Man Group shares up as earnings beat expectations
Man Group beat analysts’ expectations by posting earnings per share of 13.9c for the first half of 2015.
Financial Services
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16:59 26/04/24
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Man Group
247.00p
16:34 26/04/24
The alternative investment business increased earnings per share by 95% from 7.1c in the first half of 2014.
Shares in the company rose by 5.43% to 159.20p by 0917 BST.
Man Group’s first half pre-tax profit was up by 54% to $163m from $106m, reflecting acquired intangibles amortisation, impairment of goodwill and other adjusting items.
Total funds under management increased by 8% to $78.8bn, from $71.9bn in the second half of last year.
The company acquired Silvermine, NewSmith and Bank of America Merrill Lynch’s fund of funds business during the period, adding $6.1bn to funds under management.
Man Group chief executive Manny Roman said markets remained challenging.
"While the first quarter of the year saw a more stable environment in financial markets which benefitted all of our strategies and in particular AHL's momentum strategies, the second quarter was characterised by renewed volatility.”
Numis, which held a ‘sell’ rating on the stock and price target of 151p, said earnings per share were 48% ahead of its estimates.
Analysts said earnings growth was generated by performance fees from Man Groups AHL division.
Numis said shares were significantly above fair value, and while it was reasonable to expect decent total assets under management growth, expansion will be accompanied by reduction in margins.
“Whilst shareholders may or may not also earn no/some/a lot of performance fee earnings, we think that it is management fee profits which are by far the most important determinant of medium to long term value,” analysts said in a note to clients.