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Is it time to sit tight or take profits on listed fund groups?
by James Phillipps on Jan 28, 2013 at 13:29
Aberdeen’s earnings and balance sheet strength lead Lenardos to expect a special dividend or share buybacks in the second half of the year, which would be very supportive of the share price.
Schroders is Invesco Perpetual UK Aggressive fund manager Martin Walker’s top pick in the sector. He favours the non-voting shares, which are trading at a discount to the ordinary shares, and points out that if the £1 billion plus cash on Schroders’ ‘extremely low risk’ balance sheet is stripped out, the stock is trading on a P/E of 9.5x 2013 earnings, a significant discount to the 12.9x sector average.
He believes the firm can grow its earnings above the stock market average over the long term, given its operational gearing.
N+1 Singer analyst Andrew Watson singles out Liontrust, despite it being the top performer over the last 12 months, saying the valuation ‘remains attractive’. Liontrust’s latest update showed it grew its assets under management by 12.6% in the third quarter leaving it well-placed for the fourth and traditionally strongest quarter for inflows.
He points to its below peer 11.6x P/E and the opportunities arising from its forthcoming Global Strategic Bond fund launch.
‘With considerable growth prospects remaining in our opinion, the valuation is compelling,’ he said. ‘This implies an indicative valuation of between 145-175p -an upside of 12-35% to the current price.
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- Aberdeen Asset Management PLC (ADN.L)
- Schroders PLC (SDRt.L)
- Liontrust Asset Management PLC (LIO.L)
- Jupiter Fund Management PLC (JUP.L)
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