Hargreaves Lansdown (LON: HL.) shares, alongside the general market, have declined significantly in 2022 as its growth has slowed and economic concerns arise.
YOUR CAPITAL IS AT RISK. 81% OF RETAIL CFD ACCOUNTS LOSE MONEY.
The FTSE 100 stock is down over 39% this year and more than 44% in the last 12 months, and while it has risen slightly in the last month, analysts and funds have taken a negative stance on Hargreaves Lansdown shares.
As reported last week, RBC Capital analyst Ben Bathurst downgraded Hargreaves shares to Sector Perform from Outperform, reducing the firm's price target on the stock to 1,050p, based on a more challenging asset-gathering backdrop for UK wealth managers and investment platform providers. The analyst also stated Hargreaves faces uncertainty on a “number of fronts.”
RBC wasn't the only firm to downgrade Hargreaves last week, with BofA analyst Andrew Sinclair moving the stock to Neutral from Buy based on near-term obstacles.
Meanwhile, Hargreaves is one of the most shorted London-listed stocks at 4.69%, with shorts rising since March this year. According to Short Tracker, seven funds are short Hargreaves Lansdown, including Citadel, Marshall Wace, and Blackrock Investment Management.
With the cost of living crisis weighing heavy on wallets, people are likelier to reduce and cut out investing, presenting the near-term challenges that the analysts at RBC and BofA spoke about.
The company acknowledged macro headwinds October 17 trading statement when it said, “the impact of the challenging macroeconomic and geopolitical backdrop on asset values, client confidence and propensity to invest has been seen across our industry.”
While many investors are positive about Hargreaves shares, the recent negative stances taken by some market participants are something for investors to consider in the near term.