Shares in the AIM-listed fund management group Premier Miton have been in steady decline for some time having fallen from almost 200p two years ago. The company is not alone in the fund management industry in seeing its shares come under pressure as other companies such as Abrdn and Jupiter have also struggled. The increase in the popularity of tracker funds, with their much lower costs and steady performance, has led to an outflow of funds from many active fund management groups with a corresponding negative impact on revenues and profits.
However, today’s news that assets under management at 31 December had risen slightly to £10.1bn from £9.8bn last September is an encouraging sign and may be an indication that the group’s fortunes may be about to improve. The company’s funds continue to perform well with 75% in either the first or second quartile in their respective sectors since launch or change of fund manager.
In the year to last September, the company made adjusted pre-tax profits of £15.7m for earnings per share on the same basis of 8.8p. The dividend for the year was 6p per share and so at the current price the shares are yielding over 9%. With recovery prospects looking promising as well the shares are a BUY.
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