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Jupiter suffers outflows as Merian comes onboard

The asset manager continues to deliver better than average returns, but assets contracted as the pandemic took hold
July 29, 2020

A familiar tale in managed money, as Jupiter Fund Management (JUP) saw statutory profits halve as the pandemic sent investors running for the exit during the first half of the year. Net fund outflows came in at £2bn, an increase on the net £1.1bn pulled out by clients in the first half of 2019, with an accompanying 12 per cent fall in net management fees, though the asset manager did benefit from net inflows in four of the six months during the period. However, the outflows fed through to an 8 per cent decline in assets under management (AuM) to £39.2bn, although inflows eventually resumed due to a partial retracement in asset prices.

IC TIP: Hold at 238p

Performance metrics have been encouraging given the volatility levels seen in the early part of the year. In the three years to 30 June, around 80 per cent of mutual fund AuM was above the median after the deduction of fees, with the lion’s share in the top quartile. This compares with an equivalent level of 72 per cent recorded at the end of 2019.

With an eye to the future, Jupiter completed a £370m scrip deal to acquire Merian Global Investors at the beginning of July. The integration phase is underway, and the acquired entity’s financials are not included in Jupiter’s returns, but its average AuM during the period under review was £18.6bn.

The consensus forecast for adjusted EPS in 2020 stands at 20.44p, rising to 21.61 in 2021.

JUPITER FUND MANAGEMENT (JUP)  
ORD PRICE:238pMARKET VALUE:£ 1.32bn
TOUCH:237.8-238.2p12-MONTH HIGH:438pLOW: 161p
DIVIDEND YIELD:3.9%PE RATIO:13
NET ASSET VALUE:111p*NET CASH:£164m
Half-year to 30 JuneTurnover (£m)Pre-tax profit (£m)Earnings per share (p)Dividend per share (p)
201921081.415.17.9
202018240.86.507.9
% change-13-50-57-
Ex-div:06 Aug   
Payment:28 Aug   
*Includes intangible assets of £347m, or 63p a share.