of 2.92, and above the 200-day MA of 3.06, indicating a bearish trend. The MACD of -0.06 indicates Positive momentum. The RSI at 42.35 is Neutral, neither overbought nor oversold. The STOCH value of 30.12 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AU:HM1.

Hearts and Minds Investments Ltd Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MAM	72 Outperform	AU$64.02M	2.97	35.99%	6.39%	22.67%	19.47%
HM1	69 Neutral	―	40.76	2.49%	5.33%	175.90%	109.57%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
SB2	61 Neutral	AU$57.17M	19.67	3.43%	6.89%	30.36%	-31.47%
LCE	55 Neutral	AU$26.98M	38.35	1.46%	2.94%	38.32%	―
CIW	53 Neutral	AU$27.23M	46.88	2.42%	2.03%	18.17%	―

Hearts and Minds Investments Ltd Corporate Events

Hearts and Minds Hit by AI-Driven Software Sell-off but Stands by Long-Term Strategy

Hearts and Minds Investments Limited reported that its portfolio fell 5% in February, underperforming the MSCI World Accumulation Index (AUD), which declined 1.3%, amid broad weakness in global software stocks and a rotation away from high-multiple growth names. The sharp correction in software valuations was driven by investor concerns over how rapid advances in artificial intelligence, including increasingly capable AI agents, might challenge traditional SaaS business models, although the company maintains a positive long-term view on holdings such as monday.com, BlackLine, and Zillow, while highlighting an annualised pre-tax return of 9.77% since inception and a fully franked annualised dividend yield of about 6.6%.

The most recent analyst rating on (AU:HM1) stock is a Hold with a A$3.00 price target. To see the full list of analyst forecasts on Hearts and Minds Investments Ltd stock, see the AU:HM1 Stock Forecast page.

Hearts and Minds Reports Lower NTA After Dividend Adjustment

Hearts and Minds Investments Limited has reported indicative unaudited net tangible asset backing per share as at 6 March 2026, showing a pre-tax NTA of $3.25, post current tax NTA of $3.15 and post-tax NTA of $3.06. These figures are lower than the levels reported on 27 February 2026 and incorporate the impact of the recently declared fully franked annual dividend of 9.5 cents per share, which has already gone ex-dividend and is scheduled for payment in April, signalling a distribution to shareholders despite the slight softening in NTA.

The most recent analyst rating on (AU:HM1) stock is a Hold with a A$3.00 price target. To see the full list of analyst forecasts on Hearts and Minds Investments Ltd stock, see the AU:HM1 Stock Forecast page.

Hearts and Minds Flags Lower NTA Following Interim Dividend Adjustment

Hearts and Minds Investments Limited reported a decline in its net tangible asset backing per share as at 27 February 2026, with pre-tax NTA falling to $3.33 from $3.44 a week earlier, post current tax NTA easing to $3.24 from $3.35, and post tax NTA sliding to $3.14 from $3.25. The figures are stated on an ex-dividend basis, reflecting the impact of a recently announced fully franked interim dividend of 9.5 cents per share, which indicates that part of the NTA reduction is attributable to capital being returned to shareholders rather than purely to investment performance.

The most recent analyst rating on (AU:HM1) stock is a Buy with a A$3.00 price target. To see the full list of analyst forecasts on Hearts and Minds Investments Ltd stock, see the AU:HM1 Stock Forecast page.

Hearts and Minds Beats Market in January as Conference Picks Surge

Hearts and Minds Investments reported a modest portfolio gain of 0.21% in January, outperforming the MSCI World Accumulation Index (AUD), which fell 2.14%, and maintaining an annualised pre-tax return of 10.68% since its 2018 inception. The company’s shares traded at $3.14 with pre-tax NTA of $3.61 and a fully franked annualised dividend yield of about 5.7%, supported by a latest final dividend of 9.0 cents per share.

Recent performance was driven by strong contributions from the 2025 Conference portfolio, notably ACM Research, up 75% since purchase, and Brookdale Senior Living, up 63% since November, while new core manager Prusik Investment Management also outperformed, aided by gains in Hong Kong names AIA, Swire Pacific, and CK Hutchison. The update underscores HM1’s ability to generate competitive returns while continuing to fund medical research, reinforcing its differentiated position in the listed investment company market for investors seeking both performance and social impact.

The most recent analyst rating on (AU:HM1) stock is a Buy with a A$3.50 price target. To see the full list of analyst forecasts on Hearts and Minds Investments Ltd stock, see the AU:HM1 Stock Forecast page.

Hearts and Minds Reports Slight Weekly Decline in NTA Backing

Hearts and Minds Investments Limited reported its estimated net tangible asset (NTA) backing per share as at 6 February 2026, indicating a pre-tax NTA of $3.53, post current tax NTA of $3.43 and post tax NTA of $3.31. These figures represent a modest decline from the prior week’s levels, signaling a slight softening in portfolio value that may be of interest to investors tracking short-term movements in the company’s underlying asset base.

The week-on-week fall in NTA suggests recent market conditions or portfolio performance have had a negative impact on the company’s asset values, although the update remains unaudited and indicative. Regular disclosure of NTA metrics underscores the firm’s commitment to transparency and provides shareholders with a timely gauge of performance, aiding investment decisions in a volatile market environment.

The most recent analyst rating on (AU:HM1) stock is a Buy with a A$3.50 price target. To see the full list of analyst forecasts on Hearts and Minds Investments Ltd stock, see the AU:HM1 Stock Forecast page.

Hearts and Minds Investments Reports Slight Weekly Decline in NTA Backing

Hearts and Minds Investments Limited reported a modest decline in its net tangible asset (NTA) backing per share as at 30 January 2026 compared with the prior week. The pre-tax NTA fell to $3.61 from $3.68, post current tax NTA slipped to $3.52 from $3.59, and post-tax NTA eased to $3.36 from $3.41, signalling a slight softening in portfolio value that shareholders and market watchers will monitor for indications of short-term performance trends in the underlying investment portfolio.

The most recent analyst rating on (AU:HM1) stock is a Buy with a A$3.50 price target. To see the full list of analyst forecasts on Hearts and Minds Investments Ltd stock, see the AU:HM1 Stock Forecast page.

Hearts and Minds Reports Slight Weekly Dip in NTA Backing

Hearts and Minds Investments Limited has reported a slight decline in its net tangible asset (NTA) backing per share for the week ended 23 January 2026, with pre‑tax NTA falling to $3.68 from $3.75, post‑current tax NTA easing to $3.59 from $3.66, and post‑tax NTA decreasing to $3.41 from $3.46. The updated NTA figures, which are unaudited and indicative, provide investors with a timely snapshot of the company’s portfolio valuation and may signal modest short‑term softening in underlying asset values, a key metric for assessing performance and sentiment toward the listed investment vehicle.

The most recent analyst rating on (AU:HM1) stock is a Buy with a A$3.50 price target. To see the full list of analyst forecasts on Hearts and Minds Investments Ltd stock, see the AU:HM1 Stock Forecast page.

Hearts and Minds Investments Reports Steady NTA Backing as at 16 January 2026

Hearts and Minds Investments Limited has reported an unaudited estimated net tangible asset (NTA) backing per share as at 16 January 2026, with pre-tax NTA of $3.75, post current tax NTA of $3.66, and post-tax NTA of $3.46, broadly unchanged from the prior week. The largely stable NTA levels indicate that the company’s investment portfolio value and tax-adjusted position have remained steady over the period, signalling a relatively flat short-term performance environment for shareholders.

The most recent analyst rating on (AU:HM1) stock is a Buy with a A$3.50 price target. To see the full list of analyst forecasts on Hearts and Minds Investments Ltd stock, see the AU:HM1 Stock Forecast page.

Hearts and Minds Updates Performance Figures as Portfolio Mix Evolves

Hearts and Minds Investments reported a revised December 2025 monthly update after correcting its stated investment performance figures, confirming an annualised pre-tax return of 10.78% since its 2018 inception and a fully franked annualised dividend yield of 5.64% at 31 December, with pre-tax NTA at $3.60, post-tax NTA at $3.36 and the share price at $3.19. The portfolio fell 1.8% in December, underperforming the MSCI World Accumulation Index (AUD), while the 2025 Conference portfolio started strongly, led by ACM Research, and core manager Magellan Investment Partners added new European holdings SAP and adidas, signalling ongoing refinement of the global equity mix and reinforcing the strategy of combining shareholder returns with growing medical research funding.

The most recent analyst rating on (AU:HM1) stock is a Hold with a A$3.50 price target. To see the full list of analyst forecasts on Hearts and Minds Investments Ltd stock, see the AU:HM1 Stock Forecast page.

Hearts and Minds Posts December Dip but Maintains Solid Long-Term Returns and Grows Medical Research Funding

Hearts and Minds Investments Limited reported a 2.8% portfolio decline in December 2025, underperforming the MSCI World Accumulation Index (AUD), which fell 1.0% over the month, though since its 2018 inception the company has delivered an annualised pre-tax investment return of 10.64% and a fully franked annualised dividend yield of 5.64%. The update highlighted a strong early contribution from the 2025 Conference portfolio, particularly ACM Research, which rose 18% in December and more than 50% since purchase into early January 2026, while core manager Magellan Investment Partners added new positions in German-listed SAP and adidas, signalling continued conviction in global growth names even as the fund maintains a modest 5% cash weighting and lifts its cumulative medical research funding to $83.7 million.

The most recent analyst rating on (AU:HM1) stock is a Hold with a A$3.50 price target. To see the full list of analyst forecasts on Hearts and Minds Investments Ltd stock, see the AU:HM1 Stock Forecast page.

Hearts and Minds Investments Reports Higher NTA Backing per Share

Hearts and Minds Investments Limited reported an increase in its net tangible asset (NTA) backing per share as at 9 January 2026, with pre‑tax NTA rising to $3.74 from $3.63 a week earlier, post current tax NTA increasing to $3.65 from $3.53, and post‑tax NTA improving to $3.46 from $3.38. The uplift in all three NTA measures indicates a positive recent performance of the company’s investment portfolio, signalling strengthened asset backing for shareholders and potentially enhancing the company’s appeal in the listed investment company sector.

The most recent analyst rating on (AU:HM1) stock is a Hold with a A$3.50 price target. To see the full list of analyst forecasts on Hearts and Minds Investments Ltd stock, see the AU:HM1 Stock Forecast page.

Hearts and Minds Investments Posts Stable NTA Backing at Start of 2026

Hearts and Minds Investments Limited has reported its unaudited net tangible asset (NTA) backing per share as at 2 January 2026, showing a steady position over the previous week. The company’s pre-tax NTA remained unchanged at $3.63 per share, while post current tax NTA dipped slightly to $3.53 from $3.54 and post tax NTA was steady at $3.38, indicating broadly stable portfolio valuations and tax provisions over the period, with no material shifts in its underlying asset base signalled for investors.

The most recent analyst rating on (AU:HM1) stock is a Hold with a A$3.50 price target. To see the full list of analyst forecasts on Hearts and Minds Investments Ltd stock, see the AU:HM1 Stock Forecast page.

Hearts and Minds Investments Reports Stable NTA Backing at 26 December 2025

Hearts and Minds Investments Limited reported its estimated net tangible asset (NTA) backing per share as at 26 December 2025, showing a slight decline in pre-tax NTA to $3.63 from $3.64 a week earlier, while post current tax NTA remained steady at $3.54 and post tax NTA was unchanged at $3.38. The largely stable NTA levels indicate that the company’s portfolio value has been broadly steady over the period, suggesting limited short-term volatility for shareholders and offering investors a current snapshot of underlying asset backing as the year ends.

Hearts and Minds Investments Posts Slight Increase in NTA Backing

Hearts and Minds Investments Limited reported a modest increase in its net tangible asset (NTA) backing per share as at 19 December 2025, with pre-tax NTA rising to $3.64 from $3.62 a week earlier, post current tax NTA edging up to $3.54 from $3.52, and post-tax NTA moving to $3.38 from $3.37. The incremental gains across all NTA measures indicate a slight improvement in portfolio performance over the period, providing investors with a positive, albeit small, uplift in the value of their holdings heading into year-end.