Shares of FTSE 250-listed Jupiter Fund Management PLC (GB:JUP) plummeted on Tuesday after the company revealed higher net outflows of £2.2 billion for 2023, surpassing earlier projections. Additionally, the company announced the departure of its prominent fund manager, Ben Whitmore. Notably, Whitmore, who has been with Jupiter since 2006, currently manages funds like the £2.1 billion UK Special Situations Fund, among others.
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The Jupiter share price was down by 14.63% on Tuesday. The stock fell by over 30% in 2023.
Jupiter is an asset manager specializing in equity and bond investments for both private and institutional investors.
Jupiter Faces Challenging Market Conditions
According to Jupiter Fund’s trading update, the higher outflows were mainly triggered by weak retail sentiment in October and November 2023. As a result, retail investors pulled out more funds, leading to more outflow compared to the “modest net outflows” forecasted earlier.
Despite these challenges, Jupiter expects to report performance fees exceeding £10 million in 2023, surpassing previous guidance. This is primarily attributed to the robust performance throughout the year of “one performance fee generating fund mandate.”
In the update, the company also stated that Whitmore is moving to establish his firm. Companies such as Jupiter can experience substantial outflows when star managers depart. Consequently, Whitmore and Jupiter have reached an agreement stipulating that his newly established firm will refrain from competing with the company for two years from his departure date.
Whitmore will remain with the company until at least the end of July 2024, facilitating an orderly transition. He will be replaced by Alex Savvides, who will join the company from JO Hambro Capital Management.
The company will publish its full-year results for 2023 on February 22, 2024.
Is Jupiter a Good Stock to Buy?
As per the consensus among analysts on TipRanks, JUP Stock has been assigned a Moderate Sell rating. The company’s ratings consist of four Hold and two Sell recommendations. The Jupiter share price target is 83.5p, which is around 10% above the current share price.
