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Jupiter from on high smiles

The fund manager has been boosted by strong demand for its European equity and bond strategies
July 30, 2015

Million by million, Jupiter Fund Management (JUP) is edging towards an asset base worthy of its branding. Net inflows of £1.4bn in the first half, the majority coming in a strong first quarter, lifted assets under management to £34bn at the end of June, as investors sought European equity and strategic bond funds.

IC TIP: Buy at 454p

In particular, the manager has benefited from the strong three-year performance of its European equity strategies, which has coincided with a rise in the popularity of the asset class among investors shying away from the volatility of emerging markets and the full valuation of US stocks. The group has also increased its global distribution network, which provided the majority of net flows into its mutual funds.

Net revenues after fee and commission expenses were 14 per cent higher at £169m, although this included performance fees of £12.8m, nearly all of which came from a single fund. In the comparable period last year, the manager netted performance fees of just £0.7m, while also swallowing £18.6m of amortisation writedowns, the last of a process dating back to the company's management buyout in 2007. As a result, reported profit growth was much higher.

Analysts at JPMorgan Cazenove upgraded their full-year adjusted pre-tax profit forecast from £157m to £162m, compared with £160m in 2014. That equates to EPS of 28.9p this year, up from 26.4p in 2014.

JUPITER FUND MANAGEMENT (JUP)
ORD PRICE:454pMARKET VALUE:£2.08bn
TOUCH:454-454.6p12-MONTH HIGH:473pLOW: 305p
DIVIDEND YIELD:0.9%*PE RATIO:13
NET ASSET VALUE:123p**NET CASH:£210m

Half-year to 30 JunTurnover (£m)Pre-tax profit (£m)Earnings per share (p)Dividend per share (p)
201419348.48.53.7
201520784.014.94.0
% change+7+74+75+8

Ex-div: 6 Aug

Payment: 28 Aug

*Excludes special dividend of 11.5p for 2014

**Includes intangible assets of £349m, or 76p a share