The latest Investing Matters Podcast episode featuring financial educator and author Jared Dillian has been released. Listen here.
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I keep hovering over the sell button but something keeps telling me that given the rise in the FTSE over the last 2 months might Jupiter surprise us with an increase in funds under management.... I assume the weak markest in second half of last year was the reason for the fall so might the strengthening of the FTSE through Jan and Feb helped reverse this trend or will people still have held off due to brexit?
I hadn't followed the Shorts but that is interesting although noticeably this has not created a decline in the share price which has remained fairly stable over the last month. I guess there have been sufficient buyers for the shares shorted?
I'm in the same boat Skeletor. The short interest rising from 4% to 8% in a month is also cause for concern in my view. I'm probably going to hold and see what happens...
By tomorrow I clearly mean Friday.
Was tempted to sell this today as not expecting a positive update tomorrow and can see shares falling lower. The lack of debt and incredible yield still makes this a good investment in my opinion but could these be bought back at a 5-10% discount tomorrow morning?
Got rid of a lot of directors, why? Thanks in advance
Whereas Citigroup and BNP Paribas are considerably less positive. You pays yer money....
Assets under management jumped from £35.7bn to £40.5bn and profits rose by £3.5m to£171.6m. The firm also announced a fy dividend of 27.2p up from 25.5p in 2015.
It's a crazy drop, but one that I'm not sure we can get out off. Was so close to selling two weeks ago, but never did. Heavy investment in Europe with offices going to open in Italy if my memory serves me right. Think people are just withdrawing funds for cash... Can't blame them really as sorry state of affairs.
seems a good price.. %7 dividend and no debt
Woodford Patient Capital given ‘sell’ rating by broker: Neil Woodford’s Patient Capital investment trust has been handed a “sell” recommendation just two months after making its stock market debut.
Sophos aims to raise $100 million in London IPO: Sophos, an Oxfordshire-based IT security company that is majority-owned by private equity group Apax Partners, is taking another shot at a stock market flotation in London with plans to raise £65 million.
Odey struggles to find value amid market ‘bubble’: Odey Asset Management, one of London’s oldest hedge funds, has been stung by its bets on smaller U.K. companies this year at the same time as a bad currency trade wiped off nearly a fifth of the value of its flagship fund.
Seven Investment Management in talks to sell to Cayzer family: Wealth Manager Seven Investment Management is in advanced talks about a sale to the Cayzer family investment trust, according to people familiar with the situation, in a deal that would mark the latest tie-up in the wealth management sector
Neil Woodford’s cash call raises £800 million as fund debuts on LSE: Fund manager Neil Woodford has raised a record £800 million for his new investment fund – demonstrating his enduring box office appeal among investors.
Asset Managers pose growing threat to global financial system, warns IMF: The growth of the asset management industry poses risks to global markets that have not been fully appreciated, the International Monetary Fund has warned.
A number of buy suggestions from the financial press. e.g. the times. Attraction is the share price drift down (waiting for recent trading results) resulting in 6% plus dividend. BUY
Private equity: changing the game: There were $89 billion of leveraged buyouts in the first six months of 2014, according to S&P Capital IQ. That is a third higher than a year ago but still a very low proportion of overall M&A activity. That volume is two-thirds lower than in 2007, which was the heyday of private equity. Deals are smaller too. There have only been two deals of over $10 billion in the past five years, against 15 in the five years before the crisis. What’s wrong? Appetite for classic multibillion-dollar public-to-private deals – often carried out by a consortium of debt thirsty private equity groups – has waned. Buying out large listed companies is expensive. The S&P 500 recently hit a new high and is trading at about 15 times forward earnings compared to 11 times three years ago. And the buyout groups are having to put more into each deal – equity contributions have jumped to 35% in recent years from 30% in the pre-crisis era. To complicate things further, companies have lots of cash, so there is fierce competition for undervalued assets. So where is private equity putting money now? Unwanted divisions of big companies are popular targets. This avoids the hassle of buying public companies, which can require shareholder votes and big premiums. Another target is late-stage venture capital (think TPG’s investment in ride-sharing service, Uber). Private equity’s key skill is not buyout, but finding cheap assets and attractive deals before anyone else does.
Alibaba: From FOMO to FOGI: Fear of missing out, or FOMO, can make people do irrational things. And so it proved on Friday when shares in Chinese internet giant Alibaba closed their first day of trading at $94. The offering price was $68. The opening day pop was huge, even by Wall Street’s exuberant standards. This means someone has got something badly wrong. If the closing price represents Alibaba’s underlying value, the company’s balance sheet is now $8 billion lighter than it would be had the offering been priced correctly. Alternatively, it might be the buyers that have it wrong, if they are concerned about value at all. This seems more likely. Alibaba’s market capitalisation is more than $230 billion, larger than eBay and Amazon combined. The stock trades at more than 40 times this year’s earnings, according to the handful of analysts’ forecasts listed on Bloomberg. This makes it wildly more expensive than eBay (16 times) and Hong Kong-listed gaming and messaging service provider Tencent (29). Relative to 57% forecast growth in earnings, this may not seem steep. But these strong growth forecasts for Alibaba assume that net income margins rise from 45% this year to more than 50% for 2015 and 2016.
Shareholder value: controlling interests: Shareholders seem to be getting the best of things just now. Pretax margins in the S&P 500, at more than 10%, are at the highest level in more than 20 years. Profits are at a high relative to U.S. GDP, too. But Owners, suppliers, staff and customers all have their hooks in companies and shareholders do not always win. Look at investment banks, where the staff take most of the value. Or at the U.K.’s supermarket price war, which benefits customers at the expense of everyone else. Neither is it true that alternative forms of control will necessarily produce better companies, however that is measured. The near collapse of the U.K.’s Co-operative Group shows what can happen when well-meaning alternatives go awry. The only certainty is that taking control away from equity holders will increase the cost of equity for the companies concerned – making riskier debt funding more attractive. Here one thinks of banks’ mortgage trading before the crisis. But there are more examples of how managing companies with shareholder value in mind has been beneficial to Owners, suppliers and customers alike. By all means, experiment with new forms of control. But they may cause as many problems as they solve.
BlackRock sounds alarm over IPO quality: The world’s largest institutional investor has sounded the alarm over the quality of European IPOs as hedge funds increase their bets against private equity-backed flotations, after the market for companies going public was soured by a string of high-profile failures.
Markets: Mainland China shares led a sell-off across the region after tensions in Ukraine sparked a decline on Wall Street. The tension contributed to a 1 per cent fall for the S&P 500 to 1,920, leaving it 3.4 per cent below its record high. The CBOE Vix index rose 11.6 per cent, placing it within sight of last week’s four-month high. (FT's Global Market Overview)
Positive Points: Overall, the group said it had seen net inflows totalling £966 million for the full year, up from £278 million for the nine months to September, after a surge in gains in the final quarter. Positive commentary was reported by management in respect of the long-term growth prospects for the savings market. In October 2012, management highlighted that it continues to position the business for growth. Ageing populations and the decline in state-funded and corporate provision of pensions provide attractive opportunities. Historically low interest rates continue to detract from the attractions of traditional deposit saving accounts, with stockmarket related investments providing an alternative. Jupiter said inflows continued into its more defensive Merlin Income and Strategic Bond funds, but that investors had also put money into its UK Special Situations and European Growth products.
Negative Points: While the company is expanding into overseas markets, it does not currently benefit from the scale of international intermediary distribution channels enjoyed by other financial groups. Revenues generated in the UK currently account for around 90% of the group's total. At the heart of any asset manager is the investment team. As with any fund management business, there is a risk that if a star manager leaves, investors and assets under management may follow. The Financial Services Authority' Retail Distribution Review, which came into force on 1st January 2013, carries a degree of operational uncertainty.
Financial Highlights: In total, assets under management climbed from £25 billion to £26.3 billion. Net mutual fund inflows of £490 million in the three months to 31 December 2012 were reported. For the full year, cumulative net mutual fund inflows were £1.6 billion.
trading update: Jupiter saw its assets under management rise to £26.3 billion in the three months to 31 December 2012, up from £25 billion at 30 September 2012. Jupiter said that although industry conditions remained challenging, investor sentiment appeared to have improved towards the end of the year. The quarter also saw Jupiter deliver net mutual fund flows of £490 million, aided by a robust investment performance. Overall, net inflows for the quarter were £688 million, assisted by flows from two segregated mandate clients. Driven by mutual funds, cumulative overall net inflows totalled £966 million for the full year. The group, headed by chief executive Edward Bonham Carter warned in the short term "continued market uncertainties" left it cautious, but over the long term it was positive on the prospects for the long term savings market. The company is scheduled to release its full-year results on 28 February