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Why investors are buying this beaten-down ASX financial stock today

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After months of selling pressure, this ASX financial stock is finally getting a lift.

Generation Development Group Ltd (ASX: GDG) shares are pushing higher on Thursday after the company released a new update to the market.

At the time of writing, the share price is up 5.28% to $3.79.

Although it has bounced from its low of $3.43, the bigger picture still looks rough. The stock remains down around 38% in 2026 and has been trending lower since October last year.

Let’s take a closer look at the release.

A $1.8 billion migration is now complete

Generation Development confirmed that the $1.8 billion Xplore Wealth client book migration has now been completed.

The migration moves Xplore Wealth managed discretionary account portfolios to Evidentia Group’s Implemented Portfolios private label MDA service on the HUB24 platform.

This lifts Implemented Portfolios’ total funds under management to more than $4 billion. Generation Development said the move reinforces its position as Australia’s largest independent MDA provider.

An MDA is a managed account structure where an investment manager makes portfolio decisions within an agreed strategy. This can make it easier for advisers to manage client portfolios without approving every individual transaction.

Funds are still flowing in

The March quarter update showed the group was still growing, even as the share price continued to slide.

Evidentia Group reported funds under management of $34.8 billion at 31 March, up 30% on the prior corresponding period. The division also recorded net inflows of $1.4 billion, including $0.3 billion in a quarter affected by market volatility.

Generation Life also had a strong quarter, with sales up 57% on the prior corresponding period to $375 million. Net inflows came in at $310 million, while funds under management increased 35% to $5.3 billion.

Lonsec also continued to grow its research business, with the number of products researched rising 8% to 1,960.

Foolish takeaway

The Xplore migration adds scale to Evidentia, while the March quarter numbers showed funds are still flowing into the broader group.

The numbers are moving in the right direction. But after a 38% fall this year, investors may want to see stronger evidence that growth is turning into profit.

That is the key point from here. A completed migration is positive, but the market will still want to see the added scale show up in earnings, margins, and cash flow.

Until that happens, I would be careful about reading too much into one completed migration.

The post Why investors are buying this beaten-down ASX financial stock today appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Generation Development Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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